August 17, 2017

Short-Term High-Probability, Mean-Reversion Indicator – It’s Finally On!

Yesterday, I mentioned that EFA had moved into a short-term oversold state and that the RSI (2) for the ETF had pushed to slightly above 5. I warned that a potential trade was near. The catastrophic events in Japan over the weekend led to further declines today and pushed EFA into a short-term extreme with the RSI (2) hitting a low of 1.12 before coming back to close the day at 1.52. The gap lower today will close once the EFA hits $58.84. This will most likely be my exit point if indeed EFA moves higher over the next few days. As I write this the futures are significantly lower so we will see if we get stopped out first. Tomorrow should indeed be an interesting one. If you haven’t already, don’t forget to sign-up for my Free … [Read more...]