Day’s Theme: An important price level on at least a one-month scale.
Behavior Around the High: An intentional fake out or shake out around the high.
Behavior Around the Low: A significant drop on a one-day scale into the low.
I’m advised to trade around a move higher out of a decline in the face of seemingly overwhelming headwinds.
On May 9th, there’s a breakout on a one-day scale in the pre-market with a rally along a diagonal trend line. We’ll break through horizontal resistance to meet a secondary resistance before pulling back to somewhere between those two price levels. We’ll continue that diagonal rally out of the open and there’s a trade opportunity to open a short position. That’s followed by a significant drop into a prominent trough that forms between 10:00 a.m. and 11:00 a.m. There’s an opportunity to open up a short position for a quick day trade. Around noon, there’s a speech that I’m advised should not be trusted. There’s a big move to the downside after that failed attempt to break through resistance. That decline will bring us into a trough around 12:15 p.m. or 12:20 p.m.
There’s a big move to the upside that creates another crest. We’ll sell off from that crest around 1:00 p.m. There’s a trade opportunity to open a long position for a quick scalp trade. I would close that long position around 1:20 p.m. We’ll then have a sideways S-formation that forms within a channel between roughly 1:00 p.m. and 2:00 p.m. We’ll then have a failed attempt to break through key resistance. It’s likely the same resistance level that we failed to break through earlier in the day. There’s a lot of price change in the last hour. After that failed attempt to break through resistance, there’s a decline into a prominent low for the day. Toward the close, we’ll have a fast, sudden move to the upside to reach for a significant price level on a multi-day scale. We’ll have a high there followed by a breakdown through that same price level shortly thereafter.
On May 10th, we’ll open lower. There may be multiple failed attempts to break through key resistance around the open.