Inflection Point

This time, it’s the volume that’s important.

Most of the major indices finished higher today except for the miners, real estate and biotech.

The early session update said IYR, price action may be in a test of its up-thrust (reversal) from October 18th.

If that’s a valid assessment and it was a test, the volume is important.

Whether it’s an up-thrust or a spring, when the set-up gets tested, the volume gives additional clues.

What we’re looking for is when price action comes back to test, volume contracts.

If that happens, it means (with good probability) there’s no commitment to sustain prices at the test level.

Real Estate IYR, Daily

The real estate situation may be about to get interesting.

Volume contraction is near-textbook.

This is one of the rare times, there’s a high probability expectation; that is, IYR price action resumes its downtrend (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279