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Strategies & Market Trends : Technology Stocks & Market Talk With Don Wolanchuk -- Ignore unavailable to you. Want to Upgrade?

To: Fiscally Conservative who wrote (118807)	7/5/2018 8:22:31 AM
From: Robohogs	1 Recommendation Recommended By Fiscally Conservative Respond to of 207141

Fed minutes later. Should be pretty hawkish but known.

To: Fiscally Conservative who wrote (118807)	7/5/2018 9:30:45 AM
From: robert b furman	4 Recommendations Recommended By dvdw© Fiscally Conservative Machaon Mesaverde Respond to of 207141

Well the 4th gave us a time gap. Could very well be a breakaway gap into earnings season. Great earnings last quarter were not rewarded - a long grind that no doubt gave up some inventory. "Breakaway gaps are not uncommon with Head and Shoulders" page 195 Edwards and Magee. This gap could be the fuel of a bigger short squeeze which is what a breakaway gap is all about. All those who were talking last week about head and shoulders which only are valid if the volume confirms it to be a head and shoulder. Once you see a market bounce several times off an overhead resistance value - you have a lot of nervous holders who got out, and you have some more nimble traders who short the resistance. That leaves others in the market who expect more and have patiently held their positions. Those who sold, must now chase it up, and those who were shorting have to cover. Breakaways happen because the past trading action has created a vacuum of stock available at that resistance level . Just as we are about to see a substantial breakaway gap this morning - the action in the volume after the breakaway is made, will tell us if we should expect a backtest to close the gap. If we see a big volume increase after the break out, then a backtest should find support where the backtest popped up to. If it is light volume then I'd expect a back test to fill the gap. We need to see if those who gave up their position want to chase the gap and with volume the gap will scare the shorts into covering that combination = increased volume and fast price mark up will develop. Not to get ahead of today's action but if volume shows - we'll be looking for a runaway gap or measuring gap. clx studies suggest this run could go long in time. Bob