With the markets trading sideways yesterday between the 20 and 50 sma on the daily charts follow through is limited until price action can break through support or resistance level. Looking at the hourly chart we can see intra-day there are a lot of support and resistance levels that need to factored in trading decision and game plan.
With this being said, it is very important to focus your game plan on the best sectors and stocks to achieve the highest probability for follow through. Having strong trade ideas long and short will give you great flexibility to take advantage of opportunity in the choppy market.
Yesterday the majority of Keystone traders made money on the short side as the SPY pushed lower during early morning trading which was supported by a rising VIX and weak tick reading, but continued sideways into the lunch hours. The afternoon trading provide a good opportunity as the SPY pushed higher. The Euro was able to break out of it small trading range which provide a nice long opportunity in commodity stocks, which was supported by the rally in the markets.
