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Friday Road Map
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Friday Road Map

by The MoleMay 27, 2010

I don’t have much time tonight as I’ve got to work on another project but wanted to put up a road map for Friday for you guys. So, without further ado here we go:

After today’s rip from hell I would be very surprised if there was no follow through sometime tomorrow – even if the boyz fake some weak tape in the morning. ES futures right now are hovering at 1100 – I’m sure the bulls will fight like hell to hold on to that level.

Soylent Red gives the monster Minor 3 wave scenario a bit more leeway. However at 1125 it’s time to say goodbye to that one.

Soylent Green maintains that we are at the onset of Minor 2 of intermediate (1). I would like to see that one conclude at the 61.8% fib mark around 1155, but who knows it could run all the way to 1175. Could get pretty nerve wrecking for the bears for a few weeks, so bring an extra supply of Prozac.

Looking at all the evidence I am putting the odds for Green at 65% and Red at 35%. There’s just too much bullish potential out there to not get exploited – let me repost several I have presented throughout the week:

My 30-day SMA TRIN chart – we are at extremely high levels now. Yes, could have gone higher in a market-falls-off-the-plate situation but now that we painted a bottom that potentiality has suffered greatly.

Then there’s my NYMO-BPNYA ratio chart. Also at levels we have not seen in a long time and where usually snap backs occur.

My CPCE chart – again at a cross zone where meaningful retracements happen.

My genetically enhanced gold:silver ratio chart in the context of the SPX. I expected a turn at that center line and we got it right where I thought we would. Initially I thought we push down and then go to the top line. But that does not appear to be the second favorite scenario. Rather we most likely push toward 64 again.

Finally, the NYSE A/D ratio chart – yes again but there is new evidence. One of my faithful ratlings named Scott wrote me today with some musings on the topic. One of his comments gave me the idea to look at the D/A ratio as well and when I saw it I immediately realized that it solved a problem I had sought to solve with the superAD (the normalized version of the A/D ratio). See the problem with the A/D ratio is that it’s very hard to see bearish patterns as the values go from 0 – 1 whereas the bullish signals go from 1 to who knows where – we recently saw a 17 reading and today’s bullquake presented us with a 12.4 on the Richter scale.

The superAD fixed that problem but it was not a viable solution as I had a hard time recognizing patterns. The solution was to look a both – the A/D and the D/A ratio. This way it’s much easier to determine bullish as well as bearish patterns. As a matter of fact – many of them resemble each other and I’m going to have a fine time parsing for more in the future.

Anyway, what’s immediately salient on the D/A ratio is the monster divergence between the 5/20 drop and the actual final low on 5/25. On the A/D ratio it’s very hard to make out but it’s crystal clear on the D/A. And of course you all can guess the possible implications here. Rest assured that in the future we won’t miss these things – unfortunately it’s a bit late this time around. My bad and I’m being punished along with the rest of you.

Call me masochistic but I’m a fervent proponent of the idea that pain and suffering is very productive and should be embraced. Had it not been for this little whipsaw I would have not tried the above. So, my puts suffered a bit but I gained a lot of very valuable knowledge.

Finally, there is another piece to the puzzle and it’s the daily Zero. But I cannot post that here – it’s in the prior post and it’s also extremely interesting – Zero subs know.

Alright – that’s a lot more than I wanted to post, so I’m off. See you on the other side.

Cheers,

Mole


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.
  • captainboom

    No goodies for the first post? How about exploding laser cannons or something?

  • momac

    darn, I'm second and there's no prize. Thanks for the update Mole

  • yudhisthira

    Yes, as a bear, I've been trained to expect a downturn at any surprising moment.
    There is mounting evidence that the surprise will be relentless relieving of oversold conditions.
    But it could turn any time couldn't it? A two week rise could cure me of such delusions.
    Keep the tech reports coming, Mole. Thanks. I won't bet the farm on a “belief.”

  • MDX

    How about exploding bear market rally?

  • http://evilspeculator.com molecool

    Today's prize is: You keep your sanity in this crazy tape.

  • Merker

    Hey Mole, are you able to run the Zero Daily on the data coming down from the top in 2008? If we are indeed in P3, and given the strikingly similar patterns between then and now (see KD's latest video showing off his mad photoshopping skills), perhaps there are additional clues during that time period.

  • raised_by_wolves

    Let's not call it crazy. Let's call it the new normal.

  • raised_by_wolves

    Personally, I think that GLD/SLV ratio is key. To me, it's probably only short-term bullish. It may not be long before your red sell line is hit. There's not nearly as much distance to cover between those lines as there was during February and March.

  • katzo7

    A couple of possible targets, fib. fan/fib. time and gann. Interesting that both show the same target level of ES 1113. One method shows us hitting that today, the other method shows a hit on Tuesday. This is in stark contrast to my .618 post of 1142 a pure price analysis without the element of time. The color ellipse one can be pretty accurate.

    http://www.screencast.com/users/katzo7/folders/

  • http://wadecapitalmanagement.typepad.com/blog/ Duuuuuude

    Just a bit more confirmation of a strong bounce at the very least.

    http://screencast.com/t/NDU0Mzk2

  • chronographics

    There are a number of things that may give some warning, Wolf Cub's GLD/SLV ratio, EURJPY and personally the US Long Bond. Not to mention Mole Meisters Evil Indicators.

  • anoopsan

    Apple Inc Buy signal in daily chaRT

    http://niftychartsandpatterns.blogspot.com/2010

    Thank you

  • katzo7

    Thought this spammer was banned (see lost post).

  • Bob the Horse

    I can't. It's lost.

  • tradingmom

    I've got a question about the “fractal” KD illustrated over at Market Ticker. Sorry if this was discussed already, but, if it plays out the way he would project then wouldn't we make new highs before topping out and rolling over?

  • MMM___Soylent

    Wasn't the VIX buy signal part of the equation, too? It is given a week to play out…

  • katzo7

    Short ES @ 1005.50

  • MDX

    Should be easily played out

  • katzo7

    Guys, I am having problems with disqus lately, some of my posts go into a “just a moment” phase and never appear like my exit yesterday aft (-.75).

  • http://channelsandpatterns.blogspot.com/ springheel_jack

    Disqus is really struggling this week. Replies are taking a day or two to get back to gmail.

  • http://channelsandpatterns.blogspot.com/ springheel_jack

    I've been having exactly the same problem that you describe k. No problem with replies but long waits for any new comments, which only make it through on the first attempt about 50% of the time.

  • katzo7

    Tough when trying to post real time trades, ppl have to be careful, protect themselves, and make own decisions.

  • katzo7

    Out @ 1101.50

  • http://channelsandpatterns.blogspot.com/ springheel_jack

    True story.

  • Bob the Horse

    Normally you have to reload the page and it is then there. Disqus is a bit like democracy – a rubbish system but better than the alternatives.

  • katzo7

    Who said I was normal Bob?

  • greedybastard

    It would seem the yesterday is to this minute wave two as 5/10/10 was to minor wave two, big gap up, high A/D, very bullish looking day.

  • katzo7

    There is my 1099.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    all k%'s where high enough for a top by yesterday's close so…

  • gsavli

    i am actually betting on this being temporary top.

  • katzo7

    Long ES @ 1097.

  • fuw

    A retest of the 1100 area was hardly unexpected, and in my eyes this open is so far telling us nothing.

  • katzo7

    Target 1102.50

  • gsavli

    watch out for europe – not feeling to well today.

  • katzo7

    Out

  • Anonymous

    As XLF is going up, FAZ is going down.

  • tradingmom

    I hate to say it, but so far it looks like the ES is in the same uptrending channel as yesterday.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    1104 was one of the possible outcomes…

  • OldChicago

    what's up with NFLX. ballistic.

  • katzo7

    Damn, just missed an entry L @ 1095 ES, sitting and waiting, on to next trade.

  • katzo7

    In @ 1095

  • http://www.mylifemytrade.com MyLifeMyTrade

    People looking at what stocks suffered least damage in the correction and piling onto those names… Recall GOOG in 2007.. I think AAPL will be a wonderful short whenever we top out “LATER THIS YEAR” …

  • http://www.mylifemytrade.com MyLifeMyTrade

    Oh well.. the close was indeed shortable (in hindsight).

    Today morning is the classic pattern we saw in the Feb-Apr melt-up. Big up day followed by minor morning weakness (bear trap or whatever) and then up we go… I have a feeling that high readings of VIX are deceptive here…

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    1089 SPX should be the sign of a breakdown… BTW, 30 min view of my 2 min intradays is sometimes helpfull, R(at)SI is already droping while stochastics are still rising… last I saw this was may 11

  • katzo7

    Out @ 1100.25

  • http://www.mylifemytrade.com MyLifeMyTrade

    There is probably a gap fill near spx 1110 area I think.. Either from there or from 1122es area, we may have a nice retracement down to 1080 area… I think we have to build more volume in 1080 area before we go up.

  • http://www.mylifemytrade.com MyLifeMyTrade

    Mole is correct in saying that we may have some followthru today – it may be more like slow painful meltup.. If you are long, then its good.. If short or waiting to short, one will need a lot of patience to wait for the correct price levels (1108es, 1111es 1122es) to arrive.

  • Kudos

    EURJPY had a fast recovery from its initial morning drop. So did the 10YR yields which jumped 6 basis points in 5 minutes. Seems bullish to me

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    i know a lot of people see a “support to grow from ” @1080's, but not today, today 1089 is a line bulls can't cross, next week that line will have droped, but not today

  • gsavli

    today has a funny feeling to it. like something is wrong with the market. :)

  • anoopsan

    Intraday hourly chart of APPLE INC shows the stock testing resistance line.

    http://niftychartsandpatterns.blogspot.com/2010

    Thank you

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    there are … things, it has been disrespectful lately, but from 13:08 yesterday… IT'S OBSCENE, the morning ramp came without a k0% and went too far, but the “saves” since 13:08 are a complete joke

  • boycottnow

    i think aapl will keep going up ….past 300 ..maybe even this year …the ipad is a game changer ….iphone update,itunes,ipods,ipad …they got it together …allwonderful toys ..did i mention mac computers ……………soon to be anounced ….icar !!!!

  • Bob the Horse

    It's just money flow. You have to watch the bond market – as long as TYA is heading lower, there is just going to be cash flowing into the equity market. It's relentless when it gets going – don't be on the wrong side of it.

  • http://www.mylifemytrade.com MyLifeMyTrade

    Bob: Once again apologies about yesterday.

    On a different note, where can I follow TYA intra-day?

  • http://www.mylifemytrade.com MyLifeMyTrade

    I agree… I said the same thing.. AAPL will be a great short LATER THIS YEAR WHEN WE TOP OUT.

    By then I expect AAPL to be near 350… And I expect 500 price targets to be making news then… This is what happened to GOOG.. when it took out 700, price targets like 1000, 1500, 2000 were making the news… That is all too frothy…

  • Bob the Horse

    furgettabbatit. No idea – I use Bloomberg, the futures ticker is TYU0 at the moment, alternatively just follow the 10yr yield.

  • http://www.mylifemytrade.com MyLifeMyTrade

    We may likely have a VWAP ping pong day today with a narrow range with a possible GBD into close… Not sure which way, but we might have a decent sized move into close.. 3-day weekend esp with Europe open on Monday and US not open… people will be wary of headline risk…

  • tradingmom

    Can you chart the ES on Stockcharts.com? If so, what's the symbol?

  • Rayden

    “I guess I’m referring to minor 2? I’m talking about wave 2 of P3” – I think (and mole?, EWI, daneric etc agree) we are nowhere near 2 of P3. that would be intermediate 2, it’s a ways off. big picture, intermediate 1 of P3 takes us down within reach of the P1 low (600-800?), intermediate 2 is a nasty sharp bounce (900-1000?), and intermediate 3 of P3 is an express elevator to hell (< 400?). we would seem to only be in minor 1 (or 2, or the early stages of minor 3 – depends on which count you favor) of intermediate 1 of P3 ๐Ÿ˜‰

  • katzo7

    Stalking short ES @ 1100-01, could change my mind it/when hits there.

  • katzo7

    Short ES @ 9950.

  • roncofooddehydrator

    Today seems like it's going to be a “screw around some and then end up where we started” sort of day.

  • BobbyLow

    If we are talking about the same thing – on TD Ameritrade, I can use $TNX.X which gives me a live running quote on the CBOE 10 Year Treasury Yield.

  • http://www.mylifemytrade.com MyLifeMyTrade

    Thanks

  • fuw

    DAX looking ready to break higher, towards 6000.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    UPDATE

    lazy hamster (the slow stochastic) says this last save didn't work… says we're heading down

    top is in for the morning

  • skynard

    Thanks Hammy! How are you?

  • katzo7

    This is where short term E Waves have the advantage.

    http://www.screencast.com/users/katzo7/folders/

  • http://evilspeculator.com molecool

    If this continues much longer I might switch – is there a good competitor?

  • katzo7

    break 1093 and we go down more

  • anoopsan

    Nasdaq 100 resistance line seems to be strong. Not able to break it till now

    http://niftychartsandpatterns.blogspot.com/2010

    Thank you

  • tradingmom

    It looks to me like the ES is sitting right at the bottom of the upward trending channel it has been in since all day yesterday. If we go lower from here, the channel will be broken.

  • katzo7

    Out @ 1093.75

  • katzo7

    Awaiting next trade.

  • EvilTrader

    SPY @110.

    It was hard to break yesterday, expect some decent support here.

  • http://www.mylifemytrade.com MyLifeMyTrade

    In EW terms, possibly the A-B-C pullback is over.

  • http://www.mylifemytrade.com MyLifeMyTrade

    Minor bullish divergence on ZL: lower low on ES, higher low on ZL – do others see this as well.

  • http://evilspeculator.com molecool

    How's everyone holding up this morning?

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    1-2-i-ii?

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    waitng for the 1089-1090 battle… war gerbils summoned

  • yudhisthira

    I reloaded on the close last night, just in case….
    The addiction won't die.
    Watching vwap and zero line.
    Expecting to go neutral, but waiting for market to further prove it's bullish valor.

  • derekste

    doing well, thanks!

    despite some of the warnings about being short you posted from yesterday (A/D ratio, etc) I'm still happy holding my 100/90 Dec SPY vertical put spread.

  • http://evilspeculator.com molecool

    Ballsy!

  • http://evilspeculator.com molecool

    You look vaguely familiar…

  • katzo7

    1193 ES is sticky area.

  • EvilTrader

    If this support is lost today, bears may gain control, wait for anxiety to step in when everybody wants to go flat into weekend, afraid of europe's monday markets.

  • BobbyLow

    I'm hanging in pretty good all things considered. I tweaked a couple of positions while trying to manage my Delta and Vega (Man, that's a full time job)

    But I'm actually up on the day so far so I can't complain. :)

  • tradingmom

    I see it — hoping it resolves itself in favor of the bears.

  • fuw

    Intraday divergence between TRIN & SPX

  • yudhisthira

    Divergence is real. Zero can't quite get up to positive signal yet
    Further head fake for bullish reversal later?

  • Bob the Horse

    Long ESM0 here 1091.25, stop 1088

  • skynard

    Waiting for 1090 to reload long

  • katzo7

    Broke my 93, let' see where she goes

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    Boss, do you keep that phrase on the clipboard?

    we just had a k0% on fast so we should bounce a bit but lazy still has some fuel within… 1097 should tell

  • Kudos

    Sweet divergence on the lite batman.

  • katzo7

    Long ES 91.50

  • http://www.mylifemytrade.com MyLifeMyTrade

    Doug kass saying something about N. Korea.

    Likely we bottom around 11:30 when europe closes…

    Also, the Inverse Head n Shoulder neckline is around ES1088 area..

  • Tooncez

    I still can't read that thing. To me it looks like div from thurs thru fri in one direction and div on just friday in the other… :(

  • http://www.mylifemytrade.com MyLifeMyTrade

    Mole specifically said that ZL is intra-day. You CAN NOT and SHOULD NOT compare signals from two different days on ZL

  • http://www.mylifemytrade.com MyLifeMyTrade

    Regarding divergences you should be aware of one thing.. often a large signal comes when an importance price level is broken. In this case.. ES1088 is important price level.. So, we could keep painting a bullish divergence and then we may dip below ES1088 and get a huge negative signal. I am not at all implying that either or both will happen.

    However, you must have seen yesterday that ZL signal was painting a bearish divergence with price TILL we took out 1096ES area

  • skynard

    Dumped July puts for small gain and went long UCO again with some spy front moth calls. Waiting for 1140 to load up again short.

  • Kudos

    Those are two different time frames. The left pain is the hourly, the right is the 5 minute chart. Today lows, the opening, the following, and the most recent were accompanies by less and less momentum. Thats the divergence I was seeing, it could have been early but I feel like pointing it valuable. It wasn't that big of a divergence though

  • katzo7

    Out @ 1094, I am getting a bad feeling about upside, just got spooked about an EW reading. MACD on the 5 min.

  • BobbyLow

    I think the divergence they were talking about this morning is look at the bottom turns on the signal line and then look at the candles. They are heading in the opposite direction therefore having a divergence from the signal line to the candles.

  • tradingmom

    About the divergence(s)…At first, the ES (above chart) was dropping, while the ZL had an upward sloping lower trendline. However, the signal has been fading steadily in both directions, so I'm inclined to attribute it to early departure for long vacation weekend. I will place more emphasis on the actual prices today and less on the ZL.

  • tradingmom

    Of course, as soon as I wrote that, Europe closed and we blasted up for a VWAP test.

  • yudhisthira

    Approaching vwap with positive zero lite.

  • skynard

    Up 10% on those calls already may make it a day trade.

  • http://www.mylifemytrade.com MyLifeMyTrade

    I think VWAP might push this back once more to test the 1088es area IMO

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    well, we had our 1097… now could we have the drop to test 1090?

  • ricebowl

    Mini IH&S on SPX cash. If we trace back to 1095 and turn around and cut through the neckline at 1097, we're headed for 1102 which sends us green.

  • ricebowl

    Good job, sir. Congratulations!

    I had a shitty entry but averaged down at 1092, and I'm positive here at 1097.

  • Bob the Horse

    out 1096.75

  • http://www.mylifemytrade.com MyLifeMyTrade

    Nasdaq was strong this morning. Not any more..

    It also seems that AAPL is not bouncing that strongly any more.

  • katzo7

    gonna drop now IMHO, short 1095.75

  • skynard

    Think we just back tested the IHS neckline and will rocket up above 1100 today. IMO

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    well, we should at least do a 1090 if we want to se nervous bulls, so your view can be a PPT alert

  • anoopsan

    Dow Jones 5 Minutes down ward channel that may break on the upside.

    http://niftychartsandpatterns.blogspot.com/2010

    Thank you

  • tradingmom

    we are backtesting the ES channel from yesterday that was broken a little while ago…zero signal is weak so I hope it won't recapture the channel.

  • tradingmom

    Not only are we backtesting the channel, but the bars that are part of the backtest are making a really nice rising wedge that we are about to break down from imo.

  • katzo7

    if I am seeing this correctly that should be it for the upside for some time . . . target 1089 ES

  • OldChicago

    The issue I'm seeing is that high vol on down tick, low vol on the rise. We could just churn.

  • Tooncez

    I think I see what you are saying… Thanks.

  • OldChicago

    some wave 3 or 3 here?

  • http://www.mylifemytrade.com MyLifeMyTrade

    Ok whats the news.. we just dumped like shit

  • yudhisthira

    How did you do that? You spoke to a short-term turn.
    I thought I saw a micro-bearish divergence in zero lite.

  • Kudos

    what just happened?

  • Tooncez

    Did I say thanks already? Nice!

  • bananaben

    Yeah I'm asking the same thing. And I was counting on a nice rally?

  • Kudos

    EurJPY dropped 80 basis points in a blink of an eye

  • yudhisthira

    It was Katzo. He has a fat finger.

  • http://www.mylifemytrade.com MyLifeMyTrade

    Yeah katzo sold 1000 SP; when he intended to sell 1 SP

  • EvilTrader

    my heart almost went to mouth

  • tradingmom

    That was amazing…those wedges are great — they work every time!

  • Kudos

    Spains rating just got cut to AA from AAA

  • yudhisthira

    Easy mistake, when you wear clown gloves while typing.

  • http://www.mylifemytrade.com MyLifeMyTrade

    Fake move IMO.. likely bounce back…

  • tradingmom

    Okay — I never thought that whole move would take place in one 5 min bar. So will 1088 hold now?

  • BobbyLow

    Wow. At 12:37, 12:38 and 12.39 each 1 minute candle showed big selling. Then 1 minute retrace and back down.

  • katzo7

    This is why I got spooked, no divergence in the EWs (old count in yellow). http://www.screencast.com/users/katzo7/folders/

  • skynard

    Damn Hammy! Right on Bro, nice call.

  • katzo7

    Tradingmom, that is an EW5 move

  • ricebowl

    Are you suggesting that we just started 5 of 1 of 3?

  • katzo7

    lol

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    talking about the 1089-1090?

    this is where the fun begins, brace for war

  • skynard

    Thanks!

  • katzo7

    Magic of EW analysis. I posted a chart.

  • BobbyLow

    Vix back up 10%

  • http://www.mylifemytrade.com MyLifeMyTrade

    God's gift opportunity to go long IMO.. likely 82 will be tested

  • http://www.flickr.com/photos/dabasia/sets/ Croozer

    filled a runaway gap……gap and crap ??

  • skynard

    Cheers!

  • yudhisthira

    What kind of charting system is that?
    Are you putting the EW counts in?

  • skynard

    Doubled down on those SPY front moth 112 calls and UCO. HEHEHEHEHE!

  • EvilTrader

    touched intraday down channel lower band.

    If we break 109 watch below.

    On the contrary..if we go back up today…that would be super bullish.

  • Kudos

    Stay Frosty. Another big divergence, it may be negated on a another drop by for now its blatent.

  • jigdaddy

    is that a divergence i see on zero lite?

  • katzo7

    You guys call that a BRD? lol

  • tradingmom

    Katzo — I love the idea of EW but I can't count the waves yet myself. However, I could see that we had fallen thru yesterday's channel, and were backtesting. Then, Fitch downgraded Spain right at the top of the backtest wedge. I tried to post something else, but I keep having that stupid discus problem. That just paid my kids' school tuition for next year.

  • katzo7

    eSignal, it has auto but I don't always trust it, have to think for myself like this time.

  • katzo7

    Let me do the counting for now, when I am right I am right, when wrong, loooook out . . .

  • BobbyLow

    IMO, this much Volatility is definately confirming change over to at least an intermediate down trending market.

    Of course we're going to get all kinds of all false all clear signs as price retraces temporarily back up. We could even close green today.

    But Bull Markets tend to have a long slow and relentless rides up. Bear Markets are nutzo with massive rallies with the end result massively down where no one wants to touch the market with a ten foot pole. That's when I'll buy the market with both hands.

    If I survive until then. :)

  • katzo7

    Any drop like that is a 5 on some time frame. I count on the 5, 15, 60, 120, & 240 min. and the day. IMO we are just finishing up a 4 of 3 (D).

  • http://evilspeculator.com molecool

    Public Service Announcement

    I have to run a few errands this afternoon and won't be able to do a new post. However, I take this one should keep you occupied for a while ๐Ÿ˜‰ Expect me to chime in after the bell but it'll probably be brief (yeah right – I have said that before – hehe).

    As most of you know U.S. equity markets will be closed on Monday. So I will either post my 'weekend forecast' on Sunday or Monday.

    L8er!

  • Kudos

    I worry for bears that that drop cleared out all selling momentum left, and that the big money is covering hand over fist before the 3 day weekend while the tape whipsaws

  • ricebowl

    Nice… I went running like a dog with a tail between its legs; wasn't willing to risk it. Of course, this played out exactly as before…

  • amokta

    what happens when a gold (GLD) ball starts to roll down a hill?

  • http://evilspeculator.com molecool

    You will – just stick around.

  • http://evilspeculator.com molecool

    See the chart ๐Ÿ˜‰

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    hey, what was the first thing i said to mole on this thread

  • http://evilspeculator.com molecool

    I park my truck at the bottom of the hill.

  • jigdaddy

    LOL! thanks for the confirmation. im getting a hang of this..have a safe weekend.

  • OldChicago

    the cruelest joke here would be to drop to 1060 and close the gap. The dip buyers of SPY were apparently out sweeping the manna from heaven, so someone said. The breadth has turn down.

  • http://evilspeculator.com molecool

    Bite me?

  • katzo7

    You calling me a clown??

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    fast rat and lazy hamster are way up, we still have downward momentum available

  • http://www.mylifemytrade.com MyLifeMyTrade

    agree.. but i think that down to 1060 was already done.. why would MMs give a chance to bulls to load up at higher levels.. I think the gap remains unfilled till we go visit 1120 area…

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    shaved and toothless gerbils don't bite…

    i said “waitng for the 1089-1090 battle… war gerbils summoned”

  • yudhisthira

    Sorry, I had to explain the fat finger.

    Isn't that a line from a movie I never saw?

  • amokta

    lol! (truck might get crushed though – truck would lose value)

    anyway, all to play for still on the markets, i think

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    cool down, i'm almost sure he didn't, let me check

  • ricebowl

    Not to be rude, but who really cares what happens here? If you're a short-term bear, you'd better go grab the lube now. If you're a long-term bear, then today is totally inconsequential. If you're a trader, then you make money on the way up and the way down.

    I, for one, want to see this thing run higher. The higher we go, the more confident I am of being able to short and not lose my lunch money. I have already started implementing my strategy of scaling slowly into long-term puts as we chase this up. I'm buying Sept puts expecting 500-1000% easy money here when we do tank.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    yudhi… you're out of order, respect other traders please

  • amokta

    im going out for some food (UK) – when i come back i expect to see fat finger friday event!
    Bon apetite

  • yudhisthira

    I stand corrected. Got giddy about his ST top call.

  • ricebowl

    I don't think he meant disrespect by it… just one of those things that you say without thinking about it and you regret later. It's pretty clear that you do pretty well at trading. It's good to have guys like you around here.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    food? uk? bon appetit? all in the same sentence?

    just kidding, there are worse…. the dutch!

  • katzo7

    FYI: with respect and only in the hopes of helping fellow traders.

    http://www.screencast.com/users/katzo7/folders/

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    disagree as much as you want, insult and I'll show why hamsters carry iron brooms (but we always warn and educate and only use the broom as a last ressort)

    cheers, you've been around for a while, you know no offense meant by me, just keeping ES civil

  • yudhisthira

    Zero lite still in channel. Can't get positive yet.
    Vwap a few points away.

  • http://www.mylifemytrade.com MyLifeMyTrade

    Not questioning your strategy, but as a fellow evil dweller.. some questions for you to think about:
    – is sept 2010 (3 months away) really long term?
    – are you willing to let them expire worthless like mole is?
    – if not, then at what price level do you let them go.
    – what SPX level do you expect by sept 2010?

  • http://www.mylifemytrade.com MyLifeMyTrade

    Dip to be bought.. Remember the day when Spain got S&P downgrade.. we went down 10 points in a jiffy.. and by EOD we made up for those 10 points and lot more.

    Of course those were different days.. now there is lot more fear out there..

  • Kudos

    Yes today is inconsequetial, but if todays moved continued to a very negative day I'd be less confident about the retrace. I play both sides but i'm a long-term bear and i'm not that i'm barely hedged for more downside right now. That abrupt move today scared me and I almost made a bad decision. It looked like a fat finger event briefly

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    thanks, sharing is the key ๐Ÿ˜‰

    and do stay calm, the comment was… doubtful but appologies were presented

  • katzo7

    thnx, over it now.

  • katzo7

    Triangle building on the 5 min.

  • skynard

    Hang on folks!

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    that's the spirit!

    now… 1089-1090 was broken, i expect some agressive followthrough if there are no “helping hands”

  • http://www.mylifemytrade.com MyLifeMyTrade

    Are we painting a bear flag now?

  • katzo7

    Heavy lifting may be done for the day, (I said this earlier and was very wrong, it is ok to be wrong, just not to lose $$). So much for the philosophy that all the big boyz are in the Hamptons and the small fries are trading today and that nothing will happen. Rules are meant for fools. I want you all to see how fast I got spooked, how fast someone can change their opinion about market direction, the market is dynamic, takes no prisoners.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    i did my own guts over brain plays today

  • katzo7

    in what way?

  • equity_momo

    If we break 1093 again today on the 15min look out below.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    reduced my crazy long edge (abk) even after it went above support at 1.07

  • equity_momo

    Correction – 109.3 on the SPY. looking at the wrong instrument apologies.

  • Tronacate
  • katzo7

    Megaphone

  • Tronacate

    ya

  • equity_momo

    Waiting for XLF to break 14.68 on the 15 min and then that gets the full beans on the short side too.

  • Tronacate

    You could be saying we have an inverted h&s BUT volume was pathetic on the breakout above the neckline which negates the pattern and plus the short time frame is questionable

  • momac

    Not worth a damn, should of stayed in bed. It could be worse though, like yesterday. Yikes !!
    Oh, and I did sell out yesterday all of the sds and all but 100 shares of tza. I should warn you all ahead of time, this would have been the forecast for a down market today. Whatever I do, do the opposite.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    calm down, the day is still young

  • Tronacate

    Be nice to see a gap fill to 14.40

  • elliott_surfs

    bear flag 10min /es? so neat 'n purrrdy

  • OldChicago

    If we can't hold the neckline, it's many things – failed H-S, breaking 20ma/50ma on the hourly, etc. The Megaphone would be in favor. IMO.

  • equity_momo

    Get ready.

  • Tronacate

    EUR/JPY on a nice downtrend…..same with the aud

  • tradingmom

    I'm not clear on the implications of the megaphone. Also, coming up on ZL lower trendline, signal not that strong so I don't think it will break thru.

  • katzo7

    Disqus is pissing me off.

    Look out below.

  • Tronacate

    agreed

  • Tronacate

    zero looks like a flag patern

  • anoopsan

    Dow Jones 5 Minutes Chart price back into the channel after some noise

    http://niftychartsandpatterns.blogspot.com/2010

    Thank you

  • BobbyLow

    Question on the Lite

    The signal just dropped below the red line.

    So if the signal stays below that red line then the divergence is negated right?

  • katzo7

    Note how my 1089 is now resistance . . .

  • http://www.mylifemytrade.com MyLifeMyTrade

    We could get some real panic into close…. with a 3-day weekend when Europe will be open on Monday

  • ricebowl

    1) Sept isn't that far off, but neither is the 3 of 3 if we've really started P3.
    2) I don't plan to hold into opex, but yes, I'm willing to let them go to zero.
    3) I don't plan to fully commit until 1150. I would be out if we sailed past 1180. It would be painful, but it wouldn't leave me broke. Most likely I will fully commit at 1120 and hedge through 1150.
    4) Who can say where we'll be in 3 months? I would expect that if this is a wave 2, it will last 4-6 weeks with the distinct possibility of lasting a bit longer. I expect the bottom of the 3 of 3 to come between 870-930 since this area is hugely significant from last year.

    If between now and Sept. we hit the upper target of 930 and I had Sept 100 SPY puts bought at today's valuations, I would gain approx. 50%. Besides waiting for 1120, I am waiting for ^VIX to come down more before I commit cash.

  • http://evilspeculator.com molecool

    I know this is terribly unproductive but this market is a pain in the ass – LOL

    Alright – I'm off – no need to watch those pre-holiday gyrations. Catch you later, guys!

  • http://evilspeculator.com molecool

    You would think so, yes – it's a strange signal quite frankly, especially with that fast candle down. Someone unwound a big chunk there.

  • equity_momo

    Fully short XLF 14.68. Next 15 mins vital for the remainder of the day

  • Rayden

    MLMT – can I play?

    “is sept 2010 (3 months away) really long term?” – of course not ๐Ÿ˜‰ long term is somewhere beyond 2011. i think if anyone was willing to offer me decent odds (1 in 8 to 10) on a binary bet of the SPX being lower than 500 in 2012, i would put decent money on it ๐Ÿ˜‰

    “are you willing to let them expire worthless like mole is?” – yes. it would suck bigtime, but the risk/reward is still favorable imo.

    “what SPX level do you expect by sept 2010? ” – between 600 and 900. we went 1215 to 1040 in one month. we can even spend a few months here drifting sideways/up and then go 1150 to 900 in one month, still in time for september. tops are slow; i think we are still topping/rolling over, but i don't expect things to unfold quickly yet. i think the flash crash was a preview, but i really don't expect quick follow-through. i was actually rather surprised we dropped below the flash crash lows so soon, and expect a major rally (anywhere from 1140 to 1215 or even new highs) before we head even lower. it seems clear that the *character* of trading has changed somewhat since mid-april, but that doesn't mean we don't make new highs, or we don't go back to a low volatility period; same as the jan-feb drop (which happened mostly in four trading days) was a preview for the flash crash but we still made new highs after (at least in the usa, not so much other markets), and had a month of exceptionally low volatility.

  • katzo7

    Talk about “walking the line.”

    http://www.screencast.com/users/katzo7/folders/

  • equity_momo

    Maybe missing a serious reversal off the 200 day m/a today mole , close could get fugly.
    Peace out.

  • gsavli

    This market is ill.

    No matter how oversold we are, rips get sold.

  • http://www.mylifemytrade.com MyLifeMyTrade

    Ok.. so your puts are sep 2010 or 2011 or 2012.. wait… jan 2011 is still 6 months away.. so I dont think they have sep 2011 or sep 2012 puts trading for spy yet..

    I think you have a bold prediction of spx below 900 by sep 2010… 950 or so may still be understandable because we got some really solid support in 950-960 area..

    Anyway I am glad that you understand the risks.. that is all I wanted.. A ton of people used to go all in FAZ or some such shit following Atilla. I know there are people here who are all-in into the long term puts.. That is all I am trying to prevent :-)

  • equity_momo

    Until we break 1220 this market is broken. Rips will get sold until then (unless we chop sideways so long that the moving averages can do something special – unlikely)

  • BobbyLow

    What time frame are you using in which you are seeing Megaphone? I'm looking for ABCDE Reverse Symentrical Triangle with higher highs and lower lows?

  • Tronacate

    Might get a little bounce after we get below 1080ish to backtest lower tl

  • katzo7

    was referring to Tronacate's YM chart, look there . .

  • Tronacate

    YM has the clearest pattern…….21min

  • katzo7

    Next ES tyarget 1082.50-83

  • Tronacate
  • Tronacate

    VERY NICE!!!!

  • BobbyLow

    I thought that's the one you meant but I thought that Megaphones were supposed to be bullish and that's why I was a little confused.

  • Tronacate

    Outside reversal on the daily would definitely kick ass……got a good ways to go for that

  • katzo7

    IMO megaphones reflect big indecision and can break either way.

  • katzo7

    Believe it or not she came right up to my line (“walking the line”) @ 1087.50. Let's see where she goes.

  • ricebowl

    Agreed. Yesterday I replied to mole and told him to beat with a large stick anyone who went short here. Right after a huge 180-point decline is not the time to get short. But that time will come soon.

    I am surprised at how quickly we've come 50 points up off of the bottom. That makes this very difficult to precisely call. Still, I agree with Rayden that the risk/reward for the trade is very favorable. As stated before, I haven't opened the trade yet and don't plan to until SPX 1120. I want to see ^VIX come down and some time burn off. That makes the trade even more attractive.

  • equity_momo

    Failure to grab the 15 min – that last half hour just set a tricky trend into the close for the bulls. Heads up.

  • ricebowl

    We think alike.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    our 1089 please ๐Ÿ˜‰

    BTW, my “missed call” yesterday when i said opening was a top… it is a multi-day top, today was headfake, a compressed version of 12-13 of may

  • katzo7

    It is 1087.50 now, above that and a big ?

  • http://pitch3.zstock7.com/ zstock, Pro Select!

    JNJ 59, getting close to Nov low 57.5 , closed out BTU puts from yesterday +40%

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    this market is not oversold… yet

  • katzo7

    Tink we are going up towards the close, this is a ST call.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    talking of FAZ, took a small dip today @14,8, stop @14,6, target 15,6 today or i'll risk and try 18.5 monday

  • http://www.mylifemytrade.com MyLifeMyTrade

    18.5 ???

  • http://www.mylifemytrade.com MyLifeMyTrade

    How high do we go – I think 92 is going to be a speed-bump… likely we don't get above 97 IMO

  • tradingmom

    I just have to say…today is awesome! I love this. I could do this all day long. Oh wait….I guess I do.

  • equity_momo

    Think we tank. Thats what makes a market :) I'll hold 35% short over weekend but right now im 400% short…. if we close LOD i stay margin short x2 over weekend.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    yesterday morning we were already overbought…

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    do you use ma104 on 30 min charts?

  • http://www.mylifemytrade.com MyLifeMyTrade

    yeah with OTM puts, VIX coming down will help much more than 30 more points up on SPX

  • BobbyLow

    Thanks Tonacate and Katzo

    BTW, one of the things I truly appreciate about this board is that people here devote the vast majority of their time writing about actual trading. I'm amazed at how much I've been able to pick up here. Even stuff that has kicked around in my head for years is becoming more clear.

    Or better phrased, the quality of posts are outstanding. There is no clutter about politics or saving the world and that is fantastic.

  • skynard

    Have a GOOD weekend with your family! Peace out, +5% on the day. Where is the beer?

  • gsavli
  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    not sure about the count right now, but either it sustains 14.8 and we go to 18.5+ or say hello to 11's (but there is a nice retest f 15.6 that should work today either way

  • Tronacate

    Everyday I pray for world peace :)

  • katzo7

    No, EWs on ALL time frames, stochs/MACD, %R, 20 & 50 MA crosses but they are late for my calls, channels, trend lines, oscillator to measure strength, vol. charts ~ TICK, 5, 15, 60, 120, 240, day week, month. . . century lol
    The big trick is to judge what to look at on which chart.

  • ricebowl

    How do you get overbought on a retrace after a huge decline? I've heard (and said) this so many times, but it's patently false. If we had rebounded to 1130 then I would agree with you.

  • Tronacate

    nice chart…….need to hit the bottom of the channel before we can even think about the megaphone

  • UayBalam

    Are you buying options or trading the ETF itself?

  • anoopsan

    Dow jones one hour chart with ichimoku cloud

    http://niftychartsandpatterns.blogspot.com/2010

    Thank you

  • Tronacate

    Could count out as a Wolffewave………target 1720 or below

  • katzo7

    Put a 5 min. up, draw a trend line under new up direction.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    there was a clear william R% TOP there, there was an high enough RSI and then a DIVERGENCE (rsi tanked as price rose during yesterday), but feel free to check what i use intraday, mentioned it often enough

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    my bank doesn't do options, plain securities

  • equity_momo

    15 min owning the 5. This is a war right here. SPY favouring bulls by a slim slim margin , XLF favouring bears by slenderest of margins.

  • gsavli

    you mean, your wife doesn't let you.

  • katzo7

    Mine is a VST call. I day trade.

  • Rayden

    “your puts are sep 2010 or 2011 or 2012.. wait… jan 2011 is still 6 months away.. so I dont think they have sep 2011 or sep 2012 puts trading for spy yet..” – SPX

    “a bold prediction of spx below 900 by sep 2010” – not so bold; just based on IV now the expected sept range should be +/- 150 to 200 points. by saying 900, i'm basically saying it would be -. of course IV now is also probably too low; we just had what would according to IV be a 6-month move in 1 month.

  • Tronacate

    NQ whacked top BB

  • nyse

    Ah, so you DO get IV. Kidding man ๐Ÿ˜‰ Hows it going?

  • equity_momo

    We are looking at almsot the same thing , except im on 15 min youre on 5 . With what i have on the line right now m day trading essentially and think the 15 gives less head fakes. i'll be taking my cut or a high 5 at the close either way. Looking like a cut right now.

  • ricebowl

    You trade SPX puts? How do you do it? The spreads were ridiculous the last time I looked at them.

    Also, what are you referring to with IV?

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    means exactly what i said…mrs. hamster has no opinion on options… or stock… or stock market

  • EvilTrader

    guess LOD already put.
    uptrend resuming.

  • http://www.mylifemytrade.com MyLifeMyTrade

    The spain news let the bulls free on the roads

  • katzo7

    Respectfully no guessing, just look at charts.

  • ricebowl

    <sarcasm>Just imagine what a Spanish default would do. We'd rally to infinity because it would be so bullish.</sarcasm>

  • ricebowl

    Critical retest of 1093 coming here. We could close green if it doesn't hold.

  • http://iberianviews.blogspot.com/ catracho

    sorry been out playing football (soccer for the septics!) WHAT spanish news?

  • ricebowl

    “Dios mio ni tenemos para pagar la renta… mierda! Que hacemos?”

    That news…

  • katzo7

    if you guys look at the 5 (with trend lines) it is the clearest pic I have eva seen

  • ricebowl

    You're right. It was a 5 on some intraday time frame. You can see wave 1 this morning in the AM.

  • Rayden

    “Most likely I will fully commit at 1120 and hedge through 1150.” – ricebowl, very curious, hedge how?

    “I would expect that if this is a wave 2, it will last 4-6 weeks” – hmm? you mean minor 2, correct? minor 1 (if that is what it was) lasted almost exactly a month, minor 2 should be in theory from half as long to as long, so 2-4 weeks. very wild guess of course.

  • http://www.mylifemytrade.com MyLifeMyTrade

    WHOA … look at that signal..

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    we have a double top on williams R% and lazy K just hit D… we might have a retrace finished

  • equity_momo

    Looking that way. Cut XLF at 14.79 but looking for re-entry before weekend.

  • EvilTrader

    now is the test for bulls.

    intraday channel upperband.

  • katzo7

    Art this time you should observe the MACD on the 5 min. to see what it is doing. Potential cross of the zero line ~ if so bullish. the basatards will run this up into the close IMO.

  • Long_John_Silver

    Whoa! That's a very cool divergence on Zero, going long on SPY for the 3 day weekend …

  • Rayden

    SPX, yeah, just get in between bid and ask ๐Ÿ˜‰ Many a time I've tried to do the same trade in ES and SPX simultaneously and the SPX went through at a better price (and yeah, there is an offset between the strikes, I'm of course taking that into account). So I've more or less stopped trying to use ES. Btw… have you seen the block trades in SPX options? Single trades worth 10's of millions are pretty common.

    IV=implied volatility.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    i was stoped out of my FAZ

  • katzo7

    My ES 1097 ~ actual peak was 1096.50 for the bean counters, close enough ~ just hit, where do we go now??

  • http://www.mylifemytrade.com MyLifeMyTrade

    1107ES IMO was expected to produce a strong reaction.. I guess the market makers found an excuse sooner.. so they created the shakeout from a lower level.. This just means that we may go up good 20-30 points above 1104 before the next shakeout

  • katzo7

    I will avoid any more trading for ROD.

  • tooshort

    FXE never confirmed the bounce…down we go?

  • OldChicago

    this leg up has very low vol, Euro didn't confirm the bullishness with ES. Games not over?

  • tradingmom

    ROD?

  • ricebowl

    To be honest I haven't thought it completely through since I see 1120 as being a ways off still, but I was thinking of hedging with ITM/ATM front-month calls through the 1120-1150 range. At 1150 I would set a stop (instead of managing it by hand which is how I usually treat options) and let it ride.

    I guess I'm referring to minor 2? I'm talking about wave 2 of P3. I understand EWT at a high-level, but I don't practice it personally. I didn't know about the time relation, but I was basing my 4-6 weeks comment off of the fact that rallies usually last longer than plunges. I suppose you are right that it's inverted in a bear market, though. That would put us at the bottom before the end of the year, though, which I wouldn't feel very confident of.

  • Rayden

    Hey – hanging in there, mostly cash and the rest mostly flat. Booooring ๐Ÿ˜‰

    I was just re-reading Charles Cottle's “Options Trading, The Hidden Reality” to see if there was anything useful I missed before. Then of course there's Baird's classic “Options Market Making”, it's a must read if you haven't before.

  • amokta

    The BAM model is telling us that the stock market is topping again as I write this note (9:45am PST) and we are expecting another wave of pessimism to strike at any minute. The model is forecasting a severe decline or crash into June 7th and are positioned accordingly. We shall see. 26 Hours Ago

  • Clint

    Certainly possible if the bulls don't get back total control next week…and that does not look likely.

  • amokta

    according to this months ewff, top-top-topping process is over, and to expect lower prices

  • http://www.mylifemytrade.com MyLifeMyTrade

    Did they predict the May 6th crash? If not, then I wouldn't bet my farm based on what they are saying.

    My 2c: a ton of people will come out calling for a crash, AFTER IT HAS already happened.

  • anoopsan

    There was negative divergence in DOW HOUR CHART

    http://niftychartsandpatterns.blogspot.com/2010

    Thank you

  • ricebowl

    Thanks.

    I would just ignore IV right now. It lags the market.

  • ricebowl

    I'd be more than happy to take the other side of that trade.

  • Clint

    Good point. I have to admit…if I “knew” something like that for sure….I wouldn't share it with ANYBODY. I wouldn't want to dilute the opportunities by having thousands of other traders doing the same thing. Never-the-less…going below 10,000 for a while starting next week looks like a good bet unless the 3 day weekend brings an awful lot of news full of global economic optimism.

  • amokta

    true, im just providing info (or is this mis-info!)
    i think they were bearish going into may, mind you even a broken clock is right once a year

  • http://www.mylifemytrade.com MyLifeMyTrade

    Just saying this jokingly.. no offense of whatso ever meant

    I am so used to looking at only SPX.. that when somene mentions DOW below 10k. I have to go and see what that would mean in terms of SPX – LOL

  • http://www.mylifemytrade.com MyLifeMyTrade

    Given that the big push up ended at 1097, looks like we may close somewhere between 1092 and 1097 today.

  • mothwhoflysbackwards

    if one sees a huge volume spike on min. bars is it safe to assume it was caused by one guy? I mean you wouldn't expect to see them based on random distrabution. yesterday huge spike 1:15/1:16 in FAZ and today FAZ and FAS both had a huge spike at 12:37. Any speculation on this? Must be some huge swing trader?

  • Bob the Horse

    Markets never cease to amaze me. Most of the bullish techncial signals over this week needed a monthly close over 1090 to confirm. And that is exactly what we are (probably) going to get. It is going to be a buy on the open Tuesday.

  • Clint

    Understood. SPX is the big picture index. I think DJIA 10,000 roughly correlates with around 1170. I have several screens I look at…but on one of them I only have the DJIA and SPX on it…just to see if they are running in sync…then I look at everything else on the other screens.

  • Clint

    Sorry…make that 1070 on the SPX…in relation to 10,000.

  • ricebowl

    You go short first, then tell people that you are short. If I were in that position I would never make recommendations on positions that I weren't already holding myself for two reasons:
    1) I'd have skin in the game, and you have to respect a bad call so long as the caller has money on the line, too. (Doesn't mean you trade his advice, of course.)
    2) I'd not be giving my subs the chance to get a better price than I myself got.

    As long as you disclose what you're doing and don't intend to screw people over, then it's neither illegal nor unethical.

  • ricebowl

    Agreed wholeheartedly. Even a downgrade of Spain didn't phase the market for the most part. The bulls have the puck and they're running with it.

  • BobbyLow

    They've got to close it flat or green for the holiday. So now do we get a few weeks of Spain is failing – Spain is Ok. – No Spain is failing – Spain will be helped by the EU. Germany says no – Germany says yes.

    Oh Boy, I can't wait. :)

  • http://www.mylifemytrade.com MyLifeMyTrade

    Agree… market has shaken out everyone who bought since the 1038 bottom.. only strong hands still holding.. The only one not shaken out is the one who bought between 1038 and 1046 (which anyway needed brave souls).

    IMO we are good for another 20-30 points of upside on ES now

  • ricebowl

    Maybe you mean 1070…?

    I'm in the same camp as MyLifeMyTrade; I never look at the DOW except to translate SPX into DOW for coworkers and friends who are accustomed to watching the DOW.

  • katzo7

    Pretty much called very f*cking swing today, no clowning around here, and advised not to play their game during the last hour of trading. Probably close up slightly but really do not care.

    Here is a chart for youse.

    http://www.screencast.com/users/katzo7/folders/

    And

    http://www.youtube.com/watch?v=Gs6LfHXOSxU

  • Clint

    Oh I agree. Heavy traffic on a particular directional strategy on a given position is what ruins half of the opportunities available to us. Sometimes those sentiment indicators are very effective. Sometimes.

  • http://www.mylifemytrade.com MyLifeMyTrade

    Again no offense intended: Grow up bro.. be a pro.. dow is for retail traders like cramer and his followers.

  • OldChicago

    Buffet, Briggs, Picken, to name a few.

  • tradingmom

    I never looked at the DOW until it stopped on a dime at the 61.8 fib and turned down. Now, I'm back to the Dow. Ticks me off actually, I really hate the Dow.

  • http://www.mylifemytrade.com MyLifeMyTrade

    WHOA.. I think the market wants to close green.

  • ricebowl

    Not likely. It might be a bunch of large trading desks/hedge funds that all decided to do the same thing at the same time, but I wouldn't bet on it being *one* person.

    There are program traders out there that trade news that could be responsible for such things, too. A couple of years ago when TS Faye hit Florida, Florida Today saw a surge of activity as people sought information about the storm. Because of this, an old article from 2003ish about an airline going bankrupt somehow got dug up by Google. Some program trader picked it up, incorrectly assumed that it was current news, and milliseconds later unleashed hell on that stock. Other funds saw the move and followed suit. It lost 75% intraday IIRC, but it came right back up because the news was old and irrelevant. I wish I could remember the name of the airline.

  • Clint

    I did mean 1070. 10,000 still seems to matter. Looking forward to it not mattering later this year.

  • ricebowl

    Ding, ding, ding!

    “If we make it past 1093 then we're headed for 1100.” ๐Ÿ˜‰

    I'm not sure that we'll actually close green, but I don't see us going back below 1097 today unless we do it right now.

  • http://www.mylifemytrade.com MyLifeMyTrade

    To gague WHERE the market is broadly.. I use SPX.. but the market turns are often determined better by YM (dow future) or DOW

  • Long_John_Silver

    There's a lot of bad news already priced into this market …

  • http://www.mylifemytrade.com MyLifeMyTrade

    This bull leg of the market is at least being better… previously market would go straight up without retracements.. Here we are getting good retracements so that those who didnt catch the bottom can still enter.

  • http://www.mylifemytrade.com MyLifeMyTrade

    I think a TON of people must have shorted that bounce from 85 to 92.. and they are the ones providing fuel for this short squeeze…

  • equity_momo

    Was fun for a while there with few hours to go ๐Ÿ˜‰ I put alot on the line today and was wrong and in retrospect it was too fine a line for me to play so deep. But my stop-loss kept the damage down so im back Tues.
    (i let my intermediate view cloud the short term when i wanted it to…..)

  • Clint

    You're right. The market has absorbed a lot of punches…and is still standing. We shall see.

  • ricebowl

    Next phase is the bull market from hell that goes straight up in a line… until it doesn't.

  • katzo7

    Hope I helped in some way.

    Here is a chart for youse.

    http://www.screencast.com/users/katzo7/folders/

    And

    http://www.youtube.com/watch?v=Gs6LfHXOSxU

  • EvilTrader

    close green today ?

    market already priced spain downgrade.

    Ignoring bad news is bullish. I happen to agree with 1150 target.

  • ricebowl

    Everyone makes mistakes. Better at this point to stay out of the cookie jar until risk/reward on shorting becomes favorable again. I'm thinking of taking a week or so off.

  • http://www.mylifemytrade.com MyLifeMyTrade

    I think we went up in a straight line back in Feb.. this will be a more choppier ride up IMO.

  • ricebowl

    Bounce at SPX 1097 in the works. Probably close 1097 – 1100. I'm not playing this.

  • equity_momo

    Im probably not the right person to listen to today but dont take time off. There are big moves coming. Predominantly down. I think for the most part the short side trades will be easier to run the more time that passes now as trend asserts itself.

  • katzo7

    Before any pontification about bull market or bear market I go here, previously posted WEEK and MONTH (not updated). I see nothing LT bullish about this.

    http://www.screencast.com/users/katzo7/folders/

    And

    http://www.youtube.com/watch?v=DKbPUzhWeeI&feat

  • BobbyLow

    I think that yes we are probably going to get a continued sizable retracement to the upside.

    However, I would still not put too much faith in a Friday before a three day weekend results.

  • ricebowl

    I don't feel like chasing this beast up, and I'm not willing to get my hands chopped off by shorting these levels, so I have nothing to do. The market's not going to tank 200 points next week.

  • ricebowl

    Low put in at 1096.77. ๐Ÿ˜‰

  • ricebowl

    I stand corrected. I was going to say the low will come in at 1093, but we just gapped there, so maybe not.

  • jigdaddy

    EUR/USD LOD

  • katzo7

    Nice BRD on the 5 min.

  • Clint

    This be one crazy market. In the big picture..it would appear to be negative. Very unstable. Next week will be interesting.

  • anoopsan

    Dow hour chart with ichimoki cloud gave a good trade

    http://niftychartsandpatterns.blogspot.com/2010

    Thank you

  • EvilTrader

    any one going long into weekend ?

  • Long_John_Silver

    your charts and comments are extremely helpful, & greatly appreciated

  • Clint

    I'm not…but I understand the psychology of doing it.- Good luck ! :)

  • derekste

    25% long via front month SPY 110 calls, 50% short via Dec 100/90 vertical put, and 25% cash.

  • yudhisthira

    Pretty good shake out.
    Had to go with the flow on the bearish divergence at afternoon top.
    Probably nothing. Shaking out bulls before weekend.
    I'll take my lumps next week if necessary.

  • UayBalam

    FAZ closes above 15 today!!

  • http://www.mylifemytrade.com MyLifeMyTrade

    Panic close.. close is a BUY BUY BUY…

  • http://www.mylifemytrade.com MyLifeMyTrade

    Panic sell into close.. close is BUY BUY BUY

  • Long_John_Silver

    yes, spy

  • equity_momo

    Now thats what im fugging talking about.

  • gsavli

    Are US futures open on Sunday – Monday?

  • jigdaddy

    i think the bears read your post re: 1090 :-)

  • katzo7

    Two day up rule and short !!!!!!!!!!!!!!

  • amokta

    all in all ot a bad day for circus bears

  • Tronacate

    interesting finish……..futures are trying to take out LOD

  • Tronacate

    Good question

  • Clint

    Well…time to jump in a cab…head to the bar and figure this market out with my other local trading friends. Happy memorial Day weekend. Next week might be fun.

  • gsavli

    you mean wacko instead of interesting?

  • Tronacate

    So much action is happening overnight………remember the nasdaq crash…….I think futures dropped like 60% overnight or something crazy like that

  • amokta

    all in all, not a bad close for circus bears.

  • Tronacate

    Yeah…..pretty wacko……

  • http://www.mylifemytrade.com MyLifeMyTrade

    close is a buy.. its like taking candy from a kid

  • http://www.mylifemytrade.com MyLifeMyTrade

    futures CANNOT drop more than 5% overnight.. if they do drop 5%, trading stops

  • ricebowl

    I put in a bid on June 110 SPY calls @ $233, but I probably won't get filled. :-(

  • http://www.mylifemytrade.com MyLifeMyTrade

    futures trade from sunday 6pm ET to Monday 11:30 am ET (basically from Asia open to Europe close)

  • gsavli

    thanks. so, as usual.

  • katzo7

    Once again. Anyone see a break of a channel here?

    http://www.screencast.com/users/katzo7/folders/

  • http://www.mylifemytrade.com MyLifeMyTrade

    If you trade TF (E-mini Russell 2k).. you have to find out when it stops trading Monday.. I am not sure

  • gsavli

    sorry, but the channel you draw is very weird.

  • Tronacate

    Nope

  • DudePlunger

    Simple trade setup for my swing trading strategy—Sell a break of 1082.50. Why? Yesterday's intraday low was 1082.50, today's low was 1083.25. Breaking below those two lows would tell me that we are at least going to fill the gap up from Wednesday, meaning 1060 was in the cards. Even if we only saw 1070, I'll be more than happy to book 10pts on 1/2 my position and then increase my leverage if we continue to the downside.

    I know some of you guys are bullish and that's fine, I went long 3 times today day trading, but on a swing trade basis I cannot go long as the daily trend is clearly down as long as we remain below 1120.

  • equity_momo

    Today was a lesson. Certainly for me. My charts and instinct told me i was going to make a week or mores money today on the short side.
    I came into the day +1% , unleveraged , and played a breakdown with 4x margin. I got stopped out at -2% even thought my gut was telling me to chill. For a while i saved myself a lot of dough with the stop loss but it cost me big in the end..
    Sometimes i wonder how to calibrate my TA and studying with my gut. Im getting conflicts of interest that are stopping me out at the wrong time , either one, and turning P into L. Tough week. I knew the 200 day m/a would prove an anvil for the market and yet scrabbled into the close to make MINUS 1.25%.
    Peace.

  • katzo7

    Auto regression channel, see that number up at the top? The .924? That implies that this is an extremely form fitting channel, action is respecting it very well. If you got a 92.4 in your math test you would feel good.

  • DudePlunger

    A good way to manage your TA and you're gut is to have a mechanical entry, a mechanical stop, and everything in between is gut (profit taking, reducing your stop, etc.)

  • katzo7

    No one wins very well in a transition.

  • http://iberianviews.blogspot.com/ catracho

    nope 2000 was basically limit down most days for a while…crazy stuff but fun (in an evil kind of way!)

  • katzo7

    This closing provided some real good info.

  • momac

    hmmm, and what would that be?

  • momac

    hmmm, and what would that be?

  • mothwhoflysbackwards

    Thanks for the reply.. in so far as large trading desks/hedge funds acting at once … hmmm maybe…but why would they all act right at that min? for such speed it would seem machine/computer generated? if not what specific “thing” could the trading desks/hedge funds see? what ever it is it must have been immediatly seen and acted upon by many large players.

    The second explanation seems more likely to me, but it was not known by enough people to move the market… like in the example you gave. In the fall of 08 sold SKF too soon in the day only to watch it fall like a rock… oh yeah I bought some only to find out about some bail out or such. Point being if enough insiders know something they will move the market. So any news that was known by program traders (and thus caused the volume spike) couldn't be known by enough people to move the market…and the spikes came in one two min and then stopped.

    But I do know the story of the false bankruptcy you are talking about (think a reporter found old court case and didn't check the date) unfortunatly I don't have one min data going back that far (or even to the skf “incident” so I don't know if the volume increase was confined to one (or even a few) one min bars. But yeah the one dude notion seems improbable.. on the other hand it would explain the huge spikes in both at exactly 12:37. Thanks again.. now go take sombodys money, so long as it's not mine!

  • DudePlunger

    So we slamming this thing short next week katzo or what?

  • equity_momo

    Everything in between is a fine line…..
    I honestly think im not a day trader. I have very good IT views and try to maximise them on intra-day confirmations of those IT views. Which is a mistake. Ive been trading short tack since 1140 and yet am flat. I see the chop and the mistakes i have made are intra day.
    I'll work on it and perhaps lurk here less during session hours.

  • http://iberianviews.blogspot.com/ catracho

    yes seems to be a lot of “cryptic” comments recently..

    “This closing provided some real good info.”

    “close is a buy.. its like taking candy from a kid”

  • katzo7

    Looks that way to me at this point. See no bullish rally commencing, this was a failed EW4 attempt on the day, obvious after today, we have slipped back into the EW3 down IMHO.

  • DudePlunger

    Couldn't agree more. Target 950 within 2 weeks?

  • katzo7

    See comment to DudeP.

  • equity_momo

    Thats an interesting point and makes sense. I shall opt for the latter and stick to my trend analysis. Bigger stop losses required so shall keep the positions smaller for a while. Its just so damn difficult when my gut is telling me whats about to unfold… ๐Ÿ˜‰

  • katzo7

    Will work on that over the weekend. Now I will be accused of being cryptic. ROTF . .

  • momac

    same here, that's the problem I'm having. Trying to trade intra day is 9 times out of 10 a losing proposition for me. Came in this morning basically flat, except for the long term puts and the 100 shares of tza that I held onto last night. The charts were saying go short, so I bought 5 june 110 puts, market went up, got stopped out. So then I bought 5 of the june calls, market went down, got stopped out again. This is an everyday occurence for me. But I had a feeling that there would be an end of day sell of because who in their right mind would want to stay long over this weekend. But by now, I'm freaked out so I don't act on it. And of course since I didn't act on it, it did go down. Now if I would of been positioned short, there would of been an end of day ramp. I'm pitiful, just pitiful!!

  • EvilTrader

    this happens all the time with every trader.

    In such a volatile market, stops are popped up and down every hour. It is very frustrating to be stopped out and be proven right an hour later.

    But that is the business of trading.

    Remember, the first loss is the best.

    Try to write down your trades and stoplosses and compute some statistics to see if you should tolerate more risk in order not to be stopped many times.

  • anoopsan

    Weekly bullish engulfing in NETAPP INC

    http://niftychartsandpatterns.blogspot.com/2010

    Thank you

  • katzo7

    You are not pitiful, market is designed to do that. Here was the key to the day, couldn't have been clearer. Down was in no way over, no divergence.

    http://www.screencast.com/users/katzo7/folders/

  • ricebowl

    Have to pick better stops and/or better entries, then. Generally if your stop is good, then if you stop gets hit, the market doesn't turn around until well after your stop. Likewise if your entry is good, then the market doesn't offer much chance to get in at a better price.

  • Wave_Surfer

    Just trying to understand where people are…
    If I understand right,

    Katzo7 says we are going down
    ('See no bullish rally commencing' and 'we have slipped back into the EW3 down IMHO.'

    MLMT says we are going up
    ('close is a buy.. its like taking candy from a kid')

    As far as me. I am undecided. I see good points for either argument.
    It seems like we are heading deeper into Wave 3, but then I am not sure we are done bouncing yet.

    Right now, I have the brakes on. Meaning I have 2 bearish positions, but they are spreads so with the hedge, they move like 1/5 to 1/10 as fast as they normally would and time decay and 3 day weekend works for me. Also if it goes up, I can step out of the spreads and the profit from doing that will erase most of the losses from my puts. Of course doing that will also leave me prepared (or vulnerable) to fast movements. Now I am just trying to find a good peak to step out of my spreads and add more sideline cash into puts.

    In short, I am mostly undecided for the next few trading days, but I am a tiny bit more towards the side of the market going up Tuesday and the next week.

    Anyone else want to go on record for what they think Tuesday and next week holds?

  • BobbyLow

    What a difference a day makes.

    I think my account is finally set up the way I want it where it is long term Bearish and a little bit short term Bullish. Deltas and Vegas are lined up pretty good and I almost don't care if we gap up 30 points or down 30 points on Tues. (Although a gap down would be better as it would wake up my Long Term Puts.

    Today I was able to get back 30% of the Hit I took yesterday so at least I won't be as Grumpy a Bear going into a nice 3 Day Weekend. :)

    So all in all, it was a fun day and Y'all have a great weekend.

  • gsavli

    I forgot to close my short NQ position, cause I was reading something when market closed.
    There you go.

  • psycho_puppies

    Tuesday we crash and burn… total fear… 150 VIX. Yeah Baby!

  • DudePlunger

    If we break 1082.50, we will see 1060. Otherwise, we are headed to 1120.

  • http://evilspeculator.com molecool

    “Sometimes i wonder how to calibrate my TA and studying with my gut.”

    Easy – leave your 'gut' out of it. You really think you are smarter than the market and that your intuition will lead to long term profits?

  • elliott_surfs

    420 comments. whaddya think, mole? comment:vxx

  • katzo7

    Here is what I said, listed as 4 hours ago on this site (this timing on the discus may be off a bit). “Out @ 1094, I am getting a bad feeling about upside, just got spooked about an EW reading. MACD on the 5 min. ” I posted my reasoning in an annotated chart subsequently. Again, transitions are very hard to play, and hard to call. And like today, they can happen quickly, this was obviously an EW5 down move (impulsive) on some lower time frame (doesn't matter now ~ lol). But I did offer suggestions along the way, to put a trend line on 5 min. stuff. I am not always right, but when I am I am deadly accurate.

  • momac

    no, not bullish but what I expected because people are still freaked out about what's going on in the world. I think people unloaded both their long and short positions at the end today, there were just alot more people long. That's just my opinion and really, what do I know. :-) I can't hit the broad side of a barn.

  • http://evilspeculator.com molecool

    Well, I didn't post today, so it's expected.

    Sorry everyone – today was nothing but a pre-holiday churn day and it was the best day for me to get some errands done. Will chime in over the weekend, promised.

  • ricebowl

    If that happened I'd be taking cash advances on my cards and getting a second mortgage to buy, buy, buy just like Black Thursday. We did break Black Thursday's low, but if you'd bought below 1100, you banked some mighty profits before 10xx was ever seen again. The question is only whether you sold.

  • katzo7

    Excellent point mole. As you always say, just look at the chart.

  • ricebowl

    That makes some sense, actually. I have a small short position on QQQQ which actually lost money in the train-wreck-of-a-close we had.

    It doesn't bode well, though, that people are unwilling to hold over a weekend in this environment. It's a ticking time-bomb.

  • amokta

    tell me anywhere to get live (free) futures prices (barchart.com is behind by 20-30min)

  • gsavli

    http://www.finanztreff.de/

    then choose: Marktรผberblick
    then click on : Realtime-Indikationen.

  • momac

    Exactly that – a ticking time bomb. And when it goes off, the market is going to move very fast.

  • momac

    You all are a chatty bunch. Must be the full moon. :-)

  • elliott_surfs

    and I'm a gemini, the other half has been in hiding for a good year now…time to wreak havoc ๐Ÿ˜‰
    have a great weekend Momac

  • ricebowl

    Oops…

    SPARTA!!!

  • DudePlunger
  • momac

    I appreciate you and everyone else who posts when they are either buying or selling and the explanations that go along with it. For newbie me, it helps.

  • momac

    thanks elliott_, I hope you and everyone else has a wonderful 3 day weekend. :-)

  • amokta

    thanks!

  • amokta

    thanks – ill have to learn german it seems for this site !

  • gsavli

    just watch the numbers, as i do. :)

  • equity_momo

    Easier said than done Mole and the best traders in the World cant do it. In fact,the very best often allow their gut to take over in times of major stresses in markets – thats what sets them apart.
    I've traded long enough to know that humans cannot remove their gut so the best traders are ones that harmonise that instinct with whatever system they chose. You yourself are proof of that.

  • Anonymous

    Mole may have said that. Perhaps he can clarify. My powers of intuition tell me that the daily Z (left pane) is really just an expanded view (over multiple days) of the ZL (right pane).

  • OldChicago

    A head-scratching day. The last rally around 3pm see no follow-through on Eur/Jpy or Eur/Usd or oil. Furthermore VXX weren't dropping hard either.

    Here is what puzzled me – VIX up 8%+ while VXX actually when down the last 1/2 hour and rally after market. Can anyone explain this? Is this end-of-month contract shuffles? Thanks.

  • katzo7

    Thnx Momac for the kind words, only trying to help and share what I know. I built two houses basically by myself for myself; this is harder.

  • Wave_Surfer

    Question: If EVERYONE is an independent minded contrarian, then what is a contrarian?

    It is a funny catch-22 riddle, but it is also a real question as well as a real statement. It is easy to PROVE that being contrary to the prevailing mood at extremes is a highly successful and profitable approach and so in the investment world it really is true that almost everyone sees themselves as a contrarian! So, while the question may be unanswerable, it is a very real question.

    Three recent videos on TechTicker show how 2 guys that are control of large sums of money are very bullish because everyone is too bearish.
    The EWFF has the following quote “'There are too many bears around for another collapse.' says the chief executive of a money management firm with $57 billion in assets.”

    Evidently 'everyone' is bullish because 'everyone is bearish.' My question may be more of a real question with real life application than you might first think.

  • ricebowl

    If you think of market sentiment as a sign wave, then a true contrarian runs 180 degrees out of phase. Of course, a true contrarian would make no money, either. Therefore the goal is to lead 90 degrees out of phase which is, of course, quite different. Most people lag the market somewhat. The longer you lag, the more likely you are to become net long at the top — the worst thing you could possibly do — unless you only bet one direction.

    Since we just had a huge wave of bearish sentiment sweep through the markets, the fact that a bunch of fundies are bullish is a good sign to me of a bull run. When those same guys turn bearish or when most everyone else turns bullish, that's when I'm going to run for the exit like the building's on fire.

  • katzo7

    Just watch your fave business channel, do the opposite of what they are touting. Almost everyone is saying 1150s, some are issuing 1200++. They are wrong, or the devious ones are spouting mis-information, why would that be (??), and look at the charts.

  • Wave_Surfer

    >Since we just had a huge wave of bearish sentiment sweep through the markets, the fact that a bunch of fundies are bullish is a good sign to me of a bull run.

    Or what if they never really went bearish (for more than a day or 2)? What if they set all time 200 year highs for bullishness and immediately after the dips, went back to record level bullishness, which then leaves them still sitting at an extreme of bullishness.

    I noticed on the dips during primary wave 2, that sentiment quickly went to fear and then bounced back up. This time, even though there have been strong moves down, there is still a lot of bullishness and a LOT that bulls can point too. Even Mole sees lots of reason to think there may be strong moves up. What do you think a perma-bull Mutual Fund Manager sees??

    Isn't that the point of sentiment?
    When you get record breaking readings on sentiment and then the market strongly moves in a reversal and still sentiment – this time – does not move much, that is another indication (besides the record breaking readings) that this market reversal is going to be real and large.

    I guess I did not impress you with catch-22 element of my original question. Every one thinks they are thinking outside the herd. I repeat, everyone in the herd thinks they are thinking outside of the herd. You responded with, well I can easily think outside the herd. Can your lack of fear that you are part of the herd thinking you think outside the herd be seen as a contrarian signal?

    Personally, when it comes to sentiment, I see the irony and the difficulty of everyone thinking they are thinking different from the herd. Trying to figure out what the real sentiment of the market constantly reminds me of a scene in “Princess Bride” where the guy that is too smart for his own good trying to figure out which glass has the poison in it.

    So, am I the only person that struggles with the irony of being a contrarian, “just like everyone else”?

    As far as me, I think..
    1) Not only did we have the supposedly fat finger drop, but then after a strong bounce we turned around and more slowly and steadily created lows below May 6 and below the Feb lows, shows that the first move down was indeed not a mistake.
    2) There is so much 'fear' that 'everyone' is aware of and so it seems to me that since 'everyone is a contrarian' they see this obvious fear and say like the guy that is on control of $57 Billion, “The are too many bears around for another collapse.”

    So, we have a very strong powerful move down and still we have no real move to fear as far as how the actual money is voting.

    This reminds me of April to November of last year. There was a total lack of fear SUPPOSEDLY and since everyone is a contrarian that meant there was reason to fear and there was no healthy retracement bounce to the move up and the market was overbought and therefore it HAD to come down.

    Now we are at a place where there is supposedly a lot of fear, and more reasons to be bullish than you can shake a stick at, plus the market is oversold (look at all the stuff outside of the Bollinger bands and where RSI, etc are on the daily scale), therefore 'All the independent minded contrarians' know we will go up.

  • Wave_Surfer

    Again, since 'everyone' is a 'smart contrarian' from every retail trader to every TV news expert to every mutual fund manager, it can get dizzying to try to figure out what the herd is ACTUALLY doing versus what all the individual independent minded contrarians members of the herd think the herd is doing.

    To help with that, I look to things like reliable measures of what money is actually doing and can be graphed such as: VIX, ISE, Investors Intelligence, etc say. Personally, I think VIX sitting at 30 after the month we just had says to me, the herd is convinced that 'everyone is afraid and since I am a contrarian, I will be fearless.' Also having people in charge of $57 Billion that think there is too much fear around to allow even the possibility of another collapse says that another collapse is inevitable.

    Another point I am trying to make is the human one. We should all recognize that fading sentiment extremes can be a bit harder than we think. 1) WE are part of the herd. 2) The rest of the herd is made of up individuals like us that also are fading the rest of the herd.

  • katzo7

    I want to ask everyone just one question? Why did we fall so quickly? If this is a new bull run ~ some are saying we have bottomed and stocks are cheap (isn't that a matter of perspective, if you are losing your house or out of a job, then stocks are expensive, aren't they?) why would we fall like this today? Oh, it must have been BP's premature ejaculation. No, it was Spain, their Paella dish was downgraded (btw I love Paella and used to love Spaghetti Alfredo until they said it was a “heart attack on a plate”).

    Market direction is job # one in this business, get that correct and you will be bailed out of bad entries and rewarded handsomely for good ones. Lots o' debate about that tonight ~ BUT only one side will be correct. SOunds easy, right? A 50% chance of getting it corect. If you want to go contrarian, don't hold for long (you saw me today, in and out like a male rabbit on a holiday weekend, IMO direction was still suspect in my mind until my epiphany).

    Not many survive in this business, I said today on a private site “there are bold traders and there are old traders but there are no old bold traders.” With a 90 to 95% failure rate, the big market Ponzi scheme is in constant need of suckers. The market, like a con artist (con artists always get caught, their ego does them in in the end), is smarter that you or I, it knows how to fleece many. Sorry to be so blunt but educate yourself, that is what I did after the tech wreck, and be a survivor. The alternative is unpleasant.

  • vision_invisible

    Absolutely. Go with the prevalent direction or be a lightening fast contrarian.

  • katzo7

    Philosophy major in college WS? Just kidding. Respectfully, why is this important? Do you think you or I can figure it out? Just look at the charts man, that is what I did today and what mole espouses. The answers are to be found right there. When anyone gets it right they think they are a guru. When they get it wrong they want to follow a guru. I will tell you my history. I will probably get it wrong on Tuesday and maybe even longer. That is how it works. The market is smarter than all of us; the market knows all. The market is a tease, it tells us one thing, and then does the other.

    And I will give you a suggestion. If you do not know E Waves get to know them as fast as possible. They are the road map; yes, sometimes there can be landslides blocking the road but they will recount, re-orient us to the correct path. You saw that today where I predicted a recount WAY BEFORE the software picked it up. There are signs to look for.

    Wishing you much success WaveSurfer, and am willing to help as much as my skills and time allow.

  • katzo7

    Thnx LJS, I need responses otherwise it becomes dead for me. Ask questions.

  • Wave_Surfer

    Although I took a bit more of an introspective, philosophical approach, we are very much saying the same thing and on the same page.

    By the way, I don't surf water waves, I try to surf Elliott Waves. Everything is secondary to my wave count. Since Mole is one of the few good Elliott wave people, I am here. I have been watching you a bit here and at SoH for over a year now, and I have respect for your counts as well. I am not offended you don't remember me as I have not talked that much over the last 16 months.

    I guess in my own little fortune cookie kind of way, I am inviting people to eat some humble pie with me. It is pride and arrogance that lead people to a fall, so one way to try to avoid that fall is to remind ourselves to be humble. In this case, to specifically remind ourselves that we are ACTUALLY HUMAN and therefore part of 'The Human Herd' and we can get caught up in the flow of the herd just like other humans. If we find ourselves in the middle of the herd just following the butt in front of us, bad things can happen. By reminding ourselves that we are human too and subject to the same tides that pull humanity, we increase our chances to be able to avoid those pulls and instead surf on top of the Elliott waves. That is a good thing especially since this Elliott wave seems to be heading for a cliff. Of course like in 1930-32 and like Mole KEEPS trying to remind us, we are heading for greater volatility and the swings in both directions can be brutal!

    Although he has not said it in the same words as me, Mole has been banging the 'long term view' because he realizes we are humans, part of the herd and therefore not immune to the feelings that humans have. If we allow ourselves to get caught up in the violent short term rip tides, we can end up being carried by the current of the herd instead of surfing them waves.

    So, just saying the same thing as you and Mole with a slightly different style and vocabulary is all.

  • JJ Trader

    OR… it's an Ending Diagonal with a blow off top

  • The_Grim_Reaper

    The guy who made billions shorting real estate is buying it up like no tomorrow right now (Paulson). Think about it, folks. The short trade is over. It's old news.

  • momac

    damn, this is getting too deep for me. It's like the I know what you know but you know that I know so how can I be sure of what I think I know????? or something like that. :-)

  • Anonymous

    Then I am confused.

    I was under the assumption that P1 was Oct. 2007 – March 2009 and that P2 started in March 2009 and ran, presumably, to May 2010. P3 would sub-divide into 5 waves ultimately taking us to 400-500, no? In that case, shouldn’t it be the the 5 of 3 that take us to 400, and the 3 of 3 that takes us back to the 600-800 range that you mentioned?

  • psycho_puppies

    Good advise. Iโ€™m not quitting my day job I just want more beer money. I do believe we are coming upon a once in a lifetime volatility opportunity and have a position for that but nothing that will affect the welfare of my family if I am wrong. Markets are really fascinating and understanding them helps understand people in daily life.

  • n2thezonez

    Not to interrupt you shoulder patting, but you left out the part where you said you thought we'd close up on the day.

  • katzo7

    You conveniently forgot to mention this IN2. Markets are dynamic. I adjust future view to conditions.

    I said “Probably close up slightly but really do not care.” Probably does not mean definitely.

  • Clint

    I know exactly who you are talking about, but I don't think him buying real estate has anything to do with the direction of our stock market…or even our real estate prices for the next several years. Good for him…he's a unique position to buy that shit and sit it on it now for several years…win,lose or draw,probably with some cash flow and tax benefits…without it hurting him…no matter what happens.

  • katzo7

    Removing my hand from my back to type, I said right after the 5/24 bottom “ST buy on UNG, target 7.40, then possibly 8.” The word possibly does not mean definitely.

    Bingo !

    http://screencast.com/users/katzo7/folders/Jing

  • anoopsan

    Buy signal in daily chart of MICRON TECHNOLOGY

    http://niftychartsandpatterns.blogspot.com/2010

    Thank you

  • rg64

    Real estate is a long way from recovery.

  • Gold_Gerb

    Just shut yer trap and throw the dice dude, you're over analyzing.
    ;-D

    (very good point)
    http://www.youtube.com/watch?v=f6wqKb8EUxI

  • ricebowl

    I'm not saying that I or anyone else consistently outthinks the herd. I'm just trying to point out the objective, quantitative measure of what a contrarian really is. I pointed out that a true contrarian, that is a person who bets against the market every time, will always lose on their trades. The point I was trying to make is that you cannot simply take someone's bet, flip it, and hope to win. A contrarian would have been shorting February through early May only to flip into long positions after the decline started. If you lead the market, on the other hand, you'd have been long Feb. 5 to early May when you'd have gone short. That is the neverending question: am I leading, or am I lagging? You can never tell in the moment which it is, but you can always tell shortly thereafter, and you can use it to keep yourself in check after making a bad trade.

    I am by no means an oracle, but I saw a clear bottom at 1040, and I was posting around then that anyone short was going to get their head ripped off — the guys shorting 1040 were the laggers, not the leaders. (To my chagrin, though, I grossly underestimated the severity of the correction and said the same at 1150 right before the flash crash; nobody gets it right every time.) In the 6 weeks leading up to the present decline, I had more than doubled my account mostly shorting the S&P during its ramp job. It takes a lot of precision to do that — loading up on puts at the top and dumping them after the 5-point sell-off. Therefore I say that it can be done.

    As to the question of where we go from here, I am not basing my view on any sort of contrarianism or (potentially) perma-bulls being bullish. As I pointed out before, I think that's lunacy. I only observed that it reassures me that fundies are buying in because, regardless of where we are headed, their activity can and will be a short-term prop for the market. I believe the 1 of 3 is complete because it bottomed at a hugely significant technical level and rallied with strong breadth. You cannot say the same thing about Black Thursday. If the move is complete, then we would need a 2 of 3 to take us higher, and there is no way that the 2 of 3 completes in 3 days.

  • BloodWine

    mole… some things change and some things don't
    I see that you're still a complete asshole
    but those March puts are a different year :)

  • ricebowl

    Well, I presume that all of the large trading desks have lots of traders with Bloomberg feeds, and when a shitstorm pops up on the feed, they scramble to sell (or buy). The S&P started falling off a cliff at exactly the same time that FAZ popped, so I'd bet that that's all it was. FAZ volume was up from ~200K in the two-minute candle before to >1M shares traded from 12:36-12:37. That's 800K shares * ~$15/share = $1.2M. No daytrader has $1.2M in FAZ. That was caused by market makers and lots of daytraders jumping on FAZ. The exact same thing happened with FAS, too, but it was slightly delayed. That leads me to believe that it was caused by human beings and not programs.

  • MDX

    I've been eye balling that set up for a week

  • http://evilspeculator.com molecool

    I actually try to take my gut out of it as much as I can. If the technicals line up my 'gut' sometimes tries to convince me that this must be an exception – especially if I'm positioned on the other side ๐Ÿ˜‰

    So, I don't know mate – but it seems that the charts I rely on are a lot more accurate than my so called 'gut instincts'. Maybe you're different – if you can do it consistently then screw it – I let you trade my money and retire.

  • aussiebinlaughin

    Do you think Paulson and the likes really cares if one investment goes down another 20%? Im sure hes not all in. Maybe he just thinks he is better in property than anthing else at the moment. I dont see how this 'news' means anything at all, not that it ever does.

  • http://chartsandthat.blogspot.com/ ultra

    Fade everything and just look at the charts – LOL

  • katzo7

    Talk about confusing, IMO all time frames below the 240 on the VIX are dreck. I cannot garner anything from looking at them. But here is where the key is I think. Especially look at that trend line under the %R, very telling IMO. This type of slow rise sets the stage for an eventual VIX explosion. Also note the oscillators and the MACD, bullish on the VIX.

    http://www.screencast.com/users/katzo7/folders/

  • http://chartsandthat.blogspot.com/ ultra

    Wow – what a lot of comments.

    Looking at NYAD cumulative this morning – http://tinyurl.com/3yvn4ga

    Here's 2007-8 by comparison – http://tinyurl.com/35jba53

  • katzo7

    Nice charts ultra.

  • http://chartsandthat.blogspot.com/ ultra

    de mรชme, mon ami

  • http://chartsandthat.blogspot.com/ ultra

    Mr VIX headstand.

    http://tinyurl.com/392twhs

  • http://chartsandthat.blogspot.com/ ultra

    The lunar cycle never fails to amaze me.

    http://tinyurl.com/339vl4h

  • katzo7

    In the spirit of shared edification, I post this chart. It is a way of understanding the true underlying dynamics in a complex market. Everyone was saying 1145 a sure thing. Was it/is it? This is where certain indicators can become meaningful but one has to select the “correct” indicator to view at the appropriate time. Some indicators will be misleading while others will tell the true story. Ppl ask me, which indicator is a good one ~ it constantly switches relative to the conditions and time frames switch too. This is what I saw yesterday, the MACD on the 5 spooked me (chart previously posted with full explanation).

    Oscillators show relative strength and are particularly useful when viewed along with E Waves. You can see from the divergence that the “speculative move,” the move up subsequent to the oscillator peak can be very profitable. Parabolic moves are such. But one has to discern that the move is on “borrowed” time, there will be an end. And the end can be cataclysmic. Determining the end is where proper proportional relationships of E Waves become meaningful but in this case, the EW5 decided to go sideways for a bit. This type of action becomes hard to predict; hard to deal with; hard to trade, hence in need of day trading. Is it basing for a move higher or exhibiting exhaustion? Look to the indicators.

    The horizontal yellow band on the MACD is fully reflective of this market indecision. When you see it hugging the zero line, trading becomes more difficult; yes it will eventually break one way or t'other but in which direction?

    http://www.screencast.com/users/katzo7/folders/

  • equity_momo

    You'll probably get a chance to retire this year off your own bat. I'm a student of trend following and am building a systematic trading system which is all about leaving the gut at home but i believe every system has a small part intuition as every system was designed by a human. We're all humans trying to interpret the systems and then apply trading discpline to make money and not lose money. I think you've got a great system from what i read here and am considering giving it a go – i want to add some alpha to my account as an IT trader of trends so need to learn the ST and VST techniques.
    Good luck for next week mate , its going to be volatile!

  • katzo7

    Right on Hamster !! +1 Good analysis, it setled right there.

  • http://channelsandpatterns.blogspot.com/ springheel_jack

    Here's the main declining channel from Friday morning:

    http://www.screencast.com/users/springheel_jack

  • http://www.mylifemytrade.com MyLifeMyTrade

    Like couple of days back, this dip will also be bought by the open… and then likely there should be a similar dip in few days… WHICH might be the real pullback to 1070 or so… MMs will train everyone to think one way and then do the reverse.

  • skynard

    Wow! Whats with all the comments suddenly? Hum….something is up and it won'y be the market. Long for Monday then see about some positions for puts next week.

  • http://evilspeculator.com molecool

    Too funny as this was exactly the scene I thought about.

    1+

  • http://evilspeculator.com molecool

    Try 135.

  • http://evilspeculator.com molecool

    About myself and EWT: My personal opinion is that EWT is inherently true and beautiful, however the current methodology is only about 80% there. I am determined to uncover time based fractals which get us closer to 90%. Carolan ha produced some very important work on time cycles which in combination with my humble contributions may get us all the way.

    Until we can discover the missing pieces EWY alone is only fully applicable in hindsight. I hope that your comment is an indication that I may be looking in the right direction.

  • http://evilspeculator.com molecool

    Not me – heheheee….

  • katzo7

    Thnx mole, will look.

  • katzo7

    Could someone plz put up an S&P chart with Mastercard superimposed on it? The 5 minute please.

  • Long_John_Silver

    Following your discussion with greatest interest. What does this 240 VIX chart say – that we're headed for another big peak, yes? Does theat mean a greater extreme for the S&P? I thought you were saying that we've passed the top now …

    Btw please keep posting in detail, you've got an audience out here paying the closest attention – cheers, ljs

  • gsavli

    this one looks much better.

  • tradingmom

    Momac, have you subscribed to the zero? I find that it really helps me — especially for the problems you are describing. So you're close to being stopped out and you don't know if you should close the trade? Check the zero. But it sounds to me like you need a little help on entry and exit points. If you short at the bottom of a downdraft, even if the overall trend is down, you will most likely get stopped out since most larger sized moves retrace a significant portion of their overall distance. I've read bits and pieces of Al Brooks' new book (something like reading price action bar by bar) and it really clicked with me. He advocates 5 minute charts for placing trades since they let you pick the best set ups and then give you plenty of time to get your trade placed. I agree. For example, yesterday, I was watching the ES 5 min chart above the zero lite. We opened the day at the top of the channel from Thursday. We dropped down to the bottom of the channel. So — I am wondering — will we turn around and go up and stay in the uptrending channel, or break through? I watch the zero, but the signal isn't very strong. So, I wait. We break through the channel. Then, we turn around and go up for a retest. We bounce along the underside of the channel for several bars — maybe 20 min. I see that we are painting a wedge. I buy a ton of puts right at the top of the wedge. We break down out of the wedge (Spain downgrade announced at the exact same time, so entire wedge retracement takes place in one 5 minute bar) and I am psyched at how fast that played out since I was not listening to the news at all. This was just pure TA, no EW at all. Sorry for the long comment, but I thought it might help you see how to time your entries and exits better. If you aren't working from a 5 min chart, you should maybe stick to longer term trades since your stops will always be too tight for how you are picking your entry and exit positions. Best of luck.

  • Long_John_Silver

    Some years ago a non-stock market friend passed me a book that his father had paid thousands for, a stock market system which he swore made fortunes, published in the 70's or 80's. I read the thing closely and found that, underneath it all, it was based on lunar cycles. Thinking it was astrological hogwash, I tossed it in the trash.

    And now you post this!?!? Geeze. Looks like the market has menstrual cycles…

  • katzo7

    Looks that way, higher high for the VIX, lower lows for the S&P, but market is dynamic, anything can happen at any time.

    Thnx for the kind words LJS, I enjoy this kind of community where respect should be of primary important.

  • http://chartsandthat.blogspot.com/ ultra

    The truth really is stranger than fiction..

    p.s. sounds like someone saw your friend's pa coming!

  • MDX

    Interesting..thanks mate..what's your take on this?

  • katzo7

    I want to share what I saw, I want to be perfectly clear as to what tipped me off Friday so you all have similar skills in your arsenal. Last time (lol) I promise, but I think this is extremely important. In going back and reading posts, mine and others, this may need to be made clearer. The yellow boxes represent the old count, the circled numbers represent the new count ~ go with this one now. The blue appeared well after what I saw and called for. EW5 moves ~ old yellow count ~ do not usually end this way with the MACD at extreme low. There appears the usual divergence.

    Notes:

    1) previous flat lining MACD representing indecision, basing for a move up or time to go down?
    2) relatively equal oscillator readings up to the morning bell, both up and down, a non-trending market
    3) a 20/50 MA cross, look at that !!
    4) a growing down oscillator right after opening breaking below previous lows (this is important)
    5) observe the MACD, right at 10:30 AM; while the MACD previously had a slightly
    upward bias, the cross was the clue, the tell. And it moving below the
    previous 9:30 ish bottom around 10:45 AM was the confirmation. Also it is below the
    zero line, ST bearish.
    6) note the growth in the oscillator (black arrow), markets do not turn
    and continue up when this happens. They go down. Actually I have seen this type of MACD
    “breaking” a hand full of times, not normal but possible.

    http://www.screencast.com/users/katzo7/folders/

  • http://chartsandthat.blogspot.com/ ultra

    Well, maybe it's utterly irrelevant and the market drops straight off the plate. Or maybe we're a bit oversold right now on the SPX. We have a rather small sample size tho. Have to wait and see as usual.

  • Scoops

    Holy shizzle look what Denninger cooked up.

    http://www.youtube.com/watch?v=hM79IhkbbAg&feat

  • elliott_surfs

    http://screencast.com/t/M2RmZTM2NTct (5day, line, percentage, MA in blue)

    http://screencast.com/t/OTJjYzQyN (5day, candle, comparison)

  • tradingmom

    I have a dumb question…..in stockcharts.com, what is the difference between the candlesticks that are colored red and those that are colored black? Thanks.

  • katzo7

    Thnx Elliott S. Whadda ya think? Leading indicator? I have had this theory for some time.

  • tradingmom

    That was amazing….I'll keep an eye on that. Any idea why I have to log in to discus each time I want to post?

  • katzo7

    Candles are formed by open, high, low, and close. I suspect red has a lower close than the open $ but the black has a higher close than open. My software is diifferent, it turns it blue (confirmed up trends), black (neutral market) and red (down).

  • tradingmom

    White (hollow) is up, so red must be down in confirmed downtrend and black is down in neutral. Thank you very much!

  • katzo7
  • katzo7

    No, maybe broueer setting?

  • elliott_surfs

    honestly, I can't find too many correlations that work further than a few days (EUR/JPY, EUR/USD), but MA seems to have some tip-off points on those charts. Have you looked at Goldman?

  • elliott_surfs

    mmhmm, K.I.S.S. can't beat that method. Glad that Denninger's thoughts are playing out

  • elliott_surfs

    so far

  • katzo7
  • katzo7

    GS/S&P chart plz? LOL TIA

    Don't think it will work tho, too much news related items in GS now, skews data.

  • elliott_surfs

    http://screencast.com/t/ODk2YTU1ZD
    take a look at the first day (24th into 25th) lead the down move, and Friday it looks like GS began the reversal first around 2pm
    (http://screencast.com/t/NjZmN2E2Zj)
    SPX sporting dojis while GS began printing some green

  • Long_John_Silver

    Thanks yet again. This is taking me to a new place in analyzing charts – your help is invaluable. best, ljs

  • gsavli

    i could use some of his photoshop skills.

  • gsavli

    MA as in moving averages, average of moving averages, SMA, EMA?

    It's a cool chart.

  • katzo7

    What is the method you apply LJS? I was told on another site to not use underlying indicators. If I had followed that advise, I would have never caught that MACD lack of divergence on the 5 and therefore the drop.

  • katzo7

    No G., Mastercard, which I have been researching as a leading indicator vs. S&P. But once I find these types of correlations, they cease to work effectively. FWIW. lol And chart courtesy of Elliott Surfer, I just drew the arrows.

  • gsavli

    oh well, we can't have it all, can we. but i'm glad you're having a good time in this transition. this is my kind of market too.
    whenever we are range bound in transition, lower indicators work like a charm.

  • katzo7

    Just saw this. This is exactly what I think (this and 1$ won't get you into Starbucks). I also think either down from here or one more up run before a collapse. If a last up, I get 1112 to 1116 ES but that target is a very weak target leading me to believe that it will be either a fast “kiss and drop” move or not happen at all. . . . Who knows.

    Good luck in trading, plz be conservative in your positions.

    http://blog.capitalmarketvision.com/

  • Long_John_Silver

    What is your software, if you don't mind sharing – ?

  • Long_John_Silver

    Gee, thanks for asking – usually I just go on yahoo and fool around with their charts 20 min delayed – I have Etrade online broker btw, perhaps they have something more useful

  • Long_John_Silver

    Your discussion here – and I've saved a series of your posts and charts – has been extremely interesting and informative, and I'll give everything some more study. I left my position slightly long on Friday, now looking to reverse Tues AM unless we get that little bump. As you said, finding the right direction is a huge part of success.

    Again – greatly enjoyed and appreciated your generous contributions here. Best, LJS

  • katzo7

    eSignal, 3 K, expensive plus 100$ a month for the feed. Plz get a better feed, ppl on this blog will steer you to real time better software. You need real time info.

  • katzo7

    Thnx LJS.

  • http://chartsandthat.blogspot.com/ ultra

    Constant-dollar SPX. Hat-tip to Attila for originally posting this one over on xtrends some months ago now, but it's lost none of its power in the meantime.

    http://tinyurl.com/36cuhc8

    And now?

    http://tinyurl.com/334wb2y

  • amokta

    im not convinced

    p.s top-kill (BP) fails
    germans bankers apparently angry with france

    based, on the 'news' will markets be down on tuesday!

  • MMM___Soylent

    “Nobody goes to the ballpark anymore. It's too crowded.” – Yogi Berra

  • raised_by_wolves

    Thanks ultra.

    Does anyone know the symbol for the US Dollar Index in Prophet?

  • raised_by_wolves

    UUP goes back to March 2007. Is there another symbol that goes back further?

  • katzo7

    Scoops posted Karl's vid below, a wonderful find. IMO this is a possibility also. I base my comment on the fact that both segments have possibly recognizable and well defined EW3, 4, & 5s. Just sayin' . . . My mind is open to his scenario as well as mine.

    http://www.screencast.com/users/katzo7/folders/

  • Turbodrive

    Maybe this news will shake the Asian markets tonight ๐Ÿ˜‰

    Greece urged to give up euro.

    http://business.timesonline.co.uk/tol/business/

  • katzo7

    Something to ponder this Memorial Day weekend.

    The 15, WEEK, and MONTH SPY. At this point this is what I am thinking but a good thesis can be proved wrong. I have to measure even move against what I have plotted out ~ either it is supportive or not. I am not trying to convince anyone here and reserve the right to switch my opinion as market action warrants. You saw me switch from fully bullish to fully bearish Friday morn in a matter of minutes, and rightly so. Higher volatility means greater swings, harder to predict ~ you can be right one minute and dead wrong the next. BTW, I love when ppl who never post charts or market opinions say “but you said the market will probably close up.” What happened, you are no good !?!! Trading on market history percentages, 80% of Fridays before a holiday close green, proves to you why it is not 100%. Yes, perhaps a good percentage of markets close green on Friday IF they have not just initiated (pure speculation on my part) an EW5 down on larger time frames.

    http://www.screencast.com/users/katzo7/folders/

    And

    http://www.youtube.com/watch?v=hr9vKWLgZzo

  • jaxon

    We have 5 complete waves down from Oct 07 in all indices. The NAZ,TRAN & RUT have all retraced 78.6%. These are the market leaders. The DOW & SPX have retraced 61.8%. The UTIL has been in the toilet and is swirling the drain.

    In looking at Libor, and the way the bond market is setting up, having broken the neckline of a very large head and shoulders pattern, indicates that this rally is definitely over. Any further upside, especially ANYTHING beyond Oct 07 highs would indicate that everything is broken, far worse than any of us imagine, and we should all start growing and canning our own food and buying guns and lots of ammo.

    Please see attached weekly charts for complete confirmation. You do not need a f@#*%#g decoder ring.

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

  • Wave_Surfer

    As did I.

    Thanks for posting the youtube clip that I talked about Gold_Gerb.

    >Trying to figure out what the real sentiment of the market constantly reminds me of a scene in “Princess Bride” where the guy that is too smart for his own good trying to figure out which glass has the poison in it.

  • jaxon

    Short of going into a major and prolonged depression the Greeks have
    little choice but to leave the EU. In addition, let's face it, these
    folks are not strangers to default. Anyone holding Greek bonds, as in
    French and German banks, might as well bend over and reach for the
    lube…..that would be the IMF bailout plan (20% of which is U.S.
    taxpayer supported…which of course is borrowed from our creditors.)
    The only question is whether the bailout package is implemented before
    the default. What's your guess? You guys are really smart…that's
    correct, fellow fuckees, it is us that needs to bend over and grab
    the………WTF, no lube?!?

    jaxon

  • http://chartsandthat.blogspot.com/ ultra

    Hat-tip to poster Debbie at OA who mentioned (http://tinyurl.com/2vat2pl) the nice formation in AAPL right now.

    Should see resolution of this next week I think, so keep an eye out.

    http://tinyurl.com/35y6oju

  • gsavli

    I have to spam a little here, since we are so oversold and to cool a head or two here.
    From Jack Schwager: The New Market Wizards, Chapter Stanley Druckenmiller: The Art of Top-Down Investing:

    —————————————————
    Then I assume that you held on to your short position until the market actually topped a couple of
    months later. ====
    That's right. By October 16, 1987, the Dow had come down to near the 2,200 level, after having topped at
    over 2,700. I had more than recouped my earlier losses on the short position and was back on track
    with a very profitable year. That's when I made one of the most tragic mistakes of my entire trading
    career.
    The chart suggested that there was tremendous support near 2,200 based on a trading range that had
    been built up during most of 1986.1 was sure that the market would hold at that level. I was also playing
    from a position of strength, because I had profits from my long positions earlier in the year, and I was now
    ahead on my short positions as well. I went from net short to a 130 percent long. [A percentage greater than
    100 percent implies the use of leverage.]
    ==== When did you make this transition? ====
    On Friday afternoon, October 16,1987.
    ==== You reversed from short to a leveraged long position on the day before the crash? You're kidding!
    ====
    That's right, and there was plenty of liquidity for me to switch my position on that day.
    ==== I'm not surprised, but I'm somewhat puzzled* You've repeatedly indicated that you give a
    great deal of weight to technical input. With the market in a virtual free-fall at the time, didn't the technical
    perspective make you apprehensive about the trade? ====
    A number of technical indicators suggested that the market was oversold at that juncture. Moreover, I
    thought that the huge price base near the 2,200 level would provide extremely strong support-at least temporarily.
    I figured that even if I were dead wrong, the market would not go below the 2,200 level on Monday
    morning. My plan was to give the long position a half-hour on Monday morning and to get out if the market
    failed to bounce.

  • Rayden

    “P3 would sub-divide into 5 waves ultimately taking us to 400-500” – why only a marginal new low? there are several ways to arrive at a possible size of P3. 1.618*P1 is one way, that gives about 300 on a log scale, which i would regard as a *minimum* target if P3 doesn’t extend. another is the previous 4th of one lesser degree which is (possibly) the 1987 crash range, 337-216. most of the damage would be done in intermediate 3 of P3, so it is not unreasonable for int 3 to end at 400. in terms of wave character, int 1 would make people really think that the 2009 lows will be broken, but it will ultimately fail to break them, or at most would just dip under (hence 600-800; mole mentioned 650). int 2 would run up fast similar to P2 to make people think this was a double bottom, support held, and the coast is clear for a new bull run and new highs (hence as high as 900-1000). int 3 would smash through the int 1 lows, through the P1 lows, and then keep going (200-400). third waves break through support and trendlines usually as though they aren’t there ๐Ÿ˜‰ so I’d expect the P1 low of 666 would be around the midpoint of intermediate 3. also around the same time it would also break through the 2002-03 support area and any kind of trendline drawn through the 2002 and 2009 bottoms. intermediate 4 would be about trying to backtest those areas (but not even getting that close).this may be worth a look: http://1.bp.blogspot.com/_TwUS3GyHKsQ/S_WsnnSPf

  • amokta

    two questions i need answers to
    – is oil price going to be up on tuesday
    – is spx going to be down on tuesday
    (generally both tend to trend the same direction?)

  • http://futuresrhythms.blogspot.com/ Scrillhound

    They could sell their gold…

  • elliott_surfs

    in response to the “not convinced”.
    GS, just like any other stock with enough sway over the market, can lead it up or down INTRADAY. not convinced? try day trading

  • elliott_surfs

    another thing to note – don't listen to what everyone says on these trading blogs – Slope of Hope, this blog, etc. You'd be extremely surprised how many of these constant contributors do not have a single f***ing penny in the market. Not that they're on the sidelines in cash, they don't have anything other than a f***ing paper trade account. I was extremely bothered to find this out on the Slope one day.
    Moral of my yapping is, in the end, you can listen to no one but yourself. Sure, there are plenty of helpful souls out there who can teach you a thing or two, but don't expect to have it handed to you. Experience is the only thing that holds value…and even that is on shaky ground with how the internals of this market have changed.

  • amokta

    'not convinced' was in relation to karl denningers 'photo-shop' effort
    -if you try hard enough, anything can be made to fit, but does this add anything to assessment of where market will go (at least elliott wavers follow some rules, and fractals need to be connected by waves of greater or lesser degree, rather than just plucked anywhere from the tape?)

  • amokta

    i agree, as mole says, fade most 'news' / pundits
    karl d, zerohedge, slope, safehaven.com, marketoracle – wont help trading (zerohedge useful for macro news?)

  • Anonymous

    Marginal is a relative term as the log scale demonstrates. 500 is ~35% lower than 666. For the extension I was using 1.33, but I didn’t have any reason for picking that over 1.618, and I assume the latter is the “proper” extension for a W3.

    As I said before, I have a cursory familiarity with EWT — enough to understand that I really want to be shorting P3. Thanks for your help.

  • amokta

    http://www.businessinsider.com/how-a-nuke-could
    instead of nuclear detonation, they could use large conventional charge?

  • Clint

    Well said !! – Yea…there are some B.S.'ers out there talkin the talk…and NOT walkin the walk…never making ANY trades.

  • MDX

    Wow, a bit harsh there ES? Who pissed you off buddy?

    Unless one is as naive as a child, I think it goes without saying that at the end of the day that person has to utilize his or her brain cells and make a judgment call. It's Ok to listen to everyone, just have to filter though what you hear.

    Slope, Evil, xTrends and the rest simply express their opinion and there is a fine print on each blog (although it goes without saying) that states something along these lines – “The information provided on this website, while timely, colorful, and accurate, is not to be taken as financial, legal, tax, psychological or any type of advise.”

    I, for one, don't care if they trade paper or coin, I just gladly hear what they say.

  • jacksoo

    point well made MDX – -we each hold responsibility for pulling the trigger, can but gather input to aid our own decision making but the buck must stop with the account holder.

  • http://oahutrading.blogspot.com/ steveo77

    Euro retraced 61.8% of the push up, so I call that a wave 2 down, now perhaps will be 3 up. 3 is normally larger than wave 1.

    This would also be likely to push the US equities up. It doesn't have to, but they have been highly correlated in the past. The theory is that as the Euro goes up (USD goes down), people from Europe can more easily buy US equities, and in the US, they feel that it is better to hold “hard assets” i.e. stocks, instead of US currency.

    I am not sure this really “makes sense” but the markets don't have to make sense

    http://oahutrading.blogspot.com/2010/05/euro-go

  • skynard

    Ya, I wish that you were right. I'd be allot happier if it were paper over the last 14 mo. You should be trading with paper anyhow to get your style and timing down. Nothing wrong with that if it makes you more effective in the market. Also, beginners should have a paper account, it burns less that way.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    wish i had a paper account only ….

  • katzo7

    Here is a followup on a concept I had on the 27th of last week. This is a LT (long term) view.

    Old chart

    http://www.screencast.com/users/katzo7/folders/

    New updated chart

    http://www.screencast.com/users/katzo7/folders/

    Two horizontal triangles? I guess we will see.

    About Tuesday, I will be at work for all/most of the day therefore will not be around posting very much. I will keep an eye on it from my iPhone. Tuesday looks to be a PITA day, I called for a gap down (gap fill play?) BUT the charts are very unclear now, they do this after periods of important decisions and IMO, at this point it seems Friday provided an important bit if info. Many lower time frames have gone into a series of ABC moves, never conducive poignant action for ST directional calling. One is right and then ten minutes later one is wrong.

    ABC moves are a broker's dream come true, it is best to avoid them completely on short time frames. The accompanying whipsaw are stop grabbers hence the churn just make brokers profits in commissions. Lots of stop outs. My teacher told me he gets stopped out sometimes three or four times before what he saw takes full effect. He also told me never to play an EW4. What I am looking for is a clear EW3, EW5, or a good countertrend set up as defined by the indicators I use. That is what I saw on Friday.

    http://www.screencast.com/users/katzo7/folders/

    Bear flag? And look at this channel. Channel surfing can be this simple. Sell at top of channel, buy at the bottom. Do nothing when center stream. EW4s are famous for containing ABC moves. The smaller ones are not labeled here but I can see them. This appears to be also an extended EW4, proportions are wrong, never easy to call the end.

    And

    http://www.youtube.com/watch?v=aI9lo5BRJmg&feat

  • Onorio

    Well seem like the only thing moving today is AUD….

    Still holding friday shorts. Rate decision tonight.

  • fuw

    Dax has broken through the friday's highs. Should heading for a retest of the 610-6200 area.

  • katzo7

    Short ES @ 1094,50, SL 95, T1 93.

  • katzo7

    T1 hit, SL to BE (tight stop, holiday trading), next T 92, then 89.

  • katzo7

    Out at 1093.25.

    Look how important that level 93.25 is/was. Support or resistance?

    http://www.screencast.com/users/katzo7/folders/

  • Onorio

    AUD is seem to be setting up for a dip to 0.8300 area, IMO low risk short here with a stop @ 0.8475

    Still short @ .08515 from friday

  • Onorio

    Anyone banking somem easy coin? LMAO

  • equity_momo

    Euro selling off at the european close… check that eur-yen rate.

  • katzo7

    My posted ES 1089 target reached without me on board.
    Long ES @ 1089, SL @ 1088

  • Onorio

    Ichimoku cloud support is now at 0.8375, i expect more downside after the break of the cloud.

  • katzo7

    Out ES @ 1090.25.

  • katzo7

    Been looking at charts, especially the RUT and the TRANnies. Also been reading various blogs and it is unbelievable the dichotomy in opinions. S&P 1140-50 a sure thing. A new high, we go to 1250. June rally but not a new high. August we get new highs. World is falling apart, 300 S&P a distinct possibility. Three drive pattern to your nearest 7/11 for a big gulp.

    During an 87 degree Memorial Day down by the beach this is what I think. Chart plz.

    http://www.screencast.com/users/katzo7/folders/

    My comments.

    1) ignore the auto EW count to the downside. I say it is wrong. (see MACD discussion below).
    2) both the RUT and the TRAN look exactly the same. SPY, DJIA, and S&P look even worse.
    3) in all EW4s down moves I have seen the MACD come up and break, or at least attempted to break the zero line.
    4) the MACD is not moving up and appears to be hugging the bottom.
    5) therefore, this is not an EW4 down and the EW3 decline has only begun.
    6) someone took issue with my channels, I like my channels, they are extremely effective.
    7) it is touching the top of my channel, a substantial break through may negate all the above. It is possible but not probable we get a small rally that fails, breaking out of the channel and then snapping back inside. Possible turn targets 1124-50 S&P. Note the 20/50 MA.