{"id":469,"date":"2020-03-07T18:45:24","date_gmt":"2020-03-07T17:45:24","guid":{"rendered":"http:\/\/market-and-us.com\/blog\/?p=469"},"modified":"2020-03-07T18:45:25","modified_gmt":"2020-03-07T17:45:25","slug":"double-bottom-or-a-price-action-like-a-waterfall","status":"publish","type":"post","link":"https:\/\/market-and-us.com\/blog\/double-bottom-or-a-price-action-like-a-waterfall-469\/","title":{"rendered":"Double bottom or a price action like a waterfall?"},"content":{"rendered":"\n

What a difficult price action<\/strong>! I am not sure at the moment where or when I will start trading swings again and futures day trading is a big challenge<\/strong> in this high volatility<\/strong> environment. But it’s a great experience after the weeks of strong bull market.
Now I see at least two possibilities: There will be a double bottom or price action will go down like a waterfall …<\/p>\n\n\n\n

Candles bigger than 25 candles last autumn!<\/h2>\n\n\n\n
\"\"
SPY <\/strong>(1D)<\/em><\/figcaption><\/figure>\n\n\n\n

Long shadows in the small time frames and huge candles in the daily chart. I never had such a price action in my trading journey.<\/p>\n\n\n\n

Last week the upper limit of the expected move worked as resistance and we had a range like movement. Now we have to break above the 200 SMA<\/strong> and the resistance around $302<\/strong>.
As you can see the expected move is a big one<\/strong> for the next week and especially at the limits (marked in bright yellow in the chart above)<\/em> I will pay attention what price will do.<\/p>\n\n\n\n

The green candle of Friday was created by a steep move upwards before EOW (end of week)<\/em>. So, it’s possible to see some bullish days but at this level we should also expect lower lows.<\/span><\/strong><\/p><\/blockquote>\n\n\n\n

I will wait for trading swings until I can see a clear bottom. The highest losses are in the financial sector and when you watch the weekly chart of the XLF,<\/strong> you can see that it almost bounced on the 200 SMA. The VIX<\/a> (index of the volatility of the stocks in the S&P 500)<\/em> had reached more than 50 (higher than during the correction in 2018)<\/em> and we’re still at 42!<\/p>\n\n\n\n

So, be careful with signals to both sides<\/strong>, calculate with the volatility when using stops and let’s wait for the next candles to get a clearer picture.<\/p>\n\n\n\n

My cautious step with a next long position<\/h2>\n\n\n\n
\"\"
AMD<\/strong> (1D)<\/em><\/figcaption><\/figure>\n\n\n\n

After my position in MSFT<\/strong> last week I bought another small position in AMD<\/strong> on Tuesday. I thought we would go little higher<\/a>, so I had set my stop loss at break even but it was only an up and down around my entry.
I won’t risk much although I bought it long term. But for me, there’s a too high probability of much lower prices, so I don’t want to see this buy as a good partial for long term if we won’t recover.<\/p>\n\n\n\n

I have to admit that I did no homework since the correction at the end of 2018 when I planned to learn all about hedging<\/strong> and select one method for my accounts.
So, my long term account has lost as much as my trading account – on a percentage base. I do not have big cash reserves<\/strong> for buying at the lows if we’ll see a bigger bear market.
I hope you did much better!<\/p>\n\n\n\n

Do you know that we speak of a bear market when there’s a correction of -20%<\/strong> and on average it then goes down to -30%? On average. It could be just -20% or -50% …<\/p>\n\n\n\n

\n\n\n\n

By the way, my week with real money in the futures<\/strong> was … eh, not so successful. Because of the high volatility an experience futures trader had probably paused trading and no one would recommend to switch to a live account in this environment. But I again learned a lot and I will continue on Monday. \ud83d\ude42<\/p>\n\n\n\n

What do you think? Double bottom or waterfall price action?<\/h2>\n\n\n\n

I am excited what you think will happen the next weeks. Write a comment or send me a message or email. You’d make me happy! \ud83d\ude09<\/p>\n\n\n\n

Now I wish you the smallest draw down for your accounts and a happy, healthy and successful week!<\/em><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

What a difficult price action! I am not sure at the moment where or when I will start trading swings again and futures day trading is a big challenge in this high volatility environment. But it’s a great experience after the weeks of strong bull market.Now I see at least two possibilities: There will be […]<\/p>\n","protected":false},"author":1,"featured_media":474,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"yasr_overall_rating":0,"yasr_post_is_review":"","yasr_auto_insert_disabled":"","yasr_review_type":""},"categories":[5],"tags":[130,133,131,95,113,123,60,111,9,29,129,34,132],"yoast_head":"\nDouble bottom or a price action like a waterfall? - The Market and Us<\/title>\n<meta name=\"description\" content=\"Markets are ranging with high volatility. 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