I’m sure most of my $SPY traders saw the choppy mess between 10-11am today, so I want to share what I look for in times like these, when there are no divergences showing.
My general rule of thumb is to not take a trade until an hour after market open (if you haven’t tried that, try it) and at that time we were back and forth retesting the 200ma, which I use as a key level on my chart along with VWAP.
I’m looking for one of two things to happen here.
- Price to break above the 200ma, and VWAP… As well as the resistance line directly above VWAP. (With a buy signal)
Or
- Price to break the most recent low, supported by a sell signal.
As you can see price rejected off the resistance level above, then came crashing back down and broke the previous low of the day, which usually more often than not can give a good direction for short term trades. I entered puts when price broke that previous low, and grabbed my daily PT of 30%.
For reference:
Blue line: 200ma | Pink line: VWAP
Divergences are one of my main strategies and I’ve posted many times about those, but these setups are also very effective and give very good clarity on where you want to possibly take a position at.
Would love to hear feedback and if any of you have used this methodology to trade with!
https://i.redd.it/np2d1qnh24od1.jpeg
Posted by Scary-Compote-3253
6 Comments
it goes up, it goes down ; gotta find out when it does, gotta find out before it does .. for the rest at bay, ask the piper, he knows better than decay
peace!
bought a put earlier in the day on the first hump. caught the entire move down, should have put more on it. you dont need all these indicators imo, you can see support levels as well as market trend with just the graph. all i use is rsi to see any divergence. never understood vwap. bought another put eod cus the retrace back up was crazy. pre market is looking good.
Brilliant. What’s your discord ?
Where website is this chart from?
Hm, seems brilliant. I might try to automate this strategy.
The clue is in the futures markets.
I use algos to measure order flow absorption by big boys in real time and broadcast them on Telegram. The level of rebound at the top was already measured and broadcasted before market opened:
https://imgur.com/a/BzRNz78
Many option traders of SPY and QQQ are using our alerts. They are free for now. You can PM me if interested.