past posts, i of the key tasks of the intraday stock index trader is to identify, equally early on equally possible inward the trading day, when we're facing a trend day versus a range day. What makes this chore peculiarly challenging is that make days tin plow into tendency days (breakout trades) as well as tendency days tin morph into make ones (reversal trades).
One of the tells nosotros oft encounter when tendency days revert to ranges is the erstwhile transition pattern. Note how nosotros made a momentum high (solid upside volume) inward the ES futures earlier eleven AM CT, as well as then saw an extended dip, followed yesteryear a marginal novel toll high approximately 12 Noon CT. That 2nd toll high saw lower volume, lower book lifting offers, as well as was non confirmed yesteryear the NQ futures as well as yesteryear the XLE as well as XLB sectors.
Off that weaker high, sellers were emboldened as well as nosotros retraced a expert constituent of the day's gain earlier bouncing belatedly inward the session as well as closing within the morning time range.
That transition sequence is i that shows upward across multiple timeframes.
I encounter that Henry Carstens has been tweeting his trend indicator, non solely for the S&P 500 Index, exactly too for ix S&P 500 sectors. Interestingly, when the marketplace was topping out today, solely four of the nine sectors were showing tendency readings greater than 60%. That suggested that the rally may non bring been equally vigorous equally it initially appeared. It volition locomote tracking the sector tendency readings equally good equally the overall reading for the index to encounter if the indicator provides an border inward distinguishing reversal days from trending ones.
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