Here’s why traders should ignore the news headlines and focus on technicals, especially with the put/call ratio dropping into extreme bullish territory. Upside may be limited, with SPX likely to get stuck in a range. Or… is it due for a mild pullback before targeting higher fib extension levels?
Two weeks ago I put you on a bullish path for SPY. I didn’t know it was only going to take 2 weeks, but we’re now only 1% away from our targets, having made a 5% advance from our conversation. This is the kind of precision traders dream about. Now, where does the SPX go next, and how do you trade it without getting chopped up?
This doesn’t mean the market is crashing tomorrow, but it DOES mean the momentum pattern finally broke. When that happens, you tighten stops and start planning for the most likely next move: a pullback into the pocket zone and a test of the 21 EMA.
