Hello Traders, hope you all are enjoying your weekend. I wanted to post the chart that I have been using for the past 2 trading days to maneuver myself and everybody in my chat room through the markets. I have studied channel trading for over 2 years and it is kind of a proprietary trading style that I have developed and use it with my trading strategies and patterns. When the 2 line up together on a technical basis inside a channel and a continuation pattern of the directional trend, it works out great. So Thursday was the day that actually allowed me to find the channel and then after seeing the lines respected by previous data and backtest of support holding from the breakout, it gave me more conviction that I can continue to watch these current channel lines.
Notice how on Friday once the market established a recognizable slanted range within out channels volume was coming in heavy near the lower channels( Buyers ) and selling from the top of the channel to the lower channel had light volume. Now recognizing that this is a bullish pattern( Falling Channel within an uptrend), I started telling everybody to start buying strong stocks or even the 3x long ETFs such as TNA. Notice on how the fuel bar that broke us through the top of the channel had some nice volume. We then pulled back slightly and then buyers came back in to confirm the close above the channel. We also had a successful backtest and hold from the top of the channel. Oh yea, the flag and channel breakout measure to a target of around 114.50 area if it plays out.. So that area is an area I will be focusing on for shorts if we continue to trade higher.
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