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Confessions Of A Swing Trader
241

Confessions Of A Swing Trader

by The MoleMarch 5, 2009

UPDATE 12:48pm EST: So, you want to be a swing trader, ey? All ready to go with you fancy TOS account and your Prophet charts. Well, let’s get to it:

  • Step 1: Turn off CNBC.
  • Step 2: Pull up the chart above.
  • Step 3: Draw a channel, and set the center line.
  • Step 4: Go long at the lower boundary, go short at the upper boundary. If you want to get really down and dirty you can even play the 50% line as highlighted.
  • Step 5: Profit!

Seriously – this channel is almost magical. Let’s say the center line gets breached – just set a tight stop and then get back in at the top boundary.

Yeah yeah – I know – at some point we’ll breach it and rally up hard. But until that happens swing traders should take notice. Mabye also watch the Zero for momentum changes.

Bummer I’m not a swing trader – not my cup of tea. But that doesn’t mean you swinging rats shouldn’t bank coin.

UPDATE 1:08pm EST: I am looking at the Yen and am surprised at its continued slide to the downside.

Based on what I see there is another possibility to count the tape of the last year. Any [intelligent] input would be welcome – I remember someone here is actually doing an EWT count on the Yen but I never had a chance to check it out.

We could put in at least an interim bottom here soon however – the Yen is massively oversold at this point. Even if we continue our drop we should see a day or two of consolidation to sweep some of the stops.

UPDATE 2:19pm EST: ES is re-testing S1 right now – I don’t sense much strength. Perhaps we’ll get some PPT buying around 3:30pm  – otherwise I expect to see further drip drip drip. The road to hell is long and painful – and paved with good intentions.


About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.
  • JWBlack

    I wish we could talk more openly about the Zero so that we can exchange ideas about how to read what is going on right now.

  • http://www.shadestrades.wordpress.com shadestrades

    EVIL!! I love your latest post. I’ve been trying to find channels on stocks and indices all day. Thanks for making me think I’m not completely crazy.

  • dust13

    AEM still looks juicy, and puts are still cheap. Not to mention a nice gap around 31. May 35 puts look like easy money. Buy and forget like Mole's June SPY puts way back when

  • jabber

    Nasdaq is close to breaching its Nov 21 low (finally.) I have theorized that this could be the end of Wave 3, so keep an eye on the COMP as it breaks 1300 and heads for 1295.

  • PCap

    Jabber, I'm in agreement that the Nasdaq getting to the NOV 21 lows might cause a decent sized bounce.

  • Vardoger

    scalper's delight

  • Chrys

    A separate blog for subscribers would be nice with Mole's running commentary. Mole needs an assistant. Who volunteers?

  • Lordted

    Simple chart well explained Moley

  • stxinon

    Else I say with over head supply and a expected rally go for selling VIX May puts….. May be tomorrow
    a large drop till 624 on S&P can be expected with overhead supply of trapped bulls in 850 range….
    right now VIX APRIL puts @VIX 50 are 8 and calls are trading @ 3
    meaning ::: CBOE guys are expecting a supermassive rally /flat market… after a crash…..

    I am selling a butterflies on all 3 months on VIX …. (Humble and safe trade..)

    remember everyone has a stop loss……..
    even numb headed bulls and pigs and bears…..
    I say VIX butterfly is safe and small profit trade now…..

  • Trader Jose

    Agree … a separate blog for subscribers.

  • gagelle

    I know someone who made over 200k swing trading FXI and FXP last year. He showed what he was doing and it looked very simple.

  • http://www.shadestrades.blogspot.com shadestrades

    Just something to consider before going balls to the wall on puts for the miners.

    http://shadestrades.wordpress.com/2009/03/05/ta

  • OJuice

    Mole, your insightful posts are always an enjoyable read. Your diligent work is appreciated.
    Don't let them get you down.

  • Lordted

    Big surge there – someone or something on TV over there?

  • amgrant

    It's quite amazing how much money you can make by keeping things simple. My trading is utterly simple but it took me years to go from thinking I needed something really complicated to what I have now.

  • molecool

    Keirsten – I sent you an email.

  • jabber

    No, just Barney Frank.

  • BalaB

    Mole:
    NQ RL Levels are leading the way (being respected) over the ES

  • hindawg

    Mole have you looked at the waves in XLF. They appear to be overlapping w/ + divergance. If this is an ED the shorts will have a nice suprise soon.

  • http://www.twitter.com/TraderTamas TraderTamas

    I know… I mostly just trade FAZ FAS and SPY puts

  • Tecla

    Inverse H&S on SPX looks to target 696ish.

    They've been oh so reliable tho.. we shall see

  • katzo7

    A spike to scare out weak hands?

  • Bruce

    On a macro basis, which I doubt you would care about, the yen is under pressure because the Euro is getting and will continue to get trashed. Eastern Europe is in the trash and the exposure to European banks is huge, and the possibility of a cascading failure in Europe is very real thus the euro goes to parity or below.
    This will raise the cost of Japan’s exports to Europe thus pressure will continue on the Yen.

  • Pheesh

    nibbling at some front month OTM lottery puts on BGZ/ TZA/ ERY EOD, will nibble some more Friday going into the close or if we gap down from the jobs report. These 3x funds collapse very quickly due to compounding, and the put prices are a bit better than FAZ or SKF imo. Beware that they do not have much liquidity however.

    I have more confidence in sectors outside of financials rallying since the GE disintegration is ongoing.

    The reason for my timing is simply that this Fridays job report this week has been a cloud hanging over the market. The buyers are kept in check to some degree because of fear of how bad it will be. Once that is out of the way there is less uncertainty in the buying. Still a lot of uncertainty of course… but it would be reduced short term. Also there is a great possibility of some gubment intervention or policy announcement this weekend, so it will offer a little protection to my shorts I continue to hold.

  • Joe8888

    we just hit the 20 ma .on the SPY 10 minute,,,

    now lets see if we just seloff

  • katzo7

    Tamas, you buying FAZ puts yet?

  • katzo7

    Looks down to me.

  • http://www.shadestrades.blogspot.com shadestrades

    Where's the channel for that Yen chart?

  • moneyfarm

    Anyone looking to short GLD here? I'm looking to add to my DZZ position at GLD 920.

  • http://www.oxyinvestor.com oxyinvestor

    Who will replace C in the Dow-30 ?

    http://www.oxyinvestor.com/2009/03/replacement-

  • Red

    good post, i've had a similar thought process recently … we'll see

  • TomOfTheNorth

    It's an evil speculator 'evil omen' hat trick: CNBC camera has shown Dow Ind @ 6666.6 three times today

    (yep, I watch cnbc)

  • http://centrifugaldeforest.blogspot.com/ Centrifugal_Deforest

    Roger that. 50-day is currently 50.90 and the 200-day 51.48; both reasonable entries w stop > 200-day on closing basis.

    One caveat, today is the first day since gold turned lower that they are rallying nicely w the broad mkt in clear decline. I'd like that trend to stay at 1-day (meaning no trend). When this group is declining in a down market, then I know I am in the right place; and it is pretty clear they are not acting great when the mkt rallies.

    Rock on!

  • http://centrifugaldeforest.blogspot.com/ Centrifugal_Deforest

    You have my vote 😉

  • Trader Jose

    Re Yen … FXY has support at the 100.08 level dating back to March of '08 and bounced off that yesterday.

    If it holds the next resistance is 102 (10 DMA) and then 105ish. If it breaks next support appears to be at 96.

  • Red

    circular logic

  • http://www.twitter.com/TraderTamas TraderTamas

    not yet

  • Keirsten

    I think the bigger question is: why hasn't that committee removed these losers sooner and why. Another thing that just chaps my hide.

  • Vendrell

    If we are in 5 of 3 of 5, I count 4 completed subwaves since yesterday's top.

    i taking us from 723 to 692ish (this morning)
    ii taking us from 692 to 703
    iii taking us from 703 to 684
    iv from 684 to 692
    v from 692 to ???
    Is it possible the entire 5 of 3 of 5 finishes today? I expected it to take at least 1.5-2 days. Perhaps I'm off on the count and we've only just completed waves i and ii?

  • MyLifeMyTrade

    New lows coming to XLF in next half hour

  • moneyfarm

    BK looks to be on verge of major breakdown IMHO. I have March 22.50 puts on this. Needs to play some catch up with the other banks. Sorry, can't post chart as I'm at work.

    SRCL in a decent channel. Shorted at the top of channel this AM at 48.90.

  • Keirsten

    67.15 is the .786 Fib level tracking the bottom to top from '94 low to the peak in '07 for SPY for anyone watching.

  • amgrant

    Back in the day, the rule was as soon as a stock fell below $1 it was removed.

  • slade

    go to “askresearch.com” go to the daily chart page fill in symbol,time frame and ************************check linear regresession box.
    That will give you a chart with all 3 lines
    ……Very good free site if your following
    channels
    Slade

  • standard_and_poor

    Taking 10% more of shorts off table here.

  • papiunc

    Mole, although the YEN is ridiculously oversold, that won't necessarily stop the water-fall. Ever since the YEN really started to decouple from ES as you noted a few weeks back, I've been uber-bearish on the currency. Any notions of Japan as a SafeHaven are absurd as Japan's already got GD #s, the carry trade unwind is largely through, and Japan's CB is sweating balls trying to cut its exchange value to stop the bleeding.

    In sum, the Yen as a risk aversion gauge is meaningless moving forward IMHO.

    BTW, Thanks for all your great work!

  • FlyingBoat

    Thanks for the channels Mole. Based on the channels I am setting limits to cover 15% of shorts at 68.05 and another 25% to cover at 67.8 today. We'll see if it hits it today.

  • J-So

    I believe SKF is the lead candidate.

  • Vardoger

    I'm going to put a leg in long when the nasdaq hits 1295 but I'm concerned this {ii} as well. I looks like {iv} on a 5 minute but not so much on the 15 min. Keeping it small and buying ITM erx and sso calls.

  • http://greedangerignorance.blogspot.com Deej

    Mole, I think when UUP will touch 27, yen will pick up its speed. I think dollar is in wave 5 upwards right now. everything will align beautifully. i.e. spx below 650, eur/usd at 1.23, xlf at 4.4, dji below 6000. HAHAHA. I am evil now. evil speculation has converted me into evil at last. congratulations.

  • MaxPainMan

    I think today has 3:30pm PPT action written all over it……..

  • Red

    agreed, that correlation has cracked, japan now = risk

  • MyLifeMyTrade

    Third time lukcy – another attempt to take off from the 684 region

  • Rhett

    weekly target1: 640-630
    target2 : ~600

    http://screencast.com/t/qkkVZgLAk

  • standard_and_poor

    BIDU is up 3.5% in spite of……

  • MyLifeMyTrade

    They are supporting the market in 684 region. PPT action sure to come later this afternoon… Watch for bear-flogging rally in last hour.

  • DoubleNaughtSpy

    Its not in the DJIA's best interest to replace the stocks under 10 (like they are supposed to do). Since each stock is equally weighted if GE goes to zero it will not have as much effect on the average as WMT going to zero. In other words they are artificially propping up the DJIA. If they actually do re-balance the DJIA we could see a massive sell off soon thereafter IMO.

  • http://www.tradingsign.com/ T. Waffle

    it will fail.

  • MyLifeMyTrade

    IMO we rally big from the SPX lows of the day which are being probed right now.

  • molecool

    I agree – things are starting to align nicely. Welcome to the evil side.

  • molecool

    Well, they were so desperate to get their weak Yen back. Always be careful what you wish for – LOL.

  • http://centrifugaldeforest.blogspot.com/ Centrifugal_Deforest

    I guess there is no inverse-etf for the GDX-miners..?
    …can't short on MarketGuru

  • jigdaddy

    i think this PPT wants this market to play out the way it should be…

  • MaxPainMan

    deep OTM calls on SKF looking like a tasty short pretty soon…

  • http://centrifugaldeforest.blogspot.com/ Centrifugal_Deforest

    Agree. SKF and FAZ players should look at last November on the charts. They can rise further higher, but when they stop after a huge upswing, that is when the bleed occurs (they drop much worse than the underlying index is gaining).

  • http://tradingsigns.blogspot.com/ T. Waffle

    Can I come to the Evil side?

  • Yux

    Horizon has a double short version based on S&P/TSX traded on Toronto. Think it is HGD. Don't think it works on MG though.

  • molecool

    You keep posting this stuff for weeks now – what are you basing this on?

  • alphahorn

    100

  • Red

    heh seriously

  • molecool

    That line was breached a few days ago – observe:

    http://screencast.com/t/oKEP99s0q3G

  • molecool

    That's my kind of tape :-)

  • Henny

    Anyone like a rebound in SO back to mid/upper 30's once we get rolling into the wave 4?…

    Aug 30 C @ 1.30 – might start an accumulation

    Thoughts?

  • Vardoger

    XOM bounced hard off that 62.50 fib and took the market with it. If it breaks 62.50 with conviction and COMP breaks 1295 its lights out

  • standard_and_poor

    Closing out 20% more of shorts, waiting for 668.25 for today or tomorrow.

  • http://evilspeculator.com molecool

    Keirsten – the emperor is not wearing any clothes and people are refusing to accept reality. As long as everyone pretends they believe they can stave off a the inevitable.

  • Red

    and here we are back at yesterday's open

  • http://www.twitter.com/TraderTamas TraderTamas

    I will stay short.

  • ZigZag

    Beers on you! Very nice Alpha…

  • HardTimes

    That's why I'm debating using a trailing stop as we get closer to the target. It's almost impossible to react quickly enough when these start back down… The trouble is they move so much it's easy to get stopped out, so you have to use a loose stop which is probably fine toward the end of the parabolic move but not when it's getting started…

  • BalaB

    A/D is horrendous

  • katzo7

    Spot on guy. YOU close to dumping?

  • http://www.tradingsign.com/ T. Waffle

    I posted this in the morning. enjoy……

    if NQ breaks 1080, the next support is 1055
    If /ES breaks 695 we will test 682

    /ES is at my targeted support 1 if this holds we can rally back up.

  • BalaB

    How's it hanging Red….

  • Red

    you have more conviction on your daily flip flops than i have had in years …

  • kzhat

    Agree, I think we hold these lows, 681.5 was breached, but only for a moment and on low volume. There is a spike of buying now moving us up and I think we chop, then run at the close. Big money coming in to buy this this up. That is my take, if we breach back through 681.5 with conviction, look out below.

    And yes, my money is where my mouth is. Currently I have puts on SKF and am long /ES. I will cut and run if we can break 681 with conviction.

  • http://www.triathlontrading.com TriathlonTrader

    GO BEARS!!!

  • jacksoo

    you think 682 is all she wrote for today T?

  • Red

    you have more conviction on your daily flip flops than i have had in years … whether that is good or bad i'll leave up to you

  • http://tradingsigns.blogspot.com/ T. Waffle

    if we break that next stop on is /ES S3 668.17

  • Yux

    Horizon has a double short version based on S&P/TSX traded on Toronto. Think it is HGD. Don't think it works on MG though.

  • Yux

    misplaced comment for centrifugal (look below)

  • Red

    not too bad, was able to oppress a proletariat this morning so that was nice.

    then i got spanked trying to pick a bottom on FAS … that wasnt as nice

  • jacksoo

    yeah – i think we might see some off loading end of day, pattern we’ve seen a few times. people expecting ppt might be surprised this time – – i think the administration, fed and wall st need this mkt to find its bottom or it’ll languish for years – find the bottom, secure confidence, get people deploying capital again.

  • MaxPainMan

    yeah… this thing could easily hit 350

  • Vardoger

    FWIW- I have support at 673 and the bottom of a channel as well. Thanks for the targets T and congrats on the job

  • http://www.ryanbarr.com/ Covered

    681.5 was the low from a few days ago… draw a line with a crayon. If we breach with conviction, its going to be ugly. My bias is that we hold, retracements, pivots, and a bunch of other tools give a slew of numbers to look at for support. My reason here is purely market emotions. I think people are burnt out with the slow burn.

    Buying activity is very strong around the bottom, and the volumes seem to taper off going into the lows.

    I’m watching the tape closely and its looking weak, but I don’t see enough weakness for a full breach. If we do, I’ll flip over like a fish to get very short, very quickly.

    685 and 689 are important levels to get above and hold.

  • Vendrell

    Reminded me of that SNL skit…”DA BEARS”

  • http://www.triathlontrading.com TriathlonTrader

    Reminds me of the Cal football games I go to.

  • standard_and_poor

    SLV AT 38.2 FIB. RETRACEMENT, starting to look at puts.

  • jabber

    Gold has the exact same type of channel on its 1 hour chart that the SPX has had before. Good time to short gold right here.

  • BigHouse(Aka Mr Vix)

    I'm waiting until it fills the gap 13.50

  • BalaB

    Take it easy with the lingo. Okay “College boy”. Proletariat – I had
    to look that one up.

    : )

  • http://www.mylifemytrade.com MyLifeMyTrade

    volume and price action… along with demand and supply in the active trader screen on ToS

  • http://tradingsigns.blogspot.com/ T. Waffle

    Thanks Var,

    I think we will see light volume right now but after 3:00 we will see some fire works.

  • TraderJoe

    Or it could be a decisive break?

  • http://www.facebook.com/screasy v8muscle

    wow xlf is down big. I knew i shoulda picked up those 150 FAZ March calls when they were a buck a peice… damn!

  • de3600

    lol cramer does not see a bottom in time to go long :)

  • TraderTamas

    Well you keep getting it wrong so maybe you should get a new strategy.

  • de3600

    Long anr stop 15.50

  • BigHouse(Aka Mr Vix)

    I cant stop laughing at this drip action. WOW

  • J-So

    Great job Waffle.

  • http://alphahorntrading.blogspot.com/ alphahorn

    Death first!!!!

  • http://centrifugaldeforest.blogspot.com/ Centrifugal_Deforest

    Ok, I posted a slight summary on this
    Warning to SKF, FAZ and BGZ Players
    (input/criticisms welcomed)
    http://tinyurl.com/2yhvfb

  • jabber

    What do you mean, that Gold is going back to 1007? Nah, I doubt that, I think gold will be at 750 by April.

  • MyLifeMyTrade

    I do keep getting it wrong.. The massive whipsaw has saved my ass in the past few days… Not so today… It is trending down…. I got to adapt quickly

    ________________________________

  • http://tradingsigns.blogspot.com/ T. Waffle

    Thanks, J-So

    Next stop for /ES S3 668.17

  • http://www.twitter.com/TraderTamas TraderTamas

    Your laughing all the way to the bank… right?

  • de3600

    gs broke 80

  • Red

    if you had to look up proletariat then apparently you didnt pay attention during the movie yesterday, here is the class study guide with subtitles: http://www.youtube.com/watch?v=5Xd_zkMEgkI&feat

    test next week

  • alphahorn

    Seriously as long as it hangs in this channel, no reason to. i think we have a lot more, maybe 50% upside left
    http://www.screencast.com/users/alphahorn/folde

  • Whazoo

    What's the next resistance in the S&P…I felt 650s?

  • alphahorn

    to bad we're not on the same desk, i'd love to be buying for all tonight

  • DMS425

    Here comes the selling. Have you looked at puts on SKF? Just started to buy.

  • Guardian

    The Road to Hell,

    I remember watching a movie long ago, where the hero went into hell to rescue his girl and one of the things he passed was a road paving machine with “Hell's Paving Company” on the side and people lined up which they where throwing into it. As the people(souls) got to the machine they would give the reason why they did the bad thing that got them in hell, like one said “I did it for the children”, “I did it for my husband”.

    In other words the road to hell really was paved with good intentions. Just like the way the government is trying to fix the problems with the economy and the market. With good intentions!

  • http://www.triathlontrading.com TriathlonTrader

    Question:

    Holding 3 SPY 69 calls that I just purchased for any potential upside. If I purchase the puts with the same strike (straddle) and am postioned for tomorrow. how would this play out?

    Tomorrows job #'s suck we dive lower, sell puts for profit keep calls?
    We rally and i do the inverse.

    I never straddled the market. any suggestion on how you would play it?

    thanks!

  • v8muscle

    its 680 then 650 if i remember correctly.

  • v8muscle

    if we run up big you'll be well negative because of the IV crush, so watch out.

  • joe8888

    I see a HEAD N SHOULDER Top on GS 30 min,we just crossed the neckline, target is 66 ish,

    looks on to me , as long as GS doesn't regain the neckline again…..

    That's a long way down from here

  • BalaB

    Word of Caution: Even the DOW is a busted Index, the YMs are holding their RL level.

    So far the ES is following suit.

  • joe8888

    i also see a positive divergence on the 10 min SPY…

    mixed message here..

  • katzo7

    Thanks Alpha

  • Fujisan

    The best way to play it out is “Gamma Scalping”, i.e., your current position should be delta neutral at this point. Whichever way the market moves, you sell/buy call/put options to bring it back to the delta neutral position.

    You can do this totally delta neutral or you can also do it a ratio spread, depending upon your market bias.

  • standard_and_poor

    Initiating purchase of SLV puts.

  • katzo7

    Got strikes and month?

  • standard_and_poor

    +1 Bala

  • moneyfarm

    Just bought AEM April 50 puts here. Adding to DZZ soon.

  • MyLifeMyTrade

    This bounce is for real… Massive ask in XLF… outstrips the bid at this point… XLF going to 6.4 on this push up… Lets see if /ES can take out 690.

  • alphahorn

    tomorrow when the esenpee hits 665 i'll start letting it trickle. when someone gives you keys to the mint, you don't ask “what time do you close”, you ask for more PAPER

  • http://www.mylifemytrade.com MyLifeMyTrade

    If one looks at the price-vol action in XLF, 6.3 is a VERY KEY level.. It is the make or break for this bounce up… If 6.3 gets taken out, up we go… Otherwise, we come down and create new lows.

  • jigdaddy

    are you waiting for wave 4 b4 you load up again?

  • Lonewolf7107

    Must watch: Explains in simple terms the value of “experts”…..

    http://www.thedailyshow.com/video/index.jhtml?v

  • MyLifeMyTrade

    14M shares each have traded at 6.31 and 6.32 – It is a huge wall to go through for the bulls… If we get rejected from there, then I go short again.

  • http://www.triathlontrading.com TriathlonTrader

    awesome, thank you for that input. sounds like a great way to go.

  • jabber

    A lot of selling pressure though. Battles are not good for the bulls at this stage in the game. You want to see these banks fly after the way they have been beaten up.

  • http://www.triathlontrading.com TriathlonTrader

    I will definitely keep that in mind. its risky buying calls where the vix is right now. thank you.

  • http://www.twitter.com/TraderTamas TraderTamas
  • alphahorn

    katzo, you need to be shorting AMZN anytime it approaches 65

  • MyLifeMyTrade

    Agreed bulls are going to lose any battle.. Every bounce is failing faster than the previous one… A lot of selling pressure.

    ________________________________

  • jabber

    Now that I look at it, this entire day looks like 1 giant descending triangle with support at 680. That would give us about a 20 point move to 660. I mean, if we break 680, it is fully possible.

  • MyLifeMyTrade

    Things look bad for bulls regardless. If we rally in next 30 mins, then an obvious gap-down. If we dont, then the drip drip drip continues overnight in the futures leading to a gap-down.

  • TomOfTheNorth

    I'm showing a couple of ticks off the low….is my data bad?

  • Douala

    16mins ago you said
    “This bounce is for real”

    Is it or not?

  • lester

    funny

  • MaxPainMan

    Gold spiking up

  • TomOfTheNorth

    Interesting for those of us in QID, QLD &/or other Q-related, the QQQ still have another 5-6% down before they breach the Nov lows

  • lester

    is the PPT selling?

  • http://www.twitter.com/TraderTamas TraderTamas

    It's comical now

  • 96wolverine

    Seems President Obama's Working Group on Financial Markets has changed its name to the Plunge Perpetuation Team.

  • standard_and_poor

    If we close firmly, round them critters up, brand them and take them to the corral for overnight.

  • lester

    reading between lines, are you saying cover your shorts or close yer Puts

  • TomOfTheNorth

    I think I'll round up half of them anyways….

  • Erikd

    indicators 7 for 7 stay short…………..

  • Anonymous

    Thanks, Erik

  • DMS425

    March, 180s 160s, sells some 120s to help fund it if you like. Look at the drop in the last hour again today. The redemptions are in full force. This decline will stop around S&P 650 IMHO.

  • eurobear

    ha hah …superb. Cheered me up as I make no money at all….

  • Vardoger

    lol. watch volume on /es if you want to know if its for real or not imho

  • standard_and_poor

    Yes: Peter, Paul and Mary's brother Terrified Turbo.

  • Duuuuuude

    CCI 50 on 5 minute chart planting a big buy signal here. http://screencast.com/t/0Jpzt1Rc

  • TomOfTheNorth

    ya had me @ ” 7 for 7″ lol

  • eurobear

    Doing a grand job sir. Hat tip

  • Vardoger

    I don't love the downside enough to short this but I still think we need to see capitulation in order to get buyers in this market (or some really really good news). XOM lost the fib and COMP close to 1295. Love to see that thing bounce and take the market with it. I'm inclined to stay flat overnight and hope for a big gap down to start legging in to. Good luck guys

  • Vardoger

    Keirsten– I'm sure your busy as hell but if you have a moment, are you seeing any tells on level II? Any PPT or big block buying yet?

  • Whazoo

    There is no PPT folks. Is anyone holding after the close?

  • standard_and_poor

    Firmly down just to clarify.

  • mtvernon

    10 of 14 days down on SPX if i can count. lots of gaps and impulses, this seems like the end of 3 of minor 5.

  • http://tradingsigns.blogspot.com/ T. Waffle

    Roger that.

  • Whazoo

    NAZ finally looks like it will break old low

  • MyLifeMyTrade

    6.3 on XLF is the tell – that is where the max vol took place… close above or below it should be a good indication of where we open tomorrow.

  • standard_and_poor

    We brand cattle that belong to us and when we take them to the corral overnight we are in
    effect holding(keeping not selling).

  • DMS425

    Yup, off the 200 day MA. I like the action. Fav gold stocks, AU, SA.

  • BigHouse(Aka Mr Vix)

    I’m drinking a 7 and 7 tonight lol

  • Douala

    Vardoger

    I was being sarcastic… this guy is everywhere with his posts.

  • Whazoo

    Still think a flush is req'd before we turn, my next turn signal is the 13th which happens to be the equinox.

  • http://greedangerignorance.blogspot.com DJ

    Can you please post your charts of all 7 indicators with your D, W and M trend lines. I would like to compare with mine, if I have got it right.

    thanks!

  • Keirsten

    I'll post right after the bell Var. The selling continues.

    Not a message specific to Var, but for everyone….

    RE: the PPT- you may have seen that under the Bush admin because they had an election to win, and therefore needed to keep the plates spinning until November. Now you have a new Administration and they don't need to worry about how your money is disappearing, and in fact have their sights on putting it under the guise of government protection. IOW- we're on our own rats and need to operate accordingly.

  • standard_and_poor

    I think he ment the bounce is “surreal” , he was just unrealing an aura of mystery. He's just
    a cool “playa”.

  • thunda72

    Really low, low volume on the SPY for the close. This does not bode well for the open tomorrow. There just are no buyers out there…. Gap down, maybe???

  • standard_and_poor

    CUT! It’ a wrap.

  • zenith191

    Going long SPX at the close.

  • WiredPirate

    Kudos again today Erik.

    Would you consider posting your AAPL chart. I am very curious to learn how you are drawing your lines on a chart that looks very different from XLF.

  • http://www.twitter.com/TraderTamas TraderTamas

    crazy

  • Count_de_Monee

    My thoughts exactly Keirsten.

    And thanks for your work. It's much appreciated.

  • http://tradingsigns.blogspot.com/ T. Waffle

    100% short.

    When I say 100% i mean 100% i have $36 cash in my TOS account. and yest I am holding.

  • arak0

    $TICK is -1091 … good for bounce in the morning. Is your indicator still staying short by close?

  • jacksoo

    The new Administration is not of the same 'old school' either Keirsten. This Admin isn't going to back stop Wall St buddies of the Repubs.

  • TomOfTheNorth

    NOW YOU TELL ME !!!

    Still Short!

    lol

  • TomOfTheNorth

    NOW YOU TELL ME !!!

    Still Short!

    lol

  • jacksoo

    Thx Erikd

  • Molave Street Dwende

    Banked 2/3 of my profit from the last weeks. Held SPY, VLO, and XLF from SPX 850, 820, and 750, and have now met a number of my goals. Thanks to you all for your support and analysis, without which I would have sold too soon! See you at 600!

  • http://www.twitter.com/TraderTamas TraderTamas

    Whenever I am 100% either way and there's like $20 left over I always think, “gosh, I wish I could put that $20 to work too”

    LOL

  • Count_de_Monee

    Atta boy T. Waffle.
    You got balls of steel.

    I'm holding small euro short overnight.

  • ZigZag

    Tonight? I'm starting now brotha.. :-)

  • Keirsten

    For you Var:

    http://tinyurl.com/d9tzxt

    I suspect the big buys at EOD are short covering. It would take too many scans to show you all the blocks of 100K that flew by on the sell side.

  • http://tradingsigns.blogspot.com/ T. Waffle

    Same here I try to look for something for left over heehehe

    Option BP: $45.00

  • Vardoger

    I agree to some extent Keirsten. I think they are still around to a degree and that the PTB on wall street and the bots will hit this thing hard and get a real short squeeze. I am looking for capitulation on the open followed by margin calls and I'll be looking to start legging in long. Good point, everyone thinks that any bullish move is the PPT- it's rather annoying. IF they show up w/ the bots you'll know it… They are smart and will wait until the right moment to strike. Fireworks tomorrow.

    TIA for the block trades K

  • lester

    Erikd – just wanted to thank you for your guidance on XLF. I did close about half my XLF plays late today and locked in some very nice gains. The FAZ Calls I paid 13 and sold for 44. Still holding two of those suckers (but only since 26). Wish I had the guts to hang with you all the way, but I have got to minimize risk. Thanks again.

  • molecool

    NEW POST!

  • Douala

    You call this road trip to HELL last Wednesday [Feb 25]… GREAT job “Prophet”

  • MyLifeMyTrade

    I am sure everyone is aware of this … but dont even think of buying an ITM / ATM put on the inverse leveraged ETFs… IV crush will bury you 100 miles deep when the market moves up…

    I bought a Mar 90 put SRS when SRS was up 4 bucks… Now it is $20 bucks up and my put has gone up in value.. If I looked at the delta, I should have lost $300 on it.. but the volatility has shot up since this morning… the moment market starts moving up, IV will crash esp for these inverse leveraged ETFs.

  • Vardoger

    Did you see the volume on XOM eod fighting to close above that fib? That was wild!! would love to see a shot of it, unreal

  • standard_and_poor

    I'm having 7 of those, except straight 7 for me.

  • BalaB

    Nice job Erik. Nice Job……….

  • DMS425

    A lot of the fundamenetal guys that manage the cash on the sideline have been waiting for this decline. I think they are going to make a stand any day now, 650 is my critical level. I am also going to make a stand. Just cover 60% shorts and puts. and moved some money long. I REALLY BELIEVE A LOW IS GOING TO BE MADE EARLY NEXT WEEK IF NOT TOMORROW.

    Of course this is IMHO.

  • BalaB

    LOL

  • Vardoger

    how contrarian fridge

  • molecool

    We are getting close, yes. I have a feeling that there are massive institutional orders lurking at those levels.

  • Keirsten

    Ya gotta tell me ahead of time, because if I'm not watching that chart QT won't let me bring up the raw data AH. Oy. Remind me tomorrow buddy and I'll post it for you. 😉 Let me see if I can get the feed through Shidelity instead….

  • J-So

    They put on a squeeze yesterday. It was an effort to shake out some weak shorts and hit some stops in preparation for the large move today and possibly into tomorrow.

  • Keirsten

    Agreed. Have you picked your poison in puts in the double inverse universe yet? I'd love to hear your plan on those trades. TIA.

  • molecool

    You guys are just asking to get wiped out.

  • jigdaddy

    bravo sir!

  • http://www.blog.donnaklinenow.com dkpa

    Note the retracement level data on daily versus weekly. The service is worth every penny. Mole, if I could day trade, I would buy the Zero in a heartbeat. I am EOD only.

  • Vardoger

    I know it was sarcastic. I was putting it out there so others know not to listen to that shit and look with their own eyes. Your right though, I post too often- I'm everywhere because the market is as well. I find that blogging really helps me focus on trading at a high level but I'll tone it way down because it's probably pretty annoying. I see some really stupid comments on here and it's tough to ignore them because it perpetuates stupidity and hinders the ability of the group. Sorry Douala, its a tough balance here between humor and analysis. Maybe I should step back for a while.

  • Vardoger

    oh no worries. It was wild enough to watch the bars live. I was tempted to go long but not in the face of that action. There have been MAJOR dumps in the last 15 minutes on XOM nearly every day lately.

  • http://www.twitter.com/TraderTamas TraderTamas

    By the time I'm 100% invested I already have gains locked in.

  • MaxPainMan

    I would rather short calls, because you'll get killed with puts when IV drops

  • Keirsten

    Thanks Max. I rarely dabble in options so any experienced advice is very much welcomed. One of these days I'll take some time to learn that angle so I stay out of trouble.

  • DMS425

    I picked up the March 160s. I have been watching the open interest in them jump 3 fold over the last few days. They spiked again today. I know I am playing with fire, but the expected return is huge.

    Today, SKF at 240
    Fin 10% up = SKF 190
    Fin 10% up again = SKF 152 and they are in the money.

    I figure I will get the most bang for my buck if I am right.

    As far as the IV crush, with an expected move like this it will easily be offset. Based on the past it may collapse 33% to around 100%. I could also sell some 120s, I mentioned it to Kazto. We shall see.

    I never sell calls MaxPainMan. I dont like to be on the wrong side of those bets. Been there done that.

    Heading to Tahoe in about two hours for 5 feet of fresh powder. I made my bed and will have to live with it.

  • Erikd

    classic…

  • Keirsten

    Lucky duck. I once crashed a golf cart into that lake. :-) Love the skiing there. Have fun!

    Thanks for your sharing your plan, I'll probably tag along behind you.

  • Douala

    Vardoger

    My friend… I enjoy your posts … it was not meant for you… My posts were directed at MylLifeMyTrade… Shortly after the market closed today Molecool told him to knock off thinking out loud and cut down on his posts. This guy goes from SlopeOfHope to here posting what ever. I made the mistake of listening to him the other day thinking he knew what he was doing and it cost me dearly. My fault. Now I just skip over his posts when I see his Avatar.

    So please keep on as you were.

  • katzo7

    Thanks DMS for your advise. I will look into it tomorrow, had to work all afternoon.

  • katzo7

    Tried numerous times to borrow some but Scottrade had zero shares left to short. Will try again tomorrow.

  • Vardoger

    :)

  • Lori

    If I remember correctly from OA, you do ag consulting, right? (there can't be two of you with 6 u's in your name 😉
    Are you seeing any breakdowns in capital? any problems for farmers getting credit to plant this year's crop? Are farmers, as a group, as over-extended as the general population? carrying a lot of debt?
    I've been reading some stuff about ag being the next breakdown area – for example this from Kuntsler's Clusterfuck Nation –
    http://www.kunstler.com/mags_diary25.html
    thanks for any input.

  • b_rad

    i'm sorry, but that is bad risk management. You are not a trader, you are just a gambler. You may win a few, but one day you will get wiped out. Learn from those that have been there before you.

  • b_rad

    If we rally tomorrow, IV will crush your profit potential on both sides of your straddle. You should be selling premium when the volatility is high

  • http://www.triathlontrading.com TriathlonTrader

    yes, nice call. if we open lower I will be looking to get out of my puts on the first sign of reversal. If we rally out of the gates i should start selling puts. thanks!!!

  • zenith191

    turned out ok considering SSO was up 4% this morning ..

  • zenith191

    turned out ok considering SSO was up 4% this morning ..