After last week’s market today’s session was relatively quiet. Volume was well below average, but this story continues. The current trend is still prevailing and no matter how over bought this may seem we are not going to bail until our exit signals are hit. We are seeing more and more bullish setups and this is a positive sign. We do expect this market to retrace the big move off the February lows at some point and this is where we’ll know what this market is made of. Other signals will be whether or not these bullish setups hold. Read and react to the market. Stick with the trend.
There a few blemishes with this uptrend, but what uptrend doesn’t come with blemishes. V-shape moves are prone to failure and we have plenty of them. TSLA is such a v-shaped pattern nearly rebounding a 100 points from its February lows. Quite impressive move from 141 to 238. It would be quite normal had TSLA broke out from a sound base and continued to hit new highs. At the moment it is running into massive overhead resistance and will likely struggle. If TSLA is able to consolidate in a tight manner a breakout from a sound consolidation would be very bullish. For now, an impressive run even if the chart shows a big v-shaped move.
We are looking for a small consolidation period for this market, but given what we see there is reason to think this market can push higher. We are long and continue to manage our risk through position sizes and exits. No need to get too cute with this market. Stick with the trend until it ends.
