The stock market took everyone off guard last week and blasted higher despite a head and shoulder formation that looked grim for the markets. Anymore its these failed formations that work out best especially when combined with sentiment.
Right now this stock market looks like its going to blast higher from here despite the fact its overbought. The NASDAQ SPY triggered with the nasdaq now leading. This has been very reliable in the past although the last few trades have not worked out well.
I got long one stock last week and am looking to take most setups to the long side right now. Although my stops are going to be a bit tighter then usual.
Another thing to look at is the Fed is now about as hawkish as can be right now and the markets shrugged it off. How the market reacts on news is a great indicator also. The tone of the market right now is higher and the shorts are going to have to keep covering which causes even a more dramatic move. I think we are beginning to get into the euphoria stage of the market right now. So watch sentiment and when it gets severe bullish its time to lighten up. I will try to tell you when I think we are approaching that level.Right now however we have a way to go.
Now that’s not to say the stock market cannot reverse lower from here. It’s a matter of bias not certainty. Please remember that!!!
Got to run right now as its most likely going to be a busy morning for me
If you want to follow my trades you can follow @rickjswings. It is free for now!
Good Luck Today
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