Analysis of stock market's Monday rally: Brooks

Brooks Price Action Analysis of Monday, July 1

pending chart 2185

Trend from the first bar bull, higher high major trend reversal, double top lower high major trend reversal, double bottom, double top, reversal day

  • Monday, July 1, 2013
  • Bar 1 - Yesterday had double top and double bottom, strong bull bias thru 7/5. 3t tail, but big body. Always in long, but probably pullback
  • Bar 2 - Bull body, always in long. Past 5 days = dojis on daily so might close near open of day again
  • Bar 3 - Trend from the first bar bull. 3rd consecutive bull body. Buyers at the low of week of the bar and probably scaling in lower, stop below 1. Bears should wait for second entry sell or strong bear breakout.
  • Bar 4 - Outside up bar breakout, probably measuring gap
  • Bar 6 - Two legged pullback in a bear move but 6 bars without bear body so buyers at the low of week of the bar and probably scaling in lower
  • Bar 7 - Another outside up bar breakout, but consecutive buy climax 1 5 so might soon get approx. Ten bar, two-legged correction sideways to down. Measuring gap or exhaustion gap
  • Bar 10 - Two bar revresal, wedge 2 6, but 1st bear body in 10 bars so probably buyers below. Consecutive buy climax so wait for two legged pullback in a bull move or possible triangle or wedge to buy or long. Bulls have stops below 4 or 7, but 7 low is target for bears, like 16 yesterday. Might enter trading range for hours, then trend resumption or trend reversal
  • Bar 12 - Probably sellers at the high of the bar and probably scaling in higher, but always in long
  • Bar 15 - Fail, failure bear breakout, always in long, but tight trading range likely so need swing stop below 4 or 6
  • Bar 17 - Double top 11, lower high major trend reversal, but tight trading range, lp, always in long. Better to not sell or short yet
  • Bar 19 - Double bottom 14, but tight trading range so swing or wait
  • [more Bar-by-Bar Analysis, Daily Webinar and Trading Course info at www.brookspriceaction.com and www.brookstradingcourse.com]
About the Author
Al Brooks

Al Brooks, M.D., is author of the Brooks Trading Course (27 hours of videos at BrooksTradingCourse.com), several books on Price action (Reading Price Charts Bar by Bar: The Technical Analysis of Price Action for the Serious Trader, Wiley, 2009, and the 500,000 word, three-book series, Trading Price Action, Wiley, 2012), and numerous articles in Futures Magazine. He also provides live intraday E-mini price action analysis and free end-of-day analysis on www.brookspriceaction.com.

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