POMO-licious!

So, we got a nice bounce to the 38.2% fib line - it’s possible that we push to the 50% but I’m seeing some divergences on the Lite. However, it is a POMO day and maybe they manage to bang the tape higher before the bell. BTW, the auction today yielded only a lousy $1.93 Billion - that’s chump change compared with the average amount they used to accept (i.e. $6 Billion - $7 Billion):

So, I’m getting very tempted here to plunk some cash into long term puts - this is why:

My count right now has us in a lower degree fourth wave. If this is X instead (i.e. Soylent Blue), then we know fairly quickly and while Mr. VIX is relatively low still. Technically I however see us retest the current highs in Minute {ii} of Minor 1 of Intermediate (1) of {3}. Boy - a lot of first waves in there, do we have a looong way to go - LOL But if you are conservative this might be your preferred opportunity to get exposed to the dark side.

So, it’s a matter of choice - if we bust higher here before the bell then I’d be happy to start backing up the truck. And if I’m wrong we should know in a fairly short order - meaning we run higher and breach into into Minuette (1) at 1074.31. BTW, the ole’ buck is hanging on to 75.87 thus far and it looks like it might be holding we might see 75.8 or lower. No guarantees guys - I can’t really tell you where/when we turn (if we do) - perhaps it’s best to place your bets around the bell.

3:33pm EDT: The NYSE A/D ratio peaked at 4.7 and is currently at 4.35 - a bit too strong for my taste - but let’s see where we close. The last time we got a snap back after a drop along with a strong reading was on 9/28. We then popped a little higher the next day along with a much lower (and divergent) reading, and then made new lows. So we might see a little follow up tomorrow morning and then a drop - OR - we are in blue and bust higher.

This entry was posted on Thursday, October 29th, 2009 at 2:36 pm and is filed under Elliott Wave Theory, Intraday Update, Trading. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

raised_by_wolves

Everyone was talking about a bear trap a day or two early. If yesterday had been a bounce instead of a breakdown, it wouldn't have counted as a bear trap. If what we have now is a bear trap (kinda looks like it to me), it was set yesterday when the damn $INDU rally trend line was broken.

defenderyou

Well today I made back what I lost yesterday - I might as well be indexed. Irony is my IRA was buy and hold and I bought some MTL at the lows and RSX as well early this morning and the IRA was up 6% while only losinhg 2% yesterday. Sometimes I think there is too much work involved in my style of trading. Nevertheless I guess we are now just as confused as we were last night. I know this is one of Mr. Cool's scenarios (second one I think from last night) but I sure would like to know if we are going to 1100 or 1300 or just to 1070 and then back down again, I look forward to Mr Cool's insights on this question later tonight.

molecool

¤ø„¸¸„ø¤º°¨¤ø„¸¸„ø¤º°¨
¨°º¤ø„¸ N E W „ø¤º°¨
¸„ø¤º°¨ P O S T ``°º¤ø„¸
¸„ø¤º°¨¤ø„¸¸„ø¤º°º¤ø„¸

gregn

Think it is worth mentioning the VIX buy (bullish) trigger was set today: http://screencast.com/t/GAqlcQV4ea

nyxjf

what time is lvs earning?

BloodWine

http://finance.yahoo.com/news/Las-Vegas-Sands-l...

nyxjf

page not found

BloodWine

Las Vegas Sands loses $123 million in 3rd qtr
Casino operator Las Vegas Sands loses $123 million in third quarter

By Oskar Garcia, Associated Press Writer
On 4:14 pm EDT, Thursday October 29, 2009
Buzz up! 0 Print.Companies:Las Vegas Sands Corp.
LAS VEGAS (AP) -- Casino operator Las Vegas Sands Corp. says it lost more in the third quarter this year as gambling markets struggled and the company pressed ahead on developing a resort in Singapore.

The Las Vegas-based company led by billionaire Sheldon Adelson said Thursday that it lost $123 million, or 19 cents per share, during the period that ended Sept. 30, compared with a loss of $32.2 million, or 9 cents per share, a year earlier.

Its revenue rose 3.2 percent to $1.14 billion, compared with $1.11 billion during the same quarter last year. But it fell shy of analysts' predictions of $1.17 billion.

Adelson said in a statement that the company was pleased with its performance in Macau, the Chinese gambling enclave where Sands owns three resorts.

nyxjf

Thanks man

BloodWine

http://finance.yahoo.com/news/Las-Vegas-Sands-C...

try that one... more detail there

Tronacate

Tempted to take a whack at the metals short.....anybody else?

defenderyou

Bought SMN

Eva S

I think the inverse ETFs are *done* for a while.

defenderyou

did not stay in long way mkt moved - took small loss

dreadwin

I watch AGQ and ZSL (2x silver long and short). The only thing that stops me is that last spring, silver rose with the dollar.

zstock, Pro Select!

Last day of the month, usually a down day?

elliott_surfs

since when did Steve "Green Chutes" Liesman become a bear?

Eva S

If I were him, I would change my name from "Lies"man to Goldman or Silverman or something like that....

Tronacate

Dollar heading up ah

Eva S

from CNN : Wall Street's best day in 3 months ends with the Dow surging 189 points, S&P gaining 2.2% and Nasdaq 1.8% higher on strong GDP data.

molecool

WOW - those are amazing stats - cough cough...

(was that enough sarcasm?)

Tronacate

RIMM didn't participate much in this rally........this baby can go WAY lower easy

molecool

Berk liked it too - I missed getting a fill by a few seconds. Perhaps I get a chance tomorrow.

Tronacate

Just a gut feeling RIMM and PALM are both being left behind........

zstock, Pro Select!

RIMM, major product launches next few months

Tronacate

No kidding?.....think people will ever tire of replacing their handhelds every few months?

zstock, Pro Select!

You could just say thank you, I don't quite understand your humor yet!
Product launches make stocks go higher--If you need an example Watch MSFT!

BloodWine

Mole,
There's an argument to be made that iv breeched i on the DOW.
What are your thoughts?

molecool

See latest thread.

Tronacate

Let's give DTG a big smooch...

Vardoger

Well I'm going to have a beer (or ten) and celebrate the last POMO. Don't bore me with talk of Ben still going to print or new intervention from the FED-- I've got a growler of some 8.6% pumpkin ale that doesn't give a shit. Go bucky go....

gregn

1061 reaffirmed as strong support as evident by EOD bounce to near HOD after coming close to res.

Tronacate

So cash fer clunkers saved the economy......amazing.....

BigHouse(Aka Mr Vix)

Vix down the shitter

gregn

The ole' aforementioned waning momentum from yesterdays chart.

dreadwin

Sold my other long (ERX). Currently no positions. I didn't see what I was expecting to see, and I'm going to trade my plan.

Hanuman

These POMOs are POMO-Granades.

anotherone

Just noticed that we retraced exactly 50% of the drop from Mon's high to yesterday's low on the SPY.

Eva S

A ton of oil / gas stocks went up today, e.g. CRR + 20%

Tronacate

Bought a boatload of SRS a bit ago.....we'll see how it plays out next week

tradejane

Me too. Not a boatload though, just a tea spoon. I can always add if it needs more sugar.

EWfan

from EW standpoint..do you think this was a wave 4 of 1 of primary 3? i know the S&P didnt hit 1074 (where wave 1 was) but i think the dow hit its wave 1..so the only rationale i can think of is that this is not a wave 4 and that we are still in a more complex extended wave 3..and this is only wave ii of that extended wave 3, thus, this correction can up even higher (hope not..looks like a ED and thus drop).. but it also suggests a bigger drop coming soon if not now..wave iii of 3 of 1 of primary 3..

Vardoger

I think this may be a iv of 1 but the 1 certainly isn't an Intermediate wave. For some perspective, Primary 1 took about 17 months, Primary 2 (assuming it's complete) took roughly 7 months. I'm unsure whether this would be considered a minute or minuette wave, maybe some of the more experienced EW guys can chime in on that for you.

EWfan

agree with the timeline, it will take more than 17 months to play out since wave 3 (primary or not) cannot be the shortest wave..i was just commenting that this upward movement today was another wave ii of an extended 3 we are seeing..rather than a iv..since if this was a wave iv, the Dow corrected a lot more and violated wave i territory..this suggests to me that wave 3 isnt done and there is a lot more to drop..

FWIW..purchased puts at 1062 ealier today..

Vardoger

VIX quick video-- Sonar Report from today.

http://www.youtube.com/watch?v=X7xtwMjTn44

gmak

Just got a little email from the FED. THey bought $18 bb
in MBS in the last week. Betcha a chunk of that was yesterday.

http://www.newyorkfed.org/markets/mbs/

Vardoger

Oct 30 08:30 Personal Income
Oct 30 08:30 Personal Spending
Oct 30 08:30 PCE Prices
Oct 30 08:30 Core PCE Prices
Oct 30 09:45 Chicago PMI
Oct 30 09:55 Mich Sentiment-Rev
Oct 30 10:00 Employment Cost Index

dreadwin

IYR fading now -- got stopped out of my DRN position.

Stainless_Steel_Hamster

you've got to love this game... not leting v down 10 points, gap up 10 points, intrday proding 10 points...

review all targets acordingly... unless nasdaq saves the day and we start with a gap down or a drop so sharp bulls will leave their balls up there...

Guest

roncofooddehydrator

Sitting at S2 on FAZ. If you wanted to play it for a daytrade, now would be the time, but I'm not willing...

nakedoptions

Looks like a good spot for reversal. I'll be very worried one or two boxes above.

http://www.screencast.com/t/4aqmc83uW
http://www.screencast.com/t/eEuUXFGyg
http://www.screencast.com/t/8VFaWOewO0Bb

molecool

Agreed - thanks for posting those P&F - love it. BTW, I like the price objective on the VIX - heheheeee

nakedoptions

5 minute ATR P&F is like a freakn ATM Machine trading EUR/USD lately

molecool

No shit - I'll check that out! I could use an ATM machine like that... :-)

What's the symbol in stockcharts - or are you using a local charting package?

nakedoptions

I use Euro Index ($XEU). The correlation is close enough but it takes a little practice to get the hang of it. EUR/USD usually overshoots but my stops are based on $XEU. The key is to wait until $XEU is within a few pips of filling the box above or below support/resistance so your loss is minimal. Also I use breakdown/outs using 1 minute ATR.

http://www.screencast.com/t/QqBjnIfp

gregn

Your name should be beareoptions -- a little play on words on a synonym.

Stainless_Steel_Hamster

I bear no ill feelings for such a joke bare of all humor...

dreadwin

IYR (41.51) coming close to the 50 MA (41.56)

PRSGuitars

Looks to me like a backtest, but at this point, I think we're all pretty much certain we're heading to new highs. Great. 1063+ and we're above yesterday's highs...ugh...

PRSGuitars

http://screencast.com/t/zgg42yhOn

PRSGuitars

Big volume on /dx (short /es here just to see if i can ride to 1057, 1055)

DesertEagle

That was a sweet bear trap set yesterday; a tantalizing honey pot, only to slam shut on your paw just as you went to reach for it. How silly of us to think we might actually correct. Goldman makes its year slicing our puts into thin ribbons with its demented steel blades.

raised_by_wolves

Exactly, the bear trap was set yesterday.

gregn

There were a lot of warnings going around that we were going to bounce. I know I posted that I expected a bounce -- I hope you didn't get burned.

raised_by_wolves

I'm not burned yet. I'm still green at the EOD. However, they can burn me tomorrow if equities gap up and $VIX gaps down.

AS2009

Greg - thoughts on X ? Anything else you are looking to short / go long ?

gregn

Yeah, X is definitely wants to fill that gap.

gregn

I am only short X and BIDU currently. Both positions are green presently. Entered X at 61.8 retrace of recent fall and its been downhill since then for X. I feel that it is going to fill that gap as X is pretty weak compared to SPX now. We had a rally to +2.6 when SPX was pretty low and it has had a reverse correlation since then.

DesertEagle

I did not get burned yesterday, but I am still holding onto puts. The gameplan is quite obviously to keep jerking you around until your puts are worthless...correct, rally, rinse repeat. Anybody who went short on a break of the 50 day got screwed, much like those who went short on the "head and shoulders" pattern in July. Flat out market manipulation, and if we actually lived in a democracy instead of a fascist country these thugs would have been thrown in Rikers Island years ago.

Eva S

I agree. I'm glad I stayed long & in cash and didn't jump on the inverse ETF train yesterday.

eards1

Hi mole,
this is my first time posting but i would just like to say that i'm a huge fan and greatly appreciate all the energy and effort you put into this blog. I look forward to reading your commentary everyday and this blog continues to be invaluable in helping me become a better trader.
Ass-kissing aside, i had an idea about a good way to hedge the time risk (decrease or sideways action in volatility) that comes with the otm long term-puts. Instead of just outright buying puts, maybe selling longer term out-of-the-money credit-call spreads and using the premium collected from the credit spreads to purchase out-of-the-money puts( kinda like a "breakout for free" strategy. Assuming the market rally halts around here, this strategy could greatly reduce the risk of sideways gyrations until primary 3 finally decides to kick off. Let me know what you think guys.

Eards

eards1

So for a specific example, lets say i want to buy some june '10 70 puts (which are going for around 1.25). Instead outright buying puts, i could sell a jun '10 call spread (e.g. sell 115 calls and buy 120 calls to collect around 1.35 premium). Your breakeven point will be 116.40 or so, and as long as spy stays below that before expiration, you are basically freerolling your otm puts. There def. could be more optimal call spreads that could be used and I'm going to continue to fiddle around with different spreads at different expirations.

Stainless_Steel_Hamster

how long have you been trading options? SELLING OPTIONS IS DANGEROUS if you're not fully aware of what you're doing

eards1

I agree that selling naked calls (or puts for that matter) is very dangerous, which is why i think selling a call spread would be much better in this case because it limits your risk.

Stainless_Steel_Hamster

nasdaq wise we have a WTF-WPD wave

if we can't boost it enough we'll bore you to death as the paint dries till EOD and futures are much easier to play with

BigHouse(Aka Mr Vix)

LVS coming down ...Glad i got those puts earlier

berkshire

It's partially about the $VIX. $VIX is down huge today, so long-term puts may be cheaper here due to IV than at the actual peak. Just depends... And as all of us bears know, we'd rather be early than late. If you're fully loaded, then you were damn sure early...

That was totally in response to ssh.

Skål!

Stainless_Steel_Hamster

why load up now? as per your charts we're iether going blue and chargin up ther will be cheaper OR per orange we'll return here soon enough with the dreaded blue out of the picture.

p.s. I'm fully loaded, maybe that's why I have this doubt

raised_by_wolves

Still yet once again, I concur with the rodent. Why buy now since blue has not been disconfirmed and may be confirmed tomorrow? Buy at C (blue scenario) or at {ii} (orange scenario).

P.S. I'm also fully loaded, but will be dropping everything I can sell for break even or a profit if blue gets confirmed tomorrow. Thank goodness I did most of my put option buying at the (intermediate) top.

Santinii

I'm sure others are seeing this, but so far the retrace on the IWM has been pitiful. It is stuck around the 23.6 fib. Would seem to suggest this is a w4.

gmak

I keep seeing this blaming of POMO for the market pop. Let me ask a simple question: Do you think $2 bb or $64 bb would have a greater impact on the market.

The first is about the POMO from today. The latter is the amount of MBS purchased by the FED in the week ending Oct 22. They did another purchase yesterday.

If you are going to trade based on the fact that there are no more POMO days, you may be surprised and relieved of your hard-earned lucre.

Cheers.