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18
Nov
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3:08pm
Idan: The market seems to be trading in a large triangle formation on the 10 minute SPY. But in the last 10 minutes it is trying to break out for another push higher. While I think the market still has another potential 1-1.5% higher, I think AMZN is a short at these levels for a swing trade, and that AXP might see another 0.5%-1.5% higher and then probably fall between 5-10%. Trade, Go long SPY, Go short AMZN, AXP (hedged).
Futures are pretty flat. So far market is still bullish. need a lot of breakdown for the bears to really gain any ground.
1 month:
trend line is holding and it looks like 1115 is the short term top to watch prior to the 1122 top on the 5 minute. the only drop i would be looking for (if any happens at all), is one to 1096, but it isn’t necessary.
here’s how things look on the 60 minute:
ALMOST there…i need to take some time to draft potential other tops and calculate the max extension we can head to in case we pass this 1118 area on the 60 minute. i’ll try and do it this week.
here’s the longer term chart that i’ve had up for a while. Updated from the chart i posted a month back (http://www.stocktock.com/2009/10/23/ew-and-fib-update/)
it will feel so good if this plays out. hope i’m right. if not, hopefully someone else on stocktock gets it right. good luck everyone!
———– BEARS CELEBRATE AS STOCK PRICES TUMBLE —————-
bears were dancing in the streets on Wednesday as a normally bullish day for OPEX turned terribly sour. the SP500 tumbled an incredible 0.05% and the expectation for Thursday is pure panic as the bulls took one on the chin. we asked JIM (permabull) HUDSON to comment. WSD “JIM, how do you feel about todays market action” JH ” holy crap man. i’ve never been more scared in my life. the closing bell had me biting my nails as i watched the market fail to finish in the green. i’ve placed sell orders on all my holdings for first thing tomorrow. i dont have after hours trading so i guess ill just be sitting on the shitter all night in pure panic and worry. thanks for asking !!#@$%% !” well that says it all…. .looks like the market is headed down the toilet after JIM is done with it.
Wall Street Daily, editor: Richard (Feeling Bearish Again)
November 18th, 2009 at 4:48 pm
LOL… Richard you are on a roll today!!! Keep the good stuff comin’…
November 18th, 2009 at 6:41 pm
Richard,
For so bad house news as well as Obama told Fox News “Too much debt could fuel double-dip recession CAREN BOHAN | BEIJING, CHINA – Nov 18 2009 13:30 ” SP tanked most of day, but toward the end of day moved up to get even. Bulls still fought fiercely. I moved our 3/4 of my asset into my cash. If tomorrow market goes to south, I move everything out.
Sometime, market react to the bad news one day later, right?
both $SPX and $VIX are down today. 66% probability of an up day tomorrow.
Anyone like 1’s?
Closing numbers:
Dow -11
Nasdaq -11
S&P 500 -1
———— PCLN ————- hit a new 52 week high $210.40 …….. must be that dividend they are going to announce or is it that the Swine Flu has been cancelled? you cant blame people for wanting to be a part of this success story but bajeezus… hello… is this not a bit pricey for a stock that gives you nothing back? i made a nice trade in this back at $100 on the short side. i’ve avoided it since. to think that was not long ago and it has doubled. sick.
November 18th, 2009 at 4:58 pm
way back i saw an order fill for 1,000 $100 puts on this thing. they were out a few months. if you see that on any stock post it here…. it was an unusual large order for puts and it certainly was not a bearish bet. im thinking that someone took this position and then turned the BUY PROGRAM on and away she went. those puts were about $10 each at the time and im sure if this was the case that company or individual running that protection made out very fine in the trade.
November 18th, 2009 at 5:19 pm
Yes – I remember that one Rich – but I guess they were not so far out
It is possible that the market gaps up tomorrow. I rolled into AXP Dec 41 calls yesterday (auto-exec) when AXP traded at $40.65, LOD yesterday. I still hold a few AXP Nov 40 calls, hoping to get rid of them for $2. I have AXP shorts fully hedged.
If we gap down, I will add a small long position for intraday play. Tomorrow may be the day the DOW, SPX, Nasdaq, NYSE Composite, and TSX all trigger “sell”.
November 18th, 2009 at 6:36 pm
If sell gets triggered tomorrow, I’m sure it will wait until Monday. OPEX can be volitile but rarely moves too far in one direction due to the penny option lottery players.
November 18th, 2009 at 6:56 pm
And it won’t take much for the index to trigger “sell”, because regardless of the close tomorrow, the stochastic, RSI, and MACD on these index will have locked in an exhaustive pattern. Given that the MAs have been perfectly aligned for three days now, all it takes is for the index not to close near the HOD. (If it’s a high volume, gap up and shoot down day tomorrow, the “sell” signals will be even more significant. Should that be the case, Friday will be very interesting.)
Hi, Fritz,
I learned from investool that is a sell signal is trigged with three red signs: stock drop below 30 MA, and fast/slow line of MACD close to mergy upword, and Stochastic starts to move down.
Can you share with us which TA indicators you are using to trig sell or buy?
November 18th, 2009 at 7:39 pm
Pete,
The indicators you mentioned are lagging, so often when that takes place, you’re too late in the game. My intent is to front run, so I developed my own system that looks for the first signs of exhaustion (either buyer exhaustion or seller exhaustion). I have laid out how my system works in one of my posts last week.
Basically what I am looking for is an alignment of 9 moving averages (and not SMAs, but averages of all prices traded). Shorter term MAs must be greater than longer term MAs, no rounding off is allowed. If the first condition is satisfied, then my system sniffs for exhaustion (over-extension) in the RSI and stochastics, and sniffs for weakening momentum on the MACD. If the exhaustion pattern is found, the last piece of the puzzle is declining “trending force” (or weakening of existing trend), and that’s identified using the momentum in the DPO (detrended price oscillator). My system allows me to front run, but once these signals are triggered, top/bottom is within 10% (for index the margin of error is 5%). It means that even though the top/bottom may be in, I would still hedge my positions until the long term trend has changed.
GS “sell” triggered on October 14 2009 and it was followed by a 14% drop into November 2 2009. VALE “sell” triggered on October 21 2009 was followed by a 13% drop into October 28 2009. So far AXP “sell” hasn’t worked out immediately, but I know that I must stay the course as it will pay off big in the end (last time AXP “sell” was triggered, it was followed by an 85% drop over 21 months).
November 18th, 2009 at 9:10 pm
Great explanation Fritz..thanks. Do you have a link to you last weeks post. I tried to search and came up empty handed.
November 18th, 2009 at 11:00 pm
Jon,
Here’s the link http://www.stocktock.com/2009/11/11/intraday-commentary-11112009/comment-page-2/#comments
It’s a response to post #27.
I will not be able to post intraday tomorrow because work is crazy right now. Best of luck trading.
Fritz,
Many thanks! It sounds a secure system. I learned that traders use 3, 5, 10, 12, and 15 short terms EMAs, and investors use 30, 35, 40, 45, 50, and 60 EMAs.
Can you share with us which chart you use to identify tops and bottoms of a stock (30 min, 60 min or 1 daily chart)?
Also which 9 EMAs are you normally used ( could it be stock specific or it universal)?
I start to follow your post to trade since last week. Yesterday, I put all my 401K on SP500 and bet it would move up. Today is an unusual day with shock home news and Obama’s double dip warning. Only lose 0.05% I still think it was worth a try.
I have not learnt how to hedge my investment yet. I keep your post and practice it later.
November 18th, 2009 at 10:38 pm
wow, i hope your kidding?
November 18th, 2009 at 11:18 pm
Pete,
I hope you’re not following my posts to trade. My posts are meant to help everyone here on TAs, not trading advice. Everyone is responsible for their own trading decisions. I merely tried to share a few tools that we can use as traders to avoid heavy losses. Your #1 goal when getting started in trading should be focused on breaking even (you’re guaranteed to suffer losses when you first start).
Trading is playing the probabilities. You should understand that there are no guaranteed plays. Even with the sophisticated system that I have developed, I would still be concerned if I were to trade without hedges. Try trading on a simulator first so you get more comfortable.
Back to the technicals, I use the daily charts, but I don’t use any of the EMAs you mentioned. If everyone is looking at the same indicators, then I’d like to be a contrarian. My moving averages (I call them ‘moving expected values’) are averages of the prices traded during each respective period. I manually enter those info into Excel everyday, so you understand how much work I put in (which is why I only look at 100 stocks). I am in the process of trying to implement this into a program so I can do programmed trading. Trading with these signals takes away the emotions from trading, making it much less prone to mistakes.
$BDI has been rippin. Up another 6% today to make a 52 week high.
$TRAN receded .52% today. As far as I’m concerned (no confirmation on DOW theory) it hasn’t made a new high….yet.
EXM broke out today on strong volume.
HARPEX still stuck near all time lows.
What are your support/resistance levels for STI?
Is Nov $21 call even a play?
Thanks
November 19th, 2009 at 3:53 am
That question was for Anjali or anyone who is tracking STI.
Do you have a hedge for your STI position?
I have sold all my long positions except those that have been outperforming the market (DOW + 22.60%, AMD +15.52% & MRK +12.74% since Nov 02.).
I also added 2200 shares of SDS @$35.80 only because the market theoretically has put in the top for the next 11 trading days. The market should embark on a 2-5% correction which I would like to catch half of thus my SDS has a limit order of $37.00. The next cycle should put in the bottom by December 1st. The trade now is to short on Nov 18th, and cover all positions by Decemeber 1st. Going long now is unfavourable. I would be adding shorts every time we rip higher to 1110.. If we suddenly reach the 1130 level I would get out of all shorts because the market is likely going to top instead of bottoming. This phenomenon of the market topping when it shoud be bottoming is called an inversion, and this is the main reason why I am not going aggresively short as I am scared this might happen. December 1st is a high probability cycle date, unlike Nov 16-17th, and on Dec 1ST I will be adding huge directional positions.. until then Im playing it safe. GL
As of the close of Nov 18th, here is how my portfolio is weighed.
Long 23.94% (DOW, AMD, MRK, SSS.V, SNV, CITGQ.PK)
Short 26.32% (SDS)
Cash 49.50%
November 19th, 2009 at 7:40 am
Good stuff Zee…
November 19th, 2009 at 7:52 am
Your SDS target day is today
I am also holding about 3600 shares at avg 35.95
November 19th, 2009 at 8:06 am
If SDS hits my target today that would be very bearish for the markets and I would expect a 5-7% correction.
November 19th, 2009 at 8:04 am
I did not get the right price quote on AMD. It’s actually up 62% since Nov 02.. After seeing that, I’m definetely selling most of my position in the AM.On all remaining longs, I will be writing covered calls.
Long 16.36%:: Short 25.13% :: Cash 57.78%
Flat top on the nasdaq it will drop today IMO.
Hey Zee we need a new bolg date on the home page we are still using Nov 18th..Thanks
November 19th, 2009 at 8:23 am
Zee isn’t an admin.
Anyway, looking at them futures and bumming big time since my own analysis suggested we move down and I traded based on my gut instead of my analysis. I still think we need to move toward a top but if this puppy starts getting real sick I will bail. (Probably at the next short-term bottom before it shoots back up.
)
November 19th, 2009 at 8:29 am
SPY showed a bullish formation late yesterday I also thought we would bounce to 1120 then drop but i guess that is why the market has it’s own ideas.I opened an EDZ position this morning if we drop right out of the gate.
“Jobless Claims Remain Unchanged at 505,000. Survey Expected Claims to Rise by 4,000″
this looks good enough for our gov to take this market higher today
November 19th, 2009 at 8:47 am
Market will sell off today, in order to make the move higher, some shorts need to be suckered in. One thing longs should be concerned about, is the crowded short trade of the dollar and the blind view we are going to have an Xmas rally.
November 19th, 2009 at 8:54 am
there won’t be any sell off today! Why? When there are bad news they got $ to take over that. I am seeing it tanking already
Morning crew. Remember we have two more peices of data due out this AM.
Leading Indicators @ 1000
Phil Fed Index @ 1000
Briefing.com gives the leading Indicator data only a C- in MM power.
Phil fed Index gets a B rating in importance.
November 19th, 2009 at 9:04 am
http://www.briefing.com/Investor/Public/Calendars/CalendarsLanding.htm
quite an interesting start–took a little off of sco for scalp.