Too Extreme, Too Quick? History Shows…
Traders can enjoy some new insights following the 2-day selloff to start the week that wiped out $1.7 trillion of market wealth.
The selloff is considered by some analysts as too extreme and taking place too quickly. Market data and history show the market has a high probability of trending toward a rise after a steep 2-day selloff.
Moderators in the online rooms at Simpler Trading followed the chart patterns and reliable indicator movement throughout the day Wednesday. It was an extremely choppy market with the opening driving markets up, bad news about the coronavirus midday wiping out gains, and then a slow crawl upward into the close.
Historical data shows that it’s almost a given the markets will move positive within a month.
ST moderators looked at the indexes as deeply short-term oversold with a possible low-volume bounce back. The bounce looks like a retracement back to the daily moving averages.
Any bullish position comes with caution in such a volatile market. The broad market indicators should be reviewed as to whether any bounce will hold.
Traders take what the market gives. Don’t fall into the media play that keeps people scared, anxious and glued to their televisions.
No matter the news, if the chart hits support and triggers an entry there is a trade to be taken by a savvy trader.
We Saw: choppy markets all the live-long day –
- More negative coronavirus news erased early gains
- Markets continued to crawl toward a reversal
- Opportunities for traders with a plan
We’re Watching: for any signs of the market turning –
- Cautious about holding any positions through earnings
- Working trades in CRM, BABA, NFLX
- TSLA chart peering over a cliff?