Ever look at a chart and say to yourself 'What a great setup!' and wait impatiently for the markets to open so you can start on your journey to making that first million? Then when the moment comes you freeze like a deer in headlights. I felt that today when I was looking at the opening bell and it took all my might to fight that feeling and just do it! In our last post we saw a clear trading range which on a break would have giving us the clue to the path of least resistance. I'll admit I did have a bias to the downside and was looking to play that. Below is the SPX 15min PnF including today's trading action and you can see the trading range even more clearly between 1836.8-1829.2.
The SPX 5 min chart below highlights the quick move this morning to the top of the trading range only to fail and break support (bottom trading range). Interesting enough we had a test of broken support which was a good opportunity to go short. Also notice the speed of the drop once support is broken. If you are short then you know you first target is 1810 and you stop should be the top of the trading range risking about 7-8 points with a potential gain of 18-19 points. Not a bad risk reward.
Thanks for reading.
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