With this morning’s powerful break to new 2009 highs above price resistance, let’s look at the comparative price structures in the Dow Jones, NASDAQ, and S&P 500 Indexes year to date (as of mid-day July 23).
Structurally, after the recent rally from the 875 lows, the S&P 500 is challenging possible resistance at the 955 level which comes from both the January and June 2009 highs. We’re also picking up an internal negative momentum divergence along with a TICK (high) divergence at these levels which should call our attention. Let’s look at the structure.
On Monday evening, I highlighted a reader’s question on Whirlpool (WHR) in the post “Doji Sell Example in Whirlpool.” The question was “I got short off a doji but price kept rising – what happened?” Please see the prior post for the answer and my analysis.
Today’s intraday structure gave us a nice “Rounded Reversal” example that formed another “Super Divergence” like yesterday’s session gave us. That’s why it’s so important to study the day’s structure each day because history repeats – sometimes back to back! Let’s look at today’s SPY intraday structure for lessons from the day’s events.
A reader asked me a very interesting question this evening that I wanted to discuss with you all (with permission).
The question was in regards to a perceived sell signal in Whirlpool Corp (WHP) due to a doji candle after a large run-up. The question was “Why did the doji fail?” Let’s take a look:
Today was a great example to highlight the “Divergences” principle about how the can call key turning points intraday which provide excellent low-risk, high-probability opportunities. Let’s see some of these as they unfolded on July 20th.
“A great samurai warrior possesses the perfect blend of aggression and discipline. Too much aggression, and the warrior becomes exposed to defeat. Too much discipline, and the warrior may never attack.” Damien Hoffman at Wall St. Cheat Sheet recently interviewed Prop Trader Mike Bellafiore, co-founder of New York City based SMB Capital, a leading proprietary…
Speaking of Dan Gramza, he wrote an educational article for the INO.com/Market Club Blog page that I wanted to share with you. Entitled “Selling Rallies… Monthly Market Studies,” you can read the entire blog post or for more information, watch a free presentation at INO Television (Video Network) as he discusses this topic in more…
A special announcement – every few months, Elliott Wave International (www.elliottwave.com) offers a “Free Week” for traders to see all about the services offered – this week is open and will run to Wednesday July 22nd. It actually began last week but there is still time to check out what EWI offers for subscribers, including…
India’s “Nifty 50” stock index gave us all an example of how to identify confluence support and what happens when price pulls back – especially from a bear flag – into this level. Let’s learn a few lessons and look at what might be ahead. For those of you who don’t follow India’s markets, this chart contains valuable lessons for you as well.