THREAD!! BAR BY BAR ANALYSIS ON SPY!! 1/2 POSTS!!
Bar 1: was a high 1 that trigger long in a bear trend. What do we do? Sell its high. Easy.
Bar 2: was two bar reversal but where we in a bear trend or a TR leading to a reversal. In a TR
so we should buy it instead of selling. This would have been the best trade of the day.
Bar 3: was a high 1 that was triggered and was a reversal bar doji that failed. Buying its high
was a nice idea.
Bar 4: was a low 1 that triggered in a bull trend? What do we do? Buy it. as easy as that. Do not
be afraid to go long here if you believe that there is a bull trend.
Bar 5: was a low 2 that triggered a bull trend and we were likely forming a spike and a channel
from the lows. The spike is from the low to bar 4 and the rest is the channel. It was the second
leg of the channel up so buying a low 2 here is a nice idea. Selling a low 2 in a bear trend is the
best tarde maybe. But when we see a low 2 failing and going upwards, we need to change our
perspective nd agree that we are now in a bull trend instead of a bear trend.
Bar 6: was the third push up in the bull channel and will usually retest the beginning of the
channel. This was likely specially with the bear trend and the beginning. The doji bar failed at its
low ad was bought and continued up. When this happens, we should expect a second leg up at
least the same length as the first leg up. A short squeeze will happen here were shorts will have to
cover their shorts by buying their position and prices will go even higher and higher.
Bar 7: was the first high 1 in this new trend up in the second leg and buying here was not a bad
idea if we keep the stop loss below the big green hull bar that broke above bar 6. It is better to
wait for a two-legged pullback since it has not happened yet from the low of the day. And this is
exactly what happened after.
PART 2 !! In next post!!
