Back on September 12th, I posted this chart:
Here is where we are now. Note the resistance line I drew on 9/12 has stayed on the chart, in the same place. Note what happened as the SPY approached and traded above and below the line. It almost looks easy, no?
Bottom line: There is a ton of support in this area. In fact, it is the glorious trifecta, where we have 3 different technical areas of support: The support/resistance line, the 200 day average, and the rising 50 day average.
I am a dip-buyer here.
So what happen if we dip below 50SMA? Still a dip buyer? Or what I’m trying to get out of you is that where is the “line in the sand” as we dip down?
We will have to see what happens. A dip below the 50 day would be no big deal. A breakdown beneath would be a whole other story.
We have to look at what is probable. It is probable that there will be lots of support here.
Trading beneath the 50 day average for more than a few days would be very bearish, although I would keep buying dips, just not as many and not as often.
I’m glad I load up on a few more pikes. Last night I was kind of afraid to, but once again the PD not only endures it prevails!
Sorry about the spelling, etc. I was just getting up and hadn’t had my coffee yet.