Chart of the Day - Thursday, October 3rd, 2019

Today's Chart of the Day was shared on Twitter by Scott Redler (@RedDogT3). It's a daily candlestick chart of the S&P 500 ETF, $SPY. Scott uses this chart to highlight a "Red Dog Reversal" pattern. The first example is the candle from October 1st, where price broke out to a 4-day high but then quickly reversed lower. As you can see, this reversal was followed by a gap lower yesterday and a big red candle. The second example is from today's candle where price broke below yesterday's low of  $286.64, and the quickly reversed higher to reclaim the $286.64 level. Scott explains: "It caught shorts off guard that added, and longs that got stopped out. It creates a fast action area for tactical Cash Flow." It'll be interesting to see if today's reversal will follow through to the upside tomorrow.