Channel Surfing

UPDATE 10:12am EST: The green scenario increasingly appears to be playing out:

Watch this channel, which seems to be well defined – if you’re out of the market be patient and wait for a break. Chasing the tape never works and you will get burned – MMs just love to take you to the woodshed if you sell into weakness.

However, I’m keeping my eyes on the NQ futures this morning which have stubbornly remained above VWAP and are pushing a bit higher. YM and ES look sickly and the Yen is just fucking around – not sure which way it wants to go. But if the NQ holds (and it has thus far) we might be in for a little surprise to the upside. The level to watch there is 1202, which is the S1 pivot.

UPDATE 10:35am EST: Not to pad my own shoulder, but is my timing spot on or what? 😉

UPDATE 10:45am EST: SWEET! Gap has been filled – loving this – bear trap from hell. Don’t say I didn’t warn you.

UPDATE 10:49am EST: Watch the 830 level on the ES as that one appeared to pose much resistance in overnight trading. If we breach that one we might bust higher substantially. Not sure we will, but watch that level.

UPDATE 10:57am EST: Judging by the silence in here it seems a bunch of bears just got caught in a trap. Yup, greed will get your ass every time. Come on, ladies and leeches – fess up! What are you doing?

UPDATE 11:31am EST: Well, I’m 50% unhedged now – waiting for some profits (thus a drop) before I consider going all delta negative. I’m sure we’ll get another scare to the upside, but this was as good as any level to leg out.