$SPX for the week 23 Apr 2018

Little changed this past week!

The bulls moved into the upper half of the range and with the move higher each day, it was time for the bears to have their chance and the week ended back at ± the mid point of the range around the pink line on the chart.

With moves higher some may start to get excited about the bull trend resuming and similarly a move lower may get the bears excited. For me, until there is a move into the upper or lower green boxes on the chart, this is a neutral zone while the bulls and bears try to gain control. A move into the green boxes may start to give us some information of the next likely leg, until then, there is very little to take away.

How do I trade this then?

From a trend following perspective it is not a great environment to get onto a trend that continues, it is possible, the probabilities are just lower therefore I prefer not to take on new trend following positions. When I get a setup based on the same or similar principles of my trend following setups I may look to enter a position with different trade management. I look to get risk off quickly and may take half my position off if it goes in my favour and let the other half ride. Basically the same or similar entries, but with very different trade management.

P.S. I trade individual stocks and not the index. I use the S&P analysis for information to trade the stocks. At this time I think both longs and shorts can be taken although I am not taking any short positions.

Conclusion: I think that this is a neutral zone where the bulls and bears will try and gain control and until there is a move out of this area there is very little new information that we can take away. I still think that this is medium to long term bullish, but I will not trade that view and I will wait for confirmation to allocate capital. In the meantime I am looking for short term swings.

Hopefully the above helps you to further your trading. If you have any questions then please feel free to contact me on my FB page or email Miguel@TraderMig.com

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Good trading.

Miguel — TravelingTrendTrader

Email: Miguel@TraderMig.com

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