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28
Oct
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3:28pm
The Dow is more resilient than the S&P no doubt… we are still 1-2% away from both the megaphone breakdown and the wedge breakdown of the Dow: (120 min)
3:15pm
It looks like we are going much lower upon a break of the wedge… i would wait another day before starting to put on big short positions.
1:53pm
Like i said yesterday, I wouldn’t touch BIDU until it reaches the 395 level and there is where you can try to short it. I think it’s potentially a good short around these levels here… with a stop above the daily highs. I also sold some more NAKED amazon nov 120 calls at $7, averaging it up to about $5.90 of premium. This means that unless Amazon closes above 125.90 on opex, i make money.
1:48pm
The 61.8% retracement seems to be holding alright at the 1051 level… even though we dipped slightly below it… it looks like the bulls might try to push up from here. A failure to push up from 1050 means the market is in BIG trouble.
9:38am
Wedge at around 106.30-106.40 on the SPY.. you can try and short there with a stop above… I have to leave for the morning, but I rather stay out of this type of market until we get confirmation.
9:31am
We are below the wedge, but as i mentioned last night, beware of a rally to go back above it…
2:48am
My friends, today is a day that most bears have been waiting for… but they might not be as happy as they think. Even if we open below the wedge (1051-1061) there is a chance we see a massive rally right at the beginning of the day, to save the wedge formation. The bulls are not yet fully trapped, and everyone can see that wedge formation, therefore a potential push higher is very possible. My advice is if we open below the wedge, step back.. and wait until 10:20-10:30am. You can actually go long at 1051.5 with a stop below 1050 (that’s a 61.8% retracement). You can also go short at 1060-1061 with a stop at 1063 or 1066 (if you like risk). If we do break back above the wedge.. you can actually expect a massive rally. BUT that massive rally could be the trap the bears are setting for the bulls. So i suggest you put a trailing stop on the rally and then get out at the end of the day. I have a feeling this wedge might break soon since the XLF already did. Another possible scenario is a fall to 1051 and then a strong push back up to retrace broken support as resistance (as well). Here’s an up to date (accurate) chart (60min SPX) of the wedge support and the fibs.
new highs for UUP
ouch! what bounce?
Investors Daily has been indication professional and institutional distrub for past week, this
is going to sell of huge into close because we will see anohter negative print on GDP in the
morn.
I start taking some long on FAS, hopfully we will get at least a fake bounce at the last 30 mintues. I will sell them before market close.
October 28th, 2009 at 3:27 pm
LOL, I got stopped out.
Just added to my FAZ and SRS. Have a feeling we drop another half a percent today>
Idan, SP500 already broke one of the support 1051 as you mentioned. Do you think it can break second support point 1020?
October 28th, 2009 at 3:26 pm
Very possible.. but notice that hte Dow Jones is still far from it’s support.. we are oversold on the short term.. i’d like to see a bounce first before i go short.
I was looking for 1111 on the S&P for the ultimate top, and it was close.
Wouldn’t this be a coincidence:
Oct 29, 1929
Oct 29, 2009
2929
Of course, I don’t believe in coincidences since I know the entire game is rigged. The “news” is an excuse for what are in reality carefully planned, controlled and executed events.
October 28th, 2009 at 3:50 pm
I thought only i dreamed of such stuff, LOL.
We have seen the greed, watch the same geniuses that bounced the market
higher short the hell out of it on the way back to dow 4K.
My head n shoulders coming to fruition.
hit trend line and bounced hard.
there’s a candle wick below the long term spx trend line, but the candle itself is above the trend line now…
market could still bounce a bit higher…
woo where are you
October 28th, 2009 at 3:54 pm
oh there you are right above me
October 28th, 2009 at 3:55 pm
Woo-meow, woo=meow, where fore art thou?
Are you guy’s holding overnight / closing shorts? I can’t decide what to do with (relatively small) faz position.
Anyone who know Elliott waves well could tell us where we stand as far as Elliott waves conceren. Are we done with decline and if not how much more we could decline? When we start bouncing how high we could go? woo please answer these questions as you are the master.
October 28th, 2009 at 4:08 pm
Careful now. Woo is extremely good, but let’s not get a sense of entitlement around here. I follow several EW guys and I can tell you there is much confusion. This close was right above 1041 which leaves both bullish and bearish EW interpretations on the table. In fact, we aren’t in P3 for sure until we cross under 993ish. Let’s see what tomorrow brings. GDP is going to be interesting.
P.S. Woo, thanks for all you do. I enjoy reading your valuable (and free!) insights.
October 28th, 2009 at 4:30 pm
Shaka, What are the EW guys you are following, if you do not mind please share. How did you get the 993ish number for P3?
October 28th, 2009 at 8:00 pm
Sorry so late in responding. There are sooooo many EWT guys around now. woo is excellent, especially with squiggles. Most EW guys I follow seem to be swing traders (at least that’s my impression). So, for woo to make intraday calls on minuette and minute waves is really impressive. Unfortuantely, I can’t day trade, so woo’s calls have less relevance to me. Craig, who founded this site was also excellent. Idan is excellent as well, though I find he is stronger with classic TA than EW. Idan seems to have a bigger tool box and I think he also has a very good feel for how some of the prop trading desks work and how they think.
I am a Kenny follower and I check in with Daneric every now and then. If you visit either of these two blogs, you will start to find a vast network of lesser known EWT practitioners. Kenny is an EWT badass, but he isn’t half as accessible as woo or Idan. Kenny does not suffer fools, so if you visit his blog, be on your best behavior. For instance, Bullish Bear wouldn’t have been tolerated for 30 minutes. Kenny left the Yahoo boards for his own sanctuary and he means to keep it. Daneric got a mention on Mish’s blog and both he and Shanky are on Mish’s blog list. Very impressive. But, Kenny doesn’t kiss anybody’s ass, so he is just Kenny. He is serious about EWT and he prefers that most of the questions add to the EWT analysis, not ask directional stock market questions. I know from personal experience that he called P1 bottom a day or two in advance and I think he was within a point or two if not exactly on target at 667.
Finally, 993 is an important S/R line and EW pivot. I got from following Kenny. Basically, going below 993 would rule out the more bullish scenarios and signal that we are in P3.
woo what are your thoughts
October 28th, 2009 at 4:14 pm
tomorrow gdp will be played up and will be positive, for sure even though the yearly numbers will be negative. i will short the s and p at 1090 or 1120 for sure
October 28th, 2009 at 5:45 pm
wont see those levelsa till 2209
October 28th, 2009 at 7:29 pm
2010
glad everyone values my opinion. i’m going to go home from work early today in a little while because i’m sick, but i’ll try and update a blog post when i get home. have to finish up some work first. i’ll try and answer all the questions here the best i can.
agree with shaka that there’s a lot of different opinions out there. i’ll try my best not to lead you guys astray or bull/bear bias too much.
i’m currently holding a very small call position into tomorrow, but don’t mind losing money on that position.
be back later guys. good luck!
October 28th, 2009 at 4:20 pm
woo…what is your blog ID?
October 28th, 2009 at 4:25 pm
here’s a teaser chart. most people didn’t draw the green trend line back far enough.
http://social.stocktock.com/photo/wooew1year-1?context=user
ok back to work for now.
October 28th, 2009 at 11:10 pm
Thats a teaser allright,1120 maybe 2010
October 28th, 2009 at 7:02 pm
What are you sick with woo? What meds are you taking and when do you plan
on stopping?
LOL.
Get well, hope its not the hog flu or SARS. Get well, market can wait.
A solid day for me. I closed two trades (SDS and SCO) for profits of $650.00 and $1800.00 respectively. Also, the value of my QID position increased by $4080.00 for the day.
Best of luck to all tomorrow!
October 28th, 2009 at 4:22 pm
Nice trades, Morris.
Got stopped out several times on shorting oil last week. Step back and take a rest. I think it is time to test the oil again; bought UCO @13.36. GL!
October 28th, 2009 at 4:47 pm
great trading
October 28th, 2009 at 4:51 pm
Thanks! Taking the day off from trading this past Friday really helped me get my head back together.
Ok I decided to hold my DRV shares into the close and in 3 days has profited a 4 point gain.
The $100,000 dollar question is do i sell in pre-market before GDP and employment news or gamble, and the reason i ask is when Goldman Sachs revised GDP numbers lower that is telling me it could even be worse that the 2.7% gain they are predicting..Any thoughts would be greatly appreciated.
Idan:
Do you have any downside targets for USO or upside targets for DXY ?
Thanks,
October 28th, 2009 at 4:52 pm
I’ve actually answered that question before.. I said a 38.50-38.60 target is likely after a bounce on a formation of a H&S.. which is what we go.
October 28th, 2009 at 4:57 pm
Thanks Idan.
Sold my 39 X puts – bought 2.1 sold 4.2 …
Still holding my 35 puts … but wanted to put some profit in my pocket ….thanks for your advice Idan
October 28th, 2009 at 4:53 pm
Yeah.. we are overdue for a bounce.. no problems.
300 FAS @ 69.50 in the AH
October 28th, 2009 at 5:06 pm
I hate being on the other side of your trades, though I am expecting some kind of bounce soon
October 28th, 2009 at 5:17 pm
Well, this is just a short term play thinking that we will see a bounce in the morning. I’ll be very happy to scalp a few hundred of it. I only have 3 positions in my portfolio right now (QID, UCO, and now FAS). I picked up the UCO and FAS today and I hope to sell them for profits tomorrow. I’m holding my QID (which is my biggest position by far) longer term.
Best of luck to you!
HAHHAAHHAHA. Just looked at the close. My 401k is 50% short.(as of this morning) My roth is 80% short and my trading account is 100% short as of tuesday’s open. I have almost completely erased my losses for the year from shorting in May/June. Thinking about clearing some of these positions off soon.
October 28th, 2009 at 6:27 pm
Just Curious.
How do you short the market in 401K/IRA. Are there funds that do that?
October 28th, 2009 at 6:32 pm
Bear ETFs are what I use. Be careful of the leveraged ones though. I’ve taken my lumps!
October 28th, 2009 at 6:36 pm
Examples:
DOG, SH, MYY, PSQ, RWM, SEF
x2 – SZK, DXD, SDS, MZZ, QID, TWM, EFU, REW, SSG, SKF, SRS
x3 – BGZ, MWN, , TZA, DPK, TYP, FAZ
Watch volume though – don’t want to get into anything with very low volume.
October 28th, 2009 at 6:54 pm
I use a self directed brokerage from merril lynch. For that account I am actually holding MYY which is 1x short the mid caps. I do NOT use leveraged bear ETFS for my retirement accounts. Way too risky for me. I am holding MWN in my trading account (which is even smaller than my 401(k)
)
Also I am 25, I do NOT have a huge account and I am an aggressive investor at my age, which is appropriate. So I don’t recommend this if you’re about to retire. LOL
October 28th, 2009 at 6:55 pm
Also, I am ready for my trailing stop to hit tomorrow for a nice profit if we do get squeezed from the GDP numbers. We’ll have to wait and see.
most likely spike on gdp numbers….i would look to sell it as MACD suggest that gains won’t hold. Watch.
the only inverser not to rally here is SRS. I suspect that is because it is heavy with institoots
invests.
And guys, for F*ciks sakes, leave wooz alone. He’s sick, heatlh is first.
Go cook him some chicken soup but stop imposing on him like a pack of viruses / viri ?
Close to leaving here for good after the displays of clinging i am seeing here, think for yourself
share info but decrease the depends. Guy can die of hog disease and you’d be putting bets on
what time he goes.
October 28th, 2009 at 7:20 pm
thanks shotgun wedding for your views.
Anyone have any opinions on CENX?
http://i38.tinypic.com/2vdh0s8.jpg
((note for all the Super Doom and Gloomers, we have NEVER broken down below the 61.8% from ‘0′ to the AllTime Highs….. That would put us around 603. If THAT ever comes about, the EW’ers can make a stand. Until then, The U.S. market isn’t OVER. Get it???
Everytime we break a 61.8%, the trend is ‘broken’. On every TimeFrame. Which means we can now/soon bounce, since this week’s selloff has broken the last Oct 2 to now, Uptrend. Price is right on that really nice looking Long Trend Line. I don’t know if it will hold, or not. Place your bets.
Only problem is, no one knows how far it will/won’t continue to sell off! Any bounce up in the morning, immediately draw from the new L to last H. of last week.
If/when price gets to the 50% between these 2 spots,, between these last L/H, re-short it. Because the last UP ‘Trend has been broken’ and Price will again be tested.
Use the 61.8% above the 50%, for the Stop. If that Stop fails, goes thru/above that 61.8%, then the ’short’ has failed! Cover, and go long. Stay long until trend ends, again.
Then the overall Long is still valid. If not, we might/probably will re-test and dbl bottom the new low we have yet to make, and continue down to the next fib ‘to the left’ of the current one.
If that blue fib to the left of the current fib ‘fails the 61.8%’, same scenario.
Price is now right on current Trend Line that had 2 spots in Aug and Sept as Ref pts. Will it go lower? Bears want it, Bulls fear it. I’ve been short for a week in SDS in my IRA, but have my finger on the trigger, trust it.
If/when you REALLY want to ‘learn to Daytrade’, eminiaddict is the place to learn it. Now trading Futures….much more interesting than predictions and BS. It’s all about the math.
I’m the same old Ed that has been here off and on for the last year. Just thought I’d drop in and say ‘hi’.
October 28th, 2009 at 10:03 pm
I think you need to redraw that line Ed. If you are talking about the one since March? It has clearly been violated as of today.
October 28th, 2009 at 11:04 pm
What is your question, Ox? It is unclear to me what you are asking, or stating. You say “I think you need to re draw that line”. What line are you talking about?
Perhaps I trade different time frames than you. If you are saying ‘we broke March trendlines TODAY”…I certainly don’t agree with that. Not in the slightest. What is your proof of this? I’m serious.
Here’s why:
The LONG uptrend since March low is ‘valid’ until we break below 61.8% from last weeks H back to the March L., which is at 832. Until 832 is broken to the downside, Long is still ‘valid’. (maybe not too smart, on a short term trade,,,tho it is ‘valid’)
You don’t have to agree. I could care less. If one stays Long in an IRA etc until then 832, that is their ‘way’. (not mine,,,I like to go in and out). BUT that trend is still valid. I can’t handle that much of a selloff tho.
Not to say one can’t Sell their current Long last week and be short for awhile. I am saying Price has a very, very definite probable bounce spot on that lower line I have drawn, for tomorrow/next day. You don’t have to agree. I ain’t your daddy…:)
I am speaking of the failure of the LAST trend, which was an Uptrend Long from Oct 2 L to the H on Oct 21 or so. Today IS indeed the FIRST ‘failure of that 61%’, of that CURRENT uptrend of this month. Because we broke that 61% today, that ‘invalidated’ that Long of this month. Look at the fib on the chart. 61% violated, and the previous Long is in danger. This is the correct way to use Fibonacci.
We CAN continue lower in the morning, before the short ends. Maybe even Friday, and next Monday. I never said it HAD to bounce off that lower line. It just has ‘odds’ it will. The short tho is still valid until we retrace UP from a new low back to last week’s H. ‘
‘
Price now has to break above the next 61% drawn from this ‘tomorrow’/future Low’ back to the last H. , before Long is ‘valid’ again. I will cover my short tho, and go long, with just a close above the 1052 or so level.
SOrry if I’m a bit hard to understand. I’m trying to get it written correctly.
You ONLY trade the current trend. Always. March lows are basically insignificant to me. 832 is way, way away. If that fails, then market will bounce up probably in a new uptrend to 50% to 61% of march/oct run. We’re not even close to that level, nor is that level now significant.
992 to H is the significant level now, since we ‘violated’ today. If we lose 1032 or so,,,we go into the next fib scale to the L of 970/scale, the red scale.
The new Trend Line that connects all the latest Lows of this month is probably is a ‘bounce’ point. Has 3 times this month. Might be 4. Might get me short arse handed to me in the morning.
Don’t you think the odds favor a bounce, looking at this Line that connects the low prices of the last two months?? Price has bounced 3 times since Aug, on this lower Trend Line. It doesn’t matter to me if you agree or not; I could be wrong. Price WILL decide, not me, or you.
There is no ‘thinking’ involved,,,simply stay on the correct direction of the Trend.
This week’s ’short’ can possibly bounce up in a Long. You don’t have to agree. It is better for a Long here, than last week at the Highs, is the basic theory I am implying.
Are you implying this is a ’short’ here?? Have at it. I am thinking of going Long for a bounce and covering my short that I’ve had for a week.
We WILL make a New Low,,for the CURRENT trend. That is the nature of the market. I don’t know WHERE that Low will be. No one does. When it does, draw from last weeks High, to this new low not yet known,,,and it will bounce TOWARDS 50% of this last DownTrend. lol. It will. Not saying it will go back to the 50% tho!! One never knows. If it does tho, a new short will be valid at that 50% spot. If price continues up to a New 61%, then that new short will have failed…and we redraw again.
It does give lots of people FUN and AMUSEMENT thinking they can KNOW where Price goes. All you really have is math of the fibonacci levels of the last Trend.
Place your bet on the direction you think will be correct.
And keep fairly tight stops, is my best advice.
October 28th, 2009 at 11:16 pm
Sorry Ed, I think you misunderstood my point. All I was noting was “the line” was violated, nothing to do with the fibs. I actually bought SPY 107 calls near the close. My ultimate downside target was the Oct 5th gap fill, it was also near what I believe was the bottom of a descending wedge I have drawn on multiple time frames. I have the same uptrend line as Woo does on my daily chart, which is another reason I took the gamble I did. I closed out all my short positions that were remaining today at 104.60 on the SPY. That was my punch green tickets number. I am personally still looking for 1108-1117 on the SPX. I do however think the Q’s have been cooked and made out great with 43 puts I bought back on the 26th. Bought em at .75 and sold em at 2.00 today. Could be some more downside left in them, but rather reload after a bounce. Sorry if you thought I was calling you out in some way. I am not that kind of guy
Happy Trading,
Ox
October 29th, 2009 at 12:16 am
Ox, not thinking at all that you were ‘calling me out’.
As far as ‘violating the line since March’,,,,well, you only need TWO points to make a line. Today and March could be those points. We DID make a new ‘point’ today, lol.
There are in fact 8 or more previous ‘points’ where one could draw a line from the March Low and get a Trend line. It is all about Fibonacci and the last Trend, and the violation of the 61.8% lines of that particular Trend. When we violate that, we redraw from larger Trends.
If 1032 on the /ES, the Bulls are in trouble. That would violate the next 61.8% trend, from Sept 4 to recent H.
/es…now at 1040.
October 28th, 2009 at 10:32 pm
Don’t quite no what your getting at,sounds like your saying the bull run is not over,maybe? there has been a lot of technical damage the last couple of days the best you can hope for is a retrace to 1072
October 28th, 2009 at 11:18 pm
what makes you think ‘the best you can hope for is 1072″?? I think THAT is nonsense!!
If Price goes past that 50% at 1072, then the 61% ‘failure’ at 1079-80 will negate this last ’short’. And Longs are ‘valid’ again.
I can see a lot of folks don’t know how to accurately use the Fibonacci tool. I showed you that eminiaddict.com teaches it. He’s changed my trading from ‘not knowing how’ to ‘knowing how’.
No one “knows’ where the Top is. Lots of folks think they do, tho. I say nobody knows.
95% of people on Stocktock are ‘hung up’ on PREDICTIONS.
October 28th, 2009 at 11:31 pm
It will not go past 1072.your thinking it will
October 29th, 2009 at 12:19 am
another prediction. See?
October 28th, 2009 at 10:33 pm
I will check with you in the next 10 days just to confirm
For those of you feeling extremely bearish, take note of Woo’s comment and chart in #14. It should be noted that line is from November 08 lows through the Jan 09 lows. If you notice where the market bounced the last couple times, you will see its importance and strength. We are basically sitting on it now. It has been significant since August.
i am curious why you think $395 on bidu is a safe short bet? the fib is around 406….395 in my opinion really doesnt mean anything. why is this number significant for you? what are you basing that call on. no bashing, just curious as to your thoughts. thanks
October 28th, 2009 at 11:09 pm
While 405-406 is definitely on my radar 393-396 is prior support which is now resistance. After a massive drop.. and a quick rise back up.. these types of resistances in the past are extremely strong.
October 28th, 2009 at 11:21 pm
On a weekly chart 395 lines up very well with the 8ema. It is hard to short something that keeps finding support on the 8ema, unless of course you try to short it to that area. Once that is give up, there is some downside left without nearly as much risk Chris.
All I’m saying is that we might get a bounce, since Price is on that lower Trend Line….
If you short on a ‘lower’ trend line,,,,, Well, look at my chart. See what has happened the last two times of shorting on a lower trend line.
That said,,,, I explained ‘how to draw fibs’. Oh, you can draw them any way you want to. The current ’short’ is still valid, until it isn’t. We will know soon enough. What is your time frame? 1-10 years?? Stay Long.
1 month? One week? One week, and might be best to go Long. Idan has some nice price ideas. 1052 will get my ’short’ attention…
October 28th, 2009 at 11:11 pm
should be “the last 3 times”…
October 28th, 2009 at 11:32 pm
This is what I see:
http://i399.photobucket.com/albums/pp80/cnest/SPX102809.gif
October 28th, 2009 at 11:34 pm
P.S. I know my lines aren’t perfect but they work for me and these not so nimble fingers lol.