Rule #1 of technical analysis – news takes priorities over charts. Rule #2 of technical analysis – surprising news is going to make the charts useless short term. This doesn't relate just to good news, but bad news as well. Today the job numbers was obviously surprise good news and the markets ate it up. As a trader based on TA, these are the types of situations where you say 'fuck that sucks' and move on. You can't control that – you just need to react to it now that it is here. If you read any of my posts the past few weeks, had you been playing any of the stronger sectors (REITS, Banks, Energy), you are laughing. The weaker sectors (Tech and Gold Miners) struggled again and silver showing some pullback as well. So where would I go from here? I'll cover each sector below but obviously short term it's bullish for everyone except gold miners. But let's take a look at where everyone is relative to SPY. SPY is at $320ish which is at the top of February 24th, 2020. A V shape recovery if I have ever seen one and now 7% from ATH…., I know.
Note: I wrote this at 1pm. I had to go back just now and edit as the markets bounced and brought up most names. If there is some inconsistencies it's because I missed on the edit. These are the days I get a lot of work done for my actual job because it was a very boring trading day. Had I not had my money tied into, today would have been an easy gap down for buying. SPY opening and dropped to LOD ($279. 13) after the first 10 minutes. So let's look at different timeframes to see what that looks like (note, I have pre/after market on so my RSI numbers may look different from yours): 5 minute 15 minute 1 hour 4 hour daily So we have daily support from 23rd/24th at $278. 50. We were just outside the BB on the 4 hour. We have oversold RSI conditions on the hourly. We were just outside the BB and close to oversold on RSI on the 15 minute. We were outside of the BB on the 5 minute. So the first question I would ask myself: did something significantly change with the markets to cause this shift?