SHOGUN TRADING STRATEGY
DAILY ANALYSIS FOR 04/10/06

(Use this chart and commentary to plan your trades. The goal is to trade with the market, never against it. This chart will show our expectation, projection and commentary. This is a very important tool for you.)

SHORT TERM ANALYSIS

The market gapped up in an exhaustion gap, move ran out of steam, and then pulled back as expected.

LONG TERM ANALYSIS

The market is forming a new up trending channel. Not much momentum, not a monster trend, but it is climbing up.

TRADING CONDITIONS

As we talked about on Friday, the 1750 proved to be mighty resistance for the NDX on Friday. It gapped up in what we call and exhaustion gap and then pulled back.

Exhaustion happens right at the end of a trend, people get so excited about a trend, make the market gap right at the wrong time. These are usually desperate people or amateurs that are afraid they will miss the trend, so they jump on it late. For those that follow candle stick patterns, this can also be called a shooting star or a reversal candle for most.

The market is still in an up trending channel, as you can see by the chart above. It is normal for it to bounce back and forth between support and resistance. As long as we stay within this channel, the long term trend is still an up trend.

Hope this helps,

Shay Horowitz - ShogunTrading