The strong sell signals that formed in the indexes on Friday, but Dow forming a bearish left/right combo, created the probabilities of more selling today. Was the magnitude of Today’s selling anticipated? No, but the strong sell signals of Friday implied there was going to be more downside. When the market/stock prices move down dramatically from a knee-jerk reaction, the 10 minute chart becomes the best time frame to see if the markets are going to bounce or continue to show weakness. That allows for closing long positions that are not showing any strength or as an aggressive trader, being ready to buy if it looks like the market and stocks stabilize and start moving back up. Currently with the Dow down 460 points, it is to early to see which direction the markets will move from here.
January 27th Daily Market Comments
The strong sell signals that formed in the indexes on Friday, but Dow forming a bearish left/right combo, created the probabilities of more selling today. Was the magnitude of Today’s selling anticipated? No, but the strong sell signals of Friday implied there was going to be more downside. When the market/stock prices move down dramatically from a knee-jerk reaction, the 10 minute chart becomes the best time frame to see if the markets are going to bounce or continue to show weakness. That allows for closing long positions that are not showing any strength or as an aggressive trader, being ready to buy if it looks like the market and stocks stabilize and start moving back up. Currently with the Dow down 460 points, it is to early to see which direction the markets will move from here.