Identifying support near market lows is key to getting positioned for the next uptrend.
∙ Momentum shifting
∙ Clear lows to play against
∙ Tight action allows for better entries
Let's take a look at the market's current action, and some positive signs we're seeing:
Positive Sign #1: 3 Gap Downs In A Row
While some may think this is negative... "Why would it be positive for the market to be gapping down 3 days in a row?"
...it's the close that matters!
Here's $SPY:
As William O'Neil famously said, in bull markets you want to see weak opens with strong closes, and in bear markets you'll see strong opens with weak closes.
Stacking multiple sessions of weak opens and strong closes is a good first step to the market finding some rhythm again.
The best thing you can do for your trading right now is go back and study winning setups.
Here's a step by step walkthrough on how you could have used the Episodic Pivot setup to catch an 80%, single day move $CRNC:
Before you can trade a setup like CRNC consistently, you need to have a process to find names that are gapping up on the open.
You can use @deepvue to run the "Premarket Movers" scan, and on that day CRNC was at the top of the list with 290% volume.
@Deepvue The next thing you need to do is check into why the stock is gapping in the first place — is it positive news about a drug release? Is it an analyst upgrade? In either scenario, is this a game-changing catalyst?
For CRNC, it was a partnership with $NVDA — yes, game-changer!