A lot of people got hit by this correction in the markets last week. In today’s update, I show from a Hawkeye perspective how to see and know when the markets are changing.
A sore subject
I know it’s a sore subject, but it always good to go back over and learn from the charts. Since I love the daily charts, it is my goto for reading the markets. However, the daily S&P e-mini (ES) didn’t show me any clear indication of a market correction. I had to dig down into the hourly chart to really see what was going on.
From the charts
From the hourly chart, I could see a real change in the character of the volume. Beginning Jun 2nd, and going until the correction started, selling volume spikes were predominant over buying spikes. When price finally failed to produce new highs on Jun 10, that was the sign of potential correction.
Then the majority of the correction occurred overnight, with extremely low volume. This is significant, in that, markets USUALLY don’t go down on low volume. This is not normal price action. We didn’t see it on the daily, but it was clear to see on the hourly.
The Hawkeye Perspective
The markets are fickle… they do what they want without the common courtesy of letting us know ahead of time. However, with the right tools (i.e. volume) you can find and prepare for these market changes, and even profit from them. Learn to trade the Hawkeye way.