While from a distance this may seem impressive there is much more to this action than simply the reversal from a potential breakdown.
If equities on a short term basis had a substantial amount of upside energy pent up, then a bearish pattern such as we saw would not even form. The fact that this pattern occurred failure or not shows that the market is losing momentum.
Add to this the lopsided risk to reward model and the market continues to send signals that it will work lower.
I used the strength today to unload 90% of the equity positions in the Aggressive Trading Account and also 4 or 5 of the positions in the 20% in 7 days account. Once I receive more confirmation that the market has in fact rolled over and is going to work lower short term, then I will add a very limited number of shorts to the Aggressive Equity Trading Account.
Day Trading today was very slow, as I had only one signal all day and this managed to break even. Sometimes on these large spike days my day trading models can just mark time. I actually did not mind the inactivity of the day trading models today as it allowed me to work on some intermediate term models I have been developing.
Once again the Day Trading Blog is http://www.lowriskdaytrade.blogspot.com/
Stop and by and give me some input.
Also I am sure you noticed that I changed the look of the blog and I want your input on how you like it. Either drop me an email or I placed a Poll on this blog for your input.
Have a great day trading tomorrow!
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