We were ready for the sell off from the consolidation. The market has sold from 1842.5 to the current 1770 area. This does not mean you will not find long plays, it just means we have flipped the trading bias.
- The market will be long, short, or trading in a range.
- The trade bias will rotate: going "long is easy and shorting difficult" will rotate to "shorting is easy and going long is difficult".
The difficulty can be mitigated by sticking with your rules or trading parameters which establishes your tolerance for risk, your entry/exit rules, and your trading time rules which includes when you can trade and what instruments you can trade. For instance, if you have a "day" job, you may be restricted to trading stocks and/or options that are set up with a risk stop and a target return since you are likely unable to monitor your position. If you have a time to monitor your trades, then futures may be an option to add.
RULE TODAY: the 50CB with trend lines
A 50CB developed early and price was trading around the bullish trend line. The trade in financial chat today was long on the test of the 50CB (bar 12) with targets at the EMA and the Trend Line. It appeared we were in a narrow trading range day, get in, get out, and wait for the next set up or find another "place to fish" when the range is considered narrow.
You do not need to watch the market 24/7 nor could you. There will be another trade when you return...
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