once we get past 8880, then old highs would be our next resistance.
it's much safer to play up there from trading 8880 to old highs. why? because you have that 8880 as support.
right now, in terms of risk, it's a bit higher right now.. why? because we dont have a CLEAR support below us.
8750 has only been tested twice: 4/1/98, 6/4/98. but the recent dip below broke that support (so it's not that strong)
for example, look at august to jan 1997. 7694 was tested HOW many times? tested: 8/18/97, 8/29/97, 9/10/97, 11/5/97, 12/24/97, 1/21/98.
what is noteworthy, is the oct crash did break those supports.. BUT, the key here is to know that the supports are VALID.
right now, with the current situation, we know that 8880 is a valid resistance. it has been tested.
8750 might be a good support, but not as well-tested.
summary: i like to be ONE SUPPORT higher when trading. i like to enter with some kind of firm support below me. that's why i like buy stop breakout plays so much.. the support is right there |
