Stochastic is overbought on most time frames, in particular the daily and 60 minute charts, therefore we are looking for this bounce to dissipate near resistance zone noted. On the daily we are anticipating resistance at the over head trend line and/or declining moving averages, 214.52 and the 50ma at 215.82. Longs to these levels may work, if block trades above 213.00 don’t slow the pace. More than likely blocks will prove to be too much. That said we are cautious.
SPY 60 minute shows resistance starting at 213.33 (+/-), with numerous pivot lows near 214.00 (+/-). Price action is currently showing a gap above this level. This is what we are anticipating:
- Possible fade and a resumption of the bearish trend.
- Gap and Go with resistance inside the congestion shown on the 60 minute chart below and blocks up to and including 216.00.
Be mindful of the direction SPY finally decides to follow, after the Opening Range. This will dictate our positioning for the day.
Watch List stocks are holding. RY, GRUB, BBY and DLR managed to close positive. Move your stops higher on these candidates. We’ll be monitoring the rest for possible short term positions.
Happy Trading – CV
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