On my last post I proposed to search for the floor of the market to try to trade a long position once the correction finished. Right now i think its still a bit early but the signal could trigger at any moment today or tomorrow. I want to spot a signal on both us30 and us500 suggesting a long trade. But also im looking at WTI OIL.
There are basically two things that are creating the most noise in the market and making the prices of stocks go down. First OIL price going down so quickly its taking a lot of stocks down with it. Then there is the Greece tension in the market. Greek is going to give us some peace for the next couple of weeks until the election date on the 25th of January, so that gives us some calm to trade long positions right now. In the other hand we have the OIL situation, for us to be able to trade a long position we are going to need OIL to stop going down, it doesnt have to be a definitive floor, as longs as it gives us some days of peace thats enough for a positive impulse to develop.
This 1h chart for WTI OIL suggests the current wave could be taking a rest, this is not yet confirm but its close to been confirmed, so we should monitorize this chart and allow it to work as a red light/green light tool. If the oil rebounds down it will be red but if it breaks the cloud then we will have a green situation because we will expect OIL to take a rest and do at least some lateralization.
So what are we expecting to trade then? Here are the US500 and US 30 charts:
In this daily US30 (DJI future) we can see which seems to be a clasical reversal situation, a spike in volume at the same time faster oscillators reach a oversold situation suggesting this is the end of the correction. This is the first thing we want to see before a new long movemnt happens.
This are 1h charts of both US500 and US30 (SP500 and DJI futures) and we can see here how both are already giving a buy signal according to my trading sistem. There are coming out if the ichimoku cloud and have the support of both TRIX and ADX.
However in US 500 at the 2022 point and for us30 at 17530 i can see what could be resistance zones that are just above our position so it could definetly be intelligent to wait the market to confirm the long trade by breaking those resistances and then we could try to trade long from 2025+ and 17560+.
Our stop-loss for the momento could be just under the current values of the bottom of the ichimoku cloud. Without forgetting to monetorize OIL prices.
Nuño Pérez del Barrio