Again today we are going to focus on MKTs that have produced a major negative signal BEAR TREND ACCELERATION. This is a negative signal that should accelerate the current downside momentum if valid.
The question, is does this signal have potential or was yesterday's signal just a 1 day event. The price point to key off that keeps the MKT in an aggressive sell posture is the session Inflection Pivot. This is the price point that defines the technical state from being an aggressive sell posture below that price point to a potential reversal or digestive trade above that price point. Trading below the session Inflection Pivot has the MKT in an aggressive sell posture and the BEAR TREND ACCELERATION signal in play. Trading above this price point is an indication that the negative vulnerability of the MKT is reduced and there is a better chance of a sharp positive push or a firm digestive trade.
If the negative signal is good you should expect the market to hold negative structure. If not may be time for a turn.
November 3, 2009
Below are the MKTs that have produced a BEAR TREND ACCELERATION signal and the Inflection Pivot that determines the continuation of the sell signal or not.
EQUITY FUTURES [DEC09]
MidCap400 667.30
FOREX
EURCHF 15118
Draw a line on your intra-day chart at these levels. Look for opportunity in the direction of the price bias. Executing at or near these price points will provide the best risk / reward.
If the current price is above the Inflection Pivot in this technical state, market sentiment is saying "prove it to me that the negative signal is valid". If the MKT cannot break under the Inflection Pivot the likely hood that the negative signal was just a 1 day event is high with the potential for a counter signal rally.
If the Inflection Pivot is above the current price then the negative signal is still in play "up" to that price point. Any lower sales are not "wrong" unless the MKT is above the Inflection Pivot and sell signals below this point should be taken.
JS
STRATEGY BASED TRADING Review http://progressive.powerstream.net/008/00102/edu/interactive/js_services/strategy_based_trading/index.html
For more information please contact me at info@jsservices.com. You can also visit http://www.jsservices.com/.The Inflection Pivot levels are available as a chart overlay on the following platforms; Ninja trader, Strategy Runner and eSignal. Sign up for a Complimentary FREE Trial.
