CME Stock Waiting For A Breakout
Anna Coulling | Nov 09, 2021 12:07AM ET
CME Group (NASDAQ:CME) is another stock that has very similar price characteristics to Ansys (NASDAQ:ANSS). CME has been waiting for a breakout through a price-based resistance area. For this stock, it was the $215 price region clearly visible with the red dashed line of the accumulation and distribution indicator for NinjaTrader.
The thickness of the line denotes the strength of the region and is calculated and delivered automatically and more importantly updated as levels are tested and held. Hence we have an instant visual picture of the strong and less strong regions of support and resistance from a price-based perspective. So a question of waiting and being patient, and in this case, the level was duly breached in the second half of October.
Once again it is Thursday’s volatility that catches the eye here but for a different reason. Clearly, the price action closed lower on the day, so the open was a gapped-up move but look at the volume. Would this have been enough to propel the price $10 higher at the start of trading? And the short answer is no.
There is also a saying in trading which is that gaps get closed, so it was no surprise to see the price fall back and close with a wide spread down candle on average volume. So here it was a trap move of a different kind – a trap to draw traders and investors in on a gapped up open on the expectation of higher prices to follow before reversing. These are all traps set by the market makers for the unwary and all revealed through the prism of volume price analysis.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.