By: Evan Lazarus
Volatile markets are always highlighted by directional moves that go further than most traders expect only to produce a counter directional bounce that goes further than most expect the other way. The 72% Fibonacci retrace level has played a key role in shorting bounces with limited risk in my opinion. I have watched these levels become more apparent in not only the broader markets but in specific stocks as well.
Now, this is a bit speculative but I want to highlight this retrace by showing the E-Mini’s post “flash crash” and now again. I do believe that this level needs to be closely watched for clues about this market turning back down again in the near term. Even if this market continues its move higher, I believe the risk is controlled which will in the end always make for a successful trade.
