how to play this suspicious pattern

[Penny Hawk] [TWO for the Price of One!]( Kenny Glick - aka the Warlock - is an expert in trading Volume-Weighted Average Price, or VWAP. Olivia Voz uses her Volume Profile Indicator to Kinetically Confirm the single best trades from the top trading minds every day. Now, for the FIRST TIME EVER you can add both Kenny and Voz's trading styles to your repertoire by getting two services for the price of one! [Click here to learn more](. --------------------------------------------------------------- Monday, June 27, 2022 How to play this suspicious pattern Dear Traders. We had a ton to cover this morning! We really had to blow through it, so let's cover some key points in case you missed any points today! Let's start off with some headline hits! When the pandemic portfolio first launched the most popular portfolio item by far was Chewy! It had a bit of an upgrade today. I normally don't like looking at things based off the analysts. When I do, it's because they are saying something a bit counter intuitive and they are representing an extreme. When we look at a market super cycle the end of it is typically a form of despair. Analysts have gone through the despair phase on chewy and we are starting to see people come back into the market. There has been 4 bullish upgrades on chewy in the past 3 months! Whats the deal here? We took our walk down Main Street and what did we see? The chewy boxes are still sitting out on the porches. People are still utilizing this companies services even though it's often in the discretionary category for your budgets. I mean c'mon does Fido really NEED to have his squeaker replaced for the 9th time this year? The markets seem to be saying yes! Chewy has climbed its way into one of the stocks that I'm willing to say I'm willing to play the upside momentum on even in today's bear market. How are we going to do that you might ask? We buy time and space! We have been slowing the markets down and making calculated plays for months now. Chewy is a prime example of that right now. Let's point a few things out on the chart so you know what I'm talking about. Youre going to continue to see some volatility as the markets continue to sell. Chewy is currently trading outside of the Bollinger bands and we are starting to see the 20-day make a sharp move up crossing over the 50-day creating a bit of a silver cross pattern. This represents a specific momentum shift in the stock that gives us an improved outlook for Chewy. In an unusual turn of events I'm actually aligning with the analysts on this one. There are plenty of ways to leverage this stock and many others like it. As a matter of fact I don't want you to have to do all this work on your own, I'm going to be speaking with my Night Traders on Chewy and exactly how we are going to slow the markets down and leverage this as a long term position. If you want to be a part of that conversation, [check out the best way to join so you don't miss yet another great counterintuitive play that had been bringing us gains left and right.]( Even though this had been a Trigger point for investors and analysts alike for the past few weeks we did have a question come in on the Dead Cat Bounce today. Given how the markets have been in a free fall recently this is EXTREAMLY important to understand. I want to paint a picture for you. It's Saturday morning and we are kids again. We are watching Wile E. Coyote trying to put together one of his schemes (you know the one where he is trying to get the road runner to fall off the cliff, again.) That's whats happening to us right now. If you have been watching the markets and using my techniques you havent been fooled and the coyote ran over the edge of the cliff and is bouncing off every rock on the way down praying that the next impact is the bottom. Its not! That is the idea of a dead cat bounce. The markets hit a false bottom where it finds support. Inexperienced investors will start buying in again being optimistic that they are buying off the floor of the market. They end up getting stuck buying a position that will inevitably continue to fall lower and crush their portfolio. I'd be remiss if I didn't share this image with you again. Although it's here for a good laugh, I think it adds a lot of value as well. Itll be hard to forget what a Dead Cat Bounce is after seeing it. How can you find the true bottom in our current markets? This is an interesting question and can be answered by the rule of 4's. The markets have cut Investors portfolios so deep this year that it starts to turn into a self-fulfilling prophecy. Just like the rest of us, they start to assume that these spikes in price are a Dead Cat Bounce so they are looking for the exit a little bit earlier each time. When this target gets hit the investors are getting out, that sell off has the market losing its support and starts its next nose dive into the abyss. We have seen multiple Dead Cat Bounces this year. The rallies have all come in multiples of 4. Is this a part of the market cycle that I'm always talking about? No, but when you watch the markets like I do you start to notice that, just live everything in life, the market comes up with these little patterns. They are not based off anything EXCEPT the technical analysis and investor sentiment. Whats the one thing you should be watching to turn this spiral into your edge? The 20-day 'trader trend line.' We have to be paying attention to where the investors start to get worried and we start to see that domino effect happen yet again before we truly hit out bottom. Your key take away here should be to hold you put positions or, add put exposure over the next few days. We know the direction the market is heading we may see the occasional hiccup in the form of more of these pesky dead cat bounces but, if we are following my rules they won't be a problem. The rules that I say could almost be in your daily affirmations: *inhale* bend don't break *exhale* *Inhale* trade in time and space *exhale* Okay, maybe not super catchy but you get the point. Live by these rules and follow my teachings and we can traverse this market all the way to the promise land. Talk soon, Chris Johnson Quantitative Specialist, Penny Hawk [Money Morning Red Alert] The best way to receive the most timely, actionable opportunities from Money Morning is by joining our text messaging service, Red Alert - free of charge. 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