Is it for real?

Markets have broken out to the upside, giving us a very strong lunar Green period.
We could see some more upside action early this week, but a lunar Red period is about to start, so it may not be a bad idea to take some profits.

Here is the chart for the Nasdaq (click for larger image):


The Nasdaq has reached our upside target of 3200, but I doubt we can go much higher.
My Earl momentum indicator is showing a bearish divergence with prices, so we are probably setting up for a pullback between now and the end of October.
A drop to 3000-3050 would then clear the ground for another rally into year-end.
A drop below 3000 would be a signal that it is time to exit this market, so I keep a stop-loss around that level.

Good luck, Danny

By Dan

Author of LunaticTrader and Reversal Levels method. Stock market forecasts based on proprietary indicators, seasonal patterns and moon cycles.

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