Now Reading
Fib-O-Matic
228

Fib-O-Matic

by The MoleMarch 5, 2009

Drip drip drip – another down day with Ueber-bearish sentiment in the 90 percentile. I know what you’re thinking: How long can this keep going on? What happened to that Minor wave 4 you promised us, Herr Mole?

Well – love or hate this tape – it’s a third wave and it can drop till it… well…. drops! ๐Ÿ™‚ Since February 10th (the end of Minor 2) it’s been one down day after the next. I am counting 13 downers and 4 uppers – a ratio of 3.25. This, my dear ladies and leeches, is most likely a third of a third – if not then the bulls might want to head for the hills when that one hits.

However, that said, there is some strong support lurking below and I wouldn’t be surprised if our intrepid institutional friends weren’t sitting somewhere down there with some massive buy orders. There has been some very suspicious Level II activity today, so something is brewingย  I have drawn the current fibs in blue and a second one based on my preliminary target in orange. To make it easier for your teeny weeny rat brains the two main scenarios correlate with those colors.

Orange: This would actually be my favorite count and also the cleanest overall. We drop towards 650 and then reverse into Minor 4 of (5) – target 735.

Blue: We completed {v} of 3 of (5) today and are pushing into Minor 4. Our target here is the 750 region.

Of course there is nothing preventing the SPX from dropping below 650 during a capitulation triggered by a news based catalyst. GE is obviously teetering on the edge of extinction and who knows how deep the rabbit hole really goes. If you’re not already exposed to the short side this is however probably not where you want to jump in – the cards are stacked against you in the risk department.

Swing traders on the other hand can keep playing the game I talked about today because that channel has been pretty solid and right now we’re skating down the center line. Whether or not you are playing the swings – observe this channel because a break out into Minor 4 would clearly breach the upper boundary and probably not even reverse for a re-test. Sentiment is registering record extremes right now and the rubber band is stretched to the max. You don’t want to be running 20 positions in this situation. I think DeNiro said it best:

Don’t get attached to anything you can’t walk out on in 30 seconds if you feel the heat around the corner.

Great spot to load up on Gold puts or sell IMO – I’ve drawn some fibs for your convenience. The 940 to 953 region looks good. If we push past 966 I might get nervous.

BTW, I’d love to see more long candidates – you guys have been less than forthcoming in that department.

That’s it for tonight. Happy hunting tomorrow.

Cheers!


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.
  • http://www.slopeofhope.com Tim Knight

    Agreed on gold, my friend. I was long GLD the past couple of days, with good results, and I flipped the position about 30 seconds before the close.

  • Harmon

    Here's a two pound porterhouse and a fantastic bottle of wine if we see 760 soon!

  • rebozo

    Another great post tonight oh evil one ….any bounce from lows put in tomorrow will not be the anticipated wave four…only wave 4 of 3 of 5. Makes as much sense as anything. Gold is also interesting here…a big swinging triange wave four would lead to much higher prices.

  • http://gemstowear.etsy.com Jan

    Another great roadmap to the future. Thanks for all your hard work, Mole.

    Covered everything today with decent enough profits (even cashed in the June '65's) . Also booked some losses. Just couldn't take another day of this shit. Rat traps all over the place.

    I'm 100% cash and will wait for the next move.

    I want to thank everyone for your great contributions. I'm learning patience and discipline! Zero rocks my world.

    Tomorrow is another day….good trading and good luck evreyone!

    Jan

  • katzo7

    For everyone on this blog? Thanks guy!

  • asetrader

    $CPC and $TICK signal reversal in very near future. Could support either scenario though.

    http://www.screencast.com/t/787uxezgpay

  • http://spnakr007.blogspot.com/ Steve

    mole, good clip from the movie Heat. It looks like you had thought about it to fit it tonight's post..Excellent!

  • Squidman

    Oh these 3's. It feels very familiar, only last time I was on the wrong side. This time, thanks to evil et. al. I doubled my account this week and see what is happening. Still made mistakes, getting out too early. However, I knew better than to chase and now maintain control. I've read EWT 2 times since December and still struggle to understand the minutiae, but can now follow the language at times. It is coming together and I thank all for the experience, sharing, tribulations and the zero. I hope to return in kind.

  • rhae

    I have been expecting a tech bounce all week lasting more than a day… All we can do is just plot the chart and see what happens..

    S&P 650 a possiblility

    http://screencast.com/t/no4FgMFQmkh

  • ThetaGuy

    Long suggestion? Look no further than PFE. Don't bother with the fundies or news. And when you're done trying to interpret the chart let me just assure you the relative strength it displayed today was above and behond. Astounding. Jaw-dropping. Buy it. Enjoy it. -Woof!

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

    Great post there brother.

    S1 672.50
    S2 659.00

    both of your possibilities are matching with my pivot points. all charts are excellent. Let's see what those job numbers will bring to us.

  • rhae

    SMH seems to be in a sector that is holding up reasonable well in this latest smack down… I would poke around in there for stronger candidates , maybe INTC or TXN… I have not been tracking them, but they are the top two heavy weights there.

  • ablebonus

    Long candidates: AZN, FDX, IR are approaching long term support.

  • ronamatron

    I posted this on Slope but it also seems to go with your count as well:

    In an effort to step back and look at things I've just thrown these two charts together:

    http://www.screencast.com/users/ronamatron/fold

    http://www.screencast.com/users/ronamatron/fold

    The blue lines are trend lines that go back 10+ years.

    They tend to jive with both of those scenarios. And if you can't find any merit in their technical value, I'm sure you can appreciate the pastel colours I have chosen.

  • mrekim

    A few more long candidates: EWZ NOV UNG

  • Chop it up

    Same here – shorted a bunch of AEM on the close. Looking to sell some straight gold futures as well – depending on what the price action looks like. Don't want to see a close over 944 though (april contract). That would make me nervous.

  • Catbird

    Mole: The Zero is the best $39 I've spent probably ever. Actually, definitely ever.

    Take a look at AMD as a long candidate. Downside I think is pretty slim.

  • Fishy

    Great post Mole and thanks for all your hard work! Yesterday I thought the market was running out of sellers, but it looks like they found some more. I keep expecting a pop/rip, but who can blame anyone for not buying long with this economy and administration? I'm feeling brave and sticking my foot in a little on FAS at closing – how much lower can it, C and banks go? ha, ha, Yep, to zero, yikes! Thanks again for your great technical insight!! …it is the closest thing to a crystal ball I've found.

  • de3600

    whats up with the hace 1 minutos that chick attacking the site

  • de3600

    sorry mole all the comments were coming up in spanish

  • Anon

    If your scenario [on SPX] plays out and 680 is the retracement, then GLD will fall back from 940. But, if we go touch the 650 on SPX then we are looking at 953 or 966 on GLD. Either way, Gold is not going back to 1000 this time.

    A look at the 1 year Gold chart offers some clues, it kissed 1000$ last year, then fell to 90x.xx and then went up to 950 – then fell to below 900. Do you see a repeat there? http://www.kitco.com/charts/popup/au0365nyb.html

  • http://zstock7.com/ zstock

    UNH is up 4.5% in AH—could be an end to the the health care stocks falling knives

  • de3600
  • StainlessSteelChicken

    Thanks for the leads. What do you find attractive about UNG?

  • moneyfarm

    Thanks Mole. I with you on GOLD. Added to DZZ in my IRA and the EOD today. Also picked some AEM April 50 puts:
    http://screencast.com/t/pnyZkUyY0a

  • hindawg

    659- an optimist….. I've been looking at fibs and keep coming back to 633.75 we'll call it S4.

  • The M

    Thanks for an excellent post. A real “Mole”. For long ideas I'm watching the OIX and it's friends closely starting with XOM.

  • moneyfarm
  • moneyfarm
  • moneyfarm
  • lester

    I would like to know what a good charting program is for day trades. I currently use Stockcharts and it costs about $30 per month. Are there any less expensive or free alternatives?

  • Marc45

    I got the feeling today that we are seeing forced liquidations of hedge funds in time for the end of the quarter redemptions. At some point that will end (maybe even today) and once there are no sellers, we go up for a bit.

    Shorting gold seems a popular idea around here but I think that inflation and an eventual drop in the dollar will drive up the price of gold (and oil). There are signs of inflation out there despite some gov't numbers. My purchasing manager says that a lot of computer components are going up in price (many originate from overseas). I would be looking to buy gold/miners at this point and definitely on more weakness.

  • moneyfarm
  • Keirsten

    Quote Tracker. Do a google and ye shall find it.

  • http://gemstowear.etsy.com Jan

    You can open a TD Ameritrade account on-line, don't even have to fund it. The platform, Strategy Desk, can be downloaded once you set up an account (no fee). I love their charts and the flexibility in designing their watchlists. I have also been using TOS…but I'm in the early stages.

  • KevieKev1

    Mole,

    Im am new to the markets and I love your site. You present your information very well. Do you have a link to make a donation?

  • http://gemstowear.etsy.com Jan

    M'kay, I did some chart exploration and here are some longs:

    Pharmas seem to be holding up really well during these difficult times.

    WYE: gapped up on 1/22 after announcement of being bought by PFI. May have held up today because Goldman rated PFI a buy today. Three days up on volume and the 50EMA just crossed over 200EMA. Stochs look ready to roar.

    MYGN: 50 EMA over 200EMA….it is sitting on 50EMA for four days…..looks like good support there.

    CMP: one of my old time favorites. 50/200 flat. closed above both for two days now. can someone tell if that is an inverted H&S??

    VMW: speaking of H&S

    I'll keep looking….

  • Skates

    Best long bet will be puts on SKF or FAZ…

  • lester

    So I can set up an account and not deposit any funds and have access to their charts? I use Fidelity right now and I am not impressed with their charts. I have gotten info from them about Fidelity active trader but have never checked it out.

  • moneyfarm
  • lester

    why not calls on UYG?

  • Keirsten

    QT will let you get your streaming feed from Fidelity. I hate the ATP software Fidelity provides.

  • http://gemstowear.etsy.com Jan

    I'm not in the inflation camp yet and I can't seem to find a reasonable argument from any of the economists to reasonably support inflation. I'll tell you this much, when the SHTF I do not want to be holding any type of paper commodity. I'll buy a bit more physical gold once it goes below $800 again.

    Good luck.

  • http://gemstowear.etsy.com Jan

    You can!

  • http://gemstowear.etsy.com Jan

    Keirsten,

    I'm in a real rut right now….I'm using three platforms! There are certain things I MUST have from each but it's killing my bandwidth!

  • lester

    thanks, is that who you use?

  • Keirsten

    Just for watch lists- do not take the trade unless it comes to you based on your own trading rules. I have not run STO/MACD, etc. on any of these, so do some DD first please.

    Short idea: FLS: H & S
    http://tinyurl.com/c8euek

    Trading channel: LNN
    http://tinyurl.com/ch7tyw

    Big volume, up on a down day, potential short squeeze in progress: PLCE
    http://tinyurl.com/dhox48

    Same theme as PLCE: CRPT heavy volume, riding coat tails of AZO possibly, no annotations on this chart, I'd want to see it pop over overhead resistance first.
    http://tinyurl.com/arbygy

    link to short interest info for CRPT:
    http://tinyurl.com/cgazzo

  • mrekim

    It's another oversold energy play. Nat Gas is near the cost to produce – which should help set a floor. The current price is close to well defined stops (~16.35, ~16.12) which helps with risk management. OBV is increasing. There is some risk, You could have made the same argument on Feb 10, and then suffered a gap down.

  • Keirsten

    Jan- that is a lovely H&S on VMW. That thing needs to be kicked to the curb. ๐Ÿ™‚ What I like on CMP is that they stopped it just above that 50 today and held support this afternoon. Adding it to my watch list to see if that 50 eventually gives it a golden cross in the next week or so.

  • Keirsten

    LOL. I run several all day too for different things I can't live without. I think it's a girl thang. I love running scans in Advanced Analyzer, but I hate their charts, I love QT, but it hogs my bandwidth, and I have to run ATP to get market breadth, but hate their charts. Crazy, crazy.

  • Keirsten

    See above to Jan. If I had to use only one it would be QT. Give it a try, you can always ditch it if it's not what you're looking for.

  • slartybardfast

    “To make it easier for your teeny weeny rat brains …”

    Thanks for breaking it down for us Mole [j/k].

    You crack me up.

    I was with you from the start on SLV, and will be adding more puts first thing tomorrow. Thanks for bringing that breakdown trade to our attention.

  • molecool

    Thanks – you can always buy a month worth of Zero subscription. You might even get hooked ๐Ÿ˜‰

  • molecool

    I use QT myself – solid as a rock.

  • molecool

    Que?

  • molecool

    I once got a lapdance for 40 quid that would have to go first.

  • Paxromanus

    Mole

    I am so glad I featured your site on my blog….from the numbers I have seen there were hundreds of readers who found you this way. They are better for it I am sure….

    I continue to work on my blog — and continue to follow your entries closely.

    My stock picks have continued to be dead on by simply using the best blogger's inputs that I have found studying over the last 2 years. I threw a few clues out there this week for anyone who checked in….

    But that was not what my blog was supposed to be about so I have gotten back to my mission to help prepare people for what awaits us.

    Check it out when you get a chance–any feedback is welcone.

    Thanks and good luck to all Evil readers, you are one of the better communities I have found….

    Maximus
    http://4best4worst.wordpress.com/

  • molecool

    Long term – yes.
    Short term – no – I think it'll consolidate a bit in a few days.

  • molecool

    My brother from another mother. Plus first post – nice ๐Ÿ™‚

    I'm in SLV already but long term. Will bulk up on some GLD tomorrow. Let's hope it'll rally in the morning.

  • molecool

    I did check it out – thanks again for adding the humble den of evil to your list.

    BTW, you should get yourself an avatar – this way we recognize you.

  • http://gemstowear.etsy.com Jan

    Great charts! What the heck went on today with PLCE. Gymborie got crushed on earnings today….makes no sense. The only news I could find on it is that they named a new board member.

    Thanks for these!

  • Keirsten

    Stranger things have happened on dumb news like that I guess. Whatever it was it set them off and running today.

  • Paxromanus

    Thanks for the note about the avatar….and thanks again for the amazing amount of work you do….

  • LeoOfPisa

    Long candidates (when we get that bounce on the major indices): ADBE, XOM, FCX (copper play), MSFT.

  • Andrew

    I'm long MTB but I am a very inexperienced investor, for what that's worth.

  • Catbird

    LOL. Date the stripper, marry the Zero.

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

    Hey gang. Up too late here finishing this, but it might be a good one.
    …be flexible here, as we may see the real drama now (in either/or both directions)

    Toxic Tape (any price is possible)… http://tinyurl.com/2yhvfb

  • MrBinky

    Question for all you option traders:

    What is the correlation of commodity prices and volatility? I believe when commodity prices go up, volatility goes up (opposite of stocks), but wasn't 100% sure.

    I was thinking of going long DBC or DBA which are commodity ETFs. If we were in a low volatility environment for commodities, I would buy straight calls. If a high volatility, I would consider call spreads.

  • maple

    Fawlty Towers!

  • Vardoger

    Dude I've had tdameritrade and fidelity, the best thing I've done for my trading is getting Think or Swim. No BS, I love it. Their charting is great and the functionality of it far above anything else i've used. Set up a free account and paper trade, you'll never leave. Futures, options, forex, TOS has it. You can develop indicators or download them. Try it out at thinkorswim.com. Tim Knight does a show over there once and awhile that I listen too and they always have good guests teaching/ analyzing. Listening to Brad at Shadowtrader during the day on TOS can be helpful too. Check it out, if you have any questions let me know.
    Kevin

  • eurobear

    not when that IV crush kicks in…..thats a much riskier play than you think

  • standard_and_poor

    Be ready to “Move on Over”

    SPX closed closed less than half a point below my target of 684.25 on thursday. May expect some turbulance on friday, be ready for anything. Read Thursday/Friday roadmap for more details (same
    roadmap as yesterday).
    http://www.screencast.com/t/jn4emqR6
    http://www.youtube.com/watch?v=MxdCWdaUv18

  • http://greedangerignorance.blogspot.com DJ

    Currencies have set the stage, eur/usd went to 1.2726 and now coming down. All other currencies behaved the same way showing low dollar. So, we rally in the morning and then sell off again (probably tomorrow or monday, will watch currencies for that direction). I also noticed, there was big volume in FAS yesterday and FAZ had touched it top of the channel line at 104, so I expect correction in xlf, fas, skf, faz etc.

  • MyLifeMyTrade

    Dunno about currencies… ever increasing volume in FAS is also relatd to the fact that the price of FAS is coming down. If I had $1000 to buy FAS shares, a week ago I could buy 200.. Now I can buy 400.

  • katzo7

    I bought 2k shares just as a lark yesterday of FAS.

  • katzo7

    Andrew why MTB? But the most important question is when did you go long?

  • katzo7

    Yeah slartybartfast, I picked up on that too. This is by far my favorite place to come to to be humiliated. I mean this in a sincerity and in fact, would like it to intensify. I feel like a small moon circling around a large important planet, or a even a tick lodged in the back of a mole, or even a . . . . .
    Power to the rats who operate just under the cover of darkness but nevertheless, are important as they carry out their tasks with extreme efficiency.

    But you wait, just one day, when the mole is at his favorite strip joint spending his evil gains, the teeny weeny rats will swarm down your den hole and steal all of the winter corn.
    LOLOL

  • katzo7

    I agree with both of you. Hard to chart gold IMO as it can be irrational.

  • katzo7

    Good discussion over at TKs as to what signs may constitute a bottom. For newbies, oldbies, and all molebies.

  • Count_de_Monee

    Good morning plebes,

    I saw someone here was interested in going long JPM (forget who).
    I would caution against that move. I'm hearing that JPM's derivatives books are blowing up and Obama is desperate for a solution. Be very very careful going long financials, JPM is systemic risk and this can bring the whole house of cards down.

    All this leads me to believe that sometime next week we will be presented with a bombshell (nationalization perhaps?) and the markets will tank further than the RLs everyone is currently looking at.

    Also, not a big conoisseur of astrology, but as of today Venus is in retrograde which could signal a major event coming that we are helpless to control. I hope we bounce today so that I can reload shorts.

    Currently 100% cash.

  • bergs
  • alphahorn

    what's happened to you????!!!!!! it aint over.

  • katzo7

    Going to day trade in here, play is safe. Close out at EOD. As they say risk to catch last 5 to 10% is great.
    Hope you catch the bottom.

  • GMunni

    CPRT looks like its in a triangle currently. A break either way would have some momentum but the chart would suggest the break should, in all probability, be to the downside.

  • Skates

    You think calls would be better on FAS or UYG?

  • alphahorn

    today will be a reversal day with a 70% chance of finishing green because it is the 2nd day following a distribution day, so it will work today. but we are still heading down to opex with a lot of meat left on this bone. good luck. also stay away from shorting gold. the last two bottoms were marked by gold trading up for 5 days, yesterday was day 1!

  • katzo7

    I am long GDX, just have a little bit. About FAZ, when I saw those big bars,
    that is a sign I will take as a tell. Moved from about 104 to 99+ in 20
    minutes. Also, saw multiple EW5s being labeled on multiple time frames of
    FAZ.
    SO not going to be a cowboy here and took my 25% profit in a few days. Bold
    trader and old traders on Wall St. but no old bold traders.Also MACDs
    crossing on multiple time frames. I have to trust my charts.
    Sold right at 3:30 PM (HOD) partially because I had a meeting at 3:45 and
    because of what I saw. Remember what happened in last bad job report? The
    market surged. I am not saying that will happen today, but when it is so
    easy to make money, something is up. Mrs. Market is a fickle mistress, you
    don't get something for nothing. WHen I see Ponga Girl show up
    —————————————->
    I go short again. LOL

  • alphahorn

    one thing for sure today will provide ample opportunity to get back in lower than where you left if you so wish :). good luck

  • katzo7

    Short back in higher you mean, right?

  • TomOfTheNorth

    G'morning Count,

    Your note caught my eye – I can't resist a little commentary (all in good fun)

    ” I'm hearing that JPM's derivatives books are blowing up ” – NEWSFLASH!!!!!!

    “Obama is desperate for a solution” – Speech at 11:00

    “All this leads me to believe that sometime next week we will be presented with a bombshell …” – Well that's good enough for me!

    “…as of today Venus is in retrograde…” – I know there's a joke here, something along the lines of Uranus and your reloaded shorts, but I haven't had enough coffee yet to pull it all together.

    ;->

    Have a good day trading!

  • alphahorn

    I use sto (14,3,3), RSI (3), Directional Movement (14,14) which is great when you get down all the nuances and CCI 50. early on in this down wave i was playing it a bit getting out at highs and back in lower, but i've quit doing that. i might very sell some today if/when it drops because i expect to have a nice opp to add at EOD. but my share count is still 5 digits in FAZ and i own all the other bear ETFs and a bunch of calls/puts to the downside. i've almost double my YTD return this week

  • TomOfTheNorth

    I've heard Non-farm payrolls expected between down 600k – 700k with a' whisper' number of down 800k. Keep in mind that the ADP employment number was down 697k with a down 90k previous month revision, and that was viewed as already priced-in. Consider that down 790k was priced-in. What then would constitute bad news? All I'm saying is be careful here – be nimble – and fare well.

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

    +1.

    I did lot of research on JPM and all I want to say you are absolutely correct. JPM will bring down the house big time. Their derivatives are messed up big time and pretty soon it will be open book for everyone. I see Citi and BAC being nationalized pretty soon. JPM will be next

  • katzo7

    I use stochs, MACS, and EW , all applied on SPX on multiple time frames so a get a broad view of the market. Also use MAs watching for crosses of 7s &13s. IMO, the EWs look right proportional and angle wise to support a temp top at this point. That is what spooked me. MACD has crossed on 1 min., pointing down on all the rest of my time frames. While anything can happen and does, she can turn around and go up, I have to trust what I see on my charts. But remember, indicators follow markets and not the other way around. I am seeing a pop now, for how long and how high I do not know. Can only determine that when I can measure the strength of the move.

  • katzo7

    Any prediction as to how it will affect the market?

  • http://www.mudia.com/ hammerma

    long possibilities: ERTS, AIPC

  • Count_de_Monee

    He he he,

    you made me laugh big time ;>)

  • http://www.srsfinance.com SRSFinance

    From briefing:

    Mar 06 08:30 Nonfarm Payrolls Feb -651K -650K -650K -655K -598K

    The number on the left is actual and the others are the expectations.

  • Lordted

    Anyone got the numbers – that was a big spike

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

    Economy Sheds 651,000 Jobs; Rate Jumps to 8.1%

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

    Economy Sheds 651,000 Jobs; Rate Jumps to 8.1%

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

    very nice price to short Gold.

  • innatedc

    I would watch for yourself…….

  • TomOfTheNorth

    I would've thought the ADP number was sufficient to break us but didn't – seems the China stimulus was center stage on Wednesday.

    As far as today's numbers, the 8.1 % unemployment rate is higher than anything I've heard. The headline loss of 650k would have been good news if not for the previous month revisions of over 160k. But it's not significantly higher than ADP.

    I should've just said “no clue” – I'm short with the trend

  • joe8888

    Look at GS ,,,,10 Minute chart.

    we formed a Head n Shoulder's top ,
    crossed the neckline and backtested neckline,,,,

    As of now,looks to me GS ,is heading down ,,,,,and maybe the markets as well..!!…?

  • alphahorn

    have you ever used directional movement?? i got that idea from kemal and have been studying and using it ever since. it's the best i've found for predicting vs. following

  • BigHouse(Aka Mr Vix)

    I'm going back to bed.

  • katzo7

    With the teddy?

  • katzo7

    More explanation please innatedc.

  • katzo7

    There are three lines on directional movement right? How does one interpret all of those lines?
    LOL

    As for gold, looked at gdx and charts are a mess. Very tough to call this one.

  • Susannah

    I think it's important to look at sentiment levels above this. I think of levels in the market as the holding periods of the people that comprise it, so you've got daytraders, swing traders, position traders, buy and holders. The buy and holders are still optimistic, but most are not contributing anymore. Most are just holding, which means there is a lot of selling potential still. Maybe not today, it could be Monday, I'd imagine a lot of people will mull it over on the weekend. Here's the poll I've been looking at:

    http://www.gallup.com/poll/116428/Majority-Stoc

  • hog

    GS is up 1.58

  • hog

    Looks like a rally is getting started in financials.

  • Susannah

    Made some money on AZO yesterday, didn't hold overnight. Could have made a lot more money on something else lol

  • Lordted

    WEll cash gets you no interest so maybe a lot of people think it's worth taking a punt?

  • alphahorn

    that's the beauty of it, the ADX or black line on mine, marks trends the red/green mark direction, here's a link for a very nice introductory overview. Look at the case study too

  • katzo7

    Link?

  • alphahorn
  • katzo7

    Respectfully disagree. They will get involved at the top of the market, always did, always will. I used to do this also until I started charting. And they will panic (like now) at or near the bottom. 90% loose on Wall St., only 10% make money.

  • innatedc

    Pretty straightforward statement…..trade what's in front of you not what others crystal ball may say…..however if you want more details -I can see that as of this post futures are pushing past a key area of 690 (thereby shaking off job numbers) and hence I am looking to see it if it can climb through 700, 715 and then 725…..at 725-730 area I will looking at shorting again…..my preference is to sit tight til after the first half hour since I find it the most relevant time reversal occurs at 10:00….if after that time we start tanking down and clear through 680….my first target is 650 to exit or enter…..plan the trade, trade the plan.

  • TomOfTheNorth

    well said

  • innatedc

    Interesting take Susannah….thanks.

  • Lordted

    It's a hole big debate and wouldn't want to take up Moles site discussing it.. BUT: Most buy and holders are praying about now for the market to rise.. When it does they'll be told by the media thast it is all over and things are getting better.. (bullshit of course) Then they will buy. They don't buy at the bottom. As you say..

    Let's focus on trading eh? – more fun than worrying about Joe Soap.

  • TomOfTheNorth

    Welcome to the Doom Bunker!

    http://paul.kedrosky.com/archives/2009/03/steph

    Some of that Pessimism Pornography that Herr Mole is so fond of….

  • katzo7

    Agree fully. If you read my statements today you will see where I am
    positioned and my take. Good info though (statement straightforward?)
    although the market may not fit your plan exactly. I find 10:05-10:10 to be
    a better time to evaluate. Thanks.

  • Count_de_Monee

    Always good to see what levels other traders are watching.
    Here's Bob Byrne's (Realmoney columnist) levels for today:
    Hope you find them useful:

    “The level I will be watching on any morning weakness is 691.50…if traders hold this level we have a shot at a rally. The emini has moderate resistance at 697.75 and stronger resistance at 701.75 and 707. Above 707 we should see some weak selling near 712.50 and another bout of strong selling at 724. If a rally supported by strong volume and bank participation does form I would expect the 724 to be a speed bump rather than a cement wall.

    As we have all seen, markets can stay oversold longer than most can imagine. If sellers come in with guns blazing watch the 684 level for strong support. I would want to see this level hold if we are to avoid more new lows in the SPX. A break of 684 finds weak support at 681 and then a retest of the 676.25 lows from yesterday. While I would expect the double bottom crowd to test the waters at 676.25…I would not bet the farm on this level. We have moderate support at 672 and much stronger support at 662.50 (ouch). “

  • BalaB

    USD down a very healthy amount

  • BalaB

    I got a sneaking suspicion you're a pretty talented dude….
    Funny stuff

  • Susannah

    That could be, too, but from what I'm reading from non-traders (my mom's message forums, money blogs from average joes), is that they are scared, but are holding waiting for it to recover. They aren't risk takers, they are scared, and many of the same ones are scared for their jobs, a few whose families have already lost a job or two.

  • Vardoger

    +1

  • babydoomer

    I was burned badly on UNG this past year, and held it all the way down. Finally dumped it in disgust and it is still going down. While it makes sense that it is oversold, that there will be need for NG, that there is a bottom price below which it can't go, it still makes sense to consider the seasonality that normally pushes the price up through the winter and spring and then pushes it back down beginning in May or so. Having only a couple of months of seasonality left to get it going doesn't encourage me to load up again this time around in the cycle.

  • roncofooddehydrator

    Pre-market doesn't generally predict what's going to happen in the day…

  • J-So

    AAPL down almost $2.

  • michealr

    Mr Mole, would you put the explanation of the color indicators back on the zero chart? Am learning and it is so much easier to see what is going on with the explanation right on the chart. Maybe I overlooked it but couldn't find the info in your instructions i.e., pink bar up, etc.

    Thanks, Mike

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

    /NQ is lagging.

  • Lordted

    That black line is the Moving Average.. you're right Directional Movement also reffered to as ADX is a great indicator… Hope you are using it set to 14. That is how it was intended. Adios

  • BalaB

    Dude, I hope you're not 100% short (or all in).

  • lester

    Erikd – would you add to XLF short plays on this bounce? I closed most of mine on Thursday and thinking of reloading. Your advice is greatly appreciated.

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

    I am shorting /NQ from 1122. I am not worried

  • katzo7

    lester, just wait IMO until this sorts itself out. Lots of time.

  • molecool

    NEW POST!

  • miketrading

    Thanks Katz…was wondering myself.

  • Lordted

    The best timer frame for ADX is 10 minute. Especialy for day trading

  • molecool

    I mailed it out yesterday – didn't you get that message?

    Long:
    Dark Green Line – Long ETA
    Green Line – Long VTA
    Short Green Line – Long PTA
    Short Pink Line pointing up – Exit Shorts (ignore when already long)

    Short:
    Red Line – Short ETA
    Orange Line – Short VTA
    Short Orange Line – Short PTA
    Short Pink Line pointing down – Exit Longs (ignore when already short)

    Centered Pink Lines – Exit Always (short or long)
    Centered Yellow Lines – Indecision – you can ignore them but they are often followed by Centered Pink Lines.
    The dots are only there to help connect candles with lines and replicate the state of the indicator lines.

  • innatedc

    I should add I never trade without looking at the internals (breadth, AD, ticks) so they have to confirm price action in order for me to get excited going either way…..thanks for the discussion katzo, good luck to ya.

  • BalaB

    Ok.
    I said my peace out of concern.

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

    I know you care for my account bro. Don't worry I see that market will give up all this gains pretty soon.

  • innatedc

    Gang…I mentioned this yesterday but I'm really feeling that oil's relative strength is the first signs of its decoupling to the markets (similar to gold)….I could be wrong but I am open to some intelligent fundamental insights as why I could be wrong or right.

  • michealr

    Got it this time, thank you…

  • BalaB

    Nice. You got big Balls.

  • BigHouse(Aka Mr Vix)

    Look at JNPR.Going off the cliff .LOL Its good to be short

  • TomOfTheNorth

    Ironically, the President IS speaking @ 11:00 and the market trades off……

  • katzo7

    Yeah slartybartfast, I picked up on that too. This is by far my favorite place to come to to be humiliated. I mean this in a sincerity and in fact, would like it to intensify. I feel like a small moon circling around a large important planet, or a even a tick lodged in the back of a mole, or even a . . . . .
    Power to the rats who operate just under the cover of darkness but nevertheless, are important as they carry out their tasks with extreme efficiency.

    But you wait, just one day, when the mole is at his favorite strip joint spending his evil gains, the teeny weeny rats will swarm down your den hole and steal all of the winter corn.
    LOLOL

  • katzo7

    I agree with both of you. Hard to chart gold IMO as it can be irrational.

  • katzo7

    Good discussion over at TKs as to what signs may constitute a bottom. For newbies, oldbies, and all molebies.
    And
    A bit of discussion on shorting AZO, or as Keirsten says to paraphrase, a devilish stock .

  • Count_de_Monee

    Good morning plebes,

    I saw someone here was interested in going long JPM (forget who).
    I would caution against that move. I'm hearing that JPM's derivatives books are blowing up and Obama is desperate for a solution. Be very very careful going long financials, JPM is systemic risk and this can bring the whole house of cards down.

    All this leads me to believe that sometime next week we will be presented with a bombshell (nationalization perhaps?) and the markets will tank further than the RLs everyone is currently looking at.

    Also, not a big conoisseur of astrology, but as of today Venus is in retrograde which could signal a major event coming that we are helpless to control. I hope we bounce today so that I can reload shorts.

    Currently 100% cash.

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

    what's happened to you????!!!!!! it aint over.

  • katzo7

    Going to day trade in here, play is safe. Close out at EOD. As they say risk to catch last 5 to 10% is great.
    Hope you catch the bottom.

  • GMunni

    CPRT looks like its in a triangle currently. A break either way would have some momentum but the chart would suggest the break should, in all probability, be to the downside.

  • Skates

    You think calls would be better on FAS or UYG?

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

    today will be a reversal day with a 70% chance of finishing green because it is the 2nd day following a distribution day, so it will work today (when I say reversal i'm not talking mole's blue scenario i'm talking sub 700 spx still). but we are still heading down to opex with a lot of meat left on this bone. good luck. also stay away from shorting gold. the last two bottoms were marked by gold trading up for 5 days, yesterday was day 1!

  • katzo7

    I am long GDX, just have a little bit. About FAZ, when I saw those big bars,
    that is a sign I will take as a tell. Moved from about 104 to 99+ in 20
    minutes. Also, saw multiple EW5s being labeled on multiple time frames of
    FAZ.
    SO not going to be a cowboy here and took my 25% profit in a few days. Bold
    trader and old traders on Wall St. but no old bold traders.Also MACDs
    crossing on multiple time frames. I have to trust my charts.
    Sold right at 3:30 PM (HOD) partially because I had a meeting at 3:45 and
    because of what I saw. Remember what happened in last bad job report? The
    market surged. I am not saying that will happen today, but when it is so
    easy to make money, something is up. Mrs. Market is a fickle mistress, you
    don't get something for nothing. When I see Ponga Girl show up
    —————————————->
    I go short again. LOL

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

    one thing for sure today will provide ample opportunity to get back in lower than where you left if you so wish :). good luck

  • katzo7

    Short back in higher you mean, right? You use MACD?

  • http://outsidethe-cardboard-box.tumblr.com/ TomOfTheNorth

    G'morning Count,

    Your note caught my eye – I can't resist a little commentary (all in good fun)

    ” I'm hearing that JPM's derivatives books are blowing up ” – NEWSFLASH!!!!!!

    “Obama is desperate for a solution” – Speech at 11:00

    “All this leads me to believe that sometime next week we will be presented with a bombshell …” – Well that's good enough for me!

    “…as of today Venus is in retrograde…” – I know there's a joke here, something along the lines of Uranus and your reloaded shorts, but I haven't had enough coffee yet to pull it all together.

    ;->

    Have a good day trading!

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

    I use sto (14,3,3), RSI (3), Directional Movement (14,14) which is great when you get down all the nuances and CCI 50. early on in this down wave i was playing it a bit getting out at highs and back in lower, but i've quit doing that. i might very well sell some today if/when it drops because i expect to have a nice opp to add at EOD. but my share count is still 5 digits in FAZ and i own all the other bear ETFs and a bunch of calls/puts to the downside. i've almost double my YTD return this week

    also i haven't stopped adding to my DXO base, it's getting to be an insane # of shares

  • http://outsidethe-cardboard-box.tumblr.com/ TomOfTheNorth

    I've heard Non-farm payrolls expected between down 600k – 700k with a' whisper' number of down 800k. Keep in mind that the ADP employment number was down 697k with a down 90k previous month revision, and that was viewed as already priced-in. Consider that down 790k was priced-in. What then would constitute bad news? All I'm saying is be careful here – be nimble – and fare well.

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

    +1.

    I did lot of research on JPM and all I want to say you are absolutely correct. JPM will bring down the house big time. Their derivatives are messed up big time and pretty soon it will be open book for everyone. I see Citi and BAC being nationalized pretty soon. JPM will be next

  • katzo7

    I use stochs, MACS, and EW , all applied on SPX on multiple time frames so a get a broad view of the market. Also use MAs watching for crosses of 7s &13s. IMO, the EWs look right proportional and angle wise to support a temp top at this point. That is what spooked me. MACD has crossed on 1 min., pointing up on all the rest of my time frames. While anything can happen and does, she can turn around and go down at any point, I have to trust what I see on my charts. But remember, indicators follow markets and not the other way around. I am seeing a pop now, for how long and how high I do not know. Can only determine that when I can measure the strength of the move.

  • katzo7

    Any prediction as to how it will affect the market?

  • http://www.mudia.com/ hammerma

    long possibilities: ERTS, AIPC

  • Count_de_Monee

    He he he,

    you made me laugh big time ;>)

  • http://www.srsfinance.com SRSFinance

    From briefing:

    Mar 06 08:30 Nonfarm Payrolls Feb -651K -650K -650K -655K -598K

    The number on the left is actual and the others are the expectations.

  • Lordted

    Anyone got the numbers – that was a big spike

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

    Economy Sheds 651,000 Jobs; Rate Jumps to 8.1%

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

    Economy Sheds 651,000 Jobs; Rate Jumps to 8.1%

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

    very nice price to short Gold.

  • innatedc

    I would watch for yourself…….

  • http://outsidethe-cardboard-box.tumblr.com/ TomOfTheNorth

    I would've thought the ADP number was sufficient to break us but didn't – seems the China stimulus was center stage on Wednesday.

    As far as today's numbers, the 8.1 % unemployment rate is higher than anything I've heard. The headline loss of 650k would have been good news if not for the previous month revisions of over 160k. But it's not significantly higher than ADP.

    I should've just said “no clue” – I'm short with the trend

  • Joe8888

    Look at GS ,,,,10 Minute chart.

    we formed a Head n Shoulder's top ,
    crossed the neckline and backtested neckline,,,,

    As of now,looks to me GS ,is heading down ,,,,,and maybe the markets as well..!!…?

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

    have you ever used directional movement?? i got that idea from kemal and have been studying and using it ever since. it's the best i've found for predicting vs. following

  • BigHouse(Aka Mr Vix)

    I'm going back to bed.

  • katzo7

    With the teddy?
    BigHouse and his teddy
    http://forums.miamibeach411.com/index.php?ACT=3

  • katzo7

    More explanation please innatedc.

  • katzo7

    There are three lines on directional movement right? How does one interpret all of those lines?
    LOL

    As for gold, looked at gdx and charts are a mess. Very tough to call this one.

  • Susannah

    I think it's important to look at sentiment levels above this. I think of levels in the market as the holding periods of the people that comprise it, so you've got daytraders, swing traders, position traders, buy and holders. The buy and holders are still optimistic, but most are not contributing anymore. Most are just holding, which means there is a lot of selling potential still. Maybe not today, it could be Monday, I'd imagine a lot of people will mull it over on the weekend. Here's the poll I've been looking at:

    http://www.gallup.com/poll/116428/Majority-Stoc

  • hog

    GS is up 1.58

  • hog

    Looks like a rally is getting started in financials.

  • Susannah

    Made some money on AZO short yesterday, didn't hold overnight. Could have made a lot more money on something else lol

  • Lordted

    WEll cash gets you no interest so maybe a lot of people think it's worth taking a punt?

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

    that's the beauty of it, the ADX or black line on mine, marks trends the red/green mark direction, here's a link for a very nice introductory overview. Look at the case study too

  • katzo7

    Link?

  • http://alphahorn.blogspot.com/ alphahorn
  • katzo7

    Respectfully disagree. They will get involved at the top of the market, always did, always will. I used to do this also until I started charting. And they will panic (like now) at or near the bottom. 90% loose on Wall St., only 10% make money.

  • innatedc

    Pretty straightforward statement…..trade what's in front of you not what others crystal ball may say…..however if you want more details -I can see that as of this post futures are pushing past a key area of 690 (thereby shaking off job numbers) and hence I am looking to see it if it can climb through 700, 715 and then 725…..at 725-730 area I will be looking at shorting again…..my preference is to sit tight til after the first half hour since I find the most relevant time reversal occurs at 10:00….if after that time we start tanking down and clear through 680….my first target is 650 to exit or enter…..plan the trade, trade the plan.

  • http://outsidethe-cardboard-box.tumblr.com/ TomOfTheNorth

    well said

  • innatedc

    Interesting take Susannah….thanks.

  • Lordted

    It's a hole big debate and wouldn't want to take up Moles site discussing it.. BUT: Most buy and holders are praying about now for the market to rise.. When it does they'll be told by the media thast it is all over and things are getting better.. (bullshit of course) Then they will buy. They don't buy at the bottom. As you say..

    Let's focus on trading eh? – more fun than worrying about Joe Soap.

  • http://outsidethe-cardboard-box.tumblr.com/ TomOfTheNorth

    Welcome to the Doom Bunker!

    http://paul.kedrosky.com/archives/2009/03/steph

    Some of that Pessimism Pornography that Herr Mole is so fond of….

  • katzo7

    Agree fully. If you read my statements today you will see where I am
    positioned and my take. Good info though (statement straightforward?)
    although the market may not fit your plan exactly. I find 10:05-10:10 to be
    a better time to evaluate. Thanks.

  • Count_de_Monee

    Always good to see what levels other traders are watching.
    Here's Bob Byrne's (Realmoney columnist) levels for today:
    Hope you find them useful:

    “The level I will be watching on any morning weakness is 691.50…if traders hold this level we have a shot at a rally. The emini has moderate resistance at 697.75 and stronger resistance at 701.75 and 707. Above 707 we should see some weak selling near 712.50 and another bout of strong selling at 724. If a rally supported by strong volume and bank participation does form I would expect the 724 to be a speed bump rather than a cement wall.

    As we have all seen, markets can stay oversold longer than most can imagine. If sellers come in with guns blazing watch the 684 level for strong support. I would want to see this level hold if we are to avoid more new lows in the SPX. A break of 684 finds weak support at 681 and then a retest of the 676.25 lows from yesterday. While I would expect the double bottom crowd to test the waters at 676.25…I would not bet the farm on this level. We have moderate support at 672 and much stronger support at 662.50 (ouch). “

  • http://implicittrading.blogspot.com/ BalaB

    USD down a very healthy amount

  • http://implicittrading.blogspot.com/ BalaB

    I got a sneaking suspicion you're a pretty talented dude….
    Funny stuff

  • Susannah

    It won't come from this level of buyers – they are scared for their jobs, too, and are not in risk-taking mode at all. I think the market's proving that the other level of buyers, daytraders, swing, position, can only provide short-lived short-covering rallies. We need capitulation, I think, at this point.

    Looking at stuff like this just helps me answer the question – how high can it go? how low can it go? intermediate term and long term

  • Vardoger

    +1

  • House of Cards

    I was burned badly on UNG this past year, and held it all the way down. Finally dumped it in disgust and it is still going down. While it makes sense that it is oversold, that there will be need for NG, that there is a bottom price below which it can't go, it still makes sense to consider the seasonality that normally pushes the price up through the winter and spring and then pushes it back down beginning in May or so. Having only a couple of months of seasonality left to get it going doesn't encourage me to load up again this time around in the cycle.

  • roncofooddehydrator

    Pre-market doesn't generally predict what's going to happen in the day…

  • J-So

    AAPL down almost $2.

  • michealr

    Mr Mole, would you put the explanation of the color indicators back on the zero chart? Am learning and it is so much easier to see what is going on with the explanation right on the chart. Maybe I overlooked it but couldn't find the info in your instructions i.e., pink bar up, etc.

    Thanks, Mike

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

    /NQ is lagging.

  • Lordted

    That black line is the Moving Average.. you're right Directional Movement also reffered to as ADX is a great indicator… Hope you are using it set to 14. That is how it was intended. Adios

  • http://implicittrading.blogspot.com/ BalaB

    Dude, I hope you're not 100% short (or all in).

  • lester

    Erikd – would you add to XLF short plays on this bounce? I closed most of mine on Thursday and thinking of reloading. Your advice is greatly appreciated.

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

    I am shorting /NQ from 1122. I am not worried

  • katzo7

    lester, just wait IMO until this sorts itself out. Lots of time.

  • http://evilspeculator.com molecool

    NEW POST!

  • MikeT

    Thanks Katz…was wondering myself.

  • Lordted

    The best timer frame for ADX is 10 minute. Especialy for day trading

  • http://evilspeculator.com molecool

    I mailed it out yesterday – didn't you get that message?

    Long:
    Dark Green Line – Long ETA
    Green Line – Long VTA
    Short Green Line – Long PTA
    Short Pink Line pointing up – Exit Shorts (ignore when already long)

    Short:
    Red Line – Short ETA
    Orange Line – Short VTA
    Short Orange Line – Short PTA
    Short Pink Line pointing down – Exit Longs (ignore when already short)

    Centered Pink Lines – Exit Always (short or long)
    Centered Yellow Lines – Indecision – you can ignore them but they are often followed by Centered Pink Lines.
    The dots are only there to help connect candles with lines and replicate the state of the indicator lines.

  • innatedc

    I should add I never trade without looking at the internals (breadth, AD, ticks) so they have to confirm price action in order for me to get excited going either way…..thanks for the discussion katzo, good luck to ya.

  • http://implicittrading.blogspot.com/ BalaB

    Ok.
    I said my peace out of concern.

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

    I know you care for my account bro. Don't worry I see that market will give up all this gains pretty soon.

  • innatedc

    Gang…I mentioned this yesterday but I'm really feeling that oil's relative strength is the first signs of its decoupling to the markets (similar to gold)….I could be wrong but I am open to some intelligent fundamental insights as to why I could be wrong or right.

  • michealr

    Got it this time, thank you…

  • http://implicittrading.blogspot.com/ BalaB

    Nice. You got big Balls.

  • BigHouse(Aka Mr Vix)

    Look at JNPR.Going off the cliff .LOL Its good to be short

  • http://outsidethe-cardboard-box.tumblr.com/ TomOfTheNorth

    Ironically, the President IS speaking @ 11:00 and the market trades off……