In my previous blog released two days ago I spoke about how we were completing a ABC down with the C wave being an expanding ending diagonal which caused me to believe get LONG we are going to rally! The rally was bit stronger than expected but nonetheless played out perfectly to my initial target area I had two days ago in a 5 wave sequence.
The Good Stuff:
Today in the group chat the Nassar Investing Team was able to recognize the 5 wave pattern to the upside which then led us to believe we still have a higher high coming (we were in wave 4 when we spoke about this). Sure enough we grind-ed slowly but steadily higher to a higher high. The NASDAQ, Russell, and Dow were the first three to confirm then finally SPX cash caught the hint and rallied to a new high just before close. After seeing the higher high before close and Apple's earnings 30 minutes after the bell, it was a debate to short or not to short. Luckily I was able to get short at 2740 and cover half at 2730 just above the VWAP post earnings. I still have half my position on with a stop above my entry.
It is entirely possible the 5th wave is not finished yet and we can still see monthly pivot at 2751, we will see. We are in a rising wedge that I do expect to break down for a B wave with a initial target at 2672. Please understand this B wave is a corrective wave meaning a whole bunch of scenarios can play out maybe a double, tripple, flat, triangle, etc. Loads of combinations that we will take one step at a time but for now I am looking for a simple zigzag into my black target box.
Payroll Employment is out tomorrow which can offer some decent volatility in the morning so just be aware and ready to act if need be.
Happy trading everyone - Trade well, trade smart, and trade your own game plan.
To enlarge chart click here