Navigating the Waves of a Slow Monday: A Patient Approach in Uncertain Market


As the new week unfolded, the aftermath of an RTX sell signal on the weekly chart set the stage for what promised to be an uneventful Monday. The anticipation of potential sideways movement for the next one to two weeks loomed, prompting a cautious approach to trading.

Morning Observations: A Hesitant Start

The opening moments of the day hinted at the anticipated sluggishness, with price spiking over its moving averages. However, a closer look at the Price Pressure Momentum (PPM) indicators revealed a relatively feeble trend level, registering at only .03 compared to the more robust .25 threshold. This signaled a potential lack of conviction in the market's momentum.

Mid-Morning Rally: Testing Resistance at 4790

By 10 o'clock, price did show some movement, rallying up to 4790. The significance of this level became apparent, with a cluster of numbers converging around it. R1 on the weekly chart at 4789, R2 on the daily at 4792, and a high target of 4796 on the hourly chart formed a formidable barrier. Meanwhile, PPM 1 reached a peak at .20, suggesting a potential topping out.

Strategic Decision-Making: Shorting at Resistance

Observing PPM 1 cutting through its first derivative and projecting to dip under the second, I made my only trade of the day at 4789.75, shorting with the target of testing the 40MA at 4783. PPM 2 and 3 were projecting to test their first derivatives, providing further rationale for the short position.



Trade Execution and Exit: Patience Pays Off

The trade played out as expected, with price descending under the 10 and 21 moving averages towards the 40MA. Exiting at 4784, I recognized the lack of momentum to breach the 40MA, coupled with the PPMs flattening out. PPM 1 and 3 predicted a test back to their second derivatives, aligning with the decision to exit.



Market Surprises: Holding the 40MA and New Highs

In a twist of events, price held the 40MA, establishing support and subsequently soaring to a new high at 4793. All three PPMs briefly spiked above their averages, showcasing a short burst of positive momentum. The remainder of the day unfolded with sideways movement, closing at 4792.

Key Takeaways and Looking Ahead

Today's trading day underscores the importance of patience and adaptability in navigating uncertain markets. While the day started slow, strategic decision-making around key resistance levels presented profitable opportunities. The market's ability to hold support at the 40MA and reach new highs serves as a reminder that surprises are inherent in trading.

As we look ahead to the rest of the week, may each trading day bring new insights, opportunities for growth, and the wisdom to navigate the ever-changing currents of the financial markets.


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