After a near vertical rise to the highs, prices are on the hinge.
Prices made a lower low and lower high today. The trend tentatively is lower, but a lower low is required.
Tonight a different average will give a remarkably different volume picture while all the averages show a narrow range reversal day. I chose the SPY because it clearly shows the strength of the sell-off and weakness of the subsequent rally. I believe yesterday's volume was as poor as depicted and do not excuse it with the Jewish holiday. Bears wanted higher prices to sell more and bulls wanted higher prices without having to buy much as has been the case throughout this move in the SPY. As such I have to believe until shown other wise today is a classic secondary test of the highs and offered a low risk place to sell short. Needless to say especially in this market where the bulls are financed by the FED there are no guarantees.
The high volume at 9:55 was climactic in an upthrust position and the sell off to 2 was a sign of weakness. The volume on that bar was fantastic and was sellers liquidating very large positions. Having run out of buyers on the way up they sold them to those waiting for a dip on the way down. Someone is in a rush perhaps it is the end of the quarter perhaps they know something. 3 is the test of the sell off and the lower low. It also is a reversal day. Frequently these tests of highs or lows or breakouts and breakdowns end with classic reversal type bars. In fact you can count on it in the majority of cases. Every selling bar or drive the rest of the day and I numbered some of them has ease of movement and wider bars and more volume. In contrast the bars in rallies are wanting range and volume. The rally from 5 until 6 had no volume.
After a near vertical rise to the highs, prices are on the hinge.
Prices made a lower low and lower high today. The trend tentatively is lower, but a lower low is required.
Tonight a different average will give a remarkably different volume picture while all the averages show a narrow range reversal day. I chose the SPY because it clearly shows the strength of the sell-off and weakness of the subsequent rally. I believe yesterday's volume was as poor as depicted and do not excuse it with the Jewish holiday. Bears wanted higher prices to sell more and bulls wanted higher prices without having to buy much as has been the case throughout this move in the SPY. As such I have to believe until shown other wise today is a classic secondary test of the highs and offered a low risk place to sell short. Needless to say especially in this market where the bulls are financed by the FED there are no guarantees.
The high volume at 9:55 was climactic in an upthrust position and the sell off to 2 was a sign of weakness. The volume on that bar was fantastic and was sellers liquidating very large positions. Having run out of buyers on the way up they sold them to those waiting for a dip on the way down. Someone is in a rush perhaps it is the end of the quarter perhaps they know something. 3 is the test of the sell off and the lower low. It also is a reversal day. Frequently these tests of highs or lows or breakouts and breakdowns end with classic reversal type bars. In fact you can count on it in the majority of cases. Every selling bar or drive the rest of the day and I numbered some of them has ease of movement and wider bars and more volume. In contrast the bars in rallies are wanting range and volume. The rally from 5 until 6 had no volume.
