After the three week’s growth world markets have fallen for like 0.5%. S&P market has opened up with a gap down. We should look at SPY rates which precisely reflect S&P. Index has opened with a gap down and we could talk about the power of sellers, but in such a strong uptrend there always is a possibility of an overlap of this gap. The key rate is $195.11 which used to act as a support until yesterday it turned into a resistance.
I think it was safe enough to enter the trade down and wait for a fall. The market is exhausted with such a 70 points’ growth, indicators are in the overbought zone. As always buyers managed to buy off a bottom to the end of trades. If buyers can overlap this gap, then we may expect an uptrend. A breakthrough lower than $194.48 may lead to the next support rates: 8 EMA $194.32, and then $192,25-$193.
IBM shares give us trading opportunities two days in a row. The first entrance was when the price opened lower than yesterday’s important support $184.00, which shows us the buyers’ interest for lower prices. After the one hour consolidation IBM shares broke an intraday support $183.60 and this was a signal for the second entrance, after which it fell down and have never come back to these rates. 8/21 EMA were in control of the price the whole day, quotes reached the $182.00 bottom — an important support rate on a daily chart, and it’s breakthrough may lead to the further speed up. We may probably have 1 or 2 days’ rest before it happens.
Facebook has opened at the rate of the expected support and formed a great $65.00$ level, quotes have not fell lower than it for a long time. It’s a good example of how to use Fibonacci levels after extensive range on the first day. Usually when the price holds up higher than 25%-38%, we may see a strength of buyers and you can expect a resumption of the initial upward movement. After the intraday resistance $65.43 breakthrough it reached the previous day top $65.78 and closed at it. I use today’s session rates to plan my trades. The breakthrough of the $65.82 top could give additional upward movement.
Amazon shares used to show a relative strength in the early afternoon, but they didn’t manage to hold up above the opening point, where coincidentally the top of the previous day is $335.50, and closed near to the $334 bottom, penetration of which can give a good move down to $332 then $326.