Gap up above resistance trend day. Recent downside (test of support) momentum has been non-existent. In the chart below it's helpful to notice the cup with handle pattern the 3/10macd forms over the past couple days where we test support. Especially when we make a lower low and form that inverse H & S price bar pattern.
After the first half-hour we had momentum bringing us just under a previous gap zone. The break of this bar is a move into the gap-zone (filling longer-term short covering orders) where the next resistance level is the close of the pre-gap day:
While the opening momentum extended to the 200% projection (PDC to tOpen)
The most helpful the 3/10 macd can be on days such as these, I find, is on the faster time frame (higher time frame will just point to the obvious (trend day), where I'm just looking for bearish & bullish readings to give me a heads-up on the directional trade.
For instance, 2b &/or 2c short indications or 3a/1a or 1b to 1a long indications:
Oh yeah, and the SPY triggered a 3d long entry on the daily chart on Monday's close:
The setups I include on this blog are used in conjunction with the 3/10macd and the criteria I ascribe to it as a way to alert me to an existing condition of price. The key concept to take away from this blog is that I try to anticipate what will happen on the higher time frame by using a faster time frame to trigger the trade setup. I do not trade a "system" I use two indicators to clue me in to price conditions. Please read the Disclaimer located in the sidebar of this site. I can be contacted via email at toddstrade@gmail.com
I am always open to questions, comments, or suggestions on how to improve this blog.
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