The market tends to drift toward the downside after any big spike in volatility like what we saw on Monday last week. If and when the volatility index (VIX) dies down, the market will typically bounce right back. With the S&P 500 (ES), Nasdaq (NQ), and Dow Jones (YM) setting up with bullish daily squeezes, the path of least resistance is to the upside. All three major indices are setting up bullish, so there are three main components that we want to focus on when searching for high-probability setups.
We’ll be looking for a combination of three main things to make up a solid setup: trend, structure, and momentum. Watch the video above for a review of how to utilize these three components in your trading and a run-through of some good-looking setups like AAPL, FB, and GOOGL.
Stay Focused!