On the eve of the one year anniversary of the market bottom, it was only fitting to get some continued range extension to the upside.Market traded lower in the overnight session, we touch the 100% range extension on the short side in overnight. This is calculated by taking the high to low of the previous trading day to come up with these range extension support/resistance levels for the next day.
As soon as we touched the range extension which was double the range of yesterday, we saw immediate short covering and initial buying. In fact we rallied all the way up to the 100% range extension level on the long side. Two great low risk trade entries that worked quite well today!
We continue to build volume value higher today (bottom chart) and closed above both point of control and midpoint.
However we are approaching the January highs again, I would not be surprised to see a minor reaction at these levels maybe back down to 1126 or so again.
But once again not to sound like a broken record, the market is ultimately headed for 1230's, at least!
