History Repeats and Those Trusty Fib Targets
(Anatomy of a Selloff and SP-500 Targets)
I penned concern the area we were in had previously been an area with no real direction or follow thru in either direction. An entire month of a trend less market dominated by alternating opposite direction bars.
Fast forward to today and I woke up to the makings of a really nice short trade. The market gapped through my first target - “ringing the register"- and I had visions of a market meltdown racking up big $$$ on the second half of my short position. I dutifully set my second target, brought my stop down to breakeven, and ran some errands. I came back about a half hour before the close expecting to see some real market ugliness, and instead found a pretty bullish reversal had transpired.
It turned out the Fibonacci first target was pretty much the low. With a nominal follow thru to today’s reversal, I will likely be stopped out on the remainder of my position. I wrestled with reversing my position near the close but decided to stick to my trade plan, and let the market decide where I’m out of my short. (Stop or Target #2).
For now, history is repeating as the bulls and bears battle to a stand still in the same area as their previous stalemate. There is no reason to take a large position in either direction.
Good Trading,
KW
