Ugly Market…

By Red, on March 30th, 2010

This market is now so ugly it needs “double bagged”! But, at this point I still have too believe that we will see 11,000 DOW this week, as the bears are now dead and bulls have little resistance to stop them. This pushes the coming fall out to next week… or the following week, or the following month, or the following year, or after I’m dead and buried. Maybe it will correct in my next life? I’m hope I’m reincarnated in the bankster family… as then I’ll know where the market is going.

Writing about this market lately has been extremely challenging as nothing is happening. Maybe the ADP jobs number will give us some excitement tomorrow? But, after that… it’s back to being boring for the rest of the day. Thursday should be just as boring as most traders will leave early for the 3 day holiday weekend.

However, the market is looking really tired now, as each day is having pops and intraday drops… indicating that retail traders are buying the news, and the big institutions are selling on those pops. I have no doubt that we are still within spitting distance of a big dump in the market, but it seems that it can drink a few more beers before it pukes its’ guts out.

And believe me… this market is seriously drunk now. It needs too throw up before I do! Reading the comments from yesterdays’ post had me agreeing that someone needs to puke now… and I rather it be the market then my fellow traders. So hang in there gang… just a few more spins on the merry go round before the fat pig loses it.

Red

Bear Meat...

No related posts.

monicadern

Pocomotion on http://content.screencast.com/users/acousticsol…

http://www.reddragonleo.com Red Dragon Leo

Nice chart Monica… thanks for the link. I do wonder if they stage some event or release some really bad news over this 3 day weekend?

Looks like Sun is thinking the high will be in on this Thursday or possibly Monday, so that's some good news at least. I'm really debating on whether or not I want to go short this Thursday… expecting something to happen over the weekend, or wait until Monday so I don't get killed on a possible rally like most Mondays' have.

monicadern

Here's the thing Red – I got short way too early based on my fundamental belief which was silly. In my opinion, there is now real technical evidence that a trend change is about to begin. So, maybe risk some capital (not all) and don't do it with options since time is of the essence there. Decide whether you are in this for the long haul or just a swing trade because that makes a huge difference if the market goes against you. Even if you look at the chart I just posted from Poco, you will see that even though the trend changes when the MA cross, it is not exact and there are lots of ups and downs and fakeouts in between. So either you hold like me or you day trade like others. If you do hold, it won't matter if the market goes against you on a particular day. You just never know when the “big drop” is going to happen or whether it will just trickle down. That being said, if you miss a 300 point drop, there will be other opportunities to get in as long as you are willing to take them. Some may think it is crazy not to put real stops in on the short side and it probably is. But the market to me anyway shows all the signs of a breakdown and I don't think holding short (through reverse ETFs) is that different from holding stocks long. Not trying to preach because you know a hell of a lot more than me, just providing my perspective.

http://www.reddragonleo.com Red Dragon Leo

Well Monica…

All the indicators are pointing down now, and my decision is based on many different things… not one person or one chart. I may simply sit this move out? I don't want burnt again, and missing a move down is better then being in short and the rally continue.

As for you… don't go long on any 2x or 3x etf's anymore. Time will erode both the bear and bull etf's on the long side, as they will both eventually fall to zero.

Of course they will do a reverse split before that happens, but the best way to play them is to always go short on them. Of course that means buying options… but not just any options.

You would buy them deep in the money… like 10-20 dollars for a 100 etf. That way, there would be little erosion from time decay, so you wouldn't lose much or any in a sideways market.

And, if the market did go sideways, those leveraged etf's would slowly fall, as the leverage effect will alway work against them, and force them down over time, not up.

I learned that lesson playing FAZ and FAS. I keep going long on FAZ when I thought the banks were bearish. What I should have done was to go short on FAS, and the time would have worked in my favor during the choppy market.

Then, if I expected the banks to rise, I should short the bearish etf FAZ, which is the same as going long on the banks. It should fall slowly during and sideways market, and of course fall if the banks rose as expected.

Point being… all leveraged etf's are designed to fall over time. You always want to short them. Either short the bearish or bullish one… depending on what you expect the market to do, but never go long on any of them… unless you are day trading of course, as that's who they are designed for anyway… not swing trader's or long term traders.

monicadern

Red, thanks very much for the reply. I have thought about this before and what you are saying makes sense about shorting the bull ETF's instead. Earl, I think you had talked about this? Does this always hold true?

The only problem I see there is like with any shorts, there are limited possible gains and infinite possible losses. I know you are not basing your decisions on any one factor nor am I, but I just wanted to point that out. Nothing wrong with sitting it out. I wish I had. Thanks for the option explanation.
Earl of

Monica,

This is simply not a good place to discuss the merits of 3x ETFs.

People are trying to help their fellow traders avoid pitfalls, which is admirable. I'm going to let it all go.
monicadern

Not sure I understand what you are saying. I know 3X ETFs are like playing with fire, just wondering whether the time decay is worse shorting them or holding them. Thought you would know best.
Earl of

What I mean to say is that I completely disagree with those that believe there is something wrong with buying or charting the 3x ETFs.

I also see no point in discussing it.

Those that think it makes sense, and those that don't, should continue what they are doing.
http://www.reddragonleo.com Red Dragon Leo

Hey Earl… that's what we are all here for. To discuss different trading strategies. I want you to make money with your style just like everyone else. If it works for you… that's great buddy.

It just didn't work for me, but then again… I was swing trading them and the sideways market was killing me. Maybe your time frame is shorter, and they are working for you?

But for Monica, time is her enemy. As for charting them, I agree with SC, in that you are better off charting the underlining ETF, not the leveraged one. Just my opinion bud.
Earl of

Red,

People need to be careful which 3x ETF they buy, and when they buy it. That simple truth probably applies to cars, houses, and bananas.

Monica went with inverse ETF's when positive ETFs would have worked better — whether they were 1x, 2x, or 3x.

Have you compared a chart of TNA with a chart of $RUT and noticed some amazing difference? They look the same to me. The differences don't matter.

I don't have an easy way to chart $RUT and turn it upside down, so when I want to study TZA, I just chart it. It doesn't look that different from an upside down $RUT chart anyway.

Did you actually look at statistics for TNA, TZA and $RUT over the past 6 months and discover some meaningful time decay? I don't see it. If I can't see it, then how can it possibly matter?
monicadern

Earl, I think SC was saying that the time decay isn't an issue, but the way the market trends does and I think you agree.
SC

“Did you actually look at statistics for TNA, TZA and $RUT over the past 6 months and discover some meaningful time decay? I don't see it. If I can't see it, then how can it possibly matter?”

Not to start a pissing match but it is worth pointing out that,
it would have mattered had you bought bot TNA and TZA from Nov 08 to July 09. RUT basically unchanged during that holding period, but both the TNA and TZA were down big.
Earl of

SC,

Perhaps the history that you mention is a source of the concern. I really only care about today and tomorrow. I'm willing to look 6 months into the past, but things do change, and I need to focus on how well it works now.
SC

That is not my point, Earl. It is not about history. It is about the market movement. I am sure you would agree that it isn't prudent to expect the recent past to persist permanently into the future. Otherwise, we all should be mortgaging the house and emptying the kiddie college funds to buy calls, just because buying calls have worked extraordinarily for the last 12 months!

I am sure you would agree that what worked recently is a factor of the market environment we had recently. And that may persist or may change. Setting that aside for now. I just pointed out that, under a different market environment, the dynamics of the ETFs will change correspondingly. It is not a factor of the present or the distant past. It is a factor of what type of market movement that exists in the time period.
monicadern

You know I own them. You said that time decay is not really an issue which means that whether you own or short these instruments doesn't matter. I just want to verify that i understand you correctly. I am seeking your opinion because I know you understand it better than I do – that's all.
Earl of

Monica,

If I'm going to take a position today on the time decay issue, I need to take another look at $RUT vs TZA, for the past month, 3 months & 6 months. Or something like that.

Last I looked, it was not an issue. But things may have changed.

If the market goes down, you will be ok, with or without time decay.

I feel like the guy driving to work and the passenger is going on and on about how windy it is and how the car's mileage is really gonna suck today.
monicadern

!!! Thanks Earl of! Anyway, I think we are all a little stressed out, especially me!
SC

It is not a time decay issue. It is a market movement issue. If you get a strongly trending market, whether it is against that etfs or for that etfs, the daily rebalancing will mitigate the negative effect of the leverage, and increase the positive effect of the leverage. It is the choppy market that erodes your equity like a cheese grader. This is not a critical issue for people who are just scalping in and out and go home happy at the end of the day. But it is very critical for buy and hold.

This is a matter of math. Personal opinion is irrelevent. (Academic speak. No offence intended )
SC

This is one of your best posts. Logical and absence of conspiracy stuffs. Welcome back to the real world, Red! LOL
http://www.reddragonleo.com Red Dragon Leo

Too Funny… the conspiracy theory posts are what's sets this blog apart from all the others, and now I'm back in the real world with this post.

So I need a like change from time to time… the red pill was tasting funny, so I took the blue pill tonight. (But you know that won't last long, as I like red better).

monicadern

And another thing – Sundancer may not have all the answers but I think he knows a heck of lot more than any of us can imagine. That being said, blind faith in anything doesn't work – have to believe it yourself or you can't stick with it.

SC

March 30 close: Today appeared to be bad for the bears, on the surface. But underneath, the bear case got stronger. Wide spread distribution has occured under the radar. What is needed is more stocks to breakdown. Barring any reversal, that is the direction the market is sliding toward.

Action: If long, hedge or get out. If short, hold tight.
sundancer390

DIA PM Tick
http://www.flickr.com/photos/47091634@N04/44783…

http://www.reddragonleo.com Red Dragon Leo

Looks like our first target has been given to us. Thanks again Sun…
SC

lol
There you go, folks. Market top at Dow 11816.

So the ES is going to 1070-1080, and then rally to 1270!

http://www.reddragonleo.com Red Dragon Leo

So we have 2 targets now SC… One is the 107.38 spy that I posted and 107.82 that Sundancer posted. Now we have 11816 Dow, unless we are reading it wrong?

What if the 118.16 was referring to the March 25th high on the SPY, indicating that's “the high is in”, and the next target down is 109.13? Yesterdays' close on the DIA was 109.10 in my account, not 109.13.

Hard to figure this one out, but look at it this way… if we start selling, we know the target. If they start buying, we know the target there too.

SC

SPY going to around 107 and then ralling to around 127, is within the realm of possibilities. Too good to be true, however. lol

monicadern

Seems like that will be a tall order within a one month time frame but I guess anything is possible.
SC

I am not expecting the top SPY 120 to be reached in April. More like in early Summer to early Fall, sometime between then. Distance forecast is like long range weather forecast.
monicadern

I hope you are right – I would really like to get myself out of this mess so I can go on with my life. Time will tell.
SC

I think the collaboration and the collective work here should keep all of us out of the wrong side of the market. I do think we have superior collective data input here.
monicadern

Maybe you guys do! But, I like that we have a forum to discuss.

sundancer390

Here's the setup:

$SPX is going to backtest the top white TL, it will be @ 1255 in April, it will pierce the TL intra-month by 20-30 pts.
http://www.flickr.com/photos/47091634@N04/44654…

things are going to get real interesting, we have downside de-leverage pts. and up-side de-leverage pts.

for those trading longer time frames, don't use leveraged instruments

http://www.reddragonleo.com Red Dragon Leo

If that's the case, then the selling afterward will point to a low being put in this fall, maybe in September, instead of a fall correction.
sundancer390

the $VIX setup says we're going to get a down week soon as it currently is in it's 8th consecutive down week
http://www.reddragonleo.com Red Dragon Leo

What's your thoughts on this move up to 11816 DOW? Straight up from here, or down to the spy prints around 107 first, then up?

A continued straight up move from here would absolutely kill every last bear out there… that's for sure!
SC

The decline and subsequent rally will kill all the bears too. The decline will suck in the fence sitting, badly burned bears. While the subsequent rally will just kill them off once and for all. I am being a bit dramatic here, but it is a very likely outcome.
sundancer390

the bears will be almost extinct what ever path we take

mini-crash to 1078 and the bears will go all in short thinking the top is in

continued uni-directional move to 11,816

the vix setup says a downward thrust is near, I'd like to see marginal new highs there is way too many stops above 1074 area
monicadern

Oh – I must have missed this. Looks like you are expecting a big sell off with a large subsequent rally.
SC

Extreme complacency, on tops of all the other negative conditions. The making of a perfect storm…

Earl of

Carl’s morning call:

June S&P E-mini Futures: Today's range estimate is 1155 – 1166. The market is still stuck in a 20 point trading range but I think a strong move upward will begin soon. The ES should reach 1200 in April on its way to 1225 or so.
1164.25 -1173.75 actual yesterday (9.50 points)
1162.75 low last night
1155-1166 estimate for today (11 points)
1165 currently, so estimate is -10 to +1 from here (very bearish)
http://www.reddragonleo.com Red Dragon Leo

Finally… some fun!
sundancer390

the reaction this morning came off max contain on the 60 min $SPX, this is hit #4 of the up-trend
http://www.flickr.com/photos/47091634@N04/44792…

many monthly setups are looking at violations if we don't get a good sized sell off today
http://www.flickr.com/photos/47091634@N04/44271…
monicadern

I am totally confused Sundancer. The first chart you post looks bullish and then second ones you post look bearish (as long as we get a good sized sell off today). I thought you expected sell off tomorrow or Monday but you mention below we are going to new highs in April? I know you are giving us information expecting nothing in return, I just want to try to clarify what I missing. The other thing is that Poco's chart which I posted is somewhat convincing me that we are due for a trend change since the MACD have crossed.

sundancer390

I understand your confusion, the operators do a good job

I allocate capital to setups, that capital is not leveraged, therefore I take the time element out of the market

the $SPX is going to print 1078, 965, 7**.**

the operators told us this morning the $DJI is going to print 11,816

For traders in general:
staying away from leveraged instruments (options, futures, 2x-3x etf's) allows one to be extremely nimble, it's all about staying power in this game and that only happens when you leave leverage out of the equation. without leverage you're not going to turn 100k into 100 million but you also won't bankrupt your account if your time frame on your trade is wrong.

monicadern

Thanks Sundancer. I am well aware of the pitfalls of leveraged ETFs and wish I had never held on but at this point, if I get out of my position, I will never recover even a slight amount of what i have lost. Signs to me point to a sell off although it should have happened by now (according to the indicators I follow) and that makes me nervous. I would hate to sell my positions now only to see the market sell off next week. But, I have been saying that for ages and that is what got me into this mess in the first place. I guess right now I have to go by the indicators and they are still saying down. As soon as that changes, I will sell my positions.

sundancer390

trade your plan and that's all you can do

the $VIX setup says a downward thrust is near

many new bears piled on this morning thinking their going to get a free ride with the “bad” payroll come friday, I prefer a fake upward move first

http://www.reddragonleo.com Red Dragon Leo

You mean a fake up move on Thursday sometime, or next Monday?
sundancer390

this week, things are getting ripe
we've essentially gone sideways since the 3.17 high
http://www.reddragonleo.com Red Dragon Leo

I'm just trying to decide whether I want to go short tomorrow, or wait until Monday? I feel like… that if I go short tomorrow, Monday will rally one last time. Or, if I wait until Monday, the market will sell off over the weekend on some news of something, and open down big… missing out on part of the down move. Sucks either way…
monicadern

It all sucks. Unfortunately we must be willing to lose when we trade.
http://www.reddragonleo.com Red Dragon Leo

Yes… I guess when you throw spit balls at the chartboard that the teacher (aka the crooks that control the market), you should expect a paddling when you get caught. I've had a few too many lately…
http://www.reddragonleo.com Red Dragon Leo

I meant chalkboard of course… but maybe chartboard was more accurate? LOL
http://www.hotoptionbabe.com annamall

So what and how much are you shorting if you do?
http://www.reddragonleo.com Red Dragon Leo

One Million Dollars… (more like 10 cents). I haven't decided yet girl. I'm still thinking about it.
monicadern

I hear ya. Thank you.
monicadern

Looks like the upward action today may scare a few of those bears out.

Earl of

SC,

I need to keep things simple. It either works well now or it doesn't.

gcocks83

Hi earl, got any positions?

Earl of

Hi Gcocks,

Been too busy debating the merits of 3x ETFs to actually be trading them

Actually, I've been accumulating TZA all day. Average is $6.96 at the moment.

gcocks83

At this point in the day would you feel good about holding overnight?

Earl of

It's all about the close. The area of $6.99 is comfortable. Too much above or below that, and I will have to make a decision right before the close.
gcocks83

I bought a small position at 7.05 I was considering adding to it, however most of the time I do that when it is so close to my original price it goes the other way I want it to go. I bought it for a scalp. So at this point I probably will not add anymore. I have PP at 7.01.
Earl of

PP ?
gcocks83

Person's Pivot Point.
http://dreadwinaard.livejournal.com/profile dreadwin

While I got the order wrong (we gapped down), I still think we could see TZA under 6.80 by the close tomorrow.

SC

That strategy works well with your short term trading approach. To use the term of my generation, “it's all good, dude!' LOL

SC

I believe I speak for everyone here when I say we all appreciate the work and input Earl brings to the table. I don't wish the different opinions on the merits and pitfalls of leveraged ETFs to be misconstrued or misinterpreted.

We all appreciate Earl's input and looking forward to your daily update, Earl.

We have an interesting group here with input that comes from different data source. This increases the reliability of the collective concensus.

gcocks83

SC, Hi and yes Earl's work is always appreciated. I look forward to the morning and afternoon read.

SC

Yep. None of the problems and issues we have been debating about really affects short term scalping. It is a moot point, as far as short term scalping of ETFs goes.

gcocks83

SC, I have loved 3x etf's and lost a bunch. I now try and keep it to a scalp with tight stops. With the vix so low it is hard to get much movement except at the start and end of day. I have been trading options more lately but with long weekend not comfortable in them either. Mostly just cash and enjoying that position.

http://dreadwinaard.livejournal.com/profile dreadwin

Anyone else watching DTO for an entry?

Earl of

Did you notice Carl is calling for $30 oil?

http://dreadwinaard.livejournal.com/profile dreadwin

I was already looking at DTO before Carl posted. It's at the lower BB.

Earl of

Using fractal analysis (as taught by Dreadwin) I would wait for a pull away from the bottom Bollinger band for the safest entry. Once it pulls away, it seems to break upwards.

http://dreadwinaard.livejournal.com/profile dreadwin

I set a limit order for 59.25 when it was trading at 59.50ish; betting on a wave 2 fib retrace of 50%. Then I went to a meeting for 2 hours. Just came back from my meeting to discover that I got my fill and am in the green.

monicadern

It's nice to come back home to see the market finally is down. Not getting excited yet.
Earl of

Carl is now Long one unit at 1166.25

1166 was his original projected high for today.

monicadern

That's odd.

Earl of

4.5 hours ago, he said the low of the day was in, and the market was looking strong. Took him awhile to bet on it.

monicadern

At least I know now that carl doesn't have all the answers.

Earl of

He does ok overall, but does take losses now and then. And again

Seems to have small losses, which probably makes all the difference.
monicadern

That's right.
gcocks83

Out of TZA at 7.14. Small profit.
Earl of

I'm scaling out of my TZA. Hate to lose this gain.

Out of TZA.
gcocks83

I just say an order for 20k shares go by. That must have been some of yours.
monicadern

Huge buyer at the close. Either window dressing for quarter end or the Fed.
gcocks83

Monica, I was kidding Earl. there was not a 20k order on tza.
monicadern

I wasn't talking about TZA. Alsha posted this on ETF-corner:

That was the weirdest selloff I've seen in a while.. market depth on SPY showed a large buyer consistently below the market buying 80,000 to 500,000 shares a tick into a price collapse, absorbing all the selling pressure without causing a severe adverse movement in price.

This was done in two controlled spurts to create the illusion of a momentum divergence on a small time frame, causing all day traders who caught this move to pull out for fear of being eaten alive by a buy program..

As order flow of short covering comes in, a bit more of a push from this buyer this time close to the market causes a huge bullish candle, and voila, the sell off has been averted.

Be careful if you remain short this market. This is not a normal market…
monicadern

Then Alsha wrote this:
However I do find it a bit strange that JPM is a consistent participant of this little game on the SPY, while SHI Capital (name is ironic I find) is always there to buy this market for a large paper buyer when these funny events happen… Both JPM and SHI usually come in at the same time but one is on the ETF, while the other on the futures. They seem to always be there to save the day whenever the market is about to fall off a cliff.

Futures now all the way back up to 1168 from 1162.75… I'm getting really tired of their games personally, and thats why I'm always scared to death of holding EOD shorts into the close.
Earl of

Yeah. Probably some of mine in there

It's heartwarming to see the price drop after I sell, instead of just before I sell, which is a little more common

bear/bull

God I hope we get a gap down tomorrow AM.

http://www.reddragonleo.com Red Dragon Leo

If they do… they will push it back up in the light volume of the afternoon session, as the big boys will have already left for the 3 day weekend.

bear/bull

I have a feeling this will happen.
Tomorrow one more dip and the a run up in the coming days… swift to 120+ then the swift down move after opex.

Earl of

Carl just sold one unit at 1164.25 (loss of 2 points)

As Red says, Ugly Market
http://www.reddragonleo.com Red Dragon Leo

Looks like they will pin the spy at 117.00 exactly for the March option expiration. I certainly wouldn't want the crooked market makers to actually have too pay out on options they sold.
sundancer390

11 days of going no where

the only setup that may give clues about tomorrow is the IYR
currently has 5 consecutive lower closes than opens
in the last 444 trading days IYR hasn't had more than 5 consecutive lower closes than opens

XLF got it's higher close than open today to fullfill it's setup

bear/bull

It also closed at the low today
http://www.reddragonleo.com Red Dragon Leo

Either a sell off or rally is coming next week… that seems to be a given, but which one has better odds? The crooked government with the keys to the printing press, or the TA's charts and patterns?

sundancer390

SPY hit max contianment on the 60 min during the afternoon low which is hit #5, the dam isn't going to hold much longer

given the IYR setup, it looks like more sideways to slightly up tomorrow, unless we get a monster gap down

monicadern

aaaaaaaaaaaaaaaaaaaaaaaaahhhhhhhhhhhhhhh!

Earl of

Carl at day’s end:

1155-1166 estimate for today (11 points)
1161.25 -1170.50 actual today (9.25 points)
Today’s range was 4-6 points higher than Carl’s.

Trades:
In /ES at 1166.25, sold at 1164.25 today. (loss of 2 points)

Grade: D (lost some money)
sundancer390

GS daily containment setup
http://www.flickr.com/photos/47091634@N04/44793…

it's currently sitting on it's 2 most important containment pts. from the past 4 months. Grey & Purple.

the market will crack when GS takes out it's grey & purple containment

gcocks83

Sundancer, Thanks for the info. It is hard to read your charts due to size. What is the price at that point? It look like it is sitting on them now.

sundancer390

when you click the hyperlink to view the picture you can select All Sizes at the top of the picture and it will blow up the picture

both containment pts. are in the upper 169's

gcocks83

Thanks, I'll give that a try.

gcocks83

That did the trick, Thanks again.

monicadern

Thanks Sundancer. Hopefully it cracks before I do

sundancer390

I hope XLF closes above 16.09 tomorrow as it would provide a good weekly setup

XLF currently has 6 consecutive higher closes than opens on the weekly, in the last 249 weeks XLF has no occurrences more than 7 consecutive higher closes than opens
Earl of

TNA opened down 1.1%. Gap was filled. TNA was up 1.8% at the high, and closed down 2.4%.

We are now in a Full Moon Trade, which tends to favor TNA.
AmericanBulls had TNA with a WAIT signal yesterday, so this trade was in cash today.
Will buy TNA when AB has a confirmed BUY signal (which won’t be today as TNA was down today).

Volume for TNA today and the 2 days before today (Holiday Week) were the 3 lowest of the last 17 days.

$RVX (VIX for $RUT) was up 2.9 % today with TNA down 2.4%. No divergence.

TNA has now been down 4 of the last 6 days. Bad for TNA.

The high for TNA three days ago was $58.23, the highest TNA price since November of 2008. The high today was $56.94, 2.2% below that high.

Ultimate Oscillator for TNA fell from 51 to 39 today, a large drop. UO has been below 50 4 of the last 5 days. Indicates (shouts) weakness for TNA. Bad for TNA.

MACD on the monthly chart crossed over downwards four days ago and is moving down. Bad for TNA.

Bollinger Bands for $RVX (VIX for $RUT): today’s white candle closed above the Bollinger mid line (20 day MA), in an area of congestion. MACD has crossed from below and is rising. Looks like $RVX might be rising. Bad for TNA.

Bollinger Bands for $RUT: The small white candle for $RUT is in the congestion area. The top Bollinger band is falling, and $RUT seems to be in a mature topping formation. MACD has crossed down. Bad for TNA.

Bollinger Bands for $RUT:$RVX ($RUT vs VIX for $RUT): today’s black candle fell to the bottom of the congestion area. The upper Bollinger Band is falling. Looks like the topping process is continuing. Bad for TNA.

TZA had a higher high, lower low and much lower close – bad for TNA.

Money flow for the Total Stock Market was $2,425 million flowing out of the market. Bearish – bad for TNA.

I will post the AmericanBulls candlestick interpretation a bit later.

Overall, it looks bad for TNA for tomorrow.

gcocks83

Earl, thanks, I kind of think TNA will be up tomorrow. Not planning on buying any today.

Earl of

I tend to agree.

At some point things may unfold the way they look.
http://dreadwinaard.livejournal.com/profile dreadwin

Fractal analysis suggests that TNA will make a last gasp tomorrow.

gcocks83

So you are in DTo. Hope it does well for you.

monicadern

A plunge should (SHOULD) happen any day now. http://stockcharts.com/h-sc/ui?s=$nymo
That with Poco's chart gives me some hope that this consolidation will lead to a down move rather than an up one.
sundancer390

late day sell off pushed the $RUT below it's 679.75 for the monthly close

$SPX slight violation of it's 1162.5 purple line containment
http://dreadwinaard.livejournal.com/profile dreadwin

I went long DTO, entry 59.25. $WTIC (i.e. oil) set a recent-rally high today. It looked like the juiciest thing to short, given that most of the other indexes were already off their peaks.

sundancer390

USO bumped it's head on it's controlling TL again, good short entry

this is an old chart from 3.17 but USO hit the blue TL again today
http://www.flickr.com/photos/47091634@N04/44411…

sundancer390

financials looks ripe, the operators gave a de-leverage tick on 3.22 of $15
bear/bull

RIMM reported down about 5% now. Should gap down tomorrow IMO
Earl of

The Daily view from Americanbulls

TNA remains a WAIT (wait for some kind of buy signal). The sell was at $55.61. TNA closed today at $54.58, down 1.8% since the sale. The candlestick today was a Black Candlestick (normal selling pressure).

TZA remains a HOLD. The buy price was $7.04. TZA closed today at $7.16, up 1.6% since the buy. The candlestick today was a White Spinning Top Candlestick (complete indecision between Bulls and Bears).

Two recent TZA Buy signals have failed and may perhaps serve as a warning:
Buy at $7.33, sell at $7.14
Buy at $7.11, sell at $7.05
Buy at $7.04, now up 1.6%

For that matter, recent TNA Buy signals have also been uninspiring:
Buy at $55.36, sell at $55.43
Buy at $55.69, sell at $55.63

Summary of $RUT based ETFs & a few popular ETFs (Market positive):
Wait: DRV(-3x), SRS(-2x)
Hold: DRN(3x),

Market Transition:
Highly reliable SELL-IF:DIA, QQQQ, IWM(1x), UWM(2x) [all Bearish Kicking Pattern]

Market Negative:
Wait: URE(2x), IYR(1x), SPY, TNA(3x)
Hold: DTO(-2x oil), RWM (-1x), TWM (-2x), TZA (-3x)

Comment: more market negative than yesterday
Action for tomorrow: none

gcocks83

Thanks Earl. I enjoyed the discussion down below also.
http://dreadwinaard.livejournal.com/profile dreadwin

AB still hasn't decided to by DRV yet, either. Take a look at the candlesticks that pop up! The only reason I didn't get into DRV today was that it was about 9% off the recent bottom.

Earl of

On DRV, it sure looks like a BUY should be in there somewhere.

I saw this a couple of times, where AmericanBulls just does not see a pattern it likes, and the thing just keeps rising without a buy signal.

I can only hope it pulls back.

Earl of

Using fractal analysis (as taught by Dreadwin) I would wait for a pull away from the bottom Bollinger band for the safest entry. Once it pulls away, it seems to break upwards.
monicadern

It's nice to come back home to see the market finally is down. Not getting excited yet.
Earl of

Carl is now Long one unit at 1166.25

1166 was his original projected high for today.
monicadern

That's odd.
Earl of

4.5 hours ago, he said the low of the day was in, and the market was looking strong. Took him awhile to bet on it.
bear/bull

God I hope we get a gap down tomorrow AM.
Earl of

Carl just sold one unit at 1164.25 (loss of 2 points)

As Red says, Ugly Market
http://www.reddragonleo.com Red Dragon Leo

If they do… they will push it back up in the light volume of the afternoon session, as the big boys will have already left for the 3 day weekend.
monicadern

At least I know now that carl doesn't have all the answers.
Earl of

He does ok overall, but does take losses now and then. And again

Seems to have small losses, which probably makes all the difference.
monicadern

That's right.
http://www.reddragonleo.com Red Dragon Leo

Looks like they will pin the spy at 117.00 exactly for the March option expiration. I certainly wouldn't want the crooked market makers to actually have too pay out on options they sold.
bear/bull

I have a feeling this will happen.
Tomorrow one more dip and the a run up in the coming days… swift to 120+ then the swift down move after opex.
gcocks83

Out of TZA at 7.14. Small profit.
Earl of

I'm scaling out of my TZA. Hate to lose this gain.

Out of TZA.
gcocks83

I just say an order for 20k shares go by. That must have been some of yours.
monicadern

Huge buyer at the close. Either window dressing for quarter end or the Fed.
Earl of

Yeah. Probably some of mine in there

It's heartwarming to see the price drop after I sell, instead of just before I sell, which is a little more common
sundancer390

11 days of going no where

the only setup that may give clues about tomorrow is the IYR
currently has 5 consecutive lower closes than opens
in the last 444 trading days IYR hasn't had more than 5 consecutive lower closes than opens

XLF got it's higher close than open today to fullfill it's setup
bear/bull

It also closed at the low today
http://www.reddragonleo.com Red Dragon Leo

Either a sell off or rally is coming next week… that seems to be a given, but which one has better odds? The crooked government with the keys to the printing press, or the TA's charts and patterns?
monicadern

aaaaaaaaaaaaaaaaaaaaaaaaahhhhhhhhhhhhhhh!
sundancer390

SPY hit max contianment on the 60 min during the afternoon low which is hit #5, the dam isn't going to hold much longer

given the IYR setup, it looks like more sideways to slightly up tomorrow, unless we get a monster gap down
Earl of

Carl at day’s end:

1155-1166 estimate for today (11 points)
1161.25 -1170.50 actual today (9.25 points)
Today’s range was 4-6 points higher than Carl’s.

Trades:
In /ES at 1166.25, sold at 1164.25 today. (loss of 2 points)

Grade: D (lost some money)
sundancer390

GS daily containment setup
http://www.flickr.com/photos/47091634@N04/44793…

it's currently sitting on it's 2 most important containment pts. from the past 4 months. Grey & Purple.

the market will crack when GS takes out it's grey & purple containment
gcocks83

Sundancer, Thanks for the info. It is hard to read your charts due to size. What is the price at that point? It look like it is sitting on them now.
gcocks83

Monica, I was kidding Earl. there was not a 20k order on tza.
sundancer390

when you click the hyperlink to view the picture you can select All Sizes at the top of the picture and it will blow up the picture

both containment pts. are in the upper 169's
monicadern

I wasn't talking about TZA. Alsha posted this on ETF-corner:

That was the weirdest selloff I've seen in a while.. market depth on SPY showed a large buyer consistently below the market buying 80,000 to 500,000 shares a tick into a price collapse, absorbing all the selling pressure without causing a severe adverse movement in price.

This was done in two controlled spurts to create the illusion of a momentum divergence on a small time frame, causing all day traders who caught this move to pull out for fear of being eaten alive by a buy program..

As order flow of short covering comes in, a bit more of a push from this buyer this time close to the market causes a huge bullish candle, and voila, the sell off has been averted.

Be careful if you remain short this market. This is not a normal market…
monicadern

Then Alsha wrote this:
However I do find it a bit strange that JPM is a consistent participant of this little game on the SPY, while SHI Capital (name is ironic I find) is always there to buy this market for a large paper buyer when these funny events happen… Both JPM and SHI usually come in at the same time but one is on the ETF, while the other on the futures. They seem to always be there to save the day whenever the market is about to fall off a cliff.

Futures now all the way back up to 1168 from 1162.75… I'm getting really tired of their games personally, and thats why I'm always scared to death of holding EOD shorts into the close.
sundancer390

I hope XLF closes above 16.09 tomorrow as it would provide a good weekly setup

XLF currently has 6 consecutive higher closes than opens on the weekly, in the last 249 weeks XLF has no occurrences more than 7 consecutive higher closes than opens
monicadern

Thanks Sundancer. Hopefully it cracks before I do
gcocks83

Thanks, I'll give that a try.
Earl of

TNA opened down 1.1%. Gap was filled. TNA was up 1.8% at the high, and closed down 2.4%.

We are now in a Full Moon Trade, which tends to favor TNA.
AmericanBulls had TNA with a WAIT signal yesterday, so this trade was in cash today.
Will buy TNA when AB has a confirmed BUY signal (which won’t be today as TNA was down today).

Volume for TNA today and the 2 days before today (Holiday Week) were the 3 lowest of the last 17 days.

$RVX (VIX for $RUT) was up 2.9 % today with TNA down 2.4%. No divergence.

TNA has now been down 4 of the last 6 days. Bad for TNA.

The high for TNA three days ago was $58.23, the highest TNA price since November of 2008. The high today was $56.94, 2.2% below that high.

Ultimate Oscillator for TNA fell from 51 to 39 today, a large drop. UO has been below 50 4 of the last 5 days. Indicates (shouts) weakness for TNA. Bad for TNA.

MACD on the monthly chart crossed over downwards four days ago and is moving down. Bad for TNA.

Bollinger Bands for $RVX (VIX for $RUT): today’s white candle closed above the Bollinger mid line (20 day MA), in an area of congestion. MACD has crossed from below and is rising. Looks like $RVX might be rising. Bad for TNA.

Bollinger Bands for $RUT: The small white candle for $RUT is in the congestion area. The top Bollinger band is falling, and $RUT seems to be in a mature topping formation. MACD has crossed down. Bad for TNA.

Bollinger Bands for $RUT:$RVX ($RUT vs VIX for $RUT): today’s black candle fell to the bottom of the congestion area. The upper Bollinger Band is falling. Looks like the topping process is continuing. Bad for TNA.

TZA had a higher high, lower low and much lower close – bad for TNA.

Money flow for the Total Stock Market was $2,425 million flowing out of the market. Bearish – bad for TNA.

I will post the AmericanBulls candlestick interpretation a bit later.

Overall, it looks bad for TNA for tomorrow.
gcocks83

That did the trick, Thanks again.
gcocks83

Earl, thanks, I kind of think TNA will be up tomorrow. Not planning on buying any today.
Earl of

I tend to agree.

At some point things may unfold the way they look.
http://dreadwinaard.livejournal.com/profile dreadwin

I set a limit order for 59.25 when it was trading at 59.50ish; betting on a wave 2 fib retrace of 50%. Then I went to a meeting for 2 hours. Just came back from my meeting to discover that I got my fill and am in the green.
monicadern

A plunge should (SHOULD) happen any day now. http://stockcharts.com/h-sc/ui?s=$nymo
That with Poco's chart gives me some hope that this consolidation will lead to a down move rather than an up one.
http://dreadwinaard.livejournal.com/profile dreadwin

Fractal analysis suggests that TNA will make a last gasp tomorrow.
gcocks83

So you are in DTo. Hope it does well for you.
sundancer390

late day sell off pushed the $RUT below it's 679.75 for the monthly close

$SPX slight violation of it's 1162.5 purple line containment on the monthly
http://dreadwinaard.livejournal.com/profile dreadwin

I went long DTO, entry 59.25. $WTIC (i.e. oil) set a recent-rally high today. It looked like the juiciest thing to short, given that most of the other indexes were already off their peaks.
sundancer390

USO bumped it's head on it's controlling TL again, good short entry

this is an old chart from 3.17 but USO hit the blue TL again today
http://www.flickr.com/photos/47091634@N04/44411…
sundancer390

financials look ripe, the operators gave a de-leverage tick on 3.22 of $15 on the XLF
bear/bull

RIMM reported down about 5% now. Should gap down tomorrow IMO
Earl of

The Daily view from Americanbulls

TNA remains a WAIT (wait for some kind of buy signal). The sell was at $55.61. TNA closed today at $54.58, down 1.8% since the sale. The candlestick today was a Black Candlestick (normal selling pressure).

TZA remains a HOLD. The buy price was $7.04. TZA closed today at $7.16, up 1.6% since the buy. The candlestick today was a White Spinning Top Candlestick (complete indecision between Bulls and Bears).

Two recent TZA Buy signals have failed and may perhaps serve as a warning:
Buy at $7.33, sell at $7.14
Buy at $7.11, sell at $7.05
Buy at $7.04, now up 1.6%

For that matter, recent TNA Buy signals have also been uninspiring:
Buy at $55.36, sell at $55.43
Buy at $55.69, sell at $55.63

Summary of $RUT based ETFs & a few popular ETFs (Market positive):
Wait: DRV(-3x), SRS(-2x)
Hold: DRN(3x),

Market Transition:
Highly reliable SELL-IF:DIA, QQQQ, IWM(1x), UWM(2x) [all Bearish Kicking Pattern]

Market Negative:
Wait: URE(2x), IYR(1x), SPY, TNA(3x)
Hold: DTO(-2x oil), RWM (-1x), TWM (-2x), TZA (-3x)

Comment: more market negative than yesterday
Action for tomorrow: none
gcocks83

Thanks Earl. I enjoyed the discussion down below also.
http://dreadwinaard.livejournal.com/profile dreadwin

AB still hasn't decided to by DRV yet, either. Take a look at the candlesticks that pop up! The only reason I didn't get into DRV today was that it was about 9% off the recent bottom.
Earl of

On DRV, it sure looks like a BUY should be in there somewhere.

I saw this a couple of times, where AmericanBulls just does not see a pattern it likes, and the thing just keeps rising without a buy signal.

I can only hope it pulls back.
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