Bull Trap, Bear Squeeze…
Hard reversal on oversold 15 minute chart…
On Monday, at the close, the 15 minute and 60 minute charts aligned up together pointing down. That caused the massive sell off into the close and afterhours session. Tuesday opened up with a gap down to 1040 spx, and struggle to get back higher early on.
But in the afternoon the 15 minute and 60 minute chart aligned up together once again… but this time pointing up. This caused the short squeeze into the close, and higher afterhours numbers. Many bulls went long here and will probably have a chance to get out in the morning tomorrow, as the 60 minute chart is still pointing up.
But, the 15 is now overbought and will roll back down when the 60 is peaked. I expect that to happen in the first few hours of the day. Once it rolls, the 15 minute chart will follow. Then once again all 5 time frames will be pointing down again. I expect the 1040 low to be taken out on this next move down.
Nothing has really changed to make me be bullish on the market. The Monthly, Weekly, and Daily charts are still going down, and will push this market down hard when the 60 and 15 re-align back down. The market is still stuck in a downward sloping channel, and it will have to gap up out of it tomorrow to gain more traction to the upside.
If it’s able to gap out of the channel, it will find another wall of resistance from a different downward sloping trendline around 1100 spx, and that’s assuming it’s able to go through the horizontal resistance line at 1090 spx. Since the 60 minute chart is more powerful then the 15 minute, it’s possible that a run for 1090 could happen. But first it must gap out of the channel it’s currently in.
I just don’t see that happening tomorrow. I see a flat open, and some chopping sideways action until the 60 minute chart gets overbought. Then I see another move down coming. I now see the writing on the wall, and for those with a keen eye, they also shall see.
So, I wish all you bulls a bears the best success possible.
Red
P.S. Someone asked me if the fake prints work and how accurate they are. Monday night I caught one, but didn’t think it would play out today, as it was too high from the gap down that occurred. So I went short close to the open, instead of waiting, and getting a much better entry on the rally back up. That’s the emotional part that I’m still working on, as learning to trust what I see in the charts is the hardest part. It clearly showed me that it was oversold, and should rally up some… and of course the print told me the target, but I didn’t listen.
Still learning I am…
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Comments are closed.
about 3 months ago
http://reddragonleo.com/wp-content/uploads/2010...
about 3 months ago
Wow – almost there – missed seeing this one … maybe we start capturing these in the post up top as edits during the day
Today AH there are prints all the way to 109- 109.4
about 3 months ago
Yeah, that could be our upside target? But, I think we will sell off first, and then rally back to those prints.
about 3 months ago
We're probably looking at a long forced uphill march to form the right shoulder of the H&S starting tomorrow morning, and to 1140 thereafter according to some, so you should have a chance to get in.
Somehow I feel that something will trash the completion of the H&S, like unemployment numbers, global cooling, a solar flare, etc. We'll see.
about 3 months ago
Lots of motion. Seems it ought to be easy to buy and sell later and make money. Ought to be.
about 3 months ago
monkey for brains says: me no sure, me wait on sideline
about 3 months ago
We are now in a New Moon Trade, which tends to favor TZA.
TZA opened down 1.1%, and the opening gap was filled. TZA was up 0.9% at it’s high, and closed down 0.6%.
AmericanBulls had TNA with an unlikely but possible BUY today. TNA was up 0.39%. Not enough to trigger a buy signal, so TNA will remain a possible buy for tomorrow.
AmericanBulls had TZA as a Wait today (Confirmed Sell yesterday). And TZA was down 0.6%, so TZA will be a Wait again for tomorrow.
Volume for TZA today was 5% below it’s 1 month average. Bad for TZA.
Volume for TNA today was 13% above it’s 1 month average.
$RVX (VIX for $RUT) closed down 1.7% with TZA down 0.6%. No divergence.
TZA had been down 1 day, up 3, down 1, up 2, now down 1 day. Choppy, and went no where at all the last 4 days. Not good for TZA.
The low for TZA was from 20 days ago at $5.30. Today’s low was $7.01, 32% higher. Good for TZA.
Today, Ultimate Oscillator for TZA rose from 49.0 to 53.9 (+4.9) while TZA was up 0.39%. No divergence.
MACD fastline & slowline both above zero rising Good for TZA.
Bollinger Bands for $RVX (VIX for $RUT): Today, $RVX fell sharply to the Bollinger mid line (20 day MA) then bounced to end the day roughly flat. The fast MACD line is pointing down, the slow line is still rising. 2 days ago was the 3rd day of a 3-day sequence ending in a $RUT buy signal, but frankly it seems busted. Good for TZA.
Bollinger Bands for $RUT: Today, $RUT had a dogi candle that closed a bit above yesterday. MACD is falling sharply. Good for TZA.
TZA had a much lower high & much lower low & slightly lower close (Good for TZA)
Money flow for the Total Stock Market:
$13,442 million flowing out of the market 3 days ago.
$ 232 million flowing out of the market 2 days ago.
$ 2,671 million flowing out of the market yesterday.
$ 3,708 million flowing into the market today.
Bad for TZA.
I will post the AmericanBulls candlestick interpretation a bit later.
Overall, No guess for TZA for tomorrow. TZA closed in roughly the same place in 4 of the past 5 days. Wild gyrations going no where.
about 3 months ago
One smart ape man
about 3 months ago
can someone explain why this is a fake print? sorry but i'm new to trading and learning a lot on this site. thanks!
about 3 months ago
Ron,
It's hard to tell if they are just late fills, or fake. It's just when you are seeing the charts turn in that direction, just keep that target in mind. Nothing is written in stone, saying that each print will be the target. But again, when you are going in that direction, you should look for a tag of that level to be hit.
about 3 months ago
The Daily view from Americanbulls
TNA was an (unlikely) possible buy for today, was up 0.5%, and remains a possible buy for tomorrow.
TZA was a Wait today (from a Confirmed Sell yesterday). TA dropped 0.5% and remains a Wait for tomorrow.
Two recent TZA Buy signals have been successful:
Buy at $5.54, sell at $6.34, up 14.4%
Buy at $6.10, sell at $7.63, up 25.1%
Of the stocks & ETFs I follow, these are to hold on to:
GLD (gold), UGL (2x Gold)
SLV(silver)
UCO(2x Oil)
ERX(3x energy)
DRI
SPY
DRV (-3x RE)
EPV (-2x Europe)
The list to avoid:
IYR(1x RE), URE(2x RE), DRN(3x RE)
USO(oil)
AAPL
DIA
EWG(Germany)
EWQ(France)
EWU(England)
EWX(emerging mkts)
RWM (-1x $RUT), TWM (-2x $RUT), TZA (-3x $RUT)
SRS (-2x RE)
SCO (-2x Oil), DTO (-3x oil)
FAZ (-3x Financials)
DZZ (-2x Gold)
The following are possible (but unlikely) buys tomorrow:
IWM (1x $RUT), UWM (2x $RUT), TNA (3x $RUT)
UUP(US Dollar)
GOOG
SPXU (-3x $SPX)
QID (-2x QQQQ)
DXD (-2x DOW30)
The following are possible (but unlikely) sells tomorrow :
AMZN
GS
QQQQ
ERY (-3x energy)
The following are quite likely buys tomorrow: none
The following are quite likely sells tomorrow: QLD (2x QQQQ)
Summary: Fairly Bearish
New Sells today on IYR(1x RE), URE(2x RE), DRN(3x RE), EWG(Germany), EWQ(France), EWU(England)
New Buys today on DRV (-3x RE), EPV (-2x Europe)
Action for TNA or TZA for tomorrow: Avoid TZA, possible (but unlikely) buy of TNA
about 3 months ago
Only thing is will PPT let the mkt crash into the holiday …. media is already so bearish …. if the mkt falls into the holiday, you can bet people will not be spending … and PPT doesn't want that
about 3 months ago
yes they are. thank you.
about 3 months ago
red, I THINK the volume on that falsie makes it a real falsie