I closed the balance of my long positions today and am playing the short side again via long positions on SDS and QID. I'm going short because of the bearish divergences on the 15-minute charts of the S&P 500 and QQQQ. I'm very cautious here because the S&P 500 and Qs are still above their 50 day MAs on the daily charts and market breadth remains positive. However both the 15- and 60-minute charts of the S&P and Qs are very bearish.
It is unclear wheather prices will decline to form rising price channels on the daily charts, or if the move will be a full blown reversal. If prices get a sharp reversal, then we may set up some double top patterns. If prices fall back and find support near the 20- or 50-day MAs in the daily timeframe, then the advance could continue after that. If a double top doesn't form, we may see prices move sideways to carve out a cup w/ a handle pattern or for a triangle pattern. However, the VIX is very bullish on the hourly chart and it looks like support will definately be test on the S&P 500.
The video is posted below. Lock in some profits today and considering a short term long trade on QID and SDS, if the bearish divergences play out on the hourly charts of QQQQ and the S&P 500. We have a potential evening star on the Qs and evening doji star pattern on the S&P 500. If we get a reversal here, it may allow prices to expand into some rising price channels on the hourly charts. I discuss this in tonight's video.
I am doing some short term swing trading back and forth right now and not trying to position trade at all.
