Wednesday, January 6, 2016
The market was already heavy and reports of North Korea testing a hydrogen bomb are adding fuel to the fire this morning.
As we've seen many times during geopolitical events, the market tends to gravitate to and inflect at important technical levels.
One of those important levels is close by this morning...1960. A move to 1960 would also get the RSI level below 30 on the daily chart.
My feeling is that the reality of this North Korea situation will turn out to be less ominous as the information gets clearer.
I would take advantage of the support and the oversold condition and use 1960 - 1964 as a level to load up long for a trade.