Tuesday, April 27, 2010

First things first

3:21PM: Crazy day .... to be honest crazy 2 weeks we have had. Just a very quick chart to visualize a bit better what we are trying to do here. I will post up a bit more this week as I am starting to get a bit more active again. But its great news for us bears seeing such price action here, not just today but the combination of overhead supply and the combination of aggressive buying (because that has worked for 14+ months) is finally coming to a real battle.

Important to see the daily close prices, you can see the market trying its best to close above the top line of the rectangle, however even a close below in the rectangle itself could be tricky for either bear or bull. Are we seeing a corrective w4? or are we seeing the onset of a move lower. I have to admit its not looking corrective up here in the sky, but I am cautious to label this a start of a move lower.

Price action like we have seen in the past 2 weeks really makes it a lot easier to try to get my short bear feet wet. Of course, when looking at best possible entries ... break through the rectangle, retest the rectangle area (lower mid or upper range) and then boom down. However, as we all know, it never happens like that so trade carefully.

In the good old days I would have used this price range here to scale in and add as we move higher or add on break - but I am still being very cautious and will hold back - did I say I remain cautious?

More to come ....

3:55PM: Thats the monthly chart I was talking about. Such a beauty.

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