Tuesday, May 21, 2024

Rejected At The 50…

Slammed down in the morning, rallied back at noon, but rejected at the 50, and pushed back to even in the last quarter...

That's the story for the market today.  The gap down in the morning was more fear about the Greece issue, but the market shook it off and pushed on up higher... only to hit overhead resistance at the 50 day moving average, and get sold back off into the close.

This is not a good sign for the bulls.  It shows me that they don't have enough strength to rally higher yet.  Once again, they need to pull back and regroup before making another attempt to rally higher.  This overhead resistance at the 50 dma is soon to be double resistance, as the 20 dma moves down into it, forming a "necktie".

A necktie is simply two points (trendlines converging, or moving averages) of resistance or support that meet together at a certain point in time.  They will provide great support, or huge resistance.  In this case, they are overhead now, and will serve as huge resistance.

Whenever the market can't get through resistance or support, it either gaps over it, (by gapping up or down before the open), or it must pullback and rest before another attempt is made.  This leads me to believe that tomorrow,or the next day, the market will pullback and then make another attempt to go through it at a later date.

That doesn't mean tomorrow will be the be sell off day, only that a sell off is coming very soon... if the market can't break through the resistance overhead.  It might try to rally again tomorrow, and be rejected again.  Every time the market makes an attempt to pierce the overhead resistance, and fails... it gets weaker and weaker.

At some point, it will run out of energy and collapse back down.  Whether or not that's tomorrow or not, is anyone's guess?  I know it's coming, and I expect it to arrive this week, but I can't tell you exact date.  Since there isn't any major news or earnings this week, it could be any day this week.

Since Thursday has been bearish lately, and Friday is the last day going into an "unknown weekend", I'd give those two days the most likely days for a fall to happen.  Other then the charts telling me that we will sell off within a few days, there are other clues too.

Gold rallied hard today, even though the dollar stayed flat, and didn't sell off, as the market rose.  Usually, the dollar is selling off, while the market, gold, and oil all go up.  Oil went down today, but the market rallied up.  What is that saying to you?

It says too me that the dollar won't sell off hard because of the Greece fears... which is based on the Euro.  The Euro is still weak, and is likely to stay that way until the Greece fears go away.  That's not likely to happen overnight, regardless of the market's 400 point Dow rally on Monday.  That was just the reason behind it, but the market was very oversold, and was ready for a bounce any way.

As you can see by today's action, the euphoria of the Trillion Dollar Bailout wore off quickly by the close today.  So, the dollar isn't ready to sell off yet, and is staying strong.  OK, what about gold?  Why did it rally when the dollar didn't sell off?  Simple... FEAR!  That's why I don't trade the GLD, as it's supposed to trade opposite of the dollar, but it didn't this time because people will run too gold whenever fear is in the marketplace, regardless of what the dollar does.

How about Oil?  Usually oil is rallying with the market, and while the dollar sells off.  But, the dollar was flat today, and didn't sell off.  What happens to oil when the dollar takes another move higher?  If oil trades the opposite of the dollar, the it will fall hard if the dollar takes another leg up.

Putting all these pieces together, and you have lots of reasons for the market to fall down again hard.  I would love to see another touch of the 50 dma before the sell off, as that makes for a larger drop.  The market wants to hit the 50 dma at least a couple of times, before giving up and retreating lower.  If it falls tomorrow, it won't go downs as far, as it will want one more attempt at touching the 50 dma line.

Think of it like a football player hitting a blocker that he can't get through.  He will likely try several times to push past the blocker, before he falls back and thinks of another strategy.  The market is no different.  Many attempts will be made while "at the line of defense", and finally a retreat back or a push through will occur.

If we start to fall tomorrow, I do expect the gap at 111 spy to be filled before another attempt at the 50 dma is made again.  It might happen in one day or several days?  Regardless, I do still see another leg down, to retest the 105.00 low at least.

After that, then I could see another rally to a possibly higher high in the market.  I don't know if it will happen on June the 25th, as I forecasted in weekend video.  I'd be shocked if the forecast is accurate, but for now it's still possible to follow that path of a new high by late June.

So, for tomorrow... I'm bearish, but not sure if the fall comes on Wednesday, or waits until Thursday and Friday?  Either day, I'm comfortable be short right now.

Red

P.S. I'll be gone all day on Wednesday gang, and won't be able to reply to any posts (no computer access).  So, I leave you in good hands with the lovely Monica, and wise Sundancer.  (Try not to kill all the bulls while I'm gone Monica).

Red
Author: Red

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rationalnational
rationalnational
14 years ago

Great post Leo!

Red Dragon Leo
14 years ago

Thanks Rat…

Let's see if it comes true tomorrow? I really would like to see one more try at breaking the 50 dma, and a failure of course. The more times it try's, the harder it will fall.

gcocks83
gcocks83
14 years ago

nIce Post Red, Talk to you tomorrow.

Red Dragon Leo
14 years ago
Reply to  gcocks83

Thanks Gman…

jimhobson
jimhobson
14 years ago

How much credibility do you place on futures. i am to the point that i believe they are almost a useless tool. Not necessarily contrarian but close.

Red Dragon Leo
14 years ago
Reply to  jimhobson

Well, you have to watch them all night to see where they trade at. What was the overnight low, and the overnight high, etc… They will many times retest the low or high in the regular hours.

Now that assumes little movement in the overnight session. If you have a 10-15 point spx move, either up or down, I'd say a gap open it that direction is highly likely, and also that the day will most likely be a trend day.

Just like Monday's futures where up 20 points or more before the open. There was no way that was going back down. It's called a “gap and go”, where the market gaps above or below a key resistance level, or support level, and keeps going in that direction all day.

So, looking at tonight's futures, there is key support around 115.00, and the market has hit that area and rested. I see 115.00 being a like target hit tomorrow at some point.

Hopefully, that makes some sense too you?

jimhobson
jimhobson
14 years ago
Reply to  Red Dragon Leo

It does. i appreciate the input. At my age i am not going to be up all night.

Red Dragon Leo
14 years ago
Reply to  jimhobson

Me neither Jim… go to bed, and look at the charts in the morning. You can still see what information you are looking for. You don't need to stay up all night… I don't. LOL

BloodWine
BloodWine
14 years ago

Great Post Red. I agree… we need to at least retest 1100 or 1050
will LOVE to trade it 🙂

Red Dragon Leo
14 years ago
Reply to  BloodWine

Fujisan has 105.00 as a likely target by this Friday, and then up to 110.00 by OPX. I agree with her on this. She is a great charts, and correct many times. Her, Anna, and Kiersten are all good traders and chartists.

http://slopeofhope.com/2010/05/spy-may-opx-pin-

monicadern
monicadern
14 years ago
Reply to  Red Dragon Leo

Thanks red – I know the vix is probably killing my account. I haven't looked at it today!

SC
SC
14 years ago
Reply to  Red Dragon Leo

Doesn't she also have 118 by today. From 118 to 105 on Friday? yeah right… Are we all riding on the short bus ? LOL 2 crashes in 2 weeks?

newbear
newbear
14 years ago

I kept her projection as a reference, yes fuji is quite good with her analysis.

dreadwin
14 years ago

Not my chart, belongs to a blogger named “humblestudent”:

http://1.bp.blogspot.com/_Qe2EUehGkjM/S-mOOCV59

Gere64
Gere64
14 years ago
Reply to  dreadwin

Great work!

dreadwin
14 years ago
Reply to  Gere64

I'm impressed by his skill at counting. If the fractal holds, it's golden for bears.

Red Dragon Leo
14 years ago
Reply to  dreadwin

Great Chart Dreadwin…

Thanks for posting it, as it's very good work from Humblestudent. I agree with it too, as it still looks too me like one more leg down is needed before a rally back up can happen, to put in one final high in mid-summer.

Gere64
Gere64
14 years ago

Great read Red. 🙂

For me, I would just as well see us tank and do away with the backtests!

Red Dragon Leo
14 years ago
Reply to  Gere64

Thanks Gere…

I only say I'd like to see another day, as that will make the fall down quicker and deeper. More profits for the shorts…

bobarsenault
bobarsenault
14 years ago

gotta love it red! total bullsh*t. I guess the trick is to be on the right side, right?

http://market-ticker.denninger.net/

Keirsten
Keirsten
14 years ago

Here's a chart I played with last night, Red. Zig Zag and I refer to these as our John Nash charts. 😉 The bottom to bottom 66 cycles look pretty good, and if this pattern holds, that would take us from May 06 bottom to August 09, should the pattern hold again. This is also the beginning of the Cardinal Climax, fwiw, and obviously earlier than Laundry's August 26th projected cycle target.

http://bit.ly/crN4aK

AS2009
AS2009
14 years ago
Reply to  Keirsten

Great chart K 🙂

bensjoyce
bensjoyce
14 years ago
Reply to  Keirsten

Keirsten

Does this guy have something organized that he puts out. I went to his blog of what ever it was and i was lost.
you have to study the the site for about a month before you can use it.

any suggestions?

ben

Rip Van Trader
Rip Van Trader
14 years ago

One of my greatest fears at this point is a gap opening for this morning. Lo and behold, that is what appears to be shaping up. European markets are exulting as of the time of this post (7:30) and FTSE appears to be forming a coffee cup (5 day Yahoo chart), an extremely bullish signal. So, it looks like a fight this morning. Rather, I hope there's a fight and that the 117 resistance is not bypassed.

Rip Van Trader
Rip Van Trader
14 years ago
Reply to  Rip Van Trader

Sold off 1/3 of my SDS. I am still rather heavily committed.

Rip Van Trader
Rip Van Trader
14 years ago
Reply to  Rip Van Trader

C'mon, Europe! Do we always have to do all of your heavy lifting?

j/k

monicadern
monicadern
14 years ago

Another fun day in paradise. . .

Earl of
Earl of
14 years ago

Carl’s morning call:

June S&P E-mini Futures: I think that last week's low at 1056 ended the correction from 1216. Today's range estimate is 1150-75.

1141-1160 range last night (19 points)
1150-1175 estimate for today (25 points – ~1.5 times the usual range)

1158 currently, so estimate is -8 to +17 from here (bullish)

Rip Van Trader
Rip Van Trader
14 years ago

Hey, Monica, where's everyone hanging out today? I miss the play-by-play.

monicadern
monicadern
14 years ago
Reply to  Rip Van Trader

Hey Rip – sorry I have a newborn so sometimes I get tied up. Red is working, Sundancer usually comes in after the close. Most of us are probably just stuck in our short positions and trying not to look!

Rip Van Trader
Rip Van Trader
14 years ago
Reply to  monicadern

I can't look away! I guess we'll find out soon if it's going to 118. Once we get there, I may buy a souvenir if I dare.

SC
SC
14 years ago
Reply to  Rip Van Trader

Get a t or something that says “I rode the short bus”. LOL

Rip Van Trader
Rip Van Trader
14 years ago
Reply to  SC

Did somebody say, “Don't fight the tape?”

SC
SC
14 years ago
Reply to  Rip Van Trader

Everybody says that. But here is the trick question : Which way is the tape going? 🙂

newbear
newbear
14 years ago
Reply to  monicadern

stuck and looking is right, this is not looking to good for bears now.

Stock_tech
Stock_tech
14 years ago

Anbother gap down on the vix today?

There WILL be more downside to fill those gaps the big ?????? is when

AS2009
AS2009
14 years ago

Take a look at SPY from May 4th to today's high – I see a HUGE inv H&S with neckline at 117 and tgt of 124 ……wooooahhhh

Rip Van Trader
Rip Van Trader
14 years ago
Reply to  AS2009

Don't know if that's valid, though, because it was an intermediate downtrend that went into it.

Wouldn't it be nice to be long today? Who knew they'd go all the way.

Rip Van Trader
Rip Van Trader
14 years ago
Reply to  Rip Van Trader

Oh, head & shoulders. I was thinking cup & saucer, my bad!

Hopefully bait for the bulls and not a bad omen for us!

jimhobson
jimhobson
14 years ago

I feel like throwing all my chart programs away.

SC
SC
14 years ago
Reply to  jimhobson

QE global. Party like it is 1929!

monicadern
monicadern
14 years ago

I will wait until 117.80 before I throw in the towel.

Rip Van Trader
Rip Van Trader
14 years ago
Reply to  monicadern

I'd wait until tomorrow in any case, see what tonight's charts look like. There WILL be resistance there, don't worry. We'll probably close on the high.

jimhobson
jimhobson
14 years ago
Reply to  monicadern

backed off of on 3 attempts at 117.23+-

i wonder if we have another after lunch adjust like yesteday??

Stock_tech
Stock_tech
14 years ago

EU just threw in a huge bailout It “apprears” that all problems are solved.

SC
SC
14 years ago
Reply to  Stock_tech

QE USA produced the Mar 09 rally.

Say hello to QE Global.

monicadern
monicadern
14 years ago

Sundancer, if you are out there will you answer me this? Did we hit the teal trendline yet? I know it was at 117.80 yesterday but it should be lower today, no?

monicadern
monicadern
14 years ago

just added to my puts.

AS2009
AS2009
14 years ago
Reply to  monicadern

Mon – what puts are you adding ?

monicadern
monicadern
14 years ago
Reply to  AS2009

i added may 114s but I would recommend doing the opposite of what I do!

AS2009
AS2009
14 years ago
Reply to  monicadern

In a quandry …. am long = but underwater as vix is getting sucked out of my options …. thinking of some protection – with 200 bucks in my account ..

monicadern
monicadern
14 years ago
Reply to  AS2009

Well now that the VIX is down, you don't want to sell options. I would buy some puts as a hedge. Not a bad position to be in. I am losing on the time, the volatility and the position!

monicadern
monicadern
14 years ago
Reply to  AS2009

more importantly here is that we have the resistance of the 20 day MA (already blew through the 50) after a sharp move up in a short amount of time. I would be afraid to be long here.

AS2009
AS2009
14 years ago
Reply to  monicadern

20 SMA Daily at 118.59 … right ?

monicadern
monicadern
14 years ago
Reply to  AS2009

You know – you are right. I apologize. But, that means we haven't blown through the 50. The 50 is at 117.42 – our high of the day!

AS2009
AS2009
14 years ago
Reply to  monicadern

Be very careful of the inv H&S playing out …. neckline at 117 – 117.15 – conservative tgt is 124 … nothing is sure yet …

monicadern
monicadern
14 years ago
Reply to  AS2009

Don't believe so much in patterns. Probably why I am getting screwed!

jimhobson
jimhobson
14 years ago
Reply to  monicadern

Looks like they are going to make another run at it. After three trys I would have thought they would give it up.

monicadern
monicadern
14 years ago
Reply to  Diablos

cool diablos. Thank you!

jimhobson
jimhobson
14 years ago
Reply to  Diablos

Thanks for the video. Seems to coincide w/ Red's June 25 high before crash but as always timing is questionable.

monicadern
monicadern
14 years ago

Now it looks like we blew through the 50 MA?

jimhobson
jimhobson
14 years ago
Reply to  monicadern

I think it failed again. I have it about 1173

monicadern
monicadern
14 years ago
Reply to  jimhobson

thanks

newbear
newbear
14 years ago

Red, tell me it ain't so, you have turned to the dark side.

Stock_tech
Stock_tech
14 years ago

Much more upside to come IMO

If this moves alot you have to watch it.
http://stockcharts.com/h-sc/ui?s=iwm&p=D&b=5&g=

IWM are composed of riskier stocks so if this moves alot others should follow. Q's DIA, SPY etc

bigbadwolfusa
bigbadwolfusa
14 years ago

If I am reading this right the volume is way down no energy…

Red Dragon Leo
14 years ago

I'm back gang, but not happy about it. I had car problems, and instead of making some money working, I paid someone else to tow me home. Real bummer…

On top of that, the market just won't die. Let's review…

On the Bullish side:

It's forming a bull flag now, and could shoot up another 10-15 points at anytime. Light volume is back in the market, and that is usually bullish.

The MACD is rising from oversold conditions and could continue to rise on up, and go into positive territory?

On the Bearish side:

We are at a double top from yesterday, and we now have a necktie of resistance overhead, with the 20 dma, and 50 dma coming even closer today. They could touch each other by tomorrow.

Gold is still rallying, and the dollar isn't selling off. It's kind of forming a bull flag on the daily chart, which is negative for the market.

Oil is still falling and forming a bear flag (kind of?) on the daily chart, which is bad for the market.

Conclusion:

It could go either way at this point? Since the necktie of resistance will be formed tomorrow, the market needs to gap up over the resistance and fulfill the bull flag, which seems like the best way to kill the last bear.

Or, the bull flag fails, and a large sell off happens (unlikely, as I'm always on the wrong side, and I'm short now).

Since the market always seems to do the opposite of I expect it to do… I expect it to gap up tomorrow. Go Bulls.. you low down dirty piece of sh*t mot**r f**k*rer's. $#$&%^^$&**^^*%$@@$%&*%!

monicadern
monicadern
14 years ago
Reply to  Red Dragon Leo

ha ha Red! I share your sentiment! I am the contra indicator.

Red Dragon Leo
14 years ago
Reply to  monicadern

Today is the opposite of “everything I touch turns to gold”…

monicadern
monicadern
14 years ago
Reply to  Red Dragon Leo

I think we are stuck in the bizarro world!

SC
SC
14 years ago
Reply to  Red Dragon Leo

LMAO. Your purpose in life is to serve as an example for others, Red. LOL

Red Dragon Leo
14 years ago
Reply to  SC

I'm laughing my way to jail, for stealing bread to eat, because I'm too broke to afford it.

SC
SC
14 years ago
Reply to  Red Dragon Leo

I tried to warn you guys. But no one listened.

Red Dragon Leo
14 years ago
Reply to  SC

I didn't hear you SC, I was too busy saying “Would You Like Fries With That?”

SC
SC
14 years ago
Reply to  Red Dragon Leo

LMAO!

newbear
newbear
14 years ago
Reply to  Red Dragon Leo

Red, you're the only one I know that can laugh at all of this and make everyone else laugh at the same time. I think we can share the cardboard at Anna's place.

Red Dragon Leo
14 years ago
Reply to  newbear

Anna already feeds 41 homeless animals… why not one more dragon? And you too of course… She likes bears so you should be a “shoe in”

monicadern
monicadern
14 years ago
Reply to  newbear

You think she will let me sleep with the cats?

newbear
newbear
14 years ago
Reply to  monicadern

Never mind Anna, the cat's will have to accept you.

buylo
buylo
14 years ago
Reply to  Red Dragon Leo

Will someone please tell me when the next great Depression starts so I can go short?

Red Dragon Leo
14 years ago
Reply to  buylo

Around Dow 11,800 range. ETA is around June 25th.

SC
SC
14 years ago
Reply to  buylo

Not when they are printing money like there is no tomorrow.

QE Global has arrived.

monicadern
monicadern
14 years ago

I just pray Sundancer comes in at 4:02 to tell us that we hit the teal line 🙂 The baby won't stop fussing and I need a break!

SC
SC
14 years ago
Reply to  monicadern

Tend to the baby first, Monica. The market will always be there.

I really wish you would adopt a less stressful trading style. 🙂

monicadern
monicadern
14 years ago
Reply to  SC

Now where is the fun in that?!

Red Dragon Leo
14 years ago

I hope the market is listening right now… I'm bullish! I'm bullish! I'm bullish! I'm bullish! I'm bullish! I'm bullish!… can you hear me Mr. Market?

bigbadwolfusa
bigbadwolfusa
14 years ago
Reply to  Red Dragon Leo

I guess that wasn't a fake print at 2:35 of 116.35…

Red Dragon Leo
14 years ago
Reply to  bigbadwolfusa

I've been gone all day, so I didn't see one?

monicadern
monicadern
14 years ago
Reply to  Red Dragon Leo

Since when did the market become a Mr?!

Red Dragon Leo
14 years ago
Reply to  monicadern

Sorry… your right! The market is a bitch!

monicadern
monicadern
14 years ago

They'll close on the 1170 level just to keep us all guessing.

Turbo Tim
Turbo Tim
14 years ago

Where Sundancer at?

Red Dragon Leo
14 years ago
Reply to  Turbo Tim

Good question? I don't know? Probably just taking some time off, and enjoying the sunshine (or rain in my case).

newbear
newbear
14 years ago
Reply to  Red Dragon Leo

Raining here to.

Red Dragon Leo
14 years ago
Reply to  newbear

My card board box is falling apart too. Damn rain…

monicadern
monicadern
14 years ago
Reply to  newbear

Pouring here 🙂

monicadern
monicadern
14 years ago

Trying to scare every last bear out.

Turbo Tim
Turbo Tim
14 years ago

History may still look valid

http://www.etf-corner.com/.a/6a010535da87f8970c

SC
SC
14 years ago
Reply to  Turbo Tim

Statistically, based on data going back 15 years, the May 6 plunge pattern + the May 10 blast off, we are looking at >95% chance of retest of the April highs with no prior retest of the May 6 low. Very bad odds for the bears.

I bought back some stocks on May 7. Lucky break. Sold them on May 3. I would claim to be a genius had I not close out my shorts on May 4….. *bang head on desk*

Red Dragon Leo
14 years ago
Reply to  SC

Did you turn bullish? Trader! LOL

SC
SC
14 years ago
Reply to  Red Dragon Leo

Bought stocks on May 7, Friday. Posted that here in real time.

Zero short.

I am waiting for a second 80- 90% upside day to go massively long.

Red Dragon Leo
14 years ago
Reply to  SC

Looks like you caught a nice up move… can ride in your Lambo with you?

SC
SC
14 years ago
Reply to  Red Dragon Leo

Just a tricyle.

monicadern
monicadern
14 years ago

Action in oil is a divergence though.

Red Dragon Leo
14 years ago

Nice fake print just showed up at 115.86 spy. Could? Just Maybe? …give the bears some hope?

monicadern
monicadern
14 years ago
Reply to  Red Dragon Leo

Not a chance!

bigbadwolfusa
bigbadwolfusa
14 years ago
Reply to  Red Dragon Leo
Red Dragon Leo
14 years ago
Reply to  bigbadwolfusa

Thanks… good job.

bigbadwolfusa
bigbadwolfusa
14 years ago
Reply to  Red Dragon Leo

ok…to tease you all I am off to the pool for some stress relief…sunny and almost in the 80's….

be back later

jimhobson
jimhobson
14 years ago

The bulls sure can run the market on what i think is pretty low volume.

Are we headed up the old grind up? I was hoping not? but going into Opex with a start like this could be a shorts frustration.

sundancer390
sundancer390
14 years ago

I posted this yesterday
We're going to back test max contain (teal line) on the 60 in the not too distant future
We can either go sideways for another day & test it or dump 30 pts. & back test it in the 1150 area

Why is everyone panicking?
http://www.flickr.com/photos/47091634@N04/46022

People are puking up their positions, throwing their charts away, calling for things to go to the moon without knowing the dance.

I've had a wonderful day out in the Sun, it looks like everybody else is literally about ready to puke.

Red Dragon Leo
14 years ago
Reply to  sundancer390

Well, I had car problem… so that's why I'm upset. I'm still short, but I still like to vent a little sometimes. LOL

monicadern
monicadern
14 years ago
Reply to  sundancer390

Added to my puts but it was hard to do without knowing exactly where that teal line was today. I am fully loaded now.

newbear
newbear
14 years ago
Reply to  monicadern

Good luck to us then. 🙂

SC
SC
14 years ago
Reply to  monicadern

Plot a 200 period weighted moving average or a 150 period wma on your hourly index/etf charts. And you get a pretty close 'teal' line. 😉

monicadern
monicadern
14 years ago
Reply to  SC

Thank you SC.

sundancer390
sundancer390
14 years ago
Reply to  monicadern

72 or 80 or 88 depending on your brokerage tools

monicadern
monicadern
14 years ago
Reply to  sundancer390

Thank you. I am assuming you mean 117.72, 117.80 or 117.88? (as opposed to 1172, 1178, or 1188 since this is a wide range)? Isn't the 117.80 level where the teal line was yesterday? Wouldn't it be a little lower today? Looks like sometimes we overshoot the teal line by a bit.

sundancer390
sundancer390
14 years ago
Reply to  monicadern

those numbers are MA, but they won't be quite the same as mine if your using a standard brokerage platform

Diablos
Diablos
14 years ago
Reply to  monicadern
monicadern
monicadern
14 years ago
Reply to  Diablos

I got it – thank you very much.

AS2009
AS2009
14 years ago
Reply to  sundancer390

Sundancer – how can we get this teal line and other max containment points on the chart ?

sundancer390
sundancer390
14 years ago
Reply to  AS2009

all the MA's are mult. of 8

Start with 3 different sequences & plot them on every time frame

Mine will be a little different than standard brokerage tools, but will at least give you a starting pt.

Rip Van Trader
Rip Van Trader
14 years ago
Reply to  sundancer390

I sold some SDS this morning, and I figure that it ought to hit a low tomorrow. If I buy more or not, I'm plenty short right now. In fact, I have more money committed to this project than at any time since early April. I've pretty much been trading options in order to protect the egg.

Glad you had a nice day! I took this afternoon off, and about flipped when I saw my computer screen after 4, all cartwheels under the 40dma. One thing I noticed was that at the upper price levels on the SP500, the difference between highs and lows was very compressed, evidence of short selling.

sundancer390
sundancer390
14 years ago

Everyone's attention is being diverted to gold
I don't trade gold, however it can often be a good tell.

http://www.flickr.com/photos/47091634@N04/46023

Gold is either putting in a terminal high now
OR
Ready to Explode 6% higher which would cause a SEVERE dislocation across capital markets

Red Dragon Leo
14 years ago
Reply to  sundancer390

I don't ever play gold either, as it's too hard to predict. Like if the market crashes down in the 2nd half of this year, you could assume that gold will rocket higher on fear… or that hedge funds, big institutions, banks, etc… will dump large quantities of gold into the market place to cover their margin calls, which would cause the price to fall.

How do you know how much gold they are holding, and how much margin they have on their holdings… as well as how much affect it will make on the “supply and demand” side if dumped into market?

Very hard to predict gold short term, in my opinion… but in the long term, we are certainly going higher.

sundancer390
sundancer390
14 years ago
Reply to  Red Dragon Leo

Should things deteriorate severely, have buy limit orders @ -14.84% & every tier below it.

1172.87 Local Min Value
-2.12% 1148.01
-4.24% 1123.14
-6.36% 1098.28
-8.48% 1073.41
-10.60% 1048.55
-12.72% 1023.68
-14.84% 998.82
-16.96% 973.95
-19.08% 949.09
-21.20% 924.22
-23.32% 899.36
-25.44% 874.49

Red Dragon Leo
14 years ago
Reply to  sundancer390

It's going to feel weird putting on a bull suit @-14.84%… but I'll do it, as a bears' gotta to do what a bears' gotta too do!

Earl of
Earl of
14 years ago

Carl at day’s end:

1150-1175 estimate for today (25 points – ~1.5 times the usual range)
1156–1171.25 actual range today (15.25 points )
Market was within Carl’s range.

Trades: No trades
Grade: C (lost no money)

Red Dragon Leo
14 years ago
Reply to  Earl of

I'm sure I probably just missed it, but does Carl ever get an “A” for his grade? Maybe I just overlooked one, but I've just noticed lately that he seems to get a lot of “C's”…

(Of course my skills aren't any better… I barely pass with a D minus. LOL)

newbear
newbear
14 years ago
Reply to  Red Dragon Leo

Your writing is more entertaining, funnier and crazier.

Earl of
Earl of
14 years ago
Reply to  Red Dragon Leo

Red,

He hasn't traded much lately. I give him a C for doing nothing.

He gets a B if he makes any money at all. I do remember a B or two.

He gets an A if he makes lots of money. I think he got an A once. It's a tough market, I guess.

Red Dragon Leo
14 years ago
Reply to  Earl of

Tell about it! Tough is an understatement!

jimhobson
jimhobson
14 years ago

Does anyone think a leg down can occur during opex after a day like today?

Stock_tech
Stock_tech
14 years ago
Red Dragon Leo
14 years ago
Reply to  Stock_tech

News released on Friday, it says… Hmmm? Panic selling or Euphoria Buying?

Anna
14 years ago

Hey everyone, I am long Gold, short SPY this is when it's gets to who's got some backbone and who doesn't :=)
Hang in there Bears, I am

monicadern
monicadern
14 years ago
Reply to  Anna

Great I am short spy but also short gold (just a small position in Gold though). I guess i am on the wrong side!

Anna
14 years ago
Reply to  monicadern

Me too but could go either way Monica….so ……………….GLTU!! 🙂

Earl of
Earl of
14 years ago

TNA opened up 3.6%, and the opening gap was not filled. TNA was up 9.5% at it’s high, and closed up 9.1%.

The gap from today $56.70 to $57.39 went unfilled.

We are now in a Full Moon Trade, which tends to favor TNA.
AmericanBulls had TNA with a Hold today from a buy yesterday at $55.66. TNA closed at $61.89, up 11.19%.
AmericanBulls had TZA with a Wait, and TZA was down today, so will be a Wait for tomorrow.

Volume for TNA today was about normal.

$RVX (VIX for $RUT) closed down 8.8% with TNA up 9.1%. No divergence, Good for TNA.

TNA had been down 4 days in a row, but now up 3 days. Good for TNA.

The low for TNA was from four days ago at $42.29. Today’s low was $57.39, 35.7% higher. Good for TNA.

Today, Ultimate Oscillator for TNA rose from 54 to 55 while TNA rose 9.1%. No divergence.

MACD fastline is below zero but rising. MACD slowline is above zero and falling. Good for TNA.

Bollinger Bands for $RVX (VIX for $RUT): Yesterday, $RVX completed a $RUT Buy Signal, and $RUT Was up sharply today. Today, $RVX fell again. MACD fast line was falling today. Good for TNA.

Bollinger Bands for $RUT: Today’s long white candle crossed above the 20day moving average. MACD appears to be rising. Good for TNA.

Bollinger Bands for $RUT:$RVX ($RUT vs VIX for $RUT): The white candle today was up from yesterday, consistent with TNA rising. Good for TNA.

NYSE up volume was 6.4 times the down volume today – good for TNA.
TNA had a higher high, higher low and higher close – Good for TNA.

Money flow for the Total Stock Market:
$ 2,881 million flowing into the market 2 days ago.
$ 693 million flowing out the market yesterday.
$ 858 million flowing into the market today.
Good for TNA.

I will post the AmericanBulls candlestick interpretation a bit later.

Overall, good for TNA for tomorrow.

sundancer390
sundancer390
14 years ago

$SPX 120 setup 4 (1111)
http://www.flickr.com/photos/47091634@N04/46019

We'll see if this time is different, the 4(1111)*120 unit ritual

dreadwin
14 years ago
Reply to  sundancer390

Interesting fractal. Thanks for sharing!

Earl of
Earl of
14 years ago

The Daily view from Americanbulls

TNA had been a Confirmed Buy, was up today, and now is a Hold. The buy price was $55.69 & the close today was $61.92, up 11.1% since the buy.

TZA had been a Confirmed Sell, was down today, and now is a Wait.

Of the stocks & ETFs I follow, these are to hold on to:
IWM (1x $RUT)
UWM (2x $RUT)
TNA (3x $RUT)
IYR(1x RE)
URE(2x RE)
DRN(3x RE)
UUP(US Dollar)
GLD (gold)
UGL (2x Gold)
ERX(3x energy)
AMZN
DRI
DIA
SPY
QQQQ
QLD (2x QQQQ)
SCO (-2x Oil)
DTO (-3x oil)
EPV (-2x Europe)
DZZ (-2x Gold)

The list to avoid:
UCO(2x Oil)
GOOG
EWG(Germany)
EWQ(France)
EWU(England)
EWX(emerging mkts)
RWM (-1x $RUT)
TWM (-2x $RUT)
TZA (-3x $RUT)
SRS (-2x RE)
DRV (-3x RE)
ERY (-3x energy)
SKF (-2x Financials)
FAZ (-3x Financials)
SPXU (-3x $SPX)
QID (-2x QQQQ)
DXD (-2x DOW30)

The following are possible buys tomorrow:
USO(oil)
GS

The following are possible sells tomorrow :
AAPL

Action for TNA or TZA for tomorrow: none

JoeMarc
JoeMarc
14 years ago

Hi Red, great comments, usually though we run up into OPEX, also the G8 G20 and with the World Cup I just think the market will pose a happy go lucky attitude and wont spook the markets…. Not sure if you agree but to think spy hits 110 and or 105 is a bold call. I hope your right, I think you will be IF most folks are long. If most folks still have their major holdings in cash, money market etc… them will run up because the big money will trade among themselves and the media will promote how the market is going up. Im trying to find a report that talks to how much cash is on the sidelines… Sym Xii looks bulish as well to atleast the 50DMA … Plus earnings are all pretty good from all market sectors.

Just my spin on things. Im 40% long approx, bought in Japan/HongKong at its lows and kept my OILs…. breaking even……

Anyhow, hope all is well
Joe

Red Dragon Leo
14 years ago
Reply to  JoeMarc

I do see more upside tomorrow. I see 118.00-118.50 spy as the next level up. I expect it too be hit tomorrow.

newbear
newbear
14 years ago
Reply to  Red Dragon Leo

You have turned to the dark side.

Red Dragon Leo
14 years ago
Reply to  newbear

Quiet… I don't want Ms. Market to really know I what I'm thinking…

writing services
13 years ago
Reply to  Red Dragon Leo

I agree

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