ZERO...
Reasons To Be Bearish...
Lies, Lies, and more Lies... (Too many to list).
I think this time period will go down in history as the most manipulated time period ever in the history of the stock market. Â I've been trading off and on since 1985. Â Of course I don't trade for a living, but I've had about 4 different time periods in the last 20 years, that I traded actively in the market. Â Each time, I learned more about the market. Â In the last year or so, that I've recently been trading again, I've learned enough about technical analysis to profit nicely from trading, yet I haven't "profited nicely".
Why? Â because they don't work anymore! Â The manipulation being done by Obama and his gang of thugs is unprecedented in any previous time period in history. Â You can't tell me that the massive up move from February the 5th is normal. Â This market is so overbought that it makes absolutely NO logical sense, pattern, rhythm, or rhyme! Â No one in their right mind would go long in this insane market!
Of course going short is just a crazy too... Â You'll end up tied down to a table with ropes pulling your arms and legs off, by some bull as he slowly tightens them with one turn at a time. Â Slow torture for the bears, and more crack cocaine for the bulls.
This is more insane then the "Dot Com" rally was! Â Seriously... at least back then there was some hope or promise of a possible future superstar company that could get you rich. Â Today... there's just bad earnings, horrible future outlooks, unemployment numbers off the charts, our national debt 10 times higher, and so much funny money in the system that a gallon of milk might cost $10.00-$15.00 in the near future... when inflation finally takes hold.
Did I miss anything?  Really... how can you be Bullish on the stock market, with the economy in the worst shape since the first Great Depression?  Everyday I see this market inch higher, and I'm just shocked!  How can it continue to go up?  I swear I think the market would rally if some large city in America was destroyed by a nuke or something.  The fracking media would find some way to spin it as positive!  WTF?  ... I get it, all those dead people would reduce the unemployment number, so let's rally some more!
Sheesh... just think how pissed I be if I had any short positions in the market right now! Â I don't, as I'm sitting this B.S. out until the insanity is over. Â I think it might be only safe to play individual stocks, that aren't as heavily manipulated, then to play the overall market right now.
I hope you guys that are day trading TNA and TZA are doing well. Â I don't have the time to monitor the market all day, so I must swing trade. Â This time of year is really busy for me, and that why I haven't had a chance to comment much. Â But, it looks like you guys (and gals) are doing just fine without me. Â Carry on the good work gang.
And keep you eye's out for another large fake print. Â I do believe they will let their buddies know ahead of time before they tank the market. Â At this point, I don't think I will take any short positions until I see a sign. Â This is truly a "once in a lifetime" event (I mean the TOTAL Manipulation of course), and standing it front of it is suicide. Â Eventually the money tree will die, and the market will then work on TA's again.
I know that I'm not the only person that thinks this way, as many others that I follow, and subscribe too (who aren't into conspiracies like I am), are now stating that "they never seen anything like it"! Â Yes, this will go down in history as the time period where the government "Was" the stock market.
Don't forget that cash is a position... a safe position too! Â I'm too stubborn to go long, plus that would be suicide right now. Â I'm too scared to go short, as that would be slow torture again... which I'm tired of now. Â It's better to just hibernate until something big happens.
Red
Red I agree with you.
Think of it using TA to screw bears is very profitable.
But people were screaming foul when world war 2 times a bull rally started on the same day when battle of Stalingrad started. On the same day bear market started in Germany.
Now we know that was the turning point of WW2.
May be markets have a way of knowing what is going to happen in future which we do not understand.
So we should be humble and follow the tape.
Even we assume that it is manipulated so what.
Price pays…
Fundamentals/smartness/truth/logic/wisdom do not….
I am bear by heart. I live in south California. I can see financial disasters all over the place. There is no logic why market should go up at all…..
That is the point when you should be humble.
Remember market and god works in mysterious ways.
and you shall have faith.
and when you see miracle then you shall yield…..
If you see Jesus walking on the water, do no scream foul and it is against the laws of physics…. Be humble and faithful…
for faithfuls are rewarded…..
Amen….
I like to post charts too, trying to forecast the coming future moves, but that's about worthless now. So, I go back to just telling people my thoughts…
Nice name by the way!
Beautiful topic and summary!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
NIce post Red
Earl, Looking for my Carl fix!
Slept in this morning 🙂
Smart! Ramp job up, then sell off at the close and then hopefully down by Monday or I give up.
$RUT is closer to topping than some other indexes, but I don't know that this will be done by Monday. If I get time, I'll post some charts.
Thank you.
Hang on for 1 more week. 🙂
I've been hanging on forever saying one more week for ever. Monday is the latest that my indicators can work. Otherwise, my whole thesis is out the window and there is no point in holding.
Carl just now:
June S&P E-mini Futures: Today's range estimate is 1156 – 1170. The ES should reach the 1200 level by the end of May.
1157.75 – 1165.50 actual yesterday (7.75 points)
1157.25 (last night's low)
1156-1170 estimate (June Expiry) for today (14 points)
1161.50 currently, so estimate is -5.50 to +8.50 from here (a bit bullish)
Carl is Long one unit at 1161.75
Another perspective on $RUT based ETFs from AmericanBulls this morning:
OK to own: IWM (1x), UWM (2x), TNA (3x)
Do not own: RWM (-1x), TWM (-2x), TZA (-3x)
CArl sold one unit at 1159.25
Carl seems a little nervous lately 🙂
Yeah. I've seen him with a 3 point stop loss, this was less than that. /ES chart looked bad, maybe he was watching that.
I personally can't imagine getting long here with every indicator showing overbought, the indices all reaching their the long term trendline resistance points, volume declining, and bullish sentiment at a high. But, then again, I have been wrong and probably will continue to be.
I'm looking longingly at DRV today. So far, it is behaving as predicted.
Looks like it just keeps falling.
The lower BB is 8.26 today — yesterday it was 8.60 (yesterday's low was 8.59). See attached chart for instructions on how to use DRV:
http://www.screencast.com/users/dreadwin/folder…
I see now. AB has it down 45% in a row. When it does turn, it might just run for a while.
TZA is challenging the 7.15 level again. A few days (?) back I thought 7.15 would be a good buy (with 7.145 as a stop). TZA wanted to go and explore lower price levels, first. $RUT is more clearly topping than $DJUSRE. $RUT will lead on the way down, I suspect.
I have been early on TZA *cough*. RSI on $RUT looks attractive.
It still looks attractive. TZA could be painting a bear flag. There should be another opportunity at $7, if this is the bottom.
Monica,
Really have to turn off a lot of brain cells to get comfortable being long.
Carl just repurchased one unit at 1161.25
Carl just sold long unit at 1159.25
CAT is dying a slow death, it's been dancing with a knot of max contain pts. since October
http://www.flickr.com/photos/47091634@N04/44438…
RIMM also provides some great setups
http://www.flickr.com/photos/47091634@N04/44431…
Thanks – looks like we may have one day left before VIX reaches containment.
Thought you might like this article:
http://market-ticker.denninger.net/archives/209…
$RUT : IWM setup
in my chart below you'll see every broken containment pt. gets backtested. The red containment pt. that held the IWM in January is going to get re-tested and presents a problem for the bullish structure in place as it is below the January highs and falling daily. The IWM January high was 64.87 and the red containment pt. is now @ 63.96 and falling about .02 per day.
http://www.flickr.com/photos/47091634@N04/44439…
Carl at day’s end:
1156-1170 estimate today for /ES (14 points, June contract) (1163.50 mid point)
1156.25 -1163.25 actual today (7 points)
Mostly stayed in the lower half of Carl’s range
Trades:
In /ES at 1161.75, out at 1159.25 (loss of 2.5)
In /ES at 1161.25, out at 1159.25 (Loss of 2)
Grade D (lost some money, too optimistic on range estimate)
3/18. Not detecting any material out flow of money, despite the intraday weakness. Tech sector and foreign stocks are still going strong.
What happened to all those pivot up, pivot down, 21 day cycle, 27 day cycle and 40day biblical cycle that were supoosed to have hit the market between the eyes from Mar1 to Mar 11?
I think they got there month mixed up.
lol.. Most likely the reasons are :
1. N too small.
2. Random coincidence.
3. Number of degrees of freedom being too low.
Basically if you draw enough lines and cycles, eventually you will be able to come up with something that explains everything.
I agree. Better to watch the trend.
21 day hit on March 7th. It usually takes up to 10 days to form a topping out process after the pivot top. 10 days will be tomorrow but I am giving it until Monday just to torture myself some more.
I have charted $RUT for you.
http://www.screencast.com/users/dreadwin/folder…
Pay attention to the MACD. See how the lines cross (red and black)? When red is on top, that's a bearish trend. When black is on top, that's bullish. We are approaching a crossover of those lines. For a conservative trader, that's the time to short. When black crosses over red heading up, that's when you cover. You don't get the entire move, but you do get most of it.
When the MACD is trending down, and price is trending up? That's a divergence.
Sometime next week, the lines should cross (barring shenanigans). There should be some retracement of this monster gain.
For those who are new to this, it is worth noting that while the basic ideas are as described, in real application, it can get a lot more complicated. In prolonged market movement, MACD(12,26) would give early but false divergence, and often gives incorrect oversold/overbought readings. It will get you to sell short into a rising market and buying into a crashing market, if you follow it blindly. In choppy market, macd will whipsaw you to focking nut. It does work as advertised in normal market conditions and a lot of people get seduced by that. Then they get their ass handed to them when the market makes a big move . It is the nature of the beast, ie the mathematical properties of the indicators.
In order to use an indicator effectively, you need to plot it over a long period so that you can have witness how it performs over different market conditions, and figure out under what conditions they would fail and how you are going to safeguard that.
Too many people take the text book description of how an indicator works, and they figure they got it. The truth is light year away. When the canned indicators do not work, as they inevitably will experience, people would blame the indicators, saying that they dont work.
SC, Thanks, The indicator works just no the way you think all the time. Makes sense.
Very good points SC. There was one fakeout on the MACD on the way up since February, and anyone who solely used MACD to make trades would have gotten scorched.
Really great Dread. Thanks so much. I just can't believe I have to keep hanging on though. There better not be any more shenanigans!
TZA opened up 0.4%. Gap was filled. TZA was up 1.4% at it’s high, and closed up 1.0%.
We are in a New Moon Trade, which favors TZA.
After three days, this trade is down 4.3%. AmericanBulls issued a sell March 17th so this trade was in cash today and did not benefit from the 1% rise in TZA. This trade will buy TZA again once AmericanBulls issues a confirmed BUY signal, or an unconfirmed high probability BUY-IF signal.
Volume for TZA was the lowest of the last 8 days.
$RVX (VIX for $RUT) closed up 0.2% with TZA up 1.0%. No divergence.
TZA has now been up 3 of the last 12 days.
The low for TZA today was $6.96. The low yesterday was $6.93 which is the lowest TZA price ever.
Ultimate Oscillator for TZA bottomed at 20 nineteen trading days ago and has generally risen since then but has remained below 50 and is currently 34. Indicating continued weakness for TZA. Today’s value was highest the previous 6 days, so the Ultimate Oscillator is in a mild up trend. Good for TZA.
Bollinger Bands for $RVX (VIX for $RUT): today’s candle rose to re-enter the congestion area above the bottom Bollinger Band. The lower Bollinger band is now falling. MACD has crossed from below. Looks like $RVX is mildly falling, generally.
Bollinger Bands for $RUT: The doji candle for $RUT made no upward progress today, getting farther from the rising upper Bollinger Band. Perhaps this is part of a topping process for $RUT. Good for TZA.
Bollinger Bands for $RUT:$RVX ($RUT vs VIX for $RUT): today’s candle fell back into the congestion area. The upper Bollinger Band seems to be rising. This is beginning to look like a topping process, which would be good for TZA.
TZA had a higher high, higher low and higher close – good for TZA.
Money flow for the Total Stock Market was $250 million flowing out of the market, good for TZA
I will post the AmericanBulls candlestick interpretation a bit later.
Overall, it looks like TZA might rise tomorrow.
I am in my position still.
Looks like you are playing it right.
I heard today that on opex volume move in morning and than gets quiet in the afternoon. I will probably hold my positions through the weekend.
Tim on SOH has a nice looking chart of $rut up. Check it out.
That chart has looked that way for awhile (16 month chart), and could look that way for many weeks to come — just needs to climb that wall (of worry) and stay away from that line 🙂
The view from Americanbulls
TNA has a SELL-IF (sell if conditions are right tomorrow) signal today. The candlestick today was a Black Spinning Top (complete indecision between the Bulls & Bears). The last two candlesticks formed a Bearish Harami Pattern. Reliability of this pattern is low, and requires confirmation.
TNA was down 1.0% on the first day since the buy signal confirmation yesterday. AmericanBulls price points have TNA slightly up.
TZA has a BUY-IF (buy if conditions are right tomorrow) signal today. The candlestick today was White Spinning Top (complete indecision between the Bulls & Bears). The last two candlesticks formed a Bullish Harami Pattern. Reliability of this pattern is low, and requires confirmation.
TZA was up 1.0% on the first day since the sell signal confirmation yesterday. AmericanBulls has this at down 0.4%, using their buy and sell points.
Summary of $RUT based ETFs:
SELL-IF: IWM (1x), TNA (3x) Both low reliability Bearish Harami
SELL-IF: UWM (2x) High reliability Bearish Dark Cloud Cover
SELL-IF: $RUT (1x) not very high reliability Bearish Harami Cross
BUY-IF: RWM (-1x), TWM (-2x), TZA (-3x) All low reliability Bullish Harami
Action for tomorrow: Possibly buy TZA, Possibly sell TNA.
See the chart I made for Monica. I think AB is going to have a lot of unconfirmed buy-if/sell-ifs while we chop sideways and make a top. I think MACD and RSI are telling us that the top is very near.
Dreadwin,
I was thinking that myself. The unconfirmed signals that don't confirm are no problem, they just go away. It's the confirmed signals that immediately reverse that get really irritating.
Here's another piece of the puzzle. Real Estate. $DJUSRE:
http://www.screencast.com/users/dreadwin/folder…
It closed outside of the upper BB yesterday, and inside today. We need a lower close tomorrow to confirm the sell signal.
The MACD is all crazy and stupid, but RSI is really overbought.
I'd like to see the $VIX do a crazy stupid move beneath its lower BB. I wouldn't be able to hold back. I'd have to short something.
Or buy vix calls
As hard as options are, $VIX options are crazy hard. I don't dare touch them. Better leave that to pros like Lester.
Dread, Great charts and explanations. You are looking at a real estate play it sounds like. Also did you see the letter lester posted last night on SOH
I didn't see the letter. Was it depressing?
Depressing no Sad yes. He has lost over 500k including retirement money that he now owes taxes on that he cannot pay. He does have some inheritance that will get him even. I advise him to let his wife handle all financial matters going forward and to seek counseling.
Yes, good advice.
Dreadwin,
I'm trying to avoid some of the chop by looking at all six of the $RUT based ETF's.
I hadn't realized it at the time, but when TNA flipped to a sell a few days ago, only 3 of the 6 ETFs flipped. Sure enough, TNA flipped right back. Now all six are aligned again.
Guys, I really think the indicators are hard to follow at tops or if there is PPT action and I think we have both going on. I would definitely think that if the VIX closes below it's bollinger band that you should get short.
Very good points SC. There was one fakeout on the MACD on the way up since February, and anyone who solely used MACD to make trades would have gotten scorched.