Rummaging Through Areas of Resistance is Fun and Easy to Do

We’re all guilty of recency bias, the idea that present conditions are all that matters and the things that happened in the past are simply antiquated and unimportant. That’s not true of course — and as stocks move into areas of congestion — levels where traders went long and lost a short while ago — you’ll start to see the gains grind to a halt, flag, and then fail.

Here are the levels I am looking at, marked by where fuckers went long and wrong.

That are encircled is the “FagBox” from which we traded in a few months ago. People who went long at that time are only now realizing their cost basis and will move to cash, elated to have their money back.  From $170 to $175, I suspect markets will begin to grind. It’s also possible we fail at this $170 levels and head back lower to $165 or even $160. I’m open to the possibilities.

A decisive move above $175 would make me extremely bullish; but at the stage in the rally, I’d wager my peas and carrots it won’t happen — at least not yet. We’ll need months of grind and fake outs before earning that level. Plus I’m pretty sure investors want to see how Q2 is shaping up before making some large directional trades.