The trading range for the QQQ last week was about as wide as you would expect to see in an entire year. The SPY is in a similar technical position to the QQQ but has rallied back only to the mid-point of its trading range. The Trading Range extremes and mid-point are shown on the Market Location Chart and on the Daily Panel of the Trading Chart. The IWM started the week as the most bearish of the major indexes and it emerged at the end of the week with its status unchanged.
Perhaps even more interesting is that after a record one-day drop on Monday the QQQ was back at the top of its trading range on Friday.


While the Daily panel in the Trading Chart (below) is still bullish, and because of it QQQ could move higher on Monday, it’s unlikely that the QQQ will launch a major upmove from the top of its trading range. IWM is at mid-range and unlikely to make it back to the top of the range before another downturn.
As a bit of added drama, the VIX crept up all during Friday’s trading session and ended the week near its high. If it starts looking dodgy for our long Put we will turn the position into a vertical debit spread by selling a lower strike Put to reduce the risk of the trade. With the individual panels, panel click-behinds, and subcharts there are more than 20 aspects of what we call technical strength or weakness.


When price is at the top of the Trading Range we can reasonably expect that it will not go much higher, and when it’s at the bottom of the Trading Range we can reasonably expect that it will not go much lower. In a perfect set-up the 15 minute and 1 hour panels will rotate from blue to tan while the Daily is still tan.
It does look like volatility will stay elevated for a while longer, and that’s a good thing.



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Comments

  1. WiND

    When you accurately predict the direction of a monetary instrument tailor-made device like a binary options.

    25.09.2015

  2. GemliGiz

    Trade per asset per day and.

    25.09.2015