The Twitter Trap TWTR a Bear Trap Reversal

Aug 4, 2016: 1:09 PM CST

Bear Trap!

Twitter shares surprised investors and traders with a strong gap lower in late July, only to power-rally higher in August.

This locks in a Bear Trap outcome and reminds us of the risks and opportunities of active trading.

Here’s the Trap and what to expect from here:

A Bear Trap occurs when price breaks lower, triggering short-sellers to enter logically.  These same bears place stops above their entry points or above key chart points.

When buyers overcome sellers, a rally develops and if the rally continues and enters the pocket of stop-losses, it can generate rapid price movement as both buyers AND sellers are buying shares at the same time (for different reasons).

The last two bars in Twitter lock in the Bear Trap and short-squeezed reversal.

Focus on $19.00 per share which is the prior high and the rapidly approaching 200 day SMA pivot.

Here’s the bigger picture: Continue Reading…

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Flag Bounce Emini Fibonacci Grid Update August 4

Aug 4, 2016: 12:49 PM CST

Our Bounce Continued – price fell toward our initial Fibonacci Target and has now bounced higher within the range.

Here’s today’s updated Fibonacci and Emini (@ES) trading levels for your plans and trades:

Here’s a reference guide of how to use and trade from these morning updates.

We still can’t use our larger Fibonacci Retracement Grid levels WITHOUT an actual larger retracement.

There’s no major update on the grid – the 23.6% level remains at 2,145 and the prior high zone is just above 2,170.

We’re seeing a “Flag” or tight parallel trendline channel develop on the short-term rally.

Note the tight intraday trendlines and play the movement toward or away from 2,170 (and 2,145 again0.

Want these levels and additional analysis/strategy planning in advance each evening?

Get these levels in advance with in-depth planning and trading opportunities by joining the Daily Membership.

Continue Reading…

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Crude Oil Finally Bounces and May Reverse Short Term Downtrend

Aug 3, 2016: 12:30 PM CST

Is Crude Oil @CL Snapping its Downtrend?

After a persistent swing down from $50.00 toward (and under) $40.00 per barrel, is price finally reversing?

Let’s start with our Color Structure Grid this morning:

A downtrend is a series of lower lows and lower highs, usually defined by moving averages or trendlines.

That’s been the case on the price pathway down from $50.00 toward $40.00.

However, short-term (intraday) downtrends can’t last forever and eventually price reverses.

Momentum and today’s strong bullish swing suggests a chart reversal especially if price remains above $40.00.

Note the lengthy divergence and breakout beyond the 50 EMA (blue) on the 30-min chart along with the color-code flipping strongly green today.

Here’s a pure-price perspective of the same movement: Continue Reading…

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Fibonacci Bounce Emini Update Aug 3

Aug 3, 2016: 11:00 AM CST

Yesterday’s sell-swing took us straight to our Fibonacci Retracement target ahead of a bounce up off this pivot.

Here’s today’s updated Fibonacci and Emini (@ES) trading levels for your plans and trades:

Here’s a reference guide of how to use and trade from these morning updates.

We still can’t use our larger Fibonacci Retracement Grid levels WITHOUT an actual larger retracement.

Price broke the support at 2,150 (short-term range) and plunged straight into our 2,145 Fibonacci Level.

After a little nip under this spot, buyers intervened and bounced the market up away from our support target.

Today gives us a bit more upside action and we’re focusing on 2,150 and 2,145 again as target/pivots.

Want these levels and additional analysis/strategy planning in advance each evening?

Get these levels in advance with in-depth planning and trading opportunities by joining the Daily Membership.

Continue Reading…

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Bullish Breakout and Reversal for Mallinckrodt MNK

Aug 2, 2016: 1:27 PM CST

If you’re looking for a bullish breakout and trend reversal candidate, look no further than MNK.

Mallinckrodt – a stock that’s been on our radar – bounced on positive divergences from $55.00 and now shattered resistance, officially reversing the downtrend into a new uptrend with today’s breakout.

Here’s the bigger picture:

Buyers rushed to support the stock through late 2015 and 2016 at the $55.00 per share level.

Positive divergences developed from the October lows to present.

The current swing takes the stock above both the 20 and 50 week EMAs along with the $70.00 per share pivot.

The assumption is that price will likely continue the new uptrend into the future (through “Open Air”).

Here’s the picture and today’s breakout as seen on the Daily Chart: Continue Reading…

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