What we have here is a spinning top candlestick pattern for the month of February. Normally, a spinning top candlestick pattern is just like any other candlestick reversal pattern, it simply offers a possible reversal signal. Nothing is guaranteed and it is merely a precaution.
However, when you have a “monthly” spinning top candlestick pattern at the TOP of an uptrend near the walls of two long-term resistance (formed in year 2000 and 2007), you HAVE to take precaution. You have to acknowledge that there may be a greater force in play here. A force that has soundly defeated the bull in year 2000 & 2007.
The month of March is now the key month to watch. It may dictate the direction for the rest of the year. A down month in March may confirm the February spinning top candlestick pattern as a bona-fide reversal signal. In other words, the walls of resistance are too formidable to overcome.
Look at the SPY monthly chart below:
Did you see the tiny spinning top candlestick bar formed in February?
I will be very mindful of the possibility going into March. Perhaps a little less tolerance in giving the trades more times to establish its uptrend. Come to think of it, I never have much tolerance with my swing trades anyway except for my position trades. I’ll be keeping an eyes for ETF such as FAZ, SKF, etc.
Just my 2 cents anyway.
Trade Well!
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