So the market has broken above the Weekly 200MA and then goes back to test it. Price was outside the Bolli Band on the M1 chart but not the M3 chart so there was no immediate buy – which was lucky because the market broke back into the level by 15pts. It then makes a retest with a nice bear bar which would have provided an entry – but the trade was a loser.
THOUGHT PROCESS: At this point, the market has broken a critical level and then goes back for another look and dips below – but this is not a reason to sell! There has been acceptance above the level – and with a seriously underwhelming response to the break-back-in, it’s time to look for a buy.
The correct trade was the triangle that setup undernearth the level.
