OTM Puts On Emotions

Quite some emotional tape today across the board. It’s times like these that usually prompt me to slow down a little, tilt my head sideways, and with a little smirk ask ‘really now’? If you remember yesterday’s musings on market weather and honeypot periods – well, case in point! Forget about Boehner, Obama, Reid, or whoever else they’re going to trot out today to induce another whipsaw. The gyrations you just have witnessed are nothing but engineered to drive you away, to get you out of the game, to press your buttons, and of course keep you from holding technically valid positions.

But I’m not going to sugarcoat it for you – we do have a bit of a mess going on right now. So let’s clean up, shall we? The technically valid setup on the E-Mini right now is to fade your emotions and be short with a stop above the line that has not yet been breached yet – that’s right the 100-day SMA. Nothing changes until that happens, no matter how scary those candles. Once we close above it then (and only then) will I take on long positions. Basta. (look it up)

Now for something completely different – I was digging into my stock arsenal and decided to put up two freebies that look promising. CCJ used to be one of my favorites back in the day when I was slinging a lot more symbols than today. I’d be long on a retest of the 25-day SMA. A bit tricky however as that one is still falling. So be disciplined. I would not chase it right now as the 100-hr BB has been breached and I’d prefer to see a bit of a shake out. Let the idiots chase that candle, thank you very much ;-)

And then there’s GOOG which just breached the Maginot Line after having painted an ominous outside period. Maybe it’s a last kiss goodbye – if she breaches back below then I’ll be short. Until that happens I’m Long John Silver. I also like that 25-day SMA on a collision course – we may kill both SMAs with one stone here.

Okay, one more since I’m in a feisty mood (blame the tape). Here is the 30-year which is looking very juicy right now. Obviously we are looking at a lot of support and I hope you took that inside day setup this morning. We’ve dropped a bit since and if you’re not long here yet then you may wait for a confident breach of the 25-hour SMA.

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This entry was posted on Wednesday, November 28th, 2012 at 1:56 pm. Both comments and pings are currently closed.


  • Joe_Jones

    This post made my day!! ;-)

  • http://dartht.blogspot.com/ Darth_Gerb

    I looked up Basta yesterday.
    (I am sooo ahead of the curve). ;-)

  • http://ibergamot.blogspot.com/ iBergamot

    Fantastic post, Mate !
    Speaking of moves ” engineered to drive you away” – Suppose you are a longer term trader, and you are long a bunch of staff since summer. You sit thru Sept and October, because it’s a consolidation and you are a trend-follower. Trend is up. Then November happens and o-shit – all kinds of support is taken out. Being a leveled-headed individual with 2 bear-markets in recent past, you say ” the music has stopped and there is only one chair left”. Next rally I will unload, go to cash, maybe go short.
    Well, this is it

  • AMCabrera

     Thank YOU MOLE!

  • itslance

    Yeah, I second that.  I was feeling a little lost in the tape.  Thanks mole.

  • AMCabrera

    It really is awesome. “Forget about Boehner, Obama, Reid, or whoever else they’re going to trot out today to induce another whipsaw. The gyrations you just have witnessed are nothing but engineered to drive you away, to get you out of the game, to press your buttons, and of course keep you from holding technically valid positions.” On point.

  • AcoBrasil

    “Chega” em portugues.

  • AmazingLarry

    Gingerbread lair, I picked the wrong do to stop huffing kerosene. 

    Watching the Russell to see if it can hold the 200, 25 break the resistance TL and hop above the 100 SMA. It’s like clubbin’ baby seals.

  • AcoBrasil

    Beyond all the political noise, they whipped it up right after a bad miss on new housing data. 

  • http://dartht.blogspot.com/ Darth_Gerb

    them Portuguese must be really bad ass to carve out a niche of the spanish penisula. Si? and then sail the world.

  • amokta

    This is what? – are you short/cash now, or waiting for putative rally first?

  • http://dartht.blogspot.com/ Darth_Gerb

    /ES 1401 – price is stuck in the BB(25,2.0) like a damn sausage casing.

    http://static2.businessinsider.com/image/4ce59b21ccd1d58533010000/sausage-casing.jpg

  • http://ibergamot.blogspot.com/ iBergamot

     Have a little short, still have a bunch of longs.
    As for cash, will have to see what will be stopped out by the end of day.
    Sold SIL and CG yesterday.
    The difficulty of this moment in this context is: even if I stop out, I must be willing to buy it right back.
    Welcome to Whipsaw Valley, USA

  • itslance

    H&S pattern and VIX creeping up.  Hopefully this is the LKGB.

  • amokta

    Yes, best to be nimble right now
    We live in undulating times :-)

  • Pervergence

    Closed out my GC short awhile ago……now long……

  • Skynard

    Thanks Mole, lines up very well with the div going on the 5 min panel:)

  • Pervergence

    eyeing a nice bounce off the 25day sma

  • BobbyLow

    On the topic of emotion, there is one thing that I should have learned many years ago and that is:

    “The stock market is never obvious. It is designed to fool most of the people most of the time.” 

    Jesse Livermore

    And this was happening long before there were computers.    

  • http://dartht.blogspot.com/ Darth_Gerb

    bah! computers (have been) around since the mid 17th century!

    http://en.wikipedia.org/wiki/Human_computer

    edit: Jesse probably had a few in the room with him. though paranoid, maybe not!

  • http://evilspeculator.com molecool

    Classic.

  • Joe_Jones

    Jeez, that should have been my entry. Oh well. :(

  • http://dartht.blogspot.com/ Darth_Gerb

    I’m just glad you closed your shorts (how many hours ago?).
    aye-caramba!

  • ronebadger

    “Probably not a trend day”

  • http://dartht.blogspot.com/ Darth_Gerb

    oh, that will get you banned for sure.

  • Joe_Jones

    I close them at the volume hole this a.m, but then reloaded further up. I just got stopped. F!

  • http://dartht.blogspot.com/ Darth_Gerb

    ouch.

  • Joe_Jones

    You win some, you lose some. That’s part of the game. Today’s tape is brutal though.

  • Skynard

    Out of /ES, 23 pts.

  • http://dartht.blogspot.com/ Darth_Gerb

    Holy Mother of Santa Maria Dominaca

  • Skynard

    SPX want’s a new high now, if so will wait for another set up tonight:)

  • itslance

    I wish I would have just stayed in my longs yesterday.  Would have saved me a lot of headaches, grief and money. :(

  • Joe_Jones

    reloading 1/3 position short

  • BobbyLow

    You still “Da Man”  Skynard.  

    Congrats

  • http://dartht.blogspot.com/ Darth_Gerb

    what is your secret to sitting on 23pts!?

  • ridingwaves

    damn mercury retrograde started Nov. 6th and begins to wane on Nov. 26th……no wonder were jumping all over the place…

  • AMCabrera

    Nope staying cool and taking it down.

  • http://dartht.blogspot.com/ Darth_Gerb

    *Market close soon, look sharp*

  • Joe_Jones

    make that 2/3

  • Skynard

    SPY 136 calls, will dump tomorrow. Only 53% profit right now, should gap up heavily:)

  • itslance

    Why are you short again?  We got a breach of the 100 day SMA?  Just trying to understand your thinking

  • Skynard

    Bought on a triple ZL div and only briefly dipped below the signal line. The rest of the day remained above the signal line.

  • ridingwaves

    nice mm/hedgy rotation into bio sector today….
    and this is more likely the culprit in todays craziness

    The Volcker Rule won’t be completed by the end of the year as previously scheduled but instead will be pushed into the first quarter of next year, CNBC reported citing sources. The rule bans banks from proprietary trading but has proven difficult for regulators to define.

  • Joe_Jones

    we have negative div on 60 min and 5 min zero, and we still finished the day at the 100 D SMA on SPX. Yes we have a breach, but it’s a tiny one. If we keep going higher tomorrow, I’ll dump the shorts and flip to long. When everything looks bullish, I tend to be suspicious as the market loves to F 95% of us.

  • AMCabrera

    85.897…ok Ill give myself 30 more pips.

  • http://dartht.blogspot.com/ Darth_Gerb

    I’m curious to see what the BPSPX is later today.
    it was pointing up last I looked.

  • itslance

    Oh I see.  Thank you for the detailed response!  It really helps me to understand and become a better trader.  I really appreciate it! :)

  • Joe_Jones

    And I’m curious to see CPCE data

  • Joe_Jones

    I think the overnight action will give us an indication of where this thing is heading next, unless we just stop at the 100 d sma. 

  • http://evilspeculator.com molecool

    We’re getting a video – stand by.

  • ronebadger

    NICE!  Smelled like a video-day

  • Turps

    never even got to look at the Zero today……. dammit. Born to trade forced to work

  • http://evilspeculator.com molecool

    Shame on you! :-P

  • http://dartht.blogspot.com/ Darth_Gerb
  • http://evilspeculator.com 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„¸





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