We have gone over this a few times on the thread. There really are no set levels. Every trader on here is using different time frames and different A levels. Most of us form fit them to the type of trading we are trying to do. I know that's not the answer you are looking for but we have discussed it a lot and that is pretty much what we agree on. LOL. Welcome to the thread.
So vol keeps getting sucked out of this market! I posted that pic a couple weeks ago showing the close below 20 in vix, since then we have had a steady trend. Hell, the vix has been declining on just about everyday regardless of the action including today. Yea we had a short week, but I noticed this happening before this week and mentioned it in the thread. What does everyone think about this?
It's interesting because we've been talking about this, and there seems to be a H&S there, and it seems to me like last Friday was our confirmation day. So to me, it feels like this, along with the gap hold in the SPY, (despite yesterday's weakness and tough report) and those number lines, gives you reason to be bullish. That said, who the heck knows? A nice tell would be if we were able to test and hold the weekly A down this week. If that were to happen, I think we'd have our answer. Also, earnings in the banks very soon. JPM puts up a good number and it could be a catalyst. While people aren't expecting much out of earnings, it's interesting to note the strength of the small caps and U.S. names. Many companies have already lowered guidance, so that can help us move with beats.
Shan and I had a "long" talk about this on Friday in the office. LOL. Here is a summary of what I said. I am neither bullish nor bearish. I see the market through the lens of volatility and it's why I use and love ACD. June saw us trade from 1260 to 1375 pretty much in a straight shot up. I think the market has to absorb this move. I told Shan that I believe we will not break and confirm either the monthly A up or A down this month. That means with the monthly A up in ES at 1383, I think that level will hold. We may trade 1390 or the 1375 level may hold but I don't think we "confirm". On the downside that level is 1328. Again, we might trade down to 1315 or 1320 but we don't confirm. I think the market will be range bound. I think any large move we get will happen in August and September. So right now that puts us right in the middle between the two goal posts. That means we could trade higher and fail and grind lower the rest of the month or we could hit the lower end of the range and grind back higher. I'm agnostic as to which is more likely to happen. Markets rarely move straight up or straight down. If they did, trading would be very very easy. Having said this, there are plenty of stocks breaking out to new all time highs and many sector ETF's at or near 52 week highs. There is something for everyone.