Usually when you have a Doji candlestick bar near the previous pivot high, it can be said that the bull is being “checked” by the resistance. Not necessarily a bearish attack but it could be subjected to attack by bearish traders.
If SPY closes today with a Doji pattern intact; then tomorrow will be the confirmation day of either a continuation up pattern or a correction to the downside. This confirmation can be seen by price actions taking out either the high of today (continuation) or the low of today (correction).
Since I’m already net short by holding TZA and SKF; I’ll keep these position open for tomorrow and see which way the wind blows. I can’t say the probability is on my side but then a doji at resistance is usually an ominous sign. Who know, I may be speaking too soon since the day hasn’t close yet. Therefore, we may not have a doji bar after all.
Below is the daily SPY chart with the doji pattern on today bar:
Current position:
15.6% short (bought TZA and SKF)
9.7% long-term equity
74.7% cash
Good Hunting!
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Journal update:
Added to TZA due to taking out the after hour intra-day high.
Now 18% in short position.