First, consider this chart of the VIX.
Notice the big spike upwards over the last few days. That tells us to expect more volatility. Now consider today's chart:
A.) Prices opened a bit higher then sold off into the 10 and 20 minute EMA. Prices rallied from this level to
B.) the 200 minute EMA. Prices couldn't make it through this number so they sold off to the 10 and 20 minute EMA. Then
C.) Prices moved lower, printing longer and stronger downward bars. This was followed by
D.) A double bottom from which prices rallied into the close.
However, notice all of the action we say in one trading session: a mini-rally, an accelerating sell-off followed by a bottom and then a move higher. That's why I brought up the VIX -- expect more of the same going forward.
