Tuesday’s bullish reversal that formed bottoming tails and bullish reversal bars early in the morning across the broader markets and most sector ETF’s did not last.
Markets opened lower and each attempt to stabilize before the typical 10:30 ET reversal period failed.
The small intraday rally between 11:30 and 12 didn’t get far — and it was all downhill from there.
As it became clear that the markets were not going to recover, at the end of the trading, prices went into free fall and closed near the lows of the day.
Our market internal gauges are moving to historical levels close to the market low seen at the beginning of the year in February.
While we cannot be certain how tomorrow will open — or close, if prices should follow the same script as they did in February, a buyable low should be within the next 1-to-3 days.
If by chance tomorrow or Friday it ended with a Bottoming Tail (BT) in the broader market indices, we will be looking for long positions to enter.
Even if this happens on Friday, we will want to buy and hold over the weekend.
Conservative traders could wait till Monday and buy above Friday’s high.
It is impossible to know how things will play out exactly, but this video below will help you with your own decisions.
In the video, I reviewed some of the broader market indices and ETF’s in the Green Room at the end of the day.
We looked at some possible “Measured Moves” and downside targets based on percentages from the highs.
Again, I hope this information helps you with your own trading decisions. Let me know!
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Video Review of the Markets from the Green Room – View in Full-Screen
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Happy trading! If you have any questions or comments, please e-mail Greg Capra at Greg@mastertrader.com or Dan Gibby at Dan@mastertrader.com
All the best,
Greg Capra
Managing Director of Master Trader
Trading the Pristine Method — Origin and End
Dan Gibby
Chief Options Strategist
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