I Smell Opportunity, 6 Feb 2023

🖼 Daily Technical Picture 📈

➤ Equities are at an interesting juncture that should provide good trading opportunities. I can smell it.

➤ If we look at the SPY chart of the S&P500 equity index, we can see that the price is in the midst of testing resistance levels. These resistance lines are probably the most solid since the start of the rally. I therefore foresee the chance that price may settle or retrace downwards from current levels.

➤ Friday price action was a great example. The price was "trapped" entirely between the confluence of key levels. The question is where does it go next?

➤ For me, I really don't know nor do I care. All I really care about is if it will provide trading opportunities long or short. I can see both scenarios playing out. Perhaps a short opportunity first. This then opens up the second set of opportunities offering the high conviction trades. Either prices weaken further with continued selling pressure or the Bulls come in and support the price to pump prices higher.

➤ Conclusion: I'm ready to play.