HomeOptionFlowOptionFlow-reportsSPY 1-18-16

If you followed my tweets on Friday; we calculated the bullish PRZ in advance of the pattern drawn on the 15min chart, which turned out to be the LOD by mid-day.

The low became the A point of a new AB=CD pattern on a 2min chart, and the subsequent high at 188.39 was just one penny below the D of the pattern.

Here’s the updated 15min chart :

spy-1-18-16-15min

In the last hour it pulled back far enough, in order to qualify a C point for a new potential XABCD, of which the AB=CD PRZ would start at 189.75. This is right inline with the 88.6%XA of the daily chart, see previous posts.

rounding this of to 190, and I think this will be an important level to watch.

looking at it a little more closely on a 5min chart, and we see our down risk is below 186.56. Which could start yet another significant move lower. remember though, that with each higher high, this yellow indicator will be -recalculated with a new point C, at the new high, and a new corresponding entry. This is where the calculator is  very useful. Let’s say Tomorrow morning opens up above the yellow C point, then all you need to do is edit it in the calculator and just change the C value and recalculate it. Many times I use the entry as a dynamic stop, on a trade of an opposite pattern.

spy-1-18-16-5min

One of our members @Yogibear135 also pointed out that Friday’s low was just above the 261.8%BC on the monthly chart. (the top of a previous PRZ).

Friday, as of the LOD we also saw call buying for this weeks expiration increase.

So conclusion : Likely to see a bounce, with an important level around 190. At that time we’ll look at the P/C ratio again. and if it can break through the PRZ and retrace further XA levels, or if it reverses, and a new pattern emerges.

Optionflow:

1-18-16-OF

1-18-16-OF-SPY

 

 


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