Hey Market Pilots,
The markets have been difficult for my style of trading over the last few months as the high momentum, high beta names all took a beating. Week after week I kept trying to figure out where the bottom was and when we could play the long side again. The setups I usually take weren’t working, and that was just a sign the tickers weren’t ready for the long side.
Then, early last week, it all changed.
I have a vacation planned for next week, but the market was so frustrating that I was nearly ready to throw in the towel, call it, and leave early. I kept wondering when the downside was going to stop and we could actually get traction. And just like a light bulb flickering on, things suddenly started to come into focus and I could see again.
The clarity of the setups was a thing to behold. Below is an example of what we have been dealing with and what has finally changed. Romeo Power (RMO) is a good example of declining prices for months. Sure, there were bounces, but none of them lasted or held any kind of support. You can see where price kept failing support or getting rejected via the first small arrow.
The second bigger arrow shows the location of when it all changed. Suddenly moving averages (MA) started to hold price, and other MAs started to cross over each other in a positive way. Old MAs which were resistant are now giving way and price is getting through them to the upside.
This is the beginning of my old favorite high beta names basing and coming alive. Many of the Moxie subscribers like to joke that some of our best trading has been when I come back from some sort of trip or vacation…
Well, with two weeks off I hope the markets are still doing as well when I return.
Your Profit Pilot, TG