Technically the MKT is at a NEUTRAL NEGATIVE EXTREME and is ready to either pop back into a firm neutral posture or break into a new down trend. The MKT has produced a technical sell signal into support and is in a "Make or Break" scenario. Volatility as well is on the fence and ready to rise with a new trend move and decline with some sideways "positioning".
Key off the 9675 Inflection Pivot for the key to the validity of the the sell signal.
On the SELL side accept FADE and BREAKOUT strategies expecting an immediate follow through to the MKT's technical sell signal. BREAKOUT strategies below 9581 should be worked with the expectation that any sustained trade and repeated tests of support will give way to negative follow through. This strategy is vulnerable to the MKT expanding its lower support band in a series of starts and stops. Keep profit targets extended to pay for any monies spent holding a position. FADE strategies against 9675 should expect an immediate reaction as any held trade or violation of major resistance foreshadows a potential turning point. These are good opportunities to "roll" into a long position when stopped out.
On the BUY side FADE and REVERSAL strategies off the 9581support are qualified however the FADE is a lower probability and should use tight risk criteria. REVERSALs can risk more but should also go for more profit with the expectation of a turning point "key reversal" signal to play out. BREAKOUT strategies above 9675 are aggressive and should just "go" and not look back. Risk less and go for more. A laborious lack-luster rise after a positive breakout is a sign that the MKT is more likely expanding its resistance lid for a new consolidation verses transition from negative to positive technical posture.
Note: The MKT has produced a negative signal but it is not confirmed and trending indicators do not support follow through in either direction at this time. The MKT has the potential for big range conditions so don't get stuck FADing momentum in either direction.
JS
* ENTRY STRATEGY - 5min web video explaining FADE, BREAKOUT and REVERSAL strategies http://www.jsservices.com/education/sbt/CME_EntryStrategies5min.wmv .
To learn more about JS Services Strategy Based Trading approach please contact me at info@jsservices.com . You can also visit http://www.jsservices.com/ and sign up for a Complimentary FREE Trial.
