After a very difficult trading month so far in October and a couple of interesting SA posts (Jeff Miller’s weekly trading post) and a new author for me posted I have finally figured out a way to describe the change: the tides have turned and the winds have shifted. Mary Poppins like …
Previously, the trading tides were pushing upward so trades were easily identified with consolidation at support points and falls from strong resistance. The winds were blowing upward so lower values on dips made sense … and consolidation support points held – they were the floor.
It seems that the tides have turned now after watching support levels break down consistently … the dips are now hard to stop (supports are like false bottoms). The trading tactic now looks to be waiting for consolidation bottoms and upward lifts with volume and strength through weak resistance points. This may reduce potential gains on the upside (longs) … shorts are also complicated as there are no support levels below (what can i logically expect for exit and profit)?
While I fully admit that i am not an expert technician and use fundamental DCF valuations as the filter for my trades, for me at least, the tides have turned.