Bear or Bull? Pivotal Support Test Incoming
Updated
I previously had both a bullish and bearish charts going at the same time and decided to combine them into one new one (they also had a lot of updates - so its great to start a nice fresh one with the latest information).
I recently called the bullish fractal which has so far played out nicely (link below) and we have been trading it since. At the moment we are teetering on the support of the bearish ascending wedge, which will inevitably take us down to 10,150ish for another temporary reprieve, before final fall to bottom of triangle. The geometric fractal itself combined with the Fisher Transform cross and parabolic sar flip supports this. We don't yet know exactly where we will land; however it will likely be somewhere in the blue area (or just on top). From there we range for a day or two before finally deciding whether we are bear to the bottom or bull for the double top. If we do fall through the bottom support of the blue triangle, it is likely we will see a retest and come back into the triangle briefly; this is the safest way to short the fall.
If we bounce strong and hard then we will likely see a double top.
How to trade, I am short from 11,077 and stops have been moved into profit at 10,977. As we move down; I will be moving my stop down as well. Once we confirm the bottom I will close a percentage of shorts and let the rest ride in the bearish instance we fall through. At the same time I will also open some longs with a stop loss below the pivotal support level.
Will update as we go along; though it is worth noting, that there is still a very small chance we see a final leg up to the strong resistance area. This represents a very bearish case (double tapped diamond top reversal) - however we need not worry as we will be stopped out in profit; and I still have some shorts waiting there just in case!
I recently called the bullish fractal which has so far played out nicely (link below) and we have been trading it since. At the moment we are teetering on the support of the bearish ascending wedge, which will inevitably take us down to 10,150ish for another temporary reprieve, before final fall to bottom of triangle. The geometric fractal itself combined with the Fisher Transform cross and parabolic sar flip supports this. We don't yet know exactly where we will land; however it will likely be somewhere in the blue area (or just on top). From there we range for a day or two before finally deciding whether we are bear to the bottom or bull for the double top. If we do fall through the bottom support of the blue triangle, it is likely we will see a retest and come back into the triangle briefly; this is the safest way to short the fall.
If we bounce strong and hard then we will likely see a double top.
How to trade, I am short from 11,077 and stops have been moved into profit at 10,977. As we move down; I will be moving my stop down as well. Once we confirm the bottom I will close a percentage of shorts and let the rest ride in the bearish instance we fall through. At the same time I will also open some longs with a stop loss below the pivotal support level.
Will update as we go along; though it is worth noting, that there is still a very small chance we see a final leg up to the strong resistance area. This represents a very bearish case (double tapped diamond top reversal) - however we need not worry as we will be stopped out in profit; and I still have some shorts waiting there just in case!
Note
Likely to form a small descending wedge many will assume is bullish. The plot twist here is that we will fall straight down once we hit the green zone. The bottom is likely the green support just above the blue zone, but we could fall into the blue zone (hence the minor green arrows). Note
This is looking decidedly more bearish (I am 60% Bearish Scenario / 40% Bullish Double Top Scenario) than bullish to me. I think we will ultimately see a break down of the pivotal support and clear the remaining CME gap as shown below. From here a massive bull trap will occur as we will retest the resistance of the triangle pattern and likely have a fake break out back into the triangle. This will trap a great deal of bulls; however it will be just that - a trap as we WILL head back down to the low 3,000's at the very least if this occurs. If you are not in yet and we do indeed break down, do not FOMO - wait for the retest to enter shorts. tradingview.com/chart/3BegsA8j/Note
Note
Note: Waiting for the retest as mentioned above in a short sell scenario is known as a selling last support strategy, and is a smart strategy for those who are risk adverse.Note
Currently at resistance of wedge. Stop loss for short has been moved to 10,725. In a few hours we should see a move down to the 10,200's. Note
Head and shoulders to take us to the bottom of the triangle: 
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