The Resistance of the 200 Day Moving Average – Trend Following
As I have said many times…The 200 Day Moving Average is the line of delineation of bears and bulls.
If the Nasdaq and SPY can get back above this level with some conviction & stay there there is a good chance we could be moving higher. Conversely, if not then lower prices are likely ahead. At this point I am at a wait and see…or wait and potential prove. Otherwise I could be catching a falling knife and this is not trend following…
From the low on Tuesday there have been three successive up days on lower volume each day. These are wedging rallies that are usually not successful. This pattern must be broken if there averages are to have any chance of moving higher.
Time will tell…but in order to succeed one needs a complete trading plan. This is why I teach trend following. It is never easy nor something simply learned over the weekend….