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S&P Analysis Week of 11/29/2020: Post Turkey Week

S&P Analysis Week of 11/29/2020: Post Turkey Week

Now that a shortened Thanksgiving trading week is over, are markets ready to move?

As of this posting (with one more trading session in the Month), November has been a great month for bulls (10%+ returns) and even with a shortened week last week, the market still put in a nice 2.3% weekly gain.

In general, the S&P is very bullish . Look at the monthly, weekly, daily, 12 hour, 8 hour, etc. All the timeframes are technically very healthy. There is nothing wrong with any of these charts IMO.

The market has been 'creeping' up and always be weary of a 'creeping' market. After making new all time highs earlier in the month and being rejected, the market has been grinding back up consolidating to build energy.

When a professional robber wants to rob a store, they first hang out around the store. Is the market hanging out around an area they plan to breakthrough and rob? Or are they building energy to start a new leg down? Food for thought.

This week I've added three trade setups.

Trade Setup 1A: This is an aggressive entry but a valid entry. The reason it is aggressive is because all time highs is just above this area. However, I feel that price has been lingering in this area so long that any break above will most likely produce new all time highs.

Trade setup 1B: Less aggressive entry with less risk. Just wait for the break above all time highs (with retest). Simple and straight forward.

Trade setup 2: In case there is a breakdown during the week, this is a sell scenario. I did not place a sell scenario higher because of the bullish trend in the chart. The trend is your friend until it's not. Due to the weekly consolidation action, much of the space between trade setup 1 and 2 is No Man's Land (too much support too close to each other).

I use major support and resistance lines as my primary technical analysis . I avoid using other technical indicators or complicated chart patterns since they can give a lot of false signals. This has served me well by producing profitable entry and exit points.

Remember to NEVER play the breakouts (they are a losing man's trade) because they almost always result in a retrace to the last breakout/breakdown area. Wait for the retrace, retest and resumption off in the direction of your trade to take the entry. I like to use the 8 hour candle for trading and getting my entry signal.

"When it feels really right, it's probably wrong. And when it feels really wrong, it's probably right."

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