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Not A Bullish Bone In My Body
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Not A Bullish Bone In My Body

by The MoleSeptember 10, 2009

11:38am EDT: Last night some posters as well as one fellow blogger who shall remain unnamed accused me of having ‘turned bullish’ – let me assure you that nothing could be further from the truth. Especially when I see a chart like this:

Note the clearly degrading A/D ratio since September 4th – now, that doesn’t mean we can’t make new highs but this does tell me that we are on the final leg of this bear market rally.

So, unless I see a swing up on this chart today or tomorrow I’m going to hold my puts through the final ramp up – it’s time for the bears to make a stand.

Thus far my little ending diagonal (i.e. wedge) has remained intact – we are at an interesting inflection point here. Should we see the Dollar drop before a little pop then this scenario is out of the window and we’ll most likely push into 76 or below. Which of course would greatly benefit Soylent Blue in equities.


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.
  • Woolly Llama

    I will stand with you Mole, add on the way up. I havent bought into this rally yet and I'm not about to at this juncture.

  • Nightwind

    This is a “foam rally”. Can't wait till the general public finds out how much real beer is in the glass.

  • http://www.genxantihero.blogspot.com LostIllini

    It would be nice if Bears showed some fangs and claws ummmm…right now!

  • http://www.ambgtrading.com/ amgrant

    I've been pretty absent from this board, but thought people might find this post helpful with respect to the larger picture. We're matching 1938 price structure very, very well…in fact, its correlation is about 0.76.

    http://www.ambgtrading.com/2009/09/indu-structu

    On an intermediate term basis, rallies should be shorted. It will be difficult but will be the most profitable. Timing will be everything though.

  • shifthappens

    Thanks for the update Mole..

  • ultrabear

    Let's not get religious about things. We all know this rally is toast at some point in the not-too-distant future, but if we are seeing the arse-end of wave 3 at the moment, we still have four and five to go before this thing turns.

    And as things stand, that would be one fucked-up looking overlapping five waves, so maybe we are going a lot higher. This thing behaves like it's made of helium at the moment.

    But we have divergences and non-confirmations all over the place. Feels like it's close, but that intuition is no help whatever if the RMS Titanic stays afloat for another 3 weeks yet.

  • http://www.genxantihero.blogspot.com LostIllini

    Warning Will Robinson! UUP in a nasty looking Bearish Wedge, if it doesn't break out of this today I will be liquidating my shorts.

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

  • Douala

    amgrant

    I been wondering what happened to you. Welcome back.

  • http://fatratbastard.com standard_and_poor

    Last several green days have been on decreasing volume- always a tell tale sign
    for an expected turnaround trend down.

  • http://twojackstrading.blogspot.com TwoJacks

    isn't that a bullish wedge?

  • shifthappens

    Nice post, thanks for sharing this correlation.

  • rhae

    UUP 60m got a nice kiss this morning, wanna see what it does today

    http://screencast.com/t/xAjIGywsE

  • http://www.genxantihero.blogspot.com LostIllini
  • http://fatratbastard.com standard_and_poor

    But I'll trade price confirmation over expectations any day.
    Don't be a bull or bear – be a trader.

  • tradejane

    I still have my Q's short and my TLT/SRS long position and and they are absolutely flat – a small victory at this point but I'll take what I can get.

  • ropey

    don't forget schiff has been calling for a dollar collapse for a while now, basically he said 76, then 74 then possibly 70 – it's all gonna end in tears but till the chart shows technically it's broken down i can't play the downside much apart from intraday.

  • http://www.genxantihero.blogspot.com LostIllini

    I'm Long on the UUP, I'm not thrilled with the technicals but the fundamentals actually favor a strong dollar right now (In my opinion). I think the dollar bashing is a byproduct of Gold going through the roof which is a supply and demand issue and not an inflation issue. The market is a little slow and may take them a couple of days to digest this.

  • http://stainlesssteelchicken.blogspot.com/ StainlessSteelChicken

    Heretic! Burn him!

  • annamall

    I sold all my TWM long puts (nice gain) and sold all my spy 103s I bought @ 1028 this morning. got out of DO puts (not working with dollar strength) and trying to see 3 last calls in spys.
    Got in to GS 170/165 put spread for 1.77 (October)

  • http://partiallystapled.com/ gxti

    It seems some people have to either be buying everything in sight or selling everything in sight and can't comprehend the space in between. “Oh my God, Mole isn't going to dump another ten thousand dollars into buying puts today! He must be a bull! Long live the bull market!”

  • Bricks

    Well, I closed my scottrade account and opened a tos account. Until the funds clear I get to sit back and watch. Maybe a couple of days off with absolutely no possibility of trading will clear my head and let me gain some perspective.

  • Keirsten

    I feel the same way about the upside. Guess we're at a draw? LOL

  • blues

    Well Evil, regarding your ending diagonal on DXY, I actually would really like it to be broken to the down side to call it an end to the fall… just like EW ABCDE rising wedge with wave 'E' usually a blow off top, I would like see DXY to break the bullish wedge to the down side (a blow off bottom) and then a quick back up to do a nice bear trap on DXY.

    Regarding the A/D ratio and blah blah blah indicator for the equity market? It seems nothing works now, market only want to go up… it seems it has some sort of agenda and a point that it want to reach. The problem is that what's the final point and how high you are willing to bet? 1070? 1150? 1200s (as the target for this big inverted H&S on daily chart of spx)? But if we are at 1200s, might as well go to 1500s right? Only 20% away, which is not that hard for today's market… How high of a price tag you want to bet? And when will you ever turn bullish? That's the question…

  • springheel_jack

    I'm long USD with gritted teeth as well for the moment.

  • dynamo

    Looking for 1042 -ish to sell my calls then will play the downside – we appear to be breaking out of a fourth wave triangle to the upside on the 10 min SPX of a 5-wave since 1027.5. After that I expect an A-B-C correction down to around 1033, then blast-off into a small OEX week

  • annamall

    I am looking for a retest of highs on EUR 1.46 area hopefully to 1.4620 and then I am out for now.

  • Woolly Llama

    Anyone here that uses FinViz interested in starting a collaboration group to share screeners, charts, etc. or already in one that I can join?

  • Nightwind

    Which one happens first…….spx hits top……or does the dollar hit bottom?

  • annamall

    EUR whheeeeeeeeeeeeeeeeee

  • annamall

    I say dollar hits bottom, of course I am long EUR/USD, but also still have spy 103 calls yet.

  • Nightwind

    —or does one just make the other worst?

  • annamall

    If the dollar drops in orderly fashion it will work in Multi-national companies and they margins will be nice and fat, if it drops off a cliff too badly then the tape could crash as peeps realize that we don't have a GOOD economy! :)

  • BrassMonkyBalls

    well said. Is that Jeff Beck?…can't tell

  • ultrabear

    Bullish chart for you to enjoy lol

    http://screencast.com/t/buGitIIynn

  • lisa

    How GS can survive if the banks can not trade?

    http://moneynews.com/streettalk/volcker_banks_t

  • http://www.genxantihero.blogspot.com LostIllini

    Did a post on my undying love for the USD….. BTW my blog is now on the front page of google for Dennis kneale idiot search….he he he.

    http://www.genxantihero.blogspot.com

  • peder1001

    i use finviz when im looking for volatile and time decay candidates to short puts with. apart from that dont use it much

  • cramar

    Is there a stock fund that tracks the $US? Something that you can “buy” to go long the dollar rather than shorting the FXE or FXC for example?

  • annamall

    Cramer,, the UUP

  • annamall

    1.46 EUR got ya!!!!

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

    you shorting it?

  • Nightwind

    I don't jack about Forex trading…..but you should be killing them.

  • springheel_jack

    Nice call Anna.

  • Lordted

    DX is the NYBOT Futures… Have traded that sometimes

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

    They wont call it trading. They'll call it something else, or will get around it on a technicality. Or just pay off members of congress to vote against such a law. Business as always in Washington

  • fuw

    Very surprising to see TRIN mostly in bearish territory for several days, and still we keep floating upwards. I dont know what to think.

  • Nightwind

    Vix approaching retest of 22.58

  • ultrabear

    We are through the looking glass?

  • BigHouse(Aka Mr Vix)

    Boy it's shit volume out there….

  • TheCrowe

    I have that feeling too, ultrabear. But _if_ 1070 is on the horizon, that's still a long/potentially lucrative way to go. Just sitting on puts now.

  • gsavli

    shorting, going long…, she mostly does the right thing. great calls, anna!

  • springheel_jack

    Better than yesterday I think.

  • springheel_jack

    If we could just see 1070 with a vix at 20.

    What a place to buy long term puts!

  • jclaude

    its being distorted by the volume in C and the other dogs in that group

  • Nightwind

    possible bear wedge on spx

  • jclaude

    Daily Charts: DJI, SPX, NASDAQ COMP, NYA all in 5th waves from the Sept. 3rd low on daily charts, DJT in a 5th wave from the Sept. 2nd low.

    30 min charts: all in wave v:5 from the late afternoon selloff yesterday.

    Weekly charts, all are in wave v:5:C from the march 6th low. Pattern is an EW expanded flat from the Nov. 21st low, January 6th was wave A, March 6th wave B, now in and completing wave C.

    Price: maximimum I see is 1046-47 for SPX, primary index I follow, 1047 is a key number on the Gann Sq.9 chart on the 270 degree angle line and its 1/3rd of pi

    Time cycles: 22 and 44 week cycles nest on September 23rd. Last nestings of the 22/44 were November 21st 2008, 266 SPX points in 13 TD, January 23rd 2008, 219 SPX points in 18 TD. These currently have a severe right hand translation that could bring a dramatic decline.

    Gann Square of 12 timing chart has a turn for today, which should mark the end of wave v:5:C.

    thats how it looks from this side of the peanut gallery

  • Vardoger

    HIG great short here. Stop well defined

  • standard_and_poor

    Nice photo how bout a close up?

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

    nobody wants to be a buyer up here. still, we definitely might push slightly higher. My line in the sand for bull/bear markets is 1077 (the monthly 25 EMA on $SPX h+l/2). That MA has defined bull and bear markets for the past 20 years. We're also approaching the midpoint of the monthly bollinger band which is a good reversal point

  • grednfer

    Poor Mr. VIX……he fell below his 5yr line (22.8). But they brought him back………while the S&P is kissing the long term down line…..

    -SPY price increasing and volume is dropping…….

    I bought back the Oct puts I sold last week……. and am waiting to short….but that dollar just keeps making new lows……so DIE EURO and GO Dollar.

  • ultrabear

    Lol only its own weight. Anyone else see that all the fifth waves seem to be collapsing backwards out of the channel due to gravity? Prime case is the “wave 1” high, but I see it a lot at minor degree too.

    When it finally goes, it's going to be good…

    *gets popcorn ready*

    But yeah, I'm still gonna trade the ups as I see them come. Sit on my far-out puts mean-a-whiles.

  • Tronacate

    I've been eyeing the TRIN all morn also. Looks like it's going to push up hard soon here…….dollar looks bottomed……but we've heard that b4

  • standard_and_poor

    Medium rare. Don’t forget the fava beans and chianti.

  • fuw

    Might be. I haven't looked into volume on individual stocks.

  • Joe8888

    Nice Post ,,,,,Mole….

  • Tronacate

    It would be wierd just to see a red close……doesn't even have to be alot…….just something red……Sammy Hagar

  • centerline

    Interesting if we paint same chart as yesterday. This time 1032 resistance around 3 pm. Then ramp job to 1035+ close. Sold OCT SPY calls a few moments ago. Took small long position on US$.

  • KidDisco

    Really starting to look like one big divergence on the hourly zero…

  • http://twojackstrading.blogspot.com TwoJacks

    Third day in a row with TRIN greater than 1 and market up. Not normal. Something very wrong here, either we bust higher with more volume on advancers or the advancers stop advancing. Someday this war's gonna end.

  • fuw

    Been thinking the same thing since yesterday, and today just adds to the level of insanity (mine that is).

  • grednfer

    I was weird…….like they turn their back and the VIX fell off the table. But they gapped is rght back above the trendline….the lowest number I have is 22.82.

    They need VIX too……it defines put pricing.

    Nice double top on EU ….. so just now DIE!

  • Offtimer

    You win!

  • http://stainlesssteelchicken.blogspot.com/ StainlessSteelChicken

    Jailbreak! Sound the alarm! Woo woo woo woo neeee-ner neeee-ner neeee-ner!
    http://tinyurl.com/l9g6hz

  • GDII

    yr view on dxy is in line with mine 😀
    based on the recent movements in fx market and the broken of the relationship among $, oil, gold, as well as bond and interest, i smell something phishy. i am willing to guess $ will go further down. i am fairly sure 76 area may not hold. i am more aiming at 75.2. and i will not be surprised in extreme $ go to new low around 71

  • Nightwind

    EW queston: if price breaks above the spx intraday trendline (connecting yesterday high with current high) Is that considered a wave 5 throwover. Thanks

  • BigHouse(Aka Mr Vix)

    new highs here….

  • upld2

    Mole, could you give me some idea of what your position sizes are when you say you are 90% short? Just to put things into perspective in terms of the kind of risks you are taking on the strength of this EW pattern.

    I'd really appreciate it.

  • crush1618

    8/28/09 high broken.

  • Lordted

    Yep. Just drifted up through it… The clouds next.

  • http://colechambers.com Cole Chambers

    I feel like the market is on autopilot…I had no idea how much automated programmed computer trading has taken over. I mean I knew that it was there, but not to this degree…incredible. Makes me feel like the traders on the floor of the NYSE are more there for show or sentiment.

  • fuzzygreysocks
  • centerline

    well. that theory just left the building. (moving towards corner of room to sit in shame).

  • dynamo

    Out of most of my calls now, keep some Oct 1080 bought @.82, now looking for a/b/c correction – if it doesn't come, will re-enter calls but expect some kind of correction between here and 1044

  • http://colechambers.com Cole Chambers

    What's amazing too is how much stocks trade around options. So I guess the MM, they sell all the options and collect all the premium, than use that money to buy the stocks up in the opposite direction of the puts they sold. It's like the clock it just ticking in slow motion as we move from month to month, expiration to expiration. This dynamic seems to have more to do than the fundamentals of the economy or the individual stocks, amazing.

  • http://forkoholic.spaces.live.com/ Forkoholic

    Brutal personal attack on me( Forkoholic Serge) today on Yelnick's website
    was obviously the result of my critique on Neely's NeoWave on the same website earlier this week.
    Overzealous Neely supporter started attacking me and my services personally.
    It is only shows what Elliott Wave Forkology is considered a real threat to
    NeoWavers.

    I urge everyone to subscribe to Elliott Wave Forkology and it’s studies. We provide financial educational resources for every type of investor & trader.

    http://www.forkoholic.com/

  • Stainless_Steel_Hamster

    above 1040… i'm getting some KY….I'll sorely need it

  • de3600

    The way to make big money on Wall Street is to stick your neck out and take a position when everyone else thinks you're a nutcase.

  • fa_q

    Putting my last 1/4 of NQ shorts here 1681 on Dec contract, 1684 on the Sept contract. I rolled everything this morning and will update my prices later.

  • http://twojackstrading.blogspot.com TwoJacks

    and there it is, balance resolved on the TRIN. It's back below 1 on the runup in the TICK and the price of the /ES. Nicely played, big boys, nicely played.

  • http://colechambers.com Cole Chambers

    With the programmed trading, they know exactly all the technical triggers. Today for instance, it looks like they are trying to get the transports to support the DOW in a new high, triggering DOW theory as another bullish indicator. They just program the computers to buy into those stocks, with a slow, intravenous like drip.

  • http://twojackstrading.blogspot.com TwoJacks

    Uncle

  • Me_XMan

    Got some SDS 41.60

  • Stainless_Steel_Hamster

    It's worse than that, I just love the wave 5 extensions and the inversion at wave 4.

    That and the gap-ups and the half hour fights to cross critical points.

    Nobody can play with this guys, they have infinite ammo to break those points, then auto-trader takes over and way we go to next level.

  • blues

    How about to Zero?! :) That's what eventually will be…

  • innatedc

    This ramp has no real participation in it…this is a blow-off top, IMO….ticks are high but not the tick volatility, I'm staying in cash for now but we are definitely closer to the abyss coming…….look at that fuckin vix…..GET YOUR CHEAP OPTIONS HERE!!!! <selling peanuts at a ballgame voice>

  • humble1 ™

    we stopped right at the 11/4/08 high of 1044. that # and the upper t/l of the Great Bear Wedge of 2009, which is just above near 1050, is the last line of defense. after that, melt-up.

  • innatedc

    YOu will also notice treasury futs still rising…..

  • tradejane

    TLT doing good as expected. SRS and Q short obviously a dud. Oh well, better luck next time.

  • innatedc

    If you haven't looked check out the volume on Mar 70 puts…..that ain't fuckin Joe blow trader or investor, I guarantee you that…..

  • bearmaid

    Nice piece from Barry Ritzholtz:

    “Beware of Naive Contrarianism

    The contrarian view isn’t betting on the collapse, its looking at what will frustrate the most amount of people. I suspect that a continued rally higher would have that effect, despite the historical post crash patterns.

    The secret to being a true contrarian is identifying when this excited (but orderly) crowd of cheering fans becomes a an unruly mob; Determining the point at which the fanatics become hooligans. Not throwing paper cups on the court, but overturning cars; When the Wisdom of Crowds becomes the Madness of Crowds.

    That is when you short a raging bull market, buy into a crash. You hold your nose and make the purchase.

    And, it is typically an uncomfortable, outlier position.”
    http://www.ritholtz.com/blog/

  • anthem

    shorting at 1042 (/ESU9) here with a stop at 1044. I think it might drop to at least the VWAP of 1035. I think we're getting close to a lot of resistance up here. If it blows past 1044, then it might well be north to 1050/1070

  • fa_q

    And ES at 1038 which is 1042 on the Sept

  • http://zstock7.com/ zstock

    $VIX has a new low on the 4 month chart, ( 3 month chart is useless, because it leaves out the previous quarter's price activity). and VIX is a falling knife–wait for the first up day, then go long that day, or the day after. This 2 day candle pattern should establish / produce the trend reversal price. BUY VIX at this trend reversal price

  • dynamo

    Oct 104 puts @2.67
    Oct 102 puts @1.93 – for today or a few days

    Crazy markets have mercy on me…

  • http://fatratbastard.com standard_and_poor

    Good afternoon rats.
    This is a time for patience with all due respect to every ones bullish or bearish dreams and inclinations. We're at a point where almost everyone is frustrated and blowing their wad in every which way direction. This is a time for watching and waiting, but a time for diligence. Study your past trades and analyze
    your prior entries and exits with a steady eye into the present to be ready to
    act on confirmed price action and not wishful thinking or nervous reaction.
    Have faith in yourselves and the brotherhood/sisterhood of rats acting in unison for the benefit of each other.

    We are but “wooden ships on the water” but we have a course and a righteous destiny. May the trading gods be on our side!
    http://www.youtube.com/watch?v=_9crmJslTCw

  • garzooka

    but is that long or short? It does seem obvious to short doesn't it?

  • crush1618

    .SZCOR … volume huge … (but Ask lower than yesterday).

  • mrclam

    There was a comment the other day that selloffs will not be dramatic from here because large investors have protected their positions with puts. Most likely this is protection for a large long position.

  • AudioTactics

    I was short SPY at 104.00 and got run over pretty bad…

    Stopped myself out after we broke above the recent highs.

    Now that all of the lagging S&P sectors have turned positive, I think this strength could continue.

    I saw this developing earlier and should have cut my losses much earlier but always easy to say in retrospect. Even the technicals were saying I was slightly early and decent selling over the past 2 days was met with good demand.

    Anybody have a good read on the next resistance level for SPY?

  • CandleStickEmUpper

    I thought we were past the moon already

  • ultrabear

    Well, I lol'd..

  • Socrato

    i wonder how this low volume dog can be kept afloat….really astounding

  • http://colechambers.com Cole Chambers

    I don't understand why tech is so strong here. I work in tech, and sales are horrible. Corporate buyers are impossible to talk too, let alone get a PO from. I worked in IT distribution, and we worked closely with CSCO, and sales started falling off a cliff 12 mos. ago. Add to that the competition from open source, and tech companies are not making any money. APPL is close to its bull market highs here. I don't know anyone running out to buy the new Ipods. My old Nano works great and it's 4 years old. That and, not to be rude, by Steve Jobs looks like he is hanging on by a thread, but the stock continues to rally because it is weighted so heavily, and supports the entire Nasdaq.

  • http://fatratbastard.com standard_and_poor
  • molecool

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

  • Douala

    I see you are playing the “bad boy” role again …uh? I tried using http://en.gravatar.com/ and this is the best I can do.

  • Vardoger

    The 20-month and mid-bollinger should be magnets now. If I can get some weakness this afternoon or tomorrow morning I am considering selling half of my short position and reshorting back to 100% on a rip into 1060-1065.

    The headlines this weekend will be extremely bullish, IMO it will line up nicely with the Bradley's on Mon-Tues. I am likely to grab a small small spec position of front month OTM puts if we touch the target's on Monday as I believe there will a sharp decline into OPEX. Great time to sell calls if that's your game IMHO.

    http://dl.getdropbox.com/u/737329/9-10spxBB.png

    http://dl.getdropbox.com/u/737329/9-10spx20mont

    *back to fetal position under desk*

  • Douala

    For those who care and of course for those who don't give a rat's a** !
    ~~~~~~~~~~~~
    Stocks are higher again mid-day Thursday, and we have now seen higher highs in both the S&P 500 and Industrials over their August 27th highs, which supports our wave labeling that stocks are likely completing a Rising Bearish Wedge for C-up with more upside expected. However, very short-term, stocks are overbought as the 15, 30 and 60 minute Full Stochastics suggest. A short-term decline is possible, which would be wave b-down ofan a-up, b-down c-up for (C) up, the middle wave of C-up.

    [McHugh]

    http://www.screencast.com/t/o3J8COYiKFzi

  • Tronacate

    Mayo clinic patient count is down 40% here in phoenix. We are down 40% plus(dentist). Forty plus offices have closed in the Phoenix area. Newly graduated hygienists are unable to find work. There is no one to spend money. New ipod? Who gives a shit?

  • standard_and_poor

    Thanks I’m going to try gravatar myself.  I’m only bad when the ladies allow me to be. ;  )
     
     

    ________________________________

  • crush1618

    Could it be panic exits by traders who entered over last week (once they realized $SPX breaking previous high)?

  • crush1618

    Could it be panic exits by traders who entered over last week (once they realized $SPX breaking previous high)?