Multi-month uptrend line was shredded in Friday's trade, but does it mean a reversal is here? Not necessarily.
A trendline break signals the end of the current trend. From there, the trend may do one of three things: 1) resume; 2) reverse; 3) consolidate.
Usually, after we print a wide range bar like Friday's, we see some consolidation. For Monday, I will be watching for a morning range to form, looking to fade pushes either way early on. I would prefer a gap up to short back down to the lows, but a gap down needs to be watched for a long side entry as well.
After the first few hours are in, I will be watching for a later day break. The volume was big on Friday, ad this looks like the start of the correction I have been watching for over the past few weeks.
Michael tiny Saul
tinymjs at gmail dot com
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