SPY will drop ... until Christmas, Part 2
Updated
In my last chart I didn't account for the market trading sideways before heading downward so I have decided to do another chart.
There is a FED meeting this week. I suspect on the day of the announcement on Wednesday, Dec 18, the SPY will be more volatile like it has been on the last few announcements from the FED. Then on Thursday and Friday following the announcement, the SPY will continue to go lower (regardless of what the Fed states) stopping before Christmas. I trade based on what the charts indicate not on current events. The charts will often account for future events.
If you look at the weekly charts, it is also indicating a downward trend.I will try to post a weekly chart to this idea so you can see what I am talking about.
I have marked where I think the SPY will drop to on the chart (around 584)
This is just a short term downward trend. I believe on Thursday and Friday, the SPY will drop about 9 points each day and on Monday and Tuesday it will drop a little or trade sideways. After Christmas, I believe the SPY will go back up. But I will draw another chart showing what I believe will happen after Christmas.
If you look at the previous months, after an upward trend of about 10 to 14 days, the market retraced for a few more days. The SPY could retrace to any point on the Fibonacci numbers. But I just believe it will drop for 3-4 days (like it did in the previous months) to a 100% drop before continuing it's climb upward.
I am using the Heikin Ashi Candlesticks as I find you can see a definite directional pattern with them on the chart itself. Typically, I will just trade with the dominant trend and I will wait for 2 green Heikin Ashi Candlesticks before I enter. But this time I am showing the brief retracement that will happen before Christmas. I will probably enter this short trade briefly to make a little money.
Happy trading everyone!
There is a FED meeting this week. I suspect on the day of the announcement on Wednesday, Dec 18, the SPY will be more volatile like it has been on the last few announcements from the FED. Then on Thursday and Friday following the announcement, the SPY will continue to go lower (regardless of what the Fed states) stopping before Christmas. I trade based on what the charts indicate not on current events. The charts will often account for future events.
If you look at the weekly charts, it is also indicating a downward trend.I will try to post a weekly chart to this idea so you can see what I am talking about.
I have marked where I think the SPY will drop to on the chart (around 584)
This is just a short term downward trend. I believe on Thursday and Friday, the SPY will drop about 9 points each day and on Monday and Tuesday it will drop a little or trade sideways. After Christmas, I believe the SPY will go back up. But I will draw another chart showing what I believe will happen after Christmas.
If you look at the previous months, after an upward trend of about 10 to 14 days, the market retraced for a few more days. The SPY could retrace to any point on the Fibonacci numbers. But I just believe it will drop for 3-4 days (like it did in the previous months) to a 100% drop before continuing it's climb upward.
I am using the Heikin Ashi Candlesticks as I find you can see a definite directional pattern with them on the chart itself. Typically, I will just trade with the dominant trend and I will wait for 2 green Heikin Ashi Candlesticks before I enter. But this time I am showing the brief retracement that will happen before Christmas. I will probably enter this short trade briefly to make a little money.
Happy trading everyone!
Trade active
This is the weekly Chart which shows there may be a bearish move. I have circled the area which show a bearish move.
Note
There is a chance that the market will go up after today. Due to the high volatility around the Fed Meeting, I will wait until I see a clear sign of which way the market will go. I probably will wait until around the close of today before I enter.Note
Tomorrow the market should gap down. I missed getting in before close. X#@!
But I think the market will continue to drop tomorrow, so hopefully I can make some money tomorrow.
I thought the SPY would only go down to about 584, but I can see by the drop today, the SPY has a lot of momentum so my target is now lower at around 568.
The reason I say this is due to a few reasons. I find that the market moves in 6 day moves or fractions of 6 days (typically but not always). And this is NOT a fact. This is just what I notice.
So I think this is the 2nd day of the 6 day move, so the 5th day will be on Monday, Dec.23rd with the 6th day (Dec 24th) as a doji due to the short day in trading.
Trade closed manually
Sorry, for the late update. I'm visiting family so my schedule is kinda off.
I am going to close this trade right now as I have looked at the indicators and they are now suggesting an upward move for the short term.
I look at the half an hour indicators to see the daily move, while I look at the hourly move to see where the market will move for the next few days. Both are indicating a bullish move.
Even if you look at the daily charts, it is indicating a bull move.
I will draw a new chart shortly.
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