Cup with Handle or 1-2-3 Reversal

As September nears, we should all be asking the question:

Is the market headed for a reversal or an “up” trend continuation?

I don’t know nor does anyone else but what we can do is sit tight and get ready to trade the confirmation, whether it is up or down. A break of support is a signal to begin shorting the market. A move above resistance will be a signal to buy breakouts.

It’s that simple. See below for the three major indexes and their current support and resistant levels:


  1. Chris,

    I believe you use puts to short the market. When you use stops on put options, I realize that you are protected from major losses. The other question becomes volatility. Options are much more volatile. I guess you would respond and say stay in the game (by minimizing downside) until the trend moves to your favor (downard volatility) so you can make more on the trade when the market or stock reverses trend. A lot of psychology. Your thoughts appreciated.


  2. Nothing yet…still holding support…volatile Market it is…

  3. Looks like we had ourselves a cup and handle..

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