Seems pretty clear the DOW can move lower but the 33500 area is strong support. Im confident that if the right conditions persist, the 20 day cycle trough will be lower than that price by far.
Perhaps going into Wednesday, as I mentioned before, there will be a larger move through some of the August buying. This buying was too late.
for now this is an early short that may move back into the range towards the weekly pivot at 33900 if the market doesn’t have selling at the open.
IF it has selling, that will be reason to add to the position with the same stop that Im giving here.
Setup:
Go short whenever soon, at the market
stop above 33700
I think reasonable targets are 33400 and 33100
Add with selling at the open tomorrow
Getting to 32800 by Wednesday is possible
The risk should be equal to an average trade size due to the conflicting cyclical pressures and this trade using intuition more based on the psychology of the market participants on Monday.
Discretionary, but using the most math I think is sufficient for the trade location and size.
Alternatively, a larger stop can be taken to prevent transaction risk.
A larger target is the probable bottom of the 20 day cycle on down moves on Wednesday during market hours.
22aug22 1642 cst with the down move off the open, $YM proved that it was looking for lower prices as it created a 20 day cycle projection down much lower. The idea is to expect the hypothesis to play out when you see the volume, you have to go with it
22aug22 1230 cst CLosing the trade on this 33100 target is a good idea... on the $YM trade if it goes above 33175 Its not strongly down anymore