Playing Ball With Lucy

You ought to think that the bears have had enough by now – and based on what I’m seeing in the bear bashing blogosphere (BBB™) the bus is getting pretty empty at this point.

Now we may see a short term reversal here as this is where retail traders usually start chasing – but anything more sustained is a completely different story. And this is not a disgruntled or discouraged bear speaking – after all I have contrasted bullish evidence with my bearish charts for months now. No, I’m dealing with the facts only – any emotions have long gone by the wayside. Trading this tape is like making it through Combat Marine boot camp – you know it’s gonna suck, so you better smile and enjoy it.

But Mole – isn’t this exactly what the boyz want you to do? Give up just before we drop? Sorry folks – but that argument is getting pretty stale at this point – I remember tons of folks throwing in the towel over a year ago. They are all gone – you may remember their names – and most of them have gone back to their ‘day jobs’ – if they were luck enough to have one. No, this is not about psychology anymore – this is all about time – and more specifically theta burn. I know this market is going down – eventually. When exactly? Sorry – my crystal ball is still in the shop. So let’s just stick with what we got right now.

Maybe we’ll drop from here – yes possible – but that’s not the point! You can’t trade your emotions – you can’t trade on a sense of vengeance or retribution. That’ll get you killed in thirdy seconds flat. Alright – I bite – let’s just assume for some reason we gap down from here next Tuesday. So now what? What will happen at 1040 or 1020? Are we suddenly going to see bulls running for the hills and bearish tape devoid of any counter spikes? Express elevator to 980? What are the odds of that happening at this stage?

Exactly.

So, let’s look at some charts and then assess the odds right here. With each chart I will also suggest the type of readings the bears *would have to see* in order to see some a meaningful drop. After all – you can’t become disgruntled either and turn into an anti-bear (or an anti-bull for that matter). For any mental predisposition will invariably lead you to interpret charts the way you want them to see.

For that very reason I will also show you what the bulls want to see in order to sustain the current short squeeze rally. For if we push much higher from here we are looking at some mighty upside scenarios, leading into October and possibly into the next year.

This chart has been among my favorites as of late. It’s a simple channel and it is crystal clear. Once we saw a triple bottom the odds for a snap back increased significantly. And the bulls played it masterfully – faking a bit of downside and then slammed the pedal to the metal. We smashed right through the center ‘equilibrium line’ and now find ourselves at the upper 25% mark. Back to the future.

Now, quite obviously this is a good spot for a little reversal. Maybe we’ll drop back towards the equilibrium line. But the ‘dynamics’ of the game have now changed from down to up. Meaning that prices will have to drop through the equilibrium line and lower for the bears to even have a smidgen of a chance to conquer 1040 or even 1020. And than now seems lightyears away. Beam me up Scotty!

The bulls most likely will consider 1075 a nice dip buying opportunity – assuming we drop that low. If we bust straight higher from here on Tuesday then it will lower the odds for the bears even further. And finally a breach of the upper channel boundary around 1130 changes the entire game as we are then talking about an inverse H&S formation. We would have to see some significant divergences in various of my indicators to even consider fading such a move.

My ratio divergence chart between the SPX and the VIX has been in bearish territory but flat. As long as we stay below the zero mark the bears have a fighting chance medium term. But the type of stalling momentum we have see in the past two months (see blue rectangles) usually does not lead to major downside. So this one is pretty easy: We need to see expanding downside momentum in order for P3 to have any medium term probability. I think I made this point a week or two ago: Just look at the trend degradation we saw in mid April – that was beautiful. And what followed was a major drop that severely upset the longs.

For the past eight weeks or so the bears have been dressed up but nowhere to go. And if that goes on for too long there is a growing threat of a major sideways correction – in that bearish sentiment pushes to extremes without any significant downside. My take remains that any continuation of major downside will be preceded or at least be accompanied by a growing divergence between the SPX and the VIX. And that should show up on this very chart.

Similarly the longs may want to look out for a weakening of bearish readings right here. If we start pushing into green then the jig is probably up for a while as that would represent an inflection point for a move higher.

I have not shown this chart for a while, which is a shame as it’s a pretty good one. Simple RSI_EMA on the ES futures. Observe how we again painted a divergence around 1040. That was followed by a triple bottom – not good – and the rest is history.

Right now I don’t see any divergence here – the signal looks healthy. Maybe that’ll change early next week but until that happens I caution everyone to not get too excited about the short side here. It’s much easier to be reactive than to to be anticipatory in this tape. You can’t trade on a hunch – let the charts give you reasons to take on short positions. Again, bear in mind that this is a long term chart – so it will not show any potential for a quick reversal here.

And here’s the daily Zero again. It may be tempting to associate fast spikes in the signal with topping formations. However, I have drawn some arrows on similar fractal patterns and they seem to be a lot less reliable than the spikes to the downside. So again – the potential for a snap back exists but it may be short lived and may lead to further upside.

When would we start looking toward the downside again on a more extended basis? Look no further than the smoothed version of the daily Zero (the center panel) – and at this point it remains solidly and stubbornly above the zero mark. And as long as this continues the odds belong to the longs.

Again – look at what happened in early April here – the signal deteriorated and prepared the way for some further downside. Which is exactly what we got. However, since early July we have been spending more time going up than going down – so the signal has been correct, despite the fact that we had a three week drop in between. After all – this is a longer term trend indicator and except for downside fractals on the bottom panel the medium term panel shows us the ‘path of least resistance’. Remember Jesse Livermore? He always kept going on about the path of least resistance and I’m convinced that he would have loved this chart and probably bought the heck out of the 1040 dip.

I will skip the wave count chart until I see levels that are of interest. Right now I believe that counting waves is counter productive as there are too many scenarios I can imagine and none of them give me high confidence. Showing you three or four different Soylents would be unproductive as I cannot identify a clear trend here – thus counting waves would be an exercise in futility. If we had a third wave to the downside I would use the wave count to identify targets and dip buying opportunities. And if we bust higher then I can propose upside targets. But right now we are a bit in limbo and thus fractals and momentum charts rule the day for me – I hope you all concur.

Public Service Announcement:

This will be my last post until Tuesday, thus consider this to be my weekly update. It’s been a long and vacationless year for me and the ole’ Mole needs some time off. Besides I don’t think many of you will be around during the long Labor Day weekend.

Truth be told – as I have tasted blood I will most likely continue coding and optimizing my black box strategies. Thus far I have mainly focused on systems running against the ES futures but recent trading volume reports strongly suggest that the FX side is something I should explore more deeply. I have done some preliminary testing of various base strategies against the AUD/JPY and the EUR/USD FX pairs and they fared very well, which is encouraging. So, there is much work to be done.

Let me wish all of you a wonderful late summer Labor Day weekend. I strongly recommend that you recharge your batteries by spending time with your loved ones. If you don’t have one – don’t worry – you have a few more hours left to find one. Just forget about the market for a few days – believe me, whether you think about it or not, it will be there next Tuesday in all its ignominious ambiguity.

This entry was posted on Friday, September 3rd, 2010 at 2:01 pm. Both comments and pings are currently closed.

  • 99er

    People Get Ready
    http://www.youtube.com/watch?v=T43m6dcMk6U&feature=related
    Have a great Labor Day Weekend, folks!

  • http://www.120467.com Yves Goldberg

    wishing you all a great Labor Day Weekend !!

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

    Nice post.

    Great weekend all. I am going kitesurfing this weekend for the first time so will be back next week if I'm not in the fracture clinic.

  • nugie

    Gaps for possible resistance
    SPX 1092.44 to 1094.16 and 1116.89 to 1120.62
    INDU 10,411. 11 to 10,415 and 10,638.28 to 10,638.28
    RUT 2000 639. 20 to 645.97 and 654.84 to 568.90
    I still believe the old ways of TA still work.
    We have hit all of the first targets today hopefully we will not reach the second set.

  • WTFed

    Thanks for all the charts Mole. Thanks again Lucy!

  • http://gemstowear.etsy.com Jan

    Great charts and commentary! You have a wonderful three day weekend. Same to everyone here.

  • ricebowl

    For anyone interested, we're very close to starting a ^VIX reversal pattern. A nice EOD rally would put ^VIX outside the (20,2) BBs.

  • ds2

    Nice chart, nice divergence – good call on the tune. Let's drop on Tues.!

  • DudePlunger

    Yesterday I said the following in a long post,

    “So what am I doing? Well, unless an inverted hammer appears on the daily off of the 1095-1100 area with solid downside breadth next week, I am not taking a trade. I see 0 reason to force anything that isn't there.

    If we break through 1100, we will challenge the high of August 11th. Inability to recapture that high will result in a reversal. See May 6th, May 20th, and June 6th (not looking at a chart, that day may be wrong), for examples of inability to recapture the high of a significant down day.”

    Today we have broken through 1100. Now I am waiting to see if this market can attempt to reclaim the high of August 11th. I expect this attempt to take us into September 13th, at the very least. But, if we begin to see price rejection and an inability to close above, hold support, and carry through August 11th highs (1120 on /ES), I will look to start getting short based on the 15min or 1hr charts.

    An initial pullback to 1060 or 1080 might be very bullish and actually muster in enough bears to push us past 1120 and to some real pain this Fall. I don't believe that is going to happen. I think the EURO bouncing off of its 200EMA is the first step to resuming our bear trend and that we will not be able to break the summer highs in the Euro.

    But this is what I think, I am not actually placing any trades yet, I am waiting to pick my spots very precisely. In the next few weeks, this market will either present us with a very juicy bearish scenario that will take us to 950 in a minute wave 3 (I am very confident in this occurring), or it will hold support, and carry prices higher, a long setup that I will be gladly to take.

    Again, I might be very bearish, but I have no setup to go short. Just 1 year ago, I would've been shorting everyday into this rally, just to lose tons of money. For those of you that have stubbornly held short or have been adding to your shorts, go back and look at where you entered and ask yourself, “Was there a bearish edge in the trade I took or did I just enter short because I THOUGHT that the market SHOULD go down.”

    Thought and should…..it is very dangerous to think that way, and if you find yourself with those thoughts, make sure you allow the charts to convince you that there is a bearish setup presented, not just a random candle you picked to go short, thinking, “OK 1080 is the high!.” Or, “Alright, we won't break 1100, I'm going short 1095 so I can get in early.” Take it from me, I lost $20,000 in December 2008 thinking that way, and repeated the mistake multiple times costing me a few grand at a clip.

  • raised_by_wolves

    What's this talk of a long weekend? Are you telling me I can't trade on Monday ;-)

  • raised_by_wolves

    Since the close was outside, put a check mark by step one of three.

  • raised_by_wolves

    (SLV/GLD) did not participate in the EOD rally.

  • sloth_bear
  • http://profiles.yahoo.com/u/27ZC2SBQHQE6XD4KTTKHVENQNQ Ray

    Newbie here.
    Who uses the paid service here? Is it worth it? Did the zero option truly predict the bullish move this week? Thanks.

  • raised_by_wolves

    Maybe we’ll drop from here – yes possible – but that’s not the point! You can’t trade your emotions – you can’t trade on a sense of vengeance or retribution. That’ll get you killed in thirdy seconds flat. Alright – I bite – let’s just assume for some reason we gap down from here next Tuesday. So now what? What will happen at 1040 or 1020? Are we suddenly going to see bulls running for the hills and bearish tape devoid of any counter spikes? Express elevator to 980? What are the odds of that happening at this stage?

    Amen!

  • raised_by_wolves

    Junk bonds to treasuries also diverged from the EOD rally.

  • ricebowl

    Yup! Now let's see it come back inside. I forget what step #3 was.

  • raised_by_wolves

    I would say, yes, it's worth it. Pose the same question on Tuesday if you don't get any other responses.

  • raised_by_wolves

    As you know, step 2 is a close inside. Step 3 is an even further inside close inside.

  • http://evilspeculator.com molecool

    I for one could use a long weekend. Weather is too gorgeous over here to spend it in front of a computer screen.

  • http://evilspeculator.com molecool

    You can find yesterday's screen grab of the daily Zero here – you'll be the judge:

    http://evilspeculator.com/?p=17834

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

    I do believe futures will be open on Sunday and Monday….plenty of time for HBB shenanigans….after all, this IS ABOUT all the money in the world.

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

    Good luck on that!

  • ricebowl

    Now I remember. Thanks.

    Anyway, step #1 of 3 completed.

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

    The currencies, Cable and Euro, have not followed SPX as expected. However my long call on SPX

    (/ES futures) was spot on. Not sure if it has more to run.

    My call on today's Jobs Report as being “not as bad as expected” and a 1.5% rally today, was pretty good.

    It's time for a weekend. From my point of view, it is quite obvious that people are just getting more and more whacked out, completely losing their senses.

    It is very interesting to observe this mass social psychosis, as an observer with “skin in the game”.

    Astro was implying a SPX run to 1105, and a blog reader emailed in this chart of the Russell.

    http://oahutrading.blogspot.com/2010/09/bearish-hardly-cable-and-euro-have-legs.html

    The overthrow looks perfect, the Astro is completed, but currencies seems to still have legs.

    Tim Knight closed the last of his short positions yesterday….the perfect wave 2, tiring out bears by time and price, with a final push up to make even the most strident bear capitulate. PS holding QID from 17.8, but now that my ES futures long “hedge” is gone, The QID could stress me out if market continues higher next week.
    This is odd.

    But here is the scary part for bears…EWI released a new monthly Financial forecast. Of course they are predicting imminent doom, and we all know how the MM's HBB games EWI, ramping against their calls to take money from the bears.

    Think of it, how many retail, buy and hold type, long only type, are still playing this market after being whipsawed around for a whole year. Almost none. The only source of fresh money for HBB is to game the bears, who are committed as “smart observers” who realize the horrific fundamentals that this country and the whole world face.

  • ricebowl

    Best play is to game *them* by buying long-dated issues when ^VIX is low. The ^VIX chart is pretty messed up right now.

  • sloth_bear

    I'm still playing the triangle on AUD/JPY:
    http://screencast.com/t/MTZkYzU4N

    The pair did not made an higher high EOD, and traded almost flat all day long, as equities where rallying

    And here is a close up:
    http://screencast.com/t/OTgwOTYwMzU

    Also, AUD/USD looks juicy!
    http://screencast.com/t/MjAwODU5

  • raised_by_wolves

    Have you looked at the tutorial yet?

    http://evilspeculator.com/?page_id=2969

  • http://profiles.yahoo.com/u/27ZC2SBQHQE6XD4KTTKHVENQNQ Ray

    With all due respects that single chart shows me nothing. As far as I can tell Zero moves with the market. No indication of the bear/bull indicator time – days, hours, minutes? It is great to look back but where was the warning?

  • raised_by_wolves

    Did you read the instructions I linked to you first?

  • raised_by_wolves

    Obviously, you didn't read the tutorial or understand what you read. That single charts shows me a lot. For instance, see the divergences?

    http://content.screencast.com/users/raised_by_wolves/folders/Jing/media/6f5f7c45-3871-4514-b886-0393f390b40f/00002035.png

  • amokta

    Anyone feel like this!
    http://pixel-shack.net/wp-content/uploads/2009/09/DEAD-BEAR-450×340.jpg
    Have a good holiday folks

  • convictscott

    Ray, there were many indications that the market was vulnerable to a short squeeze this week, if you knew where to look. In April I started using zero lite (the 5 min chart version) to finesse exits on my swing positions, I have found it *invaluable*, it helps me get better timed exits consistently, it both makes and saves me a lot of money. I would *not* trade es futures without it after using it for several months.

    IMO it is *predictive* NOT *descriptive* which is what I aim for in all my technical analysis methods.

    I could probably discern the same information from digesting tick,trin,breadth, vol difference of breadth… but its all there at a glance with zero.

    Many (most) indicators are simply derivatives of price, ie they map price in a fancy squiggle line and traders convince themselves that somehow this “price turned into a squiggle” contains new information. In fact, most traders who use stochastics, %R, etc, couldnt actually tell you what the indicators mean, or calculate them from first principles if they didnt have software.

    Not so zero. Because is is calculated using (and this is just a guess, Mole keeps it secret) the market internal metrics only available during NYSE opening hours, it is based on MORE than just price turned into a squiggle, but the underlying supply/demand structure of the market.

    The principle, in the broad strokes, is that when you see a decline making a lower low, which is not confirmed by an equivalent lower zero reading, there is something stinky about it. You can use whatever method you want at that point to trim your shorts or get long.

    I can't reccommend it highly enough :)

  • convictscott

    My take on the price action during todays session, I'll post some detailed commentary later on, going to fly my paraglider off the front lawn now :)

    In a nutshell the market gapped up on open with negative internals and zero readings. It looked ripe for a gap and crap, and at this point I would have expected a painted daily shooting star candle, which would leave the way open for a full on price reversal on Tuesday. However it didnt play out like that. Once again the bears fumbled the ball, and the price action strengthened right into the close, which I find significant.

    It started to breakdown, and then stopped, forming a rounded reversal. Most significantly internals *strengthened* right into the close. A break of the daily high is bullish from here and would expect we test 1130 if we break the es high of 1104.75

    There were plenty of pure price action clues, I highlighted the ones I thought were significant.

    http://www.masterkillers.com/wp-content/uploads/2010/09/spx-5-min-3-sep.png

    http://www.masterkillers.com/wp-content/uploads/2010/09/5-min-es-3-sep.png

  • http://evilspeculator.com molecool

    Wow, I call that a raving review. Didn't know you liked it that much :-)

  • http://evilspeculator.com molecool

    Divergences are the warning (see RBW's chart below).

    BTW, no respect required – I like to be challenged. If you don't see value then you don't – everyone has their own way of trading the market. There are people who come here who appreciate the Zero and have so for almost two years now throughout contrasting market conditions.

    There are three versions of the Zero – the Zero Lite (intra-day), the hourly Zero (medium term), and the daily which is obviously a long term indicator. It's not a crystal ball but it has kept us out of a lot of trouble.

  • raised_by_wolves

    Rain or shine, I'm going to go hiking.

  • convictscott

    Not just pissing in your pocket. I really do think its that good.

  • http://evilspeculator.com molecool

    I never heard that expression before – is it Australian?

  • http://evilspeculator.com molecool

    That's the spirit!

  • gsavli

    futures will run on monday, right?

  • convictscott
  • Clint

    Great post DP. Really puts this 'trading game' in perspective. We'll see what they do with SPX 1100…”this time”.

  • chronographics

    Just like those Aussies to claim anything as theirs, particularly if it's from NZ – from our star races horses to the Pavlova!
    That is very much an Antipodean expression :-)

  • http://evilspeculator.com molecool

    Guess it's time to get my ass down under :-)

  • Wave_Surfer

    You gotta know how to read it and that takes training, practice and skill, but the prediction was there.

  • Wave_Surfer

    Nice drawing of divergences. It also looks like the daily zero might be drawing some bearish divergences. Draw a line from the peak in daily zero in early to mid July down to today.

  • convictscott

    Come visit, it would be my pleasure to show you around :)

  • convictscott

    Mole, would you be able to let me have some screen grabs of old zero daily charts please. I have some ideas for designing a mechanical system around it, I'd like to do some backtesting.

    I think I can use my time more productively on new projects that analysing the current state of play ;-)

  • Hungry_Joe

    AUDUSD indeed looks very very juicy. The only problem is that the move to 1097 after the initial spike gave some hope to the bears but the late rally with close almost near the highs almost totally killed it. A flatter close in equities would have been more than welcome.

  • DudePlunger

    Solid as always. Thanks.

  • Tooncez
  • convictscott

    Thanks! I'm basically trying to work a methodology around where you get a strong reading then nothing readings, to keep riding a trend until a divergence appears. Just working on concepts at this stage, then will take it to something mechanical.

  • convictscott

    I think you are right, I believe AUD represents a very high reward (but not a particularly high probability) trade for the Monday open (Sunday US time)

    http://www.masterkillers.com/2010/09/04/aud-vulnerable-to-short-on-monday-am.html

  • DarthTrader

    Thanks Scott

    You've answered what I have been wondering or assuming about Zero Lite.

    I've been using for 2 months still working on optimizing nit's benefits but it has made/saved me money

  • convictscott

    I missed taking the best trade of the day, the retest variation sell on the 5 min gap up ;-( 5 min price action trading is a long term project and I'm nowhere near good enough to earn my living from it yet.

  • Lordted

    Excellent Post Mole. If you ever get bored trading you could always be a journo… Max Keiser could do with a bit of competition.

  • http://evilspeculator.com molecool

    Max Keiser – meh – nothing but a bear shill.

  • http://evilspeculator.com molecool

    I actually am trying to do this right now but on a very short term basis. Let me know if you need anything else.

  • http://evilspeculator.com molecool

    Done that – theta burn will still get ya.

  • http://evilspeculator.com molecool
  • SW6

    Brishort, RBW, thanks for your resposes in the prior thread. The RSI on copper has been 65 for a few days now. I just checked Stockcharts today and indeed RSI 65 is again what they show for yesturday.

    I don't have a Stockcharts membership, when I tried to get a current reading on copper yesturday Stockcharts would only provide a chart up to Thurs Sept 2. I went to barchart.com to see if i coild get Sept 3 – I did.

    What barchart showed was an RSI of 69 at roughly the time of my afternoon post yesterday 13:00 EST maybe. If you take a look at it now, you'll see an RSI (close) of 67. I was looking at High Grade Copper Sept contract – that's right isn't it.

    Anyway, here's a link:

    http://barchart.com/chart.php?sym=HGU10&style=technical&p=DO&d=M&sd=&ed=&size=M&log=0&t=BAR&v=2&g=1&evnt=1&late=1&o1=&o2=&o3=&x=21&y=9&sh=100&indicators=RSI%2814%2C0%2C100%2C10079487%2C10040064%29&chartindicator_1_code=RSI&chartindicator_1_param_0=14&chartindicator_1_param_1=0&chartindicator_1_param_2=100&chartindicator_1_param_3=10079487&chartindicator_1_param_4=10040064&addindicator=&submitted=1&fpage=&txtDate=#jump

    uhhh, don't know if that link is gonna work. here goes. *post*

  • http://www.portfoliotilt.com PortfolioTilt

    Thanks for the update, enjoy the long weekend!

  • Brishort

    Hi SW6,

    here is the answer: you are looking at the sept month, whereby Stockcharts looks at the Dec one. You will see from the Comex website that the Dec contract is the most traded, hence why Stockcharts uses that one (26k traded compared to 855 for sept.)
    Here is the extract from Comex.

    this explains the difference in the RSI.

    Hopefully this helps clarify why we didn't have the same numbers.

    http://screencast.com/t/NmQ3YjRjYzMt

  • jacksoo

    Good afternoon folks: quick ? for anyone around. Did any of you TOS users suffer problems on Friday? I tried to cancel a short ES order I had on at 1094 at about 8:20am New York time – all seemed to execute fine – - a few mins later it became apparent that the application and internet based TOS systems had crapped out – -took me an hour or more to get some kind of connection/working app by which time of course it was clear my order to cancel hadn't got through to them – -pretty pissed about this – -in an d of itself the order was pretty small so not a great deal BUT what if it had been and their system just craps put – - pretty pissed about TOS recently.

  • SW6

    Wow, clear as day now – thanks.

  • raised_by_wolves

    I think I figured everything out. By comparing SPX/VIX and SPX, I expect up to three more months of upside/sideways/upside with maybe one promising dip in there.

    http://content.screencast.com/users/raised_by_wolves/folders/Jing/media/90a5a3eb-abed-4268-9c5a-90b3e6718743/00002038.png

  • raised_by_wolves
  • K.I.M.

    interesting, my last two charts confirms same action, inverted H&S and EW count. We shall see.

  • K.I.M.

    There is also one thing that i've noticed and is interesting, if we take for example MAE 89 / MAE 144 and current situation http://www.flickr.com/photos/42905134@N08/4961342420/sizes/l/in/photostream/
    usually this should confirms bear case. You need to go way back to 1989 to find a fake case for this scenario
    http://www.flickr.com/photos/42905134@N08/4961342724/sizes/l/in/photostream/

    we could have a fake now.

  • 99er

    Chart: ES
    Raised By Wolves' step before a substantial fall, a Double Top, has just appeared on the 15-minute chart. Trust that bears will always love September.
    http://www.screencast.com/t/MjBmODRjY

  • amokta

    /es Futures seem to be alive – who forgot to turn of the algo?

  • 99er

    Chart: DX
    Why, you'd think the USD was a Jumping Bean celebrating Cinco de Mayo.
    http://www.screencast.com/t/YjQ5M2I3MGY

  • convictscott

    Morning all from Australia, Sloth Bear posted yesterday about the AUD being a decent short. Futures just opened and it confirmed this. Dropped in the early early morning pre-open (while only new zealand is open, and then rose in a sloppy fashion to retest that high.

    What I'm suspecting as a gestalt is that without equities open to drive markets higher today the high correlation currencies might be ready for a breather.

    Also, the AUDJPY just painted a divergence with equities, a negative signal for equities that HAS NOT FAILED in quite some time. Caution for equities on the long side here, zero divergences, currency divergences, weakening breadth etc. Couldnt call a reversal in es yet, but the odds now favour a pullback in the next few hours.

    http://www.masterkillers.com/2010/09/05/aud-short-update.html

  • gsavli

    Today we'll be able to see once again how gay Europe is. Markets here never know what to do, when US markets are closed.

  • Gary_UK

    Ok, so everyone everywhere (not Sloth bear to be fair), has gone bullish.

    Madness I say.

    Tim Knight has caved I hear? Always ALWAYS a sign THE top is in.

    Any bears that turn bullich now will rue the day, in my humble opinion.

    And, technically, there is still so much overhead resistance, both at current levels, and again at 1130.

    Give me a shout at 1140, I'll jump ship then.

    http://screencast.com/t/NGZjNGEyYmQ

  • raised_by_wolves

    Of course, the double top I was talking about was on the daily, not the 15 minute chart.

    While K.I.M.'s EMA(89)-EMA(144) crossover is bearish setup that historically has rarely failed, both the divergence between SPX/VIX and SPX on the daily chart and the inverted head and shoulders pattern on the daily chart are bullish setups. So, I'm trying to weigh one usually reliable bearish setup against two bullish setups. A copper sell signal would make the odds favorable enough for the bears for me to consider a short swing trade. If that doesn't happen, I will stick to my new strategy of scalping the market three times a week. Long or short, I will play any promising intraday divergence between SPX/VIX and SPX on Tuesday.

  • convictscott

    ES U0 just broke the old daily highs

  • raised_by_wolves

    While your EMA(89)/EMA(144) crossover rarely fakes, if there is a time to expect a possible fake, then it is now. During my short trading career (two years or whatever), I've seen bearish setups fail time and time again and bullish setups succeed more often than not. At this point, I don't even care whether the market gets its bear on or goes bull for another three months (see my above reply to 99er). At the same time, it is helpful to know that there are both bearish and bullish setups. Thank you very much for informing us about the crossover. I will be adding those EMAs as a study.

  • raised_by_wolves

    Well, at least I went bullish at the right time when the last attempt to breach 1040 failed. We probably have different circumstances though. I trade a small and often over leveraged account that could be annihilated by a move from 1040 to 1140 or higher. So, staying short may be best for you, but I had to be more nimble. Actually, I don't consider myself bullish right now. I'm market direction agnostic with a lot of curiosity about how a multi-month bullish scenario could play out. My current thinking is that 1030 will probably be revisited. If the bulls bust a move higher, they need to clear the bar with enough distance to allow for a retracement that stays above that 1030 level. From there, they would have a platform from which to stage their next assault.

  • raised_by_wolves

    Tooncez, I forget if I replied to you in the previous thread where you showed me your market-top-indicator-in-progress which doesn't show a market top yet. Nice work. Keep us updated on whether you do or don't get a top signal.

  • raised_by_wolves

    Are copper futures steady? Is silver kicking gold ass? (I'm hanging out on the street median away from any charts).

  • convictscott

    RBW, we have conflicting evidence at this stage, for reasons you mention and others (audjpy divergence, zero divergence, gothic church fractal). Make no mistake this market is vulnerable and overextended to the upside, a little weakness to fill the open spx gap on Friday would be a valid short IMO. However, just a little bit more strength would set off even more bear stops, fuelling the positive feedback loop up to a test of 1130 spx.

    Basically the outlook for this week is exceptionally clear to me. Be short on a break of 1093.60 and be long on a break of 1105.2 spx.

    But be aware, if the short is triggered its a *must win* for bears. A further short squeeze from here (especially after a valid short entry driving the price down for a day or two) would probably give it enough impetus to get past 1130, which is a gamechanger in every respect, as longer term bears would be forced to capitulate at that point and we could see a very scary fast popped stops rally.

    IMO anyone offering forecasts as to when/if we turn at this point is being silly. We have conflicting evidence, all we can do is trade the tape out as it appears.

  • http://pulse.yahoo.com/_WCLALYTPRSCJZEM46MI4WQGYE4 Boyplunger.com

    Looks like all weak hands and some have been taken out. Four months of wild swings will free up the path to longer term gains with less speculators.

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

    Just to let you all know the hamster is still alive (though bruised) but still in

    this last week (and specialy friday we took so much short term TA to bearish view thar either we dump hard (very hard) and soon (very soon) or it's bull time.

    nevertheless some medium term stuff is still holding (specially on the spx:gold front)

    why this endless game with lucy? http://www.pbs.org/wnet/need-to-know/economy/the-true-cost-of-the-bank-bailout/3309/ , http://www.bloomberg.com/apps/news?pid=newsarchive&sid=armOzfkwtCA4

    say hello to us peso and european ruble

  • chronographics

    Scotty, Forecasting is great even at this important juncture, however whoever does it needs to give clear levels at which they are wrong and/or level at which they will take the opposite view. Like you say its is finely balanced here.
    My question to al here is why this negative commentary regarding Traditional TA not working? There were plenty of Signals that said both Euro and Stocks could go higher.
    Some people chose to go with the Bear view (hey I did, but had my protection on – just because there were warning signs and when my level got taken out I was covered) some with the Bull but TA works its JUST HOW YOU USE IT and WHAT YOUR RULES ARE TO TRADE IT.

    There is danger in always looking for the holy grail in TA.
    Always appreciate your commentary :-)

  • 99er

    Chart: HG
    Copper futures have fallen out of an earlier Rising Wedge, backtested, but currently remain within a second Rising Wedge. Should prices fall out here, look for broader market declines overnight and into Labor Day.
    http://www.screencast.com/t/NWE4M2ZkMz

  • http://evilspeculator.com molecool

    LOVE your name – good one :-)

  • convictscott

    “There is danger in always looking for the holy grail in TA” – I couldnt agree more. I read Tim Knight's post on slope a few days ago and he is looking for “the one number” that will tell him how to balance his portfolio.

    It doesnt exist, and the act of searching for it is giving power to a childish part of the psyche that gets value and safety from being right and is scared of the feelings that come from losing. Losing well should be emotionally satisfying for a trader, or put another way…

    The amount of respect I have for myself and love I show myself has NOTHING to do with whether or not the market went up or down. To use the market as a tool for validation, to prop up a negative sense of self-worth, or to escape feelings of powerlessness in the outside world is dangerous in the extreme. I know this from expensive lessons.

    In my view EWT in particular attaches itself very nicely to this childish part of the psyche. When the time comes for me to stop using EWT in my analysis I find it very difficult to block out.

    Personally, I dont use traditional TA *at all*, not because it doesnt work, but because for *me* I only see bullish trendlines when I'm bullish, and I draw the trendlines entirely different when I'm bearish ;-) I am a far better trader when I think in terms of if-then statements and probabilities. If we hold above 1100 spx then the odds favour a test of 1130. If we fall from here the short squeeze has probably played out.

    I know you trade the euro mainly so I highlighted my valid daily chart entries on the euro over the last month or so, only one of them was a real trade which was the short at the top :) This is the type of trading which suits my psyche best, simple rule based stuff. Of course I've left out the hard thing which is managing exits, 10 times as hard as entries.

    http://www.masterkillers.com/wp-content/uploads/2010/09/euro-daily-entris.png

    My gut call, with absolutely nothing to base it on, is that equities wont run into a headwind unless the euro turns down hard. Euro is at 38% retracement now, in my view it needs to be at least 50% retracement to kick off the next impusle to the downside, which based on the first drop down should be massive. Now this *could* happen today before market open tomorrow, I have no view on that.

    What I do think the evidence supports here is that the internals of this market are weakening on the way up. My research indicates that a market rising on weakening internals is vulnerable to exogenous shock. That doesnt mean it will happen, what it means is that a little bit of weakness can kick off into something more meaningful.

    Any bulls who bought at spx 1040 have a massive profit on the table, a little bit of weakness will turn them into sellers as anyone who has held for a few days only is by definition a weak hand. The action on Friday afternoon was characteristic of latecoming retail bulls getting into the action, and by definition anyone who bought on Friday afternoon is also a weak hand.

    I couldnt give odds on strength or weakness at this stage, all I know is that if I was long I would have booked profits by now and been on the sidelines. I'm currently flat in my trading accounts waiting a valid opportunity, which has not arisen yet.

  • raised_by_wolves

    Cub question for Crony: Does my TA count as traditional?

  • chronographics

    :-) you my friend definetly don't count as Traditional TA in my books. Really like your thinking on some of your stuff esp the SPX/vix charts and gold silv. Trading on something else that no-one is watching/trading off almost always gives you better entry /exit points. Its like using different time periods other than hourly etc so that you are not fighting with others to get a good execution when a trade is signaled on a more commonly used TA tool.

  • chronographics

    Nice signals on the Euro Chart, went short at 1.31 and 1.33 myself :-)
    Well you have solved what probably is the biggest problem for most Traders and that is to know yourself. Its not the glamourous side of trading and really little attention given but the most important by far. Don't know yourself = don't know what sort of system you should use to trade = don't know what rules to have = not make money
    Agree on EW been using it since 1981 – when its hot (read when I get it right) unbeatable – when its not (I get it wrong) painful. I learnt long ago it is great for framework of market ONLY as long as you put in both BULL and BEAR cases. Might alter my amounts I trade based on that but trade off my other stuff.

    Current view I have on EURO is that while we have only done 38% we have also spent time here which could balance things out. Thinking if 1.2950 holds we see good downside. I am seeing sell signal building but not there yet. hey if I get buy signal I will be Long :-)

  • sloth_bear

    Hi guys,
    Here are two important levels to watch if you are short AUD/JPY:
    http://screencast.com/t/OTIzNTUw

    http://screencast.com/t/ZDRmYTQ2M

    Will make coffee, to shake out my tiny brain…

  • Bob the Horse

    I hear producers were coming in on Friday to hedge forward – normally a decent sign of a top. Copper is all about short covering at the moment as open interest is falling as the price rises.

  • sloth_bear

    Finished my coffee, let's start the day :-)

    DXY still in a strong downtrend, this trend may be broken soon:
    http://screencast.com/t/MDVkOWI3NzQt


    AAAAAAaaaaand…. I just loaded a drawing set I made in July, and guess where we are (/ES):
    http://screencast.com/t/ZTU1MWQyYz

    4h chart:
    http://screencast.com/t/MDVkOWI3NzQt

    I will use this line as my ultimate bear line…

  • Bob the Horse

    Good news – I have been going through my roadmap for the next two months and I am starting to feel a little nauseous.

  • sloth_bear

    Maybe you are pregnant…

  • jacksoo

    the high altitude i guess?

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

    nauseous? not sure if that is good news or not?! You still short? Been away for a while and seems that bars have been battered again…going to spend the day trawling charts…

  • Bob the Horse

    Last time I got nauseous was on Aug 17th. Market then dropped out of bed. My gut has historically been a great predictor of a big market drop. I am pretty short right now – I went short at 1123 in August, covered at 1170, had a couple of small go's on the long side which got stopped out and have been adding to shorts on the rally with the bulk of the position on around 1090. Looking for a move to 920 within next 6 weeks.

  • sloth_bear

    DXY broke and retested the red channel:
    http://screencast.com/t/ZGJkNDk0

  • sloth_bear

    Nice to see that I'm not the last bear out there :-)

  • fisheggs

    Very pleased that you're not feeling great. Makes me feel better about my stab wounds. :)

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

    yes..that makes 3 of us..

  • sloth_bear

    OT: This video made my day:
    http://www.youtube.com/watch?v=4ba1BqJ4S2M

  • jacksoo

    same boat Bob – avg 1087 ES – -

  • sloth_bear

    Bulls seems to have a hard time trying to stay above 77 for more than a few hours in AUD/JPY:
    http://screencast.com/t/MzAwMTI5Y

    This time again?

  • raised_by_wolves

    Thank you for sharing, Scott. What bears need is not only SPX dropping but also VIX rising sharply because SPX/VIX needs to make a bigger move down than SPX. This is another *must* for bears.

  • raised_by_wolves

    I had the best coffee yesterday, a macchiato at Espresso Vivace that looked like this winged heart.

    http://www.espressovivace.com/archives/BM5455.pdf

    Capitol Hill is the district of Seattle to go to for latte art, and Vivace is the best of them.

    By the way, you never need a pump of syrup or a sugar packet with properly prepared milk-based espresso drinks. When I used to be a Starbucks barista, I was the only God damn Starbucks barista I ever met who could consistently steam milk correctly. This would be like being the only profitable trader at an investment bank. This is not to emphasize that I was a winner. This is to emphasize that the green mermaid is a loser. Seriously, foam must have no visible bubbles and should have a glossy sheen on the surface and not just for aesthetic reasons. If you see bubbly foam, the natural sweetness of the milk is destroyed and your drink is utterly ruined. 95% of lattes are utter shit. I'm talking about worse than Bud Light quality. I'm talking about Bud Light mixed 1:1 with feral cat piss. People drink this piss on an everyday basis for years and never even know it. This may be the most disturbing aspect of society to me. If you see bubbly foam, you are drinking shit that they should be paying you to drink and not the other way around. Also, any latte larger than 12oz is an abomination. A 4 oz macchiato or a 8 oz cappuccino is preferable. If everyone burns a Starbucks down, the world will be a noticeably better place.

  • raised_by_wolves

    Hello US Peso, hello European Ruble, and hello Hamster ;-)

  • sloth_bear

    I live in a third world country with no Starbucks (Belgium), so I drink a lot of Nespressos, what else…

    We also have Illy coffees which are good laxatives

  • Bob the Horse

    It is indeed sad that Western society has evolved from the days of Socrates and Plato to one in which poorly foamed milk goes unnoticed.

  • Hungry_Joe

    Hehehe…relax RBW…
    The best coffee that we have in India is the one from ground Beans and then plainly filtered and which is available in cheap (as in less expensive) cafes and at home. No Starbucks here and the fancy cafes fill half of the cup with tasteless foam.
    In other news, Asia has been strong today and Indian index closed at a 24 month high today. Am sitting this one out.

  • raised_by_wolves

    Have you ever made your own stove top espresso?

  • raised_by_wolves

    Sadly, the concept of quality is almost completely forgotten.

  • 99er

    Chart: HG
    Happy Labor Day, folks. It's officially September.
    http://www.screencast.com/t/ZmUxZmYxY

  • raised_by_wolves

    The coffee you described sounds respectable. Try cold-brewing coffee with maybe a little cardamon for a couple days if you have a refrigerator.

    By the way, properly textured foam is quite tasty, especially combined with oscillating waves of properly prepared espresso. Unfortunately, probably less than 5% of foam is properly textured, at least here in America.

  • raised_by_wolves

    Time to smash some windows.

  • 99er

    What? Too much coffee at Cafe Nervosa? And yes, Frazier fans, there is such a Seattle coffee shop…at Third and Pike. It's been around forever.

  • 99er

    Chart: DX
    The Dollar…on caffeine.
    http://www.screencast.com/t/MmRhYWYwMjkt

  • sloth_bear
  • 99er

    Thanks. I prefer cafe creme myself, not decaf.

  • raised_by_wolves
  • raised_by_wolves
  • chronographics

    Bob, you ought to come to NZ think they make some of the best coffee around, not that we grow coffee beans but we have the best milk and therefore the best foam. Also think most coffee shops here have someone who has been taught how to make coffee correctly, was a nice surprise to come back to,
    RBW you would probably never get to sleep :-)

  • raised_by_wolves
  • 99er
  • Bob the Horse

    I once spent a long weekend in Auckland – thought it was fantastic.

  • raised_by_wolves
  • raised_by_wolves

    It's going on 5 AM.

  • raised_by_wolves
  • 99er
  • 99er
  • 99er

    Chart: CL
    Crude oil anyway.
    http://www.screencast.com/t/NWIxZDY3

  • SW6
  • amokta

    FTSE & /ES creeping higher ?

  • SW6

    ES high so far is ~1107, low is ~1101. Currently 1105. No creeping just fluctuating. :-)
    If you click on that giant unattractive link of mine you'll see volume is/was poor for today. Probably no substantial move til American open tomorrow. EWI has, as you would know, forecast higher FTSE and CAC 40 over coming weeks – a final C wave up they/Carolan says.

  • trabuco

    Cool…a coffee thread…I grew coffee for 20 years…

  • 99er

    Way Off-Topic: Best Grocery Store In The World
    And yes, it's in Seattle. Where else can you possibly buy over a dozen varieties of live oysters all year round?
    http://www.uwajimaya.com/index.html

  • amokta

    Good point, need to look at volume!

  • 99er

    Chart: ES
    Looks like a top here, folks. It is September.
    http://www.screencast.com/t/MzUyMzFmN

  • sloth_bear

    Let's see if that yellow trend line is as strong as an expresso:
    http://screencast.com/t/ZWMyYTU5Z

  • 99er

    Deca, s'il vous plait.

  • sloth_bear

    Hehe, I guess we are looking for the same thing :-)

    I really would like to see the $ turning up, maybe an IHS is in formation but there is two strong channels which are keeping the prices down:
    http://screencast.com/t/Mjg3NTA4Yj

  • sloth_bear

    Little update:

    AUD/JPY had a heart attack when it touched the upper trendline:
    http://screencast.com/t/MTQwNjQ3
    zoom:
    http://screencast.com/t/MTQwNjQ3

    EUR/USD is resilient, maybe in a triangle:
    http://screencast.com/t/NDY0N2E4Mz

    AUD/JPY is still making lower lows and lower highs…

    Time for ES to chose a path:
    http://screencast.com/t/MjNlZDQyM2Et

  • 99er

    Chart: HG
    Copper is now completing its backtest of the rising wedge out of which it fell earlier today.
    http://www.screencast.com/t/ZWZjNDEzNm

  • 99er

    That ES chart is rather beautiful really…like a Japanese modern print. “Bad Moon Rising.”
    http://www.youtube.com/watch?v=ZeZm7KQJT1o

  • sloth_bear

    Nice spot to try a short!
    Have to leave, Good luck!

    (I called the ES chart “Dawn of the bears” ;-))

  • Hungry_Joe

    RBW, Will have to see what cold brewing in coffee is. Have seen Fight Club but I remember the novel more than the movie. The coffee thing along with your links though remind me more of the movie “Falling Down”. Will not say more on this, one never knows with Mole.

    Currencies are just stuck waiting for US equities to open. Did not know that Equities were giving the direction here. Given the asian markets action today, have closed my Friday's currencies shorts and will wait out this rally. This bear bus doesn't look like leaving the stop anytime soon. But then, who knows?

  • chronographics

    Don't think that currencies are waiting for US Equities to Open, rather waiting to get Volume back when the US Traders return – just my NSHO :-0
    Makes for a long night/day though…

  • chronographics

    Interesting to see the CDS on Greece have moved out well past where they were before the ECB announced its “rescue” package, Ireland, Portugal and Spain also have moved further out. Ticking time bomb really…

  • convictscott

    I recently stopped using the saeco superautomatic on my bench and started using chemex, it makes a beautiful cup of coffee with single origin beans :)

    http://tmagazine.blogs.nytimes.com/2010/04/22/ristretto-chemex/

  • http://evilspeculator.com molecool

    “Will not say more on this, one never knows with Mole.”

    WTF! What is it – Mole bashing weekend or something?

    Jeezzz – I'm getting really tired of running a blog – seriously. Nothing but negativity everywhere.

  • http://evilspeculator.com molecool

    Tinyurl.com is your friend.

  • convictscott

    Good morning from down under :) One little point I'd like to make (that has constantly frustrated my trading over the last few years) is that setups resulting from half trading days, or days where Europe is open and US is not, tend to be valid setups, even though I have resisted taking them thinking they obviously are a distortion.

    Half open markets and short days tend to produce tiny range days (which means if you place a stop at the daily high/low you are risking fewer points) and particularly tiny inside days. For some reason the natural cycle of range contraction/expansion means odds favour larger range days the next day.

  • http://www.hotoptionbabe.com Anna

    Hi darling!! Weren't we just speaking about this very thing!! never fails babe I have been bashed more than a bullfighter gored by a bull pumped up on testoserone this past year LOL

    I read your post every one all of the sudden bull lovers!
    You know what this means, watching the VIX closely this week.

  • http://zstock7.com/ zstock7

    only 2 places to short FCX….
    80 or 82.9–
    You have GDX double top imminent failure, so that sort of takes out 82.9.
    http://zstock7.com/?p=3242
    GDX imminent failure, has huge implications / PROFITS, if you go and short some of the other gold stocks, copper,gld.

  • http://zstock7.com/ zstock7

    I am totally expecting a pullback 1 to 3% this week. My bands on my charts are stretched to their limits, and NAUD, remember NAUD, that un reliable SOB–well it even sort of confirms a pullback.

  • DudePlunger

    I have noticed this as well. We are trading above 1100 on a closing basis, and have 3 solid green candles behind us. EUR isn't particularly weak…..and so I will wait for a short setup to appear, somewhere around 1120 would be preferable, the high of August 11th.

  • raised_by_wolves

    I've shop lifted there before ;-)

  • convictscott

    RBW, yesterday you posted this. “What bears need is not only SPX dropping but also VIX rising sharply because SPX/VIX needs to make a bigger move down than SPX”

    I really like the work you do on spx:vix etc, but I think you misunderstand the nature of volatility and what it really is in this situation.

    VIX measures volatility, right , we all know that. How does volatility behave? Just because we plot it on a chart does NOT mean it behaves like the other things we plot on charts. Similarly although ratio charts like spx:vix give us useful information, because there are (virtually) no supply/demand cues coming from this chart IMO we can't use them for exactly the same kind of analysis you would do on a straight spx chart. In other words, there are relatively insignificant numbers of traders buying volatility and buying the index (though it would be a good strategy right now) so its not a market moving type thing, more a market information gestalt type thing.

    Which gets me back to my main point. The oldest continuously traded market is cotton, which has continuously traded data back hundreds of years. Mandelbrot did a study of the way prices behave, and he discovered that the mathematics of volatilty were the mathematics of turbulence, exactly the same as the way pressure changes around a boat propeller, or wind velocity in a hurricane, etc.

    The most important thing to know about how volatility behaves naturally is that it SPIKES. From very low levels to impossibly high levels far quicker than any normal distribution could explain. Of course this has implications that Taleb and others seized upon for black swan theory, that the black scholes option pricing does not work right, and that there is a fat tail inefficiency that can be seized and profited upon. The other important thing about volatility spikes is that they cluster historically, ie once you have one massive spike, you invariably increase the odds of another (flash crash).

    So what I am saying is that vix *will* spike much higher than spx goes down, its a given. This is because of the *nature* of vix, not because its plotted nicely on a chart. Also, this is why the bollinger bands work so nicely on vix where other TA methods have limitations, because the volatility of volatility (which is what bollinger bands are measuring here) is a much more useful thing to know than whether prices are way outside normal distribution (like on bands on an spx chart)

    A precondition for massive vix spikes is complacency, they come out of the blue. We have that here. Does anyone seriously think risk of volatility events is the *lowest* since May?

  • convictscott

    Dudeplunger, one thing I've noticed about the last daily candle on the spx chart, is that even though it looks like a continuation gap (gap open at the lows, close at the highs) if you look closely the rise all happened virtually on open, so the data IMO gives a slight distortion.

    To me its more proper to see that candle as an open at the highs close at the highs, long wick. In other words, a hammer candle. As you and I both know this candle is by its nature bullish (it represents rejection of the lows) but one of the HIGHEST PROBABILITY BEAR SETUPS is a break of the hammer low (and also the shooting star high).

    Given that we have
    - gothic church fractal setup to the downside telling us to take next short setup no matter how unlikely
    - weakening breadth on the way up
    - overhead resistance
    - bearish capitualation
    - zero divergences
    - currencies, particularly euro lining up
    - copper looking toppy
    - vix behaving like it should for a crash

    A fall below 1093.60 spx would IMO be a valid short. I agree with you, its more likely to come after a failed attempt to the upside (and it would “fit” nicer as a gestalt with currencies etc), but I think we should be aware of the possibility that its all over at this point. IMO the odds of this are not in any way betting odds until we breach the daily spx low.

  • raised_by_wolves

    Excellent comment Scott.

    The volatility of VIX did NOT rise sharply during August. Wasn't that a sign to fade the drop in equities? Although VIX moved into the upper half of the BBs, those BBs remained narrow, hardly pushing up. Bears *need* VIX to push the upper BB up this next time.

  • amokta

    Sometimes bombs don't go off, due to sucessful defusing aka ECB/Fed intervention :-) Just saying..time will tell

    Also, excellent market insights from the convitscott!

  • convictscott

    In retrospect, YES! I can't believe I missed this, thanks for pointing it out :-)

  • raised_by_wolves

    So what I am saying is that vix *will* spike much higher than spx goes down, its a given.

    But not all the time. For instance, usually VIX spikes much higher than SPX goes down during wave threes but not during wave fives. Maybe much higher in terms of percentage but not in terms of proportion. When I said in my previous comment that the volatility of VIX did NOT rise sharply during August, I was describing proportions. VIX can have a 10% rise or fall within narrow BBs and it doesn't really matter if those BBs stay narrow.

  • raised_by_wolves

    No problem mate.

  • convictscott
  • convictscott

    Excellent points! Again the shape of the bb's has a lot more importance with vix, because volatility on volatility is an important metric, whereas the bbs on stock or index prices are just an envelope of price.

  • convictscott

    And euro falling off the plate too, any ideas?

  • convictscott

    Example happening right now on how you can use multiple timeframes with the retest variation pattern… watching it kick off on 15 min then 30 min, then 60 min

    http://www.masterkillers.com/2010/09/06/euro-kicking-off-to-downside-with-sequential-retest-variation-sell-signals.html

  • DudePlunger

    I have some ideas. I got short the fucking pound, that thing is weaker than the Euro, but now that we have a monster candle on the euro as well, I am looking for pullbacks to short EURO. Big time 1 hour candle on the euro here though.

  • convictscott
  • convictscott

    I'm doing exactly the same, looking for a decent pullback on the 5 min charts to get short in size.

    Bearish odds in equities increased SIGNIFICANTLY over the last hour!!!

  • raised_by_wolves
  • http://www.hervey-bay-holiday.com kea11

    AUD 10 month resistance line – low risk sell trade has been available for many hours. Probabilities say AUD will drop. If not will make parity and exceed over next several months; even so stop loss is minimal at this point.

  • raised_by_wolves

    Where did you grow coffee for 20 years?

  • convictscott
  • convictscott
  • trabuco

    Costa Rica…

  • raised_by_wolves

    I tasted a very well-balanced and flavorful Coast Rican coffee yesterday. Unfortunately, I can't recall the specific region and estate.

  • raised_by_wolves

    In addressing the question of whether it is better to be loved than feared, Machiavelli writes, “The answer is that one would like to be both the one and the other; but because it is difficult to combine them, it is far safer to be feared than loved if you cannot be both.”

  • trabuco

    Arabica bean from Tarrazu…

  • juju2

    CoT on the euro/usd. looking for a 1st target to $1.3069. Will re-evaluate once the 1st target is reached.

  • http://www.hervey-bay-holiday.com kea11

    Katter backs Coalition in Australian barter electoral system. Looking for volitility over next couple of hours with more election bombshells and but resistance to hold. Look for sell point after RBA statement.

  • 99er

    Chart: ES
    It's autumn and leaves turn red.
    http://www.screencast.com/t/YjYyODg0MmQ

  • raised_by_wolves

    Where should I go if I want to hunt or grow my own food, live in peace, and not pay taxes?

  • finalbull

    cttd is about to run up big time

  • Hungry_Joe

    Hi convictscott, how do you calculate the exit target for the rtv pattern?

  • Hungry_Joe

    Mole, if you meant it in a serious fashion, I would say, just chill. I was just trying to end an off market chat on coffee. Thats all. :-).

  • raised_by_wolves

    What's your method for determining this?

  • http://www.hervey-bay-holiday.com kea11

    Pass for all except taxes = NZ oh and just be wary of the Earthquakes it's not called the shaky isles for nothing!

  • raised_by_wolves

    Do you have to pay both income and property taxes? Property taxes = a form of rent = not really owning your land

  • finalbull

    CTTD Revenue

    For a long time, value investors have used the current share price relative to sales per share levels as an important valuation tool. We utilize a historical weighted average methodology that treats recent years more importantly in the calculation. When looking at CTTD through this framework, we can see that our weighted average historical high and low Price to Sales per share ratios over the last 9 years are 2.04x and 0.20x respectively.

    Utilizing this range we can see that CTTD’s current Price to Sales per share ratio of 0.00x is significantly below its average levels historically. In fact, with a current price of 0.01, CTTD is a full 100% below its average Price to Sales ratio at comparable sales levels. This is a rare occurrence and, when taken in context of the other areas of our analysis, can be a strong positive for our outlook for CTTD

  • http://www.hervey-bay-holiday.com kea11

    No taxes on family home. Pay income tax and GST on purchases (VAT).

  • convictscott

    Unfortunately I havent found a one-size-fits-all solution, but its a long term project of mine. I'd probably look closely at 2sweeties stuff at retracementlevels.com

  • http://evilspeculator.com molecool

    Exactly – thanks Anna. BTW, good to see you here again.

  • raised_by_wolves

    So, if you don't work and you don't buy anything, you don't pay taxes, correct?

  • convictscott

    Also, if anyone is stalking a sugar short, its worth another look today, probably a top-picking (low confidence) exercise, but anyway…

  • raised_by_wolves

    I would not use the phrase “just chill” if I was begging for my life ;-)

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

    Everyone looking at this I should imagine – we should probably expect a mighty stop run at the open before it resolves.

  • Hungry_Joe

    Oh, is it? I think I now need a lawyer. Anyways, we use it here as in “didn't mean any offense, so let it pass, chill, just chill”. And honestly, having seen guys being banned, I just wanted to come back to mkt chatter. Will keep quiet hereon and will just read. Am just a student.

    RBW, I hope you are not writing all this to provoke Mole. :-(

    PS: Mole, please don't fall for it. I got nowhere else to go.

    Convictscott, I have been following sugar, unfortunately, shorting it is banned in India so will just have to give it a pass.

  • raised_by_wolves

    For making iced coffee, you don't need to start off with hot water to brew it if you give filtered cold water and fresh ground coffee sufficient time together (a day or more).

    http://www.boston.com/lifestyle/food/articles/2010/08/25/cold_brewed_coffee_makes_a_stir_in_the_hub/?s_campaign=8315

    I haven't seen “Falling Down.” If you recommend it, I will have to put that on my list.

  • Hungry_Joe

    Will try this.
    “Falling Down” is a must see, I think. It meanders around in the end, but from the 1st scene you get a flavour of what is to come. And there is a Burger scene which I was reminded of when I read your coffee comments. No one could have done the movie better than Michael Douglas.

  • raised_by_wolves

    Don't worry, Mole won't ban us for talking about coffee on a weekend.

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

    Quick NinjaTrader question (only got it recently) – how the fark do you draw a regular, vanilla channel? It has a std dev regression channel tool that is near impossible to use but this is not what I want. Also, how to take a parallel from an existing line?

  • http://www.hervey-bay-holiday.com kea11

    Sounds like Nirvana! Also many of the Conservation huts in the National Parks are free to use and have gas on tap!

  • Bob the Horse

    Bank capital issues are coming back – looks like Basle 3 is now saying 9% Tier 1 ratio would would mean a lot more capital needed.

    Portugal German 10yr spread now 337bps vs the 348 May panic high

  • raised_by_wolves

    Does this mean the market is realizing that Europe is still fucked?

  • fisheggs

    Morning Bob. Your sicknesss indicator is fairly accurate. How do I subscribe?

  • raised_by_wolves

    I haven't made it to Nirvana yet. I'm just gathering ideas. Can they arrest you for being a good-mannered homeless vagabond foreigner in New Zealand?

  • raised_by_wolves

    Is real-time updating misbehaving for anyone else?

  • Bob the Horse

    Hopefully

  • Bob the Horse

    I will keep posting nausea levels pro bono on this site.

  • http://www.hervey-bay-holiday.com kea11

    Only if you don't wash your hair and shave at least once a day.

  • jacksoo

    and u must provide your own hard hat

  • fisheggs

    Disqus = Fucked

  • raised_by_wolves

    Haha, I haven't shaven in years, and one time I went six months without shampoo.

  • raised_by_wolves

    It keeps shifting upward when you're trying to read or write something lower down, doesn't it?

  • raised_by_wolves

    Much appreciated Bob.

  • Hungry_Joe

    Yes it does.

  • SW6

    Yes, it's been driving me moonbatty!

  • fisheggs

    Yes. I trust you will be sending them a polite email.

  • http://www.hervey-bay-holiday.com kea11

    With a name like raised_by_wolves; wouldn't expect anything less.

  • raised_by_wolves

    Yeah, which I signed as “Raised By Fucking Wolves.”

  • raised_by_wolves

    My short-term workaround is to pause real-time updating each time I want to read a long comment or write one myself.

  • sloth_bear

    Thanks, I was going crazy!

  • chronographics

    And gumboots, two pairs one for the front pair and one for the back… :-)

  • jacksoo

    LOL those bloody sheep have been talking again…….

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

    Looking at DAX daily…evening Doji star?
    http://www.screencast.com/t/NTBjNjkxYTkt

    still short this and AUD

  • chronographics

    Yup RBW will find plenty of sheep to keep himself busy :-)

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

    EURO daily possible outcomes?

    http://www.screencast.com/t/MzlkNmVmMTgt longer view

    http://www.screencast.com/t/MDUwMDE1 zoom in view

  • http://www.hervey-bay-holiday.com kea11

    Sheep, Deer, Opossums and Gumboots like I said Nirvana.

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

    New moon tomorrow, bodes well for a top

  • chronographics

    Oh yes, they reckon its the action of the sheep trying to get its back legs out of the front of your gumboots that does the trick – nah think thats an Aussie thing :-)

  • chronographics

    You might well be right – people have kind of been quiet on that correlation lately.

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

    like that!

  • Bob the Horse

    Main reason why I am absurdly confident in my short position:

    http://www.screencast.com/t/Y2U4NTAy

  • fisheggs

    That Mr Horse – is one beautiful chart.

  • sloth_bear

    Here is my ultra bearish view, it's a succession of 1-2, I didn't put it in the bin because we seems have a 5 wave impulse from the top of the “Green 2″:
    http://screencast.com/t/NTZlMGFlN

    Here is a zoom on the orange square:
    http://screencast.com/t/MjYzNDcw

    Caution, I'm a real beginner in EW

  • chronographics

    Chart of the week (or should that be weak?) and may I call you Mr Bob the Horse?
    That is one great chart, make it down to Auckland again one day and I will show you the city and any fishing you may want to do!

  • SW6

    The candles are the eurostoxx 50, but what is the blue line?
    BTW, I can understand you getting ill. Even though I don't know what that blue line represents, I can tell that the divergence is important – and it looks DISGUSTING. (in a good way.)

  • chronographics

    Nice charts SB, on the first one this is certainly a possibility and we are in 3 now and therefore we need to get on with the downside… However we could also have done an ABC with A and C being nearly equal, that would make us in a correction down after the first five up.

    personally favor the first count for a number of reasons.
    First warning we are wrong will be if this thing starts to hold up – ie it is out of character for a third wave…

  • Gary_UK

    I have googled it, but nothing comes up. Could you please explain what .porger10 represents? Many thanks.

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

    looks like spread between german and portuguese bonds

  • sloth_bear

    Agree completely, your ABC option, the 1-2 1-2 and the catracho's abc (in yellow in his chart) are the three main options I'm looking at.

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

    Looks good…also an “amateur” in EW..I prefer it on a long term view and not for predictive purposes..useful to see where we have been and where we MIGHT go…
    2 more days of school holidays..after 3 months..phew..

    Might be heading “down under” next year on a “world trip” if any of you antipodeans have any good recs of “things ” that MUST be seen or done..would be grateful for tips :)

  • Bob the Horse

    Spread between German and Portugal 10 yr bond yield.

  • sloth_bear

    Wedge alert on EUR/USD:
    http://screencast.com/t/ZTZhM2I4NTU

  • Gary_UK

    Thanks.

    Do you get that via Bloomberg please?

    Is it a free service? I'd like to be able to track that too.

    Thanks for the charts and replying.

  • chronographics

    Let me know when and where you will be then I can best make suggestions as to what there is in NZ :-)

  • chronographics

    Just Taken my Euro shorts back at 1.2745, looking to sell a bit higher… hmm hope I don't regret this later!

  • Bob the Horse

    I'd like it to be free but it costs about $20k a year.

  • http://www.hervey-bay-holiday.com kea11

    What do you like to do….. Mountain climbing maybe or skiing then there's the California of the Southern Hemisphere.

  • amokta

    We are a few points down, and just on the /ES, and everybody has turned into über Bär !

    Lets see what transpires.

  • bearmaid

    Watching the same, but the day is not over yet.

  • Bob the Horse

    Price action in EU debt suggests a few points down is la la land.

  • amokta

    la la land – you mean we are going much lower? (not getting the joke!)

  • Nightwind

    Your chart also implies to me that the German Bund's interest rate will rise too.

  • Bob the Horse

    indeed – la la land is fantasy levels, i.e you have to be hallucinating to buy equities here

  • Bob the Horse

    no – i think they will fall. it is portugal who will see yields rise. At current rate, they will be north of 6% by Friday

  • amokta

    Ok, thanks!

    Oil also a bit down today

  • 99er

    Chart: HG
    Look at the sky turn a hellfire red now…
    http://www.screencast.com/t/YjA1NDYyYz

  • Hungry_Joe

    BTW, Dr Copper now down more than 2%. I have just a small equity short that I opened today afternoon.

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

    This should be a wave 3 down for copper……….

  • Nightwind

    6%, that would be a hell of a move within a week.

  • Bob the Horse

    If the mkt sniffs trouble, they'll be at 10% by Oct

  • chronographics

    Nice wedge, nice trend line, nice back test – hell we all should have been short, nice trade!

  • 99er

    Chart: SPX
    September. Graceland.
    http://www.screencast.com/t/MmRhN2ZmMWQ

  • chronographics

    Interesting to note – at least from where I sit – that there is not much talk of Eastern Europe ie Hungary etc a bit of focus there as well might put the wind up the Market.

  • Brishort

    Good morning Mole,
    Good day all,

    Would like to contribute a chart that is experimental for me at this point. I had them separately and decided to joint the 4 horses of hell together. Since they are all heavyweights in importance for the US marketplace, I thought we may inder something from it.

    http://stockcharts.com/h-sc/ui?s=$SPX:$VIX&p=D&b=5&g=0&id=p70673597058&a=207973039

    Unsure about the significance of the divergence from last week, i.e. SPX:VIX not confirmed by OIL:USD, but there seems to be a correlation. Maybe correlation specialist around could comment if they had seen this ratio before and if looking at the chart they feel it provides insight or an edge.

    Good luck to all today, will be busy AM but reading later in the day.

  • Bob the Horse

    It's all gone totally off radar. But the HUF looks ready to move higher, EURCHF is still making lows, the GPIF in Japan has turned net seller of JGBs, Freddie Mac swap spreads are moving wider . . . it's all there if you look for it

  • 99er
  • Tooncez

    Hmm, I think that with a little automation, and maybe a site like this: http://markets.ft.com/ft/markets/researchArchive.asp?report=SPR&cat=BR
    I can scrape together a free version of that spread… let me see…

  • Bob the Horse

    Right – my nausea level is really kicking off now. I feel like this market is going to collapse in the next week.

  • http://www.hotoptionbabe.com Anna

    Good morning Mole and everyone! Looks like you need some girl power in here ;-)

    Looks like what I posted last night, we hit 78.6% and bingo! hehe

  • chronographics

    True, Think when I get short Euro again I might just be best sitting on it rather than doing a bit of jobbing around as the fall (if the count is right ) could and should be surprising on the downside. Should see another chance up around 1.2800 he says talking his book.

  • http://www.hotoptionbabe.com Anna

    Chart and good long for a hedge in a nice down tape pretty inverse H&S
    http://www.screencast.com/users/Annamall2/folders/Jing/media/91d95467-c0c9-4941-b4d8-e6cfa7f79e9b

  • DudePlunger

    I got short /ES @ 1097, stop at 1108. Currency weakness overnight should follow through in S&P. Also, we set up a very nice base of resistance at 1105-1107. Let's ee what happens the next few hours.

    Chrono—I am short EUR too. I have secured some profits at 1.276, but will look to continue adding on pullbacks and building this position.

  • Bob the Horse

    Ah – but you have the awesome analysis of Katzo to draw on. We poor minions must struggle on without him.

  • Bob the Horse

    If this price action in the periphery bonds is valid, the next move down should be impulsive, in FX and equities. I have some 1040 Nov puts from last week which are my gamma bombs.

  • chronographics

    Good man I think 1.2780/12800 good place I will be going short there, or if I miss on break lower….

  • http://www.hervey-bay-holiday.com kea11

    Nice Option, great wallpaper.

  • http://www.hotoptionbabe.com Anna

    Hey Kea how goes it :)

    TY

  • http://www.hotoptionbabe.com Anna

    HI Bob :)
    I must admit he's really good @ TA !! I do value his input and I also love Mole so there ya go :)

  • DudePlunger

    I like that level to short, but I don't know if we will see it before a fall to 1.27. Pound has already made its way lower, breaking last week's low.

    I'd like to see Euro sell off along with equities as we open. A trend day lower today would be very ideal.

  • chronographics

    Lets hope so, funny looked at Nov Puts on Friday still have spreadsheet in front of me, just got greedy on what i thought I could pay for them. Think you just might be laughing on those down the track.

    By the way I also too miss Katso :-0

  • http://www.hotoptionbabe.com Anna

    just a thought this could be a overbought correction or we also could give back all the gains from last week this week ;-)

  • http://www.hervey-bay-holiday.com kea11

    Time for bed over here in the land of oz. Hope to awake to a bigger slice of capital in my account. Convicted that USD going up but will know soon enough if my conviction kicks me in the teeth. Good luck with that reverse head and shoulders – everything looks great from between your legs – ie reverse head and shoulders.

  • chronographics

    Hmm have to admit you might be right I am nervous, but squiggle count looks like five down so we should get minor bounce so here's hoping, Will be scaling in from lower down though just to make sure:-) Happy trading

  • http://www.hotoptionbabe.com Anna

    Good night Kea :)

    I think you will I either have 1071 /es or something much juicer for this week :)

    Rofl ;-)

  • chronographics

    Is that Katso speak? :-)

  • chronographics

    Night mate :-) I am not far off either

  • http://www.hotoptionbabe.com Anna

    hahahah no mine but we have the same views either 1071 or much more :)

  • DudePlunger

    I just got hit on my 1.276 profit stop loss. I'll wait for a pullback to 277-278 to start legging in some more.

    Happy trading to you as well.

  • http://www.hervey-bay-holiday.com kea11

    I should think so it's nearing 1am there! Go to bed and no texting with the lights out. By the time I clean my teeth the opening bell will be ringing. At least you get to trade the close at a reasonable hour.

  • http://www.hotoptionbabe.com Anna

    BTW have a great night :)

  • chronographics

    Agree we are at an inflection point, particularly in the EURO believe this and possibly the Bonds will be the next big driver of stocks. Mind you there has been a disconnect for a while in the Bonds/Stocks

  • chronographics

    leaving my stop above 1.2830 :-)

  • http://www.hervey-bay-holiday.com kea11

    Wish this alphabet soup included a bit more than ABC.

  • chronographics

    Thanks, likewise

  • chronographics

    LOL reminds me of my Boarding School days. Catch you tomorrow :-)

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

    Hey Anna – good to see you back around these parts – hope you and the rest of the shelter residents are all doing good.

    Looks like everyone is on the same page today – this is either very good or we're all about to get royally stuffed..

  • http://www.hervey-bay-holiday.com kea11

    Used to it!!

  • http://www.hervey-bay-holiday.com kea11

    Goodnight – won't be far away.

  • http://www.hervey-bay-holiday.com kea11

    Thanks Anna and you have an excellent day.

  • K.I.M.

    Inverted H&S, if that thing still exists we have one on a 4H eurusd, with neckline at 1,292 forming right shoulder now.

  • http://www.hotoptionbabe.com Anna

    Hi Ultra

    TY :) nice to be back here. they are still do the Annamall rescue, but now is being set up as non -profit :)
    Fed them all last night in torrential rain

  • http://www.hotoptionbabe.com Anna

    TY :)

  • http://www.hotoptionbabe.com Anna

    Great minds ;)

    we could see a gap fill (nervous shorts :() and hit the stops around 1100 then roll on down

  • http://www.hotoptionbabe.com Anna

    TY Kea :)

  • http://www.mylifemytrade.com MyLifeMyTrade

    A big move down would have been telegraphed by open below 93.

    If they are going to let bears on the bus by shorting 1100 (sucker bear shorting level), of course we will see higher than 1100 pretty soon..

  • amokta

    Only 6 pts down onx spx, I dont see P3 yet…

    Take note of MLMT below?

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

    Ja sure – we broke out of the wedge on /ES – it would not at all be unusual to see a retest of the underside with a new high.

  • gsavli

    I see some strong headwinds for the rally today.

    TLT; FX pairs, oil, copper…

  • amokta

    Hope we dont make new highs – need to recapture lost gorund from last week, but the market will do what market does!

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

    5-down on 5 min from yesterday

  • sloth_bear

    Nice downtrending channel on ES:
    http://screencast.com/t/ZWVhMTcxMT

  • http://evilspeculator.com molecool

    Morning everyone!

    Note to Zero subs: If it wasn't for the holiday gap the ZL would have slowed right at that lower channel border. So far I'm not impressed by the downside.

  • http://evilspeculator.com molecool

    Bou, you're active here today. How are your Hobsters holding up?

    Pet a kitty for me today (yes, a real one).

  • Bob the Horse

    Good work stomach.

  • gsavli

    what's with vix? folks buying 'em ATM puts?

  • jigdaddy

    im riding this bus with you……sorry if there is vomit everywhere….i wasnt feeling good last week :-)

  • http://evilspeculator.com molecool

    Guess everyone went back to bed. Gray foggy pre-fall day here in CA (no pun intended) – so I'll do the same.

  • legobear

    How does it look now? Oil falling off a cliff (again) and should be going a lot further down eventually – http://stockcharts.com/def/servlet/SC.pnf?c=$wtic,P

  • BobbyLow

    I could see your mane from here in the back of the bus 'ol chap.

    Can never be too confident in this crazy market but I must say that my puke factor has improved at least temporarily. :)

  • amokta

    Yesterday SPX 1040 seemed so far away

    Now it looks as though P3 is here to stay

    Oh I believe In yesterday

    -perhaps a bit premature, only when we start losing 20-30 handles a day,will this be true.

  • WTFed

    I for one, as a subscriber, am waiting to hear what you think. I am not in bed.

  • http://www.hotoptionbabe.com Anna

    Morning honey bun!

  • http://www.hotoptionbabe.com Anna

    I am :) and they are happy had em go short Friday :)

    I will :) hahahha

  • http://evilspeculator.com molecool

    I worked all weekend – was fun! Need to hook this bitch into C2 soon – but want a few weeks of forward testing, preferably in a down market.

  • http://evilspeculator.com molecool

    Be careful today, ZL looks a bit iffy so far.

  • DudePlunger

    Holding short /ES from 1097. I am still keeping my stop at 1098, this needs time to develop right now.

  • http://evilspeculator.com molecool

    You must be seeing something I don't.

  • http://www.hotoptionbabe.com Anna

    yep covered some shorts and have TLT puts on :)

  • Bob the Horse

    Wake up Mole and smell the coffee!

  • WTFed

    I thought you were going to get some R&R! Can't wait to see what you have there. This market is a bitch.

  • http://www.hotoptionbabe.com Anna

    I tend to be on same page, but hedged with TLT puts :)

  • DudePlunger

    1 hour chart, we setup a range between 1105-1108, then broke down below it with my 10ema and 40ema on the 1hr crossing, first crossover since Aug31 crossed to the upside.

    All dollar based currencies rallied overnight. Copper sold off. Good enough for me to get short and lower my stop based on 1hour candles as the market keeps moving.

  • DudePlunger

    I messed up. My stop is at 1108, not 1098.

  • sloth_bear

    Backtesting the yellow rising channel on ES… Maybe a fail and badaboum
    http://screencast.com/t/ZDhjYjZlMDg

    zoom:
    http://screencast.com/t/NDFiOGNjNjE

    $DXY is strong, I hope it can go and stay above the green trendline, it would be bad for equities:
    http://screencast.com/t/YzJhOTI0N

  • http://evilspeculator.com molecool

    Meh – I'm more into tea in the morning….

  • http://evilspeculator.com molecool

    Ah – that's different.

  • jigdaddy

    let me guess Teavana

  • http://evilspeculator.com molecool

    Is anyone else experiencing a recurring page reset to the beginning of the comment thread?

  • http://www.hotoptionbabe.com Anna

    yes driving me nuts since last night!!

  • http://evilspeculator.com molecool

    Greenor white tea with pomegranate – delicious.

  • DudePlunger

    Yes.

  • sloth_bear

    yes

  • http://evilspeculator.com molecool

    Your cats or your date?

  • http://www.hotoptionbabe.com Anna

    hahhahah Rofl no the page skipping up everytime I try to post!

  • http://evilspeculator.com molecool

    Whatever it is I'm against it … (please complete)

  • http://evilspeculator.com molecool

    Here or on HOB?

  • http://www.hotoptionbabe.com Anna

    both btw I just sent you an email you must look at

  • DudePlunger

    Euro breaking lower again, S&P doesn't seem to care yet, but I'm thinking today might be one of those days where we sell off during lunchtime. The euro has been just too weak for the S&P to ignore this action and reclaim 1100.

  • ds2

    Yes!!! Making it very hard to read.

  • BobbyLow

    I thought the market had finally driven me crazy with the page jumping up as I would scroll down or try to post. :)

  • http://www.hotoptionbabe.com Anna

    i was furiously trying to figure out what I had done wrong LOL hats off to Mole for pointing out :)

  • Tooncez

    RBW,
    If you're awake, SLV/GLD pointing down today…http://screencast.com/t/MDAyODY1

  • DarthTrader

    When I get the cursor reset every few secs I just refresh the page until it stops

  • http://www.hotoptionbabe.com Anna

    Hey darth!!! :)

  • Wave_Surfer

    Ya. As long as we stay inside the range, I feel like we are range trading. Of course that means the first week or so of a major down move will be seen as range trading but considering how long it has been in this range and how much longer it might stay in range trading it seems better to think of it as range trading.

    Kind of like how the market is in an up trend so long as it is still in an up trend.

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

    I am going to go ahead and move down my 1108 stop to 1100. We have been trading sideways after the 945am breakdown, and the next move should be lower into the 1080s. If we snap back up, I don't want to lose more than 3points (short from 1097).

  • amokta

    In that case, i assume you will be Surfing the Elliott Waves :)

  • bshah

    Fly NFLX.. so CEO can pocket even more…

    http://www.businessinsider.com/netflix-ceo-salary-2010-8

    wait.. is it him and insiders trying to push it higher ? hmmmm….

  • http://www.hotoptionbabe.com Anna

    Ridiculous!! meh!
    ty for the article

  • 99er
  • http://chartsandthat.blogspot.com/ ultra

    Stage (ii) of VIX sell signal looks promising at this early stage of the game

    http://stockcharts.com/h-sc/ui?s=$VIX&p=D&b=5&g=0&id=p23819557372&a=202546768&listNum=2

    And we look to have regained the mid Bollinger on the hourly

    http://stockcharts.com/h-sc/ui?s=$VIX&p=60&yr=0&mn=3&dy=0&id=p93679576831&a=203110793&listNum=2

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

    Hi ladies and rats

    as nobody said anything…. SPARTA!!!

  • amokta

    We seem to be in Niemandsland

    If we dont go below 1000 spx this week i will hang my shorts (literally!)

    possible VIX sell signal looks intersting (c/o ultra)

  • ricebowl

    Today will almost undoubtedly complete step #2 of 3. If we sell tomorrow then the signal completes.

  • 99er
  • amokta

    Ok, will wait and see

    p.s if anyone has trouble typing into a disqus box, then press the right mouse-button while in the box, and select any of the available options – that unfreezes the cursor and allows typing again (saves having to reload the whole page)

  • jigdaddy

    under 1000 this week. might as well hang them up now…your being unrealistic…patience

  • amokta

    Ive been patient since a long time! Anyway lets see if we head in the right direction at least

  • jigdaddy

    trust me we all have. this is exactly what market makers want..if it were

    easy and profitable everyone would be doing this. but its not easy and not

    profitable if you capitulate now…in fact im betting if you havent been

    taking profits on this swings and reloading then your probably in a loss…

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

    Support here ES is the 61.8% (we were turned back at 76.4-76.8%). Bear flag suggests this is going to go. Lower fib levels are:

    1082.50 (50%)
    1071.75 (38.2%)
    1058.50 (23.6%)
    1037 (break out the disco ball)

  • OldChicago

    Morning, all. Is this a Bear reprieve? Ha, vacationers returned and had something to say. The action today feels like a bullish correction. I am seeing buying the dippers crowd hovering about –

    * TLT & Gold not able to break up.
    * APPL is hanging strong.
    * Interesting that Industrial isn't rallying after Obama's 50Billions. Just mildly up .6-1% on the average.
    * Someone has been buying since 10:00. ISEE reading has been strong, and the money flow is mildly negative.
    * European banks are very weak – down2.5-3%. GS is hanging strong, so this could be bullish.

    On the bearish side – DJT, RUT, XHB.

    This mean arm wrestling. Here is a weekly call from Jeff Saut (who is not double-dipper) – “If over the next four days stocks rally, the odds the rally will continue are high. If stocks fall, history suggests caution into October is warranted.”

  • ricebowl

    I like the 1082.50 level. My target range is 1076-1081.

    Right now I'm thinking that we're in C of 2 of 1 of P3 with a final target around 1150-1160. That's the only thing that makes sense to me.

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

    Yeah that is one of my two scenarios – basically the last big drop could well have been an X wave, in which case we are in b of Z (I think we have different labels but the end result is the same).

    Either that or this is it. We will know by what unfolds from here – b wave should be pretty easy to differentiate from the onset of a multi-degree third. Then again….

  • http://evilspeculator.com molecool

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

  • Anonymous

    I’m still looking at it. Since you like rainbow charts, here’s a fun one. Can you guess what the colors mean?
    http://screencast.com/t/OTc3ZWExMWMt

  • raised_by_wolves

    Red is normal down candle. Green is normal up candle. Blue is GCT-F up, magenta crossover, and yellow down. White is ghost sighting.

  • Anonymous

    Well, yeah, the red and green in the green patches are due to lack of TOS
    data.

    But when GCT is ‘working’: blue is up, red is down, orange is potential
    crossover up, and magenta is potential crossover down. White is me just
    starting to over-ride GCT with price action to meaning ‘maybe I should be
    blue’. That is my current area of research – squeezing the last little bit
    of accuracy out of this with price overrides.

    Statistically, I think it is net win if I use trailing stops – on the daily
    level and on down to the 5 min level.
    I’m working on a programmatic way to draw these trend lines:
    http://screencast.com/t/MGMxYTgzNW, which I intend to be the basis for my
    ‘smart’ trailing stops… The little squiggles at the end are scalping on
    the 5-min as viewed on the hourly.

    And then I’ll have a beer.

  • Anonymous

    support and resistance are better for you than ma crossovers. ma crossovers can be describing a short term change, while one is using them to trade a longer term change. incompatible and not smart.

  • Anonymous

    LinkedIn
    ————

    I’d like to add you to my professional network on LinkedIn.

    - Michael

    Michael Faulhaber
    Telecommunications Professional
    Greater Chicago Area

    Confirm that you know Michael Faulhaber: https://www.linkedin.com/e/ov0z5z-gydfqdka-u/isd/5831435020/Q457CMEH/?hs=false&tok=1J0Y6oAYSxV541

    You are receiving Invitation to Connect emails. Click to unsubscribe: http://www.linkedin.com/e/ov0z5z-gydfqdka-u/IbDjDgo0STApC6Hc7I1SJsxdsZ6i7LtLqz8gRuof359861MQycDe/goo/notifications-M6HXZZ8VWD%40disqus%2Enet/20061/I2029045235_1/?hs=false&tok=236yWIztexV541
    (c) 2012 LinkedIn Corporation. 2029 Stierlin Ct, Mountain View, CA 94043, USA.

  • Anonymous

    LinkedIn
    ————

    This is a reminder that on February 7, Michael Faulhaber sent you an invitation to become part of their professional network at LinkedIn.
    Accept Michael Faulhaber’s Invitation

    ———-

  • Anonymous

    LinkedIn
    ————

    This is a reminder that on February 7, Michael Faulhaber sent you an invitation to become part of their professional network at LinkedIn.
    Accept Michael Faulhaber’s Invitation

    ———-




    Zero Indicator


    Darth Mole Alerts

  1. poll

    • What is your average spread on the EUR/USD?



      view results

      Loading ... Loading ...


  2. NinjaTrader
    Kinetick

    search warrant



  3. recent misdeeds

    1. Happy Turkey Slaughter!
    2. One Chart Says It All
    3. Monday Snooze
    4. Monday Morning Briefing
    5. The Slow Walk-Down
    6. It Keeps Going And Going And….
    7. The Bots Are Back!
    8. An Impending Trend Shift?
    9. Fade The Noise – Play The Game
    10. Tuesday Morning Briefing