My entries for my last $SPY trade was at the end of day on the reversal up day off the 30 RSI near the $193.30ish level then the next day I added at the end of the day on the gap up near the $194 level. I took a half of my full account position on day one and doubled it on day two. My entry was a reversal off the 30 RSI and then a gap up that held the next day. I suspected all the traders that wanted out were already out as the Geo-political fears escalated. The best trades are the uncomfortable trades, we have to be zigging while the other 90% of traders are zagging if we want to be profitable.
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Today we gapped down showing an absence of buyers over the $200 level. Even as we rallied the concrete ceiling of $200 held strong.
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We closed below the previous days low of day.
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The $SPY trend flat lined near the 70 RSI level on the daily chart over the past four trading days which is what I expected due to the historical resistance found there.
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The risk/reward is now skewed against longs after this strong rally back near overbought levels. There is more potential and probability of a down move than a up move from here.
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The $SPY chart needs price consolidation here to set up for a run higher.
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I suspect there will be opportunities at lower levels to get back in as a swing trader before the next big run higher. I will be watching the 50 RSI and 50 day sma for potential long entry levels.
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The MACD lines have a wide divergence here after this run.
