9 Minute Read

Tackle Today: Implications of a Lower High

October 12, 2021

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Increasing Supply. ≈


Here’s a pro tip on chart reading: The relationship between the last two pivots will tell you more about the short-term trend direction and momentum than anything else. Whether they’re rising or falling will reveals who’s in control of the trend. September and October have lived up to their volatile reputation. If you haven’t noticed, the market’s trend structure has changed. Look at the last two pivot lows and pivot highs.

Late-day selling yesterday pulled SPY down nearly 0.75%, resulting in the second straight lower pivot high. As much as I want to be optimistic about a fourth-quarter rally and bullish finish to the year, I simply can’t. The technical don’t allow it – not yet, at least. So for optimism to flourish, we need to stop this depressing pattern of lower pivot highs and lows.

If you’re wondering what we mean when we say that “rallies are suspect” in a downtrend – look no further than the past four trading sessions. On Wednesday and Thursday last week, prices were ripping higher, making some wonder if that was the bottom. And then, on Friday and Monday, prices fell right back down – handily rejected at the 50-day moving average.

Based on the near-term performance, it looks like the market isn’t yet ready to depart Bear Country.


Chart of the Day

SPY Lower High

Another leg lower has begun, and another lower pivot high is in place. Credit goes to bears for maintaining their dominance. Now the question is where the next pivot low forms. Will it be higher, equal to, or lower than the previous one ($428)?

Video of the Day

Onboarding With Coach Frank

Each week Coach Frank walks new members and visitors to Tackle Trading through all of the features that Tackle Trading has to offer. Watch the video above if you want to check out last night’s onboarding session with Coach Frank.

Today’s line up

Traders Lounge 11 AM EST

Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.

Halftime Report 12:30 PM EST

The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day and fun in a way that only Matt and Tim can deliver.

Coaches Show 8:30 PM EST

Join us every Tuesday at 8:30 PM EST for the Coaches Show! Tonight Coach Gino and Greg will be hosting the event.

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