Wednesday, November 19, 2008
How I trade reversals
Todays market had another great example of the signals I look for that a reversal is probable.
The markets were weak on the day so being on the short side or playing the inverse ETFs was the smart play. Both the QQQQ and S&P 5 minute chart showed a slowing on the down trend with dojis, so I sold and went short. 15 minutes later both indexes showed another doji along with dropping volume. That said to me the pop is probably finished and to trade it the other way.
Chart #1 shows dojis on S&P and QQQQ after the market pop has stalled.
How I trade reversals
I changed my original post as the images did not line up with the text . See above for the revised post.
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