Hope you’re enjoying Memorial Day.
Basically looking for some kind of ‘buy’ signal in the daily charts. It’s hard for me to believe that the bounce that began on Monday, May 21st is little more than a dead cat bounce, which I guess I’ve mentioned often enough before. However, if the daily charts continue to firm up, then this could lead to another rally leg. I don’t see this happening, but you have to go with the charts.
This chart below is a slightly altered chart of my 5/10 Method. The alterations include the addition of the 15 & 20 EMA’s and the Aroon. In the highlighted area on the chart, you can see where the 5EMA is skimming right across the tops of the candle bodies but that this EMA has not yet crossed up through the 10EMA, which it has to do to trigger the first part of a new ‘buy’ signal per this method. Next part of this signal would come with the 5EMA pushing on up through the next higher EMA and then the 20/20 Stochastic having a bullish cross. On the chart it does appear that if the 5EMA does cross up through the 10EMA then at about that same time the 20/20 Sto should also have a bullish cross. If any upward move is going to prove to be legitimate, then the +DI should rise up to and cross through the -DI line, but that might not happen until the end of the week.
And just remember this: Charts don’t make the market. The market makes the charts.
IOW’s, you can put trend lines, triangles, wedges, etc, criss crossing all over a chart but you cannot with certainty predict where the next candle will be formed. All you can do is make assumptions based on the recent behavior of the stock or index in question.
Be careful and good luck in the week ahead.