We look at the fear index chart and it has peaked from a high of 83.98 on 17 March to a low of 37.19 now. That means, people are piling money into the stock market.
If you like, talk to your broker , have a chat and find out how is his business. Is he receiving a lot of calls to open account ? Does he have time to return your call ? Such groundwork research can provide you clues to how active the market is.
Next, talk to your circle of friends especially those who shun the stock market. Are they suddenly telling you how much profits they had made in XXX stock ? Or ask your opinion about ABC stock ? This is another tell tale sign to sell when the least possible person is entering the market.
You can see VIX on the day chart has broken out of the bearish trend line. Let's see if it will turn up towards 60 price level. If it does, then we can expect SPX500 to do the opposite and heads down towards 2733 first and then 2568.
However, if VIX gives us a false signal and it drops below 30.13, then we know this breakdown in SPX500 was a fluke, trapping early bears to come in. I did say in my other SPX500 charts to take partial profits and adjust your SL. Go check out.
I have also employed other indicators like 200 MA to illustrate that SPX500 has hit a resistance upon reaching this level. The weekly chart register a nice pin bar, a bearish signal as well.
If you want to short next week, go to smaller time frame and identify a good entry. Wait for the pull back. Place your SL above 2965 (around 3074 level) so that if it reaches this level , you know the market is not ready to go down yet.
Gives a thumbs up if you like my train of thoughts. Feel free to comment as well.
All the best , trade safely, employ proper risk management, always use a Stop Loss and watch your positions.
If you like, talk to your broker , have a chat and find out how is his business. Is he receiving a lot of calls to open account ? Does he have time to return your call ? Such groundwork research can provide you clues to how active the market is.
Next, talk to your circle of friends especially those who shun the stock market. Are they suddenly telling you how much profits they had made in XXX stock ? Or ask your opinion about ABC stock ? This is another tell tale sign to sell when the least possible person is entering the market.
You can see VIX on the day chart has broken out of the bearish trend line. Let's see if it will turn up towards 60 price level. If it does, then we can expect SPX500 to do the opposite and heads down towards 2733 first and then 2568.
However, if VIX gives us a false signal and it drops below 30.13, then we know this breakdown in SPX500 was a fluke, trapping early bears to come in. I did say in my other SPX500 charts to take partial profits and adjust your SL. Go check out.
I have also employed other indicators like 200 MA to illustrate that SPX500 has hit a resistance upon reaching this level. The weekly chart register a nice pin bar, a bearish signal as well.
If you want to short next week, go to smaller time frame and identify a good entry. Wait for the pull back. Place your SL above 2965 (around 3074 level) so that if it reaches this level , you know the market is not ready to go down yet.
Gives a thumbs up if you like my train of thoughts. Feel free to comment as well.
All the best , trade safely, employ proper risk management, always use a Stop Loss and watch your positions.
