By: Scott Redler
Is the unemployment rage 9.7% or 10.6%? All depends on the way you calculate the number–Very FAGAAZEY!
Anyway, the easy oversold bounce stopped short, in the lower resistance zone–1,098-1,102. It never even made it back to the 1,107-1,120 area.
The bottom line is, you cannot be perfect. Lots of traders came in today hoping for some type of big down open, yet so far we are flattish. Today will be a tug of ware as the debate on the number will continue. All in all, we are in a pressure mode, and I see no reason why we will not see a 10% correction.
My gut tells me, because of all the boxes, that this correction will either be 9% in order to screw all those waiting for 10%, or 11%-12% in order to trap all those buying in anticipation of a 10% pullback. So, if you sold this market well and want to buy a dip, use the down 9-12% zone and leave yourself a little wiggle room. That would take it to the 1,025-1,045 area (it probably won’t be today).
For today, watch the action in some of the tech leaders. See if they can hold up and try and recover some of yesterday’s down move. For example, watch Apple (AAPL)–it had a second downmove yesterday from the $194-195 zone. Some will try to short that zone for a sell setup. Others will use yesterday’s low (if the market gets pressured) as a pivot. It could trade through that spot for another move lower, catch some support at a lower level, then perhaps trade higher. You can use that strategy for just about anything today.
Another example is for Goldman Sachs (GS). See how it handles the $153-154 zone. If it contains the bounce, OR it goes negative, see how it handles yesterday’s low of $150.54.
It should be a very volatile day today, which makes for some great trading. Stay alert and execute well.
Have a great weekend!
