Stock index price action sees wedge top, reversal: Brooks

Price action and setup analysis

pending chart 2289

Trend from the first bar bull, wedge top, lower high major trend reversal

  • Thursday, August 22, 2013
  • Bar 1 - I have to leave early today. 81 might be pullback from 64. Possible low of the day but tails, middle of yesterday trading range. Probably buyers at the low of week of the bar and probably scaling in lower sellers at the high of the bar and probably scaling in higher. Wait
  • Bar 2 - Trend from the first bar bull, big bull bar, always in long, more up
  • Bar 6 - Three inside bars in a row so buyers at the low of week of the bar and probably scaling in lower sellers at the high of the bar and probably scaling in higher, but still always in long, swing stop below 2 or 1. Tight trading range no scalping with stops
  • Bar 10 - Breakout, more up
  • Bar 11 - Follow through, buyers at the low of week of the bar and probably scaling in lower, more up. Might go above 69 but stay below high of yesterday, then trading range
  • Bar 14 - Tight trading range, possible final flag test high of yesterday. Probably sellers at the high of the bar and probably scaling in higher
  • Bar 16 - Wedge top 3 10, test high of yesterday. Ok since two legs up likely. Possible high of the day, but probably will need major trend reversal after 10 bars, if so
  • Bar 17 - Probably always in short for at least approx. Ten bar, two-legged correction sideways to down. Possible high of the day
  • Bar 24 - Two legged pullback in a bull move moving average. Trading range likely but 4 consecutive bear bars so better to wait for second entry buy.
  • Bar 26 - Buy or long probabilities but at moving average and probably near bottom of trading range so buyers at the low of week of the bar and probably scaling in lower. Tight trading range likely, but should test 20 high for possible lower high major trend reversal
  • Bar 28 - Bull breakout, probably more up to 20 high area
  • [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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