Yes, a pullback to 64 and a lot more! Yet again all the clues were there leading up to the drop. At first it seemed there may be a bull triangle developing, but as time went on, the failure signs started to appear....The top was running along 9621 with the uptrend starting at 9452 culminating at the breakdown at 9579. The first clue was the lower high at 9610...The second was the failure of the uptrend support at 9664 which is a natural support /resistance value, recently established. The third confirmation ( and things go in three's) as if it were needed, was the two bounces off the old uptrend support line that was clearly now resistance, making a clear cut SR switch. I have to own up to making a fatal error of judjement tonight, having missed the third and crucial point. I had been correctly short at 58, but was 'tricked' into going long by a sudden jump in the bias on fins just as the price broke out above the 100 MA by 5 points after what appeared to be a strong up trend off 9550 that I had correctly read as a possible support value.It was compounded by the fact that there was a small bounce up right on the 100MA...From there it was downhill all the way and I reversed the long to a short again to salvage something out of a really bad move. A hard lesson learnt. My initial belief in the short should have prevailed, but I failed to re-check the overall picture, to my cost. Apart from that, I ignored one of my most basic rules :- "if you are in the 100MA band, stay in until it breaks" In mitigation, at that point I was at -20 which is my normal stop loss out. Clearly I still need practice at shorting 🙂
Plenty of interesting things to learn off today's chart. Sorry I lost the faith, H. One for the book I think.
Postscript.... check out archive dow intraday on 29/04/02 for a very similar situation.
