The last hour of trade has been dominated by buyers who are chasing the NASDAQ as it explores all-time highs.
The morning had a slow start with volatility absent from trade. It was only a matter of time before trend day logic prevailed. What is trend day logic? It is the market profile theory that any entry in the direction of a trend day is a “risk free” entry into the following session. That means there is a high probability the following session will exceed the trend day high by at least 1-tick.
Exciting stuff, I know. So exciting it is one of my rules for turning off a bias:
…circuit breakers include pressing beyond the ATR band and trend days against my bias. These help keep me in the game even when I am wrong.
Anyhow, it is only lunchtime and we are up above my last reference point at 4705.25. If you recall, the report this morning said sustained trade above this level is paramount to the continued exploration of higher NASDAQ prices. It is hypo 4, and it appears to be in play.
Don’t be a hero here. If we sustain trade above this level there is no sense fighting the tape with shorts. NASDAQ sellers are right on their heels here and the Russell is already way out in front.
Also, there is a big-A magnet just above on the Dow and it is likely to exhibit an upward force on price as it comes into orbit. Check it out, the annual CHVN up at 18,017:
Sellers have until about 1:30pm to show up otherwise I will be off the BIS bus for a loss.
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Since 2009 US Market Lows to 2015 “today”:
INDU +176%
COMPQ +306%
NDX +375%
RUT +251%
SPX +220%
Still more upside into 2015 going into 2016-2017? Does that sound o.k?
I just take it one week at a time, and I take each week one day at a time…like an alcoholic.
I agree but as any trader the big picture is the most important. These temporary price swings up are imho not the full market direction. This will be very interesting to see how this all plays out. From my perspective it would be better to have a significant pull back and then continue to march higher – that gives a higher probability and a better sustained move up to continue the so called “up trend on 6 years into 7 years or 8 or even geez 9 – who knows” than ride a shallow reversal of only approx -13% we go this year.