There were a lot of reversal hammers, bounces off of moving averages, failed breakdowns and bounces off of prior resistance today. I a little reluctant to say it because I may be early but it looks like we may be putting in the start of a tradable bottom. Let’s hope the headlines cooperate.


Things were looking pretty ugly this morning and we actually ticked just below the February low on SPY before starting to rally. Vertical moves into important support/resistance can often be a good place to fade the move. You want to the stock to put in a new high/low fail buy/sell on the way back through the previous alert and then use that new high/low as your stop, textbook action today.

Today’s action was constructive but now the charts are really a mess and I have less for tomorrow than I did for today, that is that way it goes. If this bounce is for real then we should know soon enough and some new spots will develop.

Trading the break of up or down trend lines is not really my cup of tea; the levels are too vague for me. But I know that many people do and are successful at it. The most recent selloff and potential bottoming may be giving an opportunity to buy the break of some pretty well defined down trends.

The fertilizer space (AGU, BG, CF, MON, MOS, POT) has these well defined down trends and may give the patient trader a shot to buy the break out.

The following ideas may be actionable tomorrow but I am not expecting much.

ctxs 41.82 reversal/support buy on 200 day Ma
gpn 40 short
grmn 32 short