First, Tuesday morning
Then coming into this morning. Though the 50% projection was achieved any further follow-through was capped off by resistance. When the 3d setup rolls-over it's often a good idea to reverse the trade and anticipate a lower low.
2 comments:
If its a good time to reverse the low, does that mean its time to sell? As a day trader, I have just recently gotten into reading charts. Have always worked on instinct and trying to anticipate how macro news will affect the next day's open - i.e. buy at closing based on what the news out of Greece or the next employment report will be. I guess this chart means sell if a lower low is anticipated?
Perhaps I should clarify. For me it means lower prices are possible beyond the previous swing low only, but with a clear idea of where I anticipate support to be. In the example where price rolled over, I had support at 1337.75 but the low came in at 1338.25. I was also aware that the higher time frame was still bullish, so I wasn't looking for a sell-off, just a test of a lower support point.
Hope that clarifies things.
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