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What are different time frames trying to tell you?

Hey Market Pilots,

The other day I was talking with a few guys who manage an investment fund. The conversation focused on where the market stands as far as its overall health and the duration of the bull run.

This is a relevant topic of concern since many names pulled back 40-60% or more and given back most of their gains during the run that extended as far back as November. If your charts are too zoomed in, say, on the daily and hourly charts, you would be seeing a deep gouge and think the damage was severe.

But zooming out to the monthly chart, a “bigger picture” is being painted.

Of course, these big-name pullbacks were significant, especially if you didn’t get out soon enough. But the moves to the upside were exceptional, too. So now that it appears that the dust has mostly settled,.

Where do we go from here?

Let’s look at a few examples:

ElectraMeccanica (SOLO), initially bounced off its monthly 10 Simple Moving Average (SMA), ran up to create a giant gap, and has now come back down to its monthly 10 SMA. It looks as though this should be support to me (in the chart below).

NIO also ran up extremely high (in the chart below) and got too far from support. Now, it is back to its monthly 10 SMA.

The RealReal (REAL) initially bounced off its monthly 10 SMA to start the huge run, now it’s flagging into its monthly 10 SMA (in the chart below).

Invesco Solar (TAN), the solar Exchange Traded Fund (ETF), is coming back to probable support of the monthly 10 SMA (in the chart below).

Redfin (RDFN) is coming into its monthly 10 SMA for the second time (in the chart below).

The details of these moves are still working.  I’m following closely as  price has yet to get into a confirmed uptrend on lower time frames such as the daily or even hourly.

But the “big picture” tells me this bull isn’t dead yet. It will be more a matter of when, not if, and so I am having to be patient for when that opportunity presents itself again.

Your Profit Pilot, TG.

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