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Kevin Haggerty is a full-time professional trader who was head of trading for Fidelity Capital Markets for seven years. Would you like Kevin to alert you of opportunities in stocks, the SPYs, QQQQs (and more) for the next day's trading? Click here for a free one-week trial to Kevin Haggerty's Professional Trading Service or call 888-484-8220 ext. 1.

The SPX finished +1 point to 1447.99 on another narrow-range day of just 6.8 points, which follows 4.8 on Friday and 4.5 on Monday.  That is not trader-friendly travel range.  However, both the SPX and energy sectors were short-term overbought starting the week, and hit key price zones, so traders using the "Strategies" had a decent day.  For example, the SPX traded up to 1450.19 on the 9:50 AM bar, which is into the anticipated 1450-1455 key price zone, and this set up the RST short strategy with entry below 1449.57.  It traded down to 1443.40, which set up the RST buy strategy above 1444.28, or else the 1-2-3 Close entry that followed the entry above 1444.17.  This traded up to 1448.87 before closing at 1448.  Although it was only a 6.8 point daily range day, low to high, the very high probability RST strategy caught a travel range of 11.64 points, and after entry/exit levels, about 8.5-9 points were taken out of the "casino."  The key to having the confidence to enter these trades is anticipation of key price zones, so that you are ready to act if there is an intraday reversal strategy opportunity from the zones.  Many of the energy stocks had the same first hour reversal strategy and afternoon rally.  You can learn the RST strategy in the Sequence Trading Module, Trading with the Generals 2004, and as a 3-month member of the trading service.

NYSE volume was on the light side again at 1.47 billion shares.  The $INDU was up 4 points (+.04%) to 12666, while the QQQQ was -.02% 44.05.  The sector action was benign, with the TLT +0.6% leading the upside, while the SMH, after 5 straight up days, was -0.7%.  The volume ratio was still positive at 58 and breadth +893.  The 4 MA of the volume ratio is now 60 and breadth +675.  There has been no buying or selling pressure the past 3 days, and that is indicative of three small daily chart Doji bars.

The SPX/$INDU are making new cycle highs with negative weekly momentum and money flow divergences, so that is obviously a red-alert.  It certainly means there is no edge in longer-term positions right here.  However, with the SPX in a key price zone, daytraders continue to prosper long and short.

Have a good trading day,
Kevin Haggerty

Check out Kevin's strategies and more in the 1st Hour Reversals Module, Sequence Trading Module, Trading With The Generals 2004 and the 1-2-3 Trading Module.