Good evening StockBandits!
A strong V-shaped lift off the mid-January lows produced substantial gains last week, leaving the averages facing some key short-term resistance zones created by their previous bounces. However, the bulls came up empty-handed on Friday and postponed their push beyond those resistance zones and generally retreated a bit back toward the center of their respective trading ranges.
With each passing day, those trading ranges become just a little bit more valid, yet frustrating for market participants who don’t care for frequent reversals. Fade traders are loving it, as we’re seeing morning gaps fill with regularity, as well as directional turnarounds every few days. As usual, it just boils down to your particular flavor of trading as to whether or not you like current conditions.
Although there have been some routine elements in recent weeks like the aforementioned gap fills and key levels being respected, it remains a tricky tape. That’s largely due to the lack of basing we’ve seen on condensed timeframes. Zooming out on the bigger picture, however, and this wide trading range appears to simply be a digestion phase following the rally which began in October. That doesn’t exempt it from turning sour, but for now it’s still intact and therefore the overarching condition of this market which we cannot lose sight of until it’s left behind – one way or the other.
Let’s get to the charts.
Bullish Watch (click for charts)
Bearish Watch (click for charts)
Trade Like A Bandit!
Jeff
