Hey Market Pilot,
Last week, we saw the market continue down from the inverse trampoline move. That decline was heavy for the week and flagged sideways into more resistance on a 15-minute time frame. This gave us yet another leg down and actually broke the previous lows from Monday, Sept. 20.
As for market action, there is definitely a possibility for the bottom to fall out from and for the market to drop even further. But there is also the chance this is a bear trap to lure in all the short traders only to have the market bounce right back up. As of last week, the latter happened and the market found support after slightly undercutting its previous low. In the screenshot below, we can see that undercut which also helped to form the positive Moxie Indicator™ divergence (noted on the hourly time frame with the white line). We could see this divergence forming and I had guided the Moxie Indicator™ members into looking for that setup.
Yes, the market was at the weekly 21 exponential moving average (EMA) and has held for a little bit, but we still have price below key moving averages and no significant or concrete sign that the market is ready to move up coming into this week.
We’ll need to keep an eye on the market plus individual names and how they might help us form a consensus of the market sentiment for the week. For now, I am seeing a lot of weakness and so I won’t trust any upside moves in the market as they could be selling areas. Stay nimble and be aware we are in an erratic portion of time in the market.
Your Profit Pilot, TG