Studying the charts after a massive stock market drop is always fun. It brings excitement but more importantly opportunity. I always look at the three biggest time frames when looking for a major top or bottom in a stock or a market. In this case I am focussing on the S&P 500. I analyzed the three main chart time frames, the daily, weekly and monthly. The next step is to find a level that is significant on all three time frames. In other words, a pivot, moving average, trend line..ect, where the price is the same on each time frame.

I found it and it excites me because it shows exactly where to place my buy order for a bounce in the stock market. Find a great trade level is always exciting because it brings with it the likelihood of making thouands of Dollars in profit.

Analyzing the $SPY (S&P 500 ETF Chart)

1. Daily Chart: The daily 200 moving average is at $205.75

2. Weekly Chart: The weekly 50 moving average is at $205.50

3. Monthly Chart: The monthly 20 moving average is at $206.50

These three major moving averages are all within a point of each other. This gives a tight range of monster support on the SPY and a buy level for me. I will be buying the $SPY heavily when it gets to the average of these levels which is $205.90.

 

 

 

By Pro-Trader