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Almost every chart that I posted in yesterday’s update showed some sort of reversal bar, most of them in the form of a hammer.
But as my buddy JC Parets says…
J.C. Parets @allstarchartsHammers are only hammers if there’s follow through the next period.
Well, today we got that follow through and there were plenty of opportunities to ring the register as there was green across the board, even beaten-up value stocks and cryptos got in on the action.
The question still remains, is this just a temporary bounce or the beginning of a more sustainable move?
For now, the SPX, QQQ, and IWM are all still below the 8 and 21EMAs – and the Q’s and IWM are still below the 50EMA.
And that’s why selling strength is still the name of the game if you’re an active trader.
For example, let’s say you got long on the reversal action yesterday. Selling partials into strength allows you to lock in a profit AND still participate if this move has legs.
Once the indexes get back above the short-term EMAs – and hold – then we can look to hold full positions longer and/or buy breakouts.
But for now, we still need to be strategic and manage our risk.
Okay, let’s get to the charts.
Today’s Featured Charts: ADA, AMD, AMZN, BABA, BTC, CCL, COIN, DIS, ETH, FB, HNT, JETS, LCID, LVS, MS, MSOS, MT, MU, NCLH, NFLX, NVDA, QQQ, SQ, TWTR, XLF.
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It should go without saying - but I’ll say it anyway - all opinions expressed in The Lund Loop are my own personal opinions and don’t reflect the views of my employer, any associated entities, or other organizations I’m associated with.
Nothing written, expressed, or implied here should be looked at as investment advice or an admonition to buy, sell, or trade any security or financial instrument. As always, do your own diligence.