DIA trade ideas
DIA SHORT based on TOP Resistance + Trend-LineSPDR Dow Jones Possible SHORT over the longer-term coming up, wait for extra signals. Possible SHORT based on the current resistance at 269.20 that hasn`t been crossed yet. Currently low volume trading, wait for higher volume for confirmation on SHORT. I would suggest SHORT ones 1 TARGET(RED) 262.00 is broken (SHORT33%). 2nd Target (ORANGE) 253.00(SHORT66%). If this support is broken look towards 248.00. If this level is broken SHORT full position (100%) until 242.00(GREEN) at least.
Divergence Flashing Reversal Warning in DIA? Divergence in technical analysis is simply a separation between price action and various indicators or oscillators. Divergence however, should never be used as a stand alone tool. FlashPoint Trading Academy uses divergence to assist in our swing trade entries and exits.
FlashPoint entered a long in DIA back on January 17th at $141.23. Having noticed a divergence between DIA's price and RSI, Stoch and MACD, we've set a stop-on-close order right below the 10 day EMA to ensure we lock in current gains. Simultaneously, we will also execute a sell stop order to enter a new short position as well with our initial target set at $256.61. Further weakness in the underpinning of major markets could see an even larger move down to $247.58.
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A "1.13" Setup ?Just thought I would provide this as something to think about.
Perhaps this is something you may not have considered.
Should the "abc" within the "Y" leg in fact turn out to
be 5 waves (rather than 3 as shown here), we would then
have a large expanding flat beginning at the Jan '18 peak.
Should this occur, then depending on where the 5th wave of "c"
came in, this setup may/may not then fall within the 1.13-1.618 range.
Shorting the DOW. SL & TPThe Dow is currently rejecting significant trend lines on the weekly time frame and we are witnessing decreasing volume from a weekly perspective also.
As many of you know who follow me, these trade set ups are what I look for as it allows me to set up a good risk:reward ratio in my trade plan with significant price action changes having to occur to stop my trade out. The good old saying goes, The Trend is Your Friend!
Fundamentally, we know that the future is dark economically, and generally I do not look further then technical analysis when implementing a trade plan. But when we look at the fundamental uncertainty on top of the technical set up, we have to get excited about this particular position. If you are following me, you would have noticed a few weeks ago I published a short position for NASDAQ. Well, NASDAQ has since dropped significantly while the DOW has not further indicating that we are both fundamentally and technically advantaged in this trade set up.
I have published the daily chart so that we can view the results of this trade day by day instead of waiting for weekly candles to roll over to update the chart.