The Dow has had a volatile 2018. It has formed a wedge, of which we successfully tested the bottom last week. Support held firm and a wave of buyers came in causing an aggressive reversal to the upside.
This week my trade plan is simple. Wait for price to come back down to 24,100 which is a combination of the weekly and monthly centrals, watch for a COT on the m15 and upon seeing this, get long quite aggressively especially if it’s sitting at this level on a particular NY open.
I will be targeting the top of the wedge at 24,400 for a 300 point trade. However, with the wedge tightening and global tensions easing, there is every possibility we see a breakout this week. Therefore, I will monitor closely and if price action is supportive I’ll implement a trailing stop, or alternatively I’ll close half the position and let the rest run, with a stop at breakeven.