As August comes to a Close, the S&Ps Monthly bar shows a breakout failure above 1413.25 (a 7-month high made in Mar 2012) as the market settled back within an 8 Month balance. The destination trade now becomes the 8-month balance low of 1247.50 made in Jan, 2012 - unless we make another attempt at the recent highs.
The Weekly Bar above shows a tight 3-week Balance. If we continue to auction lower, the first sign of change will be price acceptance below 1394.25 (low of week ending 8/17) which then targets 1387.25 below. This will also signal a change in the intermediate term trend as we will stop 1-timeframing UP on a weekly basis.
The profiles shows conflicting information:
- we gapped lower today - negative
- lower Value and POC - negative
- Unable to take out last week's low - postive. Today's sell off was on low Volume and felt more like short term traders liquidating ahead of the Fed announcement from Jackson Hole, WY.
- Anomalies from Wed including a prominent POC from both today and Wed - lower the odds of downside continuation - positive
- Poor high - while Value was lower - attempted direction was UP.
I would treat today as a balanced day and observe where we open relative to the POC - in or out of balance and to what degree? Also - see comments under the Weekly Bar.
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