Let's Talk About Turnaround Tuesday

Another winner Editor's Note: Please enjoy this free case study from Jeff Cooper. [Company Logo] By Jeff Cooper This is what I posted on the Hit and Run Private Twitter feed Tuesday morning before the open. (you can join at the bottom of this email) [image] The SPX gapped up 70 points and struck a high. We used the opening up-spike by shorting AYX and then covering on the pullback. It is always a good idea to stalk a small handful of, say, 5 or 6 stocks for cash flow trades. This way, you learn their personality. Stocks have their own personalities -- just like people. It pays to stay well-acquainted with them Given the size of the opening gap, it is not surprising that the index triggered a downside ORB -- trade below the first half hour’s low. However, a test of session highs saw the SPX roll over to fill the gap and erase the day's gains. The reversal came shy of the idealized 2790 level. Tuesday’s high was 2757. To recap, 2790 is 3 full revs of 360 degrees up from the 2192 March 23 low. There were two ways to view the reversal: a sign of weakness or as a sign there is unfinished business to the topside. Remember, we have been reminding you that whipsaws are common within these types of countertrend moves. That’s my primary interpretation of the current pattern -- no matter how the precise waves are counted, this best shapes up as a countertrend move. But no matter where we go right now, when this A B C wave pattern completes, a strong downswing should be on the table. Remember that counting from the February 19 all-time high, the Gann 55 day Panic Window ends on April 15. So this is a time window to look for a trough of some sort. That means the next week should see downside pressure. That said, we have a little change in character as I write this a few hours before Wednesday’s open. Rather than getting hammered overnight following Turnaround Tuesday, the market is stable and relatively flat -- so far. The SPX rallied 40 points in 20 minutes, just shy to 2700, before getting slammed again. Conclusion. The normal expectation here would be for the open gap from Monday to be tested. The gap goes from 2538 to 2574. Gapfill is at 2488.65, Friday’s close. Offsetting the gap and sustaining below 2488 indicates the move to new lows is on the table. So if that gap gets tested, watch out! P.S. Want Analysis Like This 5 Days a Week Check out Jeff's new Hit and Run Trading bundle. Get his hardcover book, his video course, and more. You even get Jeff's Private Twitter feed: [Click to learn more ==>]( [Learn About the Bundle ==>]( [Disclosures]( [Unsubscribe]( [Unsubscribe]( T3 Professional, LLC 1 State St. Plaza New York City, New York 10004 United States