Monday, October 10, 2011

Back in town

I'm back after a week long holiday. I went with my girlfriend to Lanzarote, since the weather in Belgium is crap anyway ;-)

So what did I miss? A nice rally that started last Tuesday after retesting the August lows.
A pullback on Friday didn't change the overall picture. Some good news over the weekend, the Dexia-bank in Belgium will be rescued. Other news: France and Germany agreed to come up with new solutions to resolve the crisis. So another rally followed this morning. Actually, it was a big gap up, followed by a rally.

After the first hour of the session until the beginning of the last hour, indices traded in a tight range. In the last hour price broke the range on the downside, but went back in (=> fake-out). We even got new highs for the day in the last minutes of trading, possitive news for the bulls!

Daily charts of DIA and QQQ below. Both breaking thru trendlines, but on lower volume.
However, the pattern is changing once more, what first looked like a bearflag, turned into rather rangebound action. And now it looks like we're back near the top of this range. Interesting to see what comes next, new highs or back down again.

When the intraday horizontal range broke down (yellow line), I went short some SPY's. I adjusted my stop-loss a little too aggressive and got stopped out at breakeven.
Later on, price went back up into the range, so basically this was a fake-out.

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