Still Holding On…

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The market had every chance to crash today, but it didn't...

Even though the market did sell off hard, it recovered a lot of the early losses by the end of the day.  It seems that the bears needed a breather before they can push it down again.  However, for tomorrow, it's going to be a tough call as to which direction I see the market going.

On one hand, we are pretty oversold on multiple charts... and it's option expiration this Friday.  The open interest on the put side is huge right now.  That wants to make me believe that they will gap it open tomorrow, to get above that downward sloping trendline, (that I have on the charts from yesterday's post).  That's about the only way I see them getting above the trendline, and rallying higher.

But the other part of me says that the charts are still pointing down.  The daily isn't showing any signs of turning back up yet.  The 60 minute chart is trying to turn back up, and the 15 is a little overbought now.  I just don't know how to read it?  So this post is going to be short.

If we gap open and run higher, the correction could be over for this week.  It doesn't mean it's done for good, but a rally until opx is over with this week, and then more selling next week is possible.  If we open flat, then I think we will continue selling off more.  So for now, I'm not sure about exactly what will happen tomorrow, so I not going to make a forecast.

However, I'm still bearish because of the daily chart.  It still tells me that there is more downside coming tomorrow, and Friday.  Plus the week chart also is still bearish, and I think we will go lower then where we currently are.  That's it for now.  That yellow downward sloping trendline is still intact for now, so not much has changed my opinion on the bearishness still in the market.

Best of luck to both bulls and bears... may we both get out at the ideal position.

Red

215 COMMENTS

  1. Hey that's me! Where did you get my pic?!!!

    I demand a royalty fee! You will be hearing from my Sear's prepaid lawyer!!

  2. Tomorrow is supposed to be a moon phase (quarter moon), so we may get that rallyette.

    I'm actually showing a loss today, on some puts that seemed cheap this morning but became very, very cheap by EOD. Lots of bullishness around, which is unseemly for a real bottom. Or so I hope!

  3. Europe is auguring in this morning, doing the heavy lifting for a change (usually not much happens on their shift).

    If we open at par with them, I'm going to be p1$$ed. They are due for some kind of resistance testing or rally soon.

    Pre-market SPY has a low of 109.44, is at 109.84 as of this post. 7:59am.

    • PP=111.63

      S2=109.22

      going down this morning…greece doing same thing as last week big strike…maybe another 1000pt drop…maybe…hope so…

  4. See if this helps, from Tony Coldero

    ” Today's low, with a short term positive divergence at the 1107 pivot gives us two probabilities. First, if the 1107 holds there is a potential for a failed flat (bar chart), completed flat (line chart), ending this correction. The market would have to clear the OEW 1136 pivot next to turn the short term charts positive again. Second, if the 1107 pivot fails to hold a likely retest of that SPX 1066 panic low would be next. This appears to be an important juncture for the markets. Best to your trading!”

    • 1066 is also the lower boundary of a long-term chart formation called an Ascending Broadening Wedge, details at Cobra's site:

      http://stockcharts.com/def/servlet/Favorites.CS

      If the formation holds true, we should not bounce at 1066 but have a little sideways movement. If we end the day at 1066, I hope to cover tomorrow in the termination range of 1008 to 1019.

  5. Sundancer are you still using 1135 as your local min value or does that change daily? I would like to know if 967 is still the first tier buying point. Thanks!

    • 1135.68 is last weeks $SPX close & one of many clues the operators left to the oncoming trainwreck this week

      Per my Monday morning post:
      This morning I canceled an order to liquidate my short inventory @ gold weekly containment($SPX 1050's) & re-entered the order to liquidate short inventory @ teal weekly containment($SPX 990's)

      The first Buy tier off the 1219.8 $SPX high is in the low 990's.
      2nd 967.15
      Final Tier is @ 875.01.
      Have enough capital to buy all the way down to 875.01.

      I have a large buy order in the 990's.

      • GLD is tanking in futures.

        I take it you are positioning to buy calls at spy 990. How far out are you looking?

        • I don't use levered instruments.

          I don't suggest anybody using them. If you're a professional trader, leverage is co-relational to a drug addiction.

          It never ends well.

          • I really don't see any difference between
            1) investing $100,000 in a stock and losing $5,000 because it dropped 5%
            2) spending $5,000 on calls (holding $95,000 in reserve) and losing all $5,000

            The issue simply can not be the use of a leveraged instrument.
            You could argue that people are using the whole $100,000 to buy calls, and stand to lose all of it, but that is not at all what you said.

          • That's where I'm at. Today I'm about 6% options, which is heavy. Usually it's just a couple % for a play.

            I haven't held stock for more than a month. Just been playing options, and appreciate the leverage and risk management.

          • Interesting comment. i do not disagree.
            I did however make a bundle riding the markets up last year. The short plays since the top had not been confirmed were difficult to say the least.

            So I take it you are playing straight long and possible unlevered etf shorts

      • So Sun – you are not expecting any bounces on the way ?

        What are upside levels to keep an eye on … pls could you share …

        111.77, 112.89, 114.3 are there any others that I am missing ?

        • We'll talk about upside levels after we print the terminal value.

          Until we get above teal containment on the 60 min.(1140's today) the dynamics don't change.

      • If the potential exists for an over 100 point drop from the 990's wouldn't your larger buy order be held for levels lower than the 990's as opposed to your scheduled large buys at that level?

        • No, remember this is a numbers game.
          With less than 1% probability the $SPX prints 875.01, you're most likely going to get left high & dry.
          Should we print 875.01 we would have a uni-directional move to 1097.
          I have less capital committed to orders @ 875.01 but because of the exponential function it would be the most profitable tier.

      • Sun, I can't tell you have much you have changed my life and opened my eyes and I can't thank you enough.

        • Mon – maybe you do a basics class on this weekend – to help us grasp the lingo / calculations a little better … Sun is travelling, so maybe you can help us 🙂

          • Unfortunately AS2009, I don't have the answers – Sundancer is the only one that does. Listen to him while we can – get rid of your shorts in the high 990s and start buying in the 990s as well all the way down to 875(if we get there). Buy as much as you can. That's about it.

          • Mon – I am currently long – so trying to get out … I thought that the option CP of 115 would give me a chance to do that … however with june call options not gettin the chance and heavily underwater -80% …

            You mentioned local min value – what is that ?

        • You're Welcome!!!

          After this Ritual terminates, I will likely crawl back into my cave.

          In my early days, it never bothered me much seeing ignorant fools throwing their money away, but as we draw near to the Macro Sun Ritual individuals will need all the resources they can get their hands on.

          Take care of your family.

          • I figured as much and that is why I used leverage while I had the map! I am very worried about the future and that is why I have diverted time away from my family to focus on this. I hope that my resources will protect my family. I hope good things come your way because you certainly deserve it.

        • I second that, even though I didn't made any money except losing less capital , as I generally afraid to short.

      • Sun – didn't make any money of this awesome call of yours and heavily underwater with my longs … trying to figure out where to get out and join your party … 990s is a long way off …

        • My $0.02:

          We are getting a bounce right now, may not last long. Go to NASDAQ website and watch SPY real-time quotes, buy when the line direction is up. Direction is more important than price level.

          • Yes – it is … I am trying to figure out where to get out … at this point.

            You have been a great help to everyone here … though honestly I get confused with the terminology … maybe as I have not followed everything as I work fulltime ….

            But to understand better … essentially you are looking at those 3 tiers 875-990 to go long unless we take out 1140 area = which is where you would go long as well ?

          • Correct with $SPX 990's providing the highest probability terminal value area from a numbers perspective plus there is teal weekly containment in that area as well as $SPX's last daily containment in the same region.

            The short term dynamics would change should we get above teal containment on the 60 min (currently 1140's).

  6. see jay strauss he says low aroun 10:30 or truncation at 10 then rally but big drop at close or am friday

    see blog list

    • Ben,

      There isn't likely to be any big rally today or tomorrow. They won't let the bulls out, just like they didn't let the bears out on the way up. This is going to be another blood bath for the bull.

  7. twice in the last week i could have sold my puts at much greater value intraday.

    After reading strauss he says big drop untill 10.30 or truncation at 10am then rally but big drop late day or friday am.

    I may get out at 10.30 or 10
    maybe then a rally to 1102 the 200 dma then down late today or tomorrow.

  8. Carl’s morning call:

    June S&P E-mini Futures: My range estimate for today is 1075-1115. I still think that last week's low at 1056 ended the correction from 1216. Strength above 1120 would be very bullish.

    1085.25 – 1116.50 range last night (31.25 points)
    1075-1115 estimate for today (40 points, ~2 times normal)

    1090 currently, so estimate is -15 to +25 from here (bullish)

      • I suspect he waits for the smoke to clear. The trades he posts seem not to be too bold. Would be interesting to see his not-so-public trades.

      • I am always nervous about futures. The moving averages are aligned down in a furious way even with yesterdays lull.

        If sp gets below 1100 this am I am thinking we have a major drop possibly straight to the Feb lows of 1044.

        I will not go long until averages align to the upside. who knows where this wave ends??

  9. In Dow Theory a close below 10221 is extremely bearish and crash is imminent. Might be 10271

    • Sun – based on this chart, it seems that the first hits of these points gives a bounce …. back to test the previous level broken – do u think that is reasonable to expect ?

      • The precise low of the 5.6.2010 came from light blue containment so should that break another 50 pt. slip zone down to burgundy containment which held the $SPX during 2.5.2010 low.

        Best you could hope for is a $SPX reaction to 1095 area.

  10. I see a 1110.00 fake print high on the 5 minute chart of the ES futures. Don't see it on the SPX, or the SPY…

    Anyone else see one? (Ok, it just disappeared. I don't expect it to hit today of course, but I wanted to tell everyone).

    • Could be where the bounce is. I plan to sell puts right around there. Depends on where we are at today's close. 900s may be a day or two out.

  11. MSNBC is talking about this 10% expected correction. They obviously cannot do basic math. 1252-1074=178/1252=14.2% from Feb high.

  12. How much do markets recover at eod??

    I see nothing in charts but we all know its a coming.

    • I am sorry but i do not know what an envelope is. Never heard the term before your posts.???

      • envelopes were a standard “tool” on brokerages platforms many years ago so I would assume they still are

        • Thanks. Its seems they are synonymous w/ bollinger. I will try to figure out after close today.

          • From Dr Elders Bk Come into my trading room

            Channels
            Markets are manic-depressive beasts. They rise in powerful rallies, only
            to collapse in breathtaking declines. A stock catches the public’s fancy,
            shoots up 20 points one day, and then slides 24 points down the next.
            What drives those moves? Fundamental values change slowly, but waves
            of greed, fear, optimism, and despair drive prices up and down.

            How can you tell when a market has reached an undervalued or overvalued
            level, a zone for buying or selling? Market technicians can use
            channels to find those levels. A channel, or an envelope, consists of two
            lines, one above and one below a moving average. There are two main
            types of channels: straight envelopes and standard deviation channels,
            also known as Bollinger bands.
            In Bollinger bands the spread between the upper and lower lines keeps
            changing in response to volatility. When volatility rises, Bollinger bands
            spread wide, but when markets become sleepy, those bands start squeezing
            the moving average. This feature makes them useful for options traders
            since volatility drives options prices. In a nutshell, when Bollinger bands
            become narrow, volatility is low, and options should be bought. When they
            swing far apart, volatility is high, and options should be sold or written.
            Traders of stocks and futures are better off with straight channels or
            envelopes. They keep a steady distance from a moving average, providing
            steadier price targets. Draw both lines a certain percentage above or
            below the EMA. If you use dual moving averages, draw channel lines parallel
            to the longer one.
            A moving average reflects the average consensus of value, but what is
            the meaning of a channel? The upper channel line reflects the power of
            bulls to push prices above the average consensus of value. It marks the
            normal limit of market optimism. The lower channel line reflects the power
            of bears to push prices below the average consensus of value. It marks the
            normal limit of market pessimism. A well-drawn channel helps diagnose
            mania and depression. Most software programs draw channels according
            to this formula:
            Upper channel line = EMA + EMA • Channel coefficient
            Lower channel line = EMA − EMA • Channel coefficient
            A well-drawn channel contains the bulk of prices, with only a few
            extremes poking out. Adjust the coefficient until the channel contains
            approximately 95 percent of all prices for the past several months. Mathematicians
            call this the second standard deviation channel. Most software
            packages make this adjustment very easy.
            Find proper channel coefficients for any market by trial and error. Keep
            adjusting them until the channel holds approximately 95% of all data, with
            only the highest tops and the lowest bottoms sticking out. Drawing a channel
            is like trying on a shirt. Choose the size in which the entire body fits comfortably,
            with only the wrists and the neck poking out.
            METHOD—TECHNICAL ANALYSIS 95
            Different trading vehicles and timeframes require different channel
            widths. Volatile markets require wider channels and higher coefficients.
            The longer the timeframe, the wider the channel; weekly channels tend to
            be twice as wide as dailies. Stocks tend to require wider channels than
            futures. A good time to review and adjust channels in futures is when an
            old contract nears expiration and you switch to the new front month.
            A channel drawn in an uptrend tends to fit the peaks. Rallies in a bull
            market are much stronger than declines, and bottoms seldom reach the
            lower channel line. In a downtrend, a channel tends to track bottoms,
            while the tops are too limp to rise to the upper channel line. It is unnecessary
            to draw two separate channels, one for the tops and the other for
            the bottoms; just follow the dominant crowd. In a flat market expect both
            tops and bottoms to touch their channel lines.
            When we are bullish, we want to buy value near the rising EMA and take
            profits when the market becomes overvalued—at or above the upper channel
            line. When bearish, we want to go short near the falling EMA and cover
            when the market becomes undervalued—at or below the lower channel line.

            If you buy near a rising moving average, take profits in the vicinity of
            the upper channel line. If you sell short near a falling moving average,
            cover in the vicinity of the lower channel line. Channels catch swings
            above and below value but not major trends. Those swings can be very
            rewarding. If you can catch a move from the EMA to the channel line in
            bond futures, you’ll make about $2,000 in profit on a $2,000 margin. If
            you can do this a few times a year, you’ll find yourself far ahead of many
            professionals.
            A beginner who sells his position near the upper channel line may
            regret it several weeks later. In a bull market, what looks overvalued today
            may look like a bargain the next month. Professionals do not let such feelings
            bother them. They are trading, not investing. They know it’s easy to
            be smart looking at old charts, but hard to make decisions at the right
            edge. They have a system, and they follow it.
            When prices blow out of a channel but then return to the moving average,
            trade in the direction of the slope of that MA, with a profit target near
            the channel line. Prices break out of channels only during the strongest
            trends. After they pull back, they often retest the extremes of those break-
            outs. A breakout from a channel gives us confidence to trade again in its
            direction.
            Prices occasionally take off on wild runaway trends. They break out of a
            channel and stay out for a long time, without pulling back to their EMA.
            When you recognize such a powerful move, you have a choice: stand aside
            or switch to a system for trading impulse moves. Professional traders, once
            they find a technique that works for them, tend to stay with it. They’d rather
            miss a trade than change to an unfamiliar style.
            If a moving average is essentially flat, go long at the lower channel line,
            sell short at the upper channel line, and take profits when prices return to
            their moving average. The upper channel line marks an overbought zone.
            If the market is relatively flat on long-term charts, rallies to the upper
            channel line then provide shorting opportunities, whereas declines to
            the lower channel line provide buying opportunities. Professionals tend
            to trade against deviations and for the return to normalcy. Amateurs think
            that every breakout will be followed by a massive runaway move. Once
            in a rare while the amateurs are right, but in the long run it pays to bet
            like the pros. They use channels to find when the market has outrun itself
            and where it is likely to reverse.

  13. my 5min macd rolled 15 ago and the 15min macd just rolled… so we could hit S2 @ 109.22

    • I see this shakeout failing at 1088 then resuming the selling into close…. what levels are you looking at?

      • there is your 1088. Looks like a serious wave of profit taking from short positions,

        now we see how bad people want out.

        • ya right here is a critical point in the day if we rally it could be a W.C of W.4 which could bring us up to 1093 aka the 50% fib line. But if we start selling then we are in W.5 down and well see new lows on the day.

          There is an illustration on my site for those that may be interested…

          • looks like we are in fact in W.C will prob see 1093 before selling resumes

          • looks like 1093 will in fact hold….. i believe this last hour of trading will be ugly.

          • Agreed…

            I think this is a wave 5 down, and it should go to the double bottom around 1065 by the end of the day. I think many bulls will go long there, and be trapped overnight, only to watch a gap down in the morning. Panic is coming, I believe.

          • EWE, at what point in SPX if it crosses will you change your mind? I mean bullish. Thanks

          • if 1093 doesn't hold then i would move to neutral but I wound be looking to go long anytime soon. My higher time frame counts are severely bearish and I always trade in synergy with the higher time frames. No need to step in front of a moving bus. Plus just look at how the markets have been behaving for the last several months, in the time it takes the S&P to rally x number of points it declines x number of points at a much faster rate. Imo the rallies are only serving as time corrections in out current environment. I am only looking at short opportunities. Just my two cents.

          • or todays move was another 1-2,, at your 1093 would be a good spot for the third wave down

  14. for what;s its worth Jaywizz (strauss) sees pop tomorrow am followed by sell off to 1050-1044 $spx

    • You know Ben, a few months ago I would have said the same thing. It looks like it should bounce, and maybe it will bounce tomorrow… I don't know?

      But my gut tells me that they won't let the bulls out on any rally back up, just like they didn't let the bears out on the ride higher for the last 6 months. I personally think they will gap it down tomorrow, and trap all the new bulls going long around this double bottom area of 1065-1070.

      But, I've been wrong before… a rally and and then a crash is possible?

  15. From the looks of things, we will be overbought on the 15 minute chart soon and should roll back down lower. Don't know the wave count, but being that it is also getting close to 3pm (est), the bewitching hour… I'd say there will be some panic sellers trying to get out of their long positions.

    Probably more selling overnight, and gap down in the morning. I do believe that capitulation day will be tomorrow. Once the previous low of 105.00 spy is taking out… it's going to be ugly.

  16. one big reason the stock are “crashing” is that the Eurozone is sick evidenced by the sick Euro BUT the Euro is rallying close to 500 pips ABOVE yest. low
    this could be hurting the crash. Hopefully it resumes tomorrow

    • Its going to take some energy to get this to S1 110.49 from here…I dont think so cause its been in the S2 all day…

    • fwiw my 5min macd just rolled down thats good and the 15min macd h just clicked down…so maybe we go down to the close

    • that would not have been a very convincing wave 3,, with this kind of down move, wave 3 would have huge volume, be much longer than 1,, and absolutely bury the rsi.. which it has not done . yet

        • Hell no.

          If you saw some of the emails I am sending out right now that are not politically correct you would most likely jail me. Which I guess is where politicians belong.

  17. Looking at this on the daily chart, you will see that it make an “h” from the market top to the 1065 low, and now the current low. This pattern has a high percentage odds of falling much deeper on the right leg of the “h”.

    Many people will abandon their short positions on the double bottom, only to see it go a lot lower tomorrow.

    http://stockcharts.com/def/servlet/Favorites.CS

  18. Sundancer,

    What's the current count now on lower closes then opens? Is it 6 days now? Do we need today to close above the open to reset the count? Do you see it necessary to close higher on the close, in order for tomorrow to be down?

  19. I just saw a tech that believes the Dow on 30 minute is oversold and will bounce to 10 400. In looking at my charts RSi is at 42.57, MACD is negative, did cross but is statring to level.

    I definitely think more selling is at hand. Capitulation has not happened yet IMO

    • Who said that Jim? What kind of “tech”? Someone on the floor of one of the exchanges? I don't see it happening tomorrow, as I don't think they will go up and allow the bulls to get out.

      I really think a gap down is coming tomorrow. It really has too, when you think about it. In order for capitulation to occur, all the trapped bulls need to be forced into selling.

      • It was Vincent Michael. not that i give him too much attention. Additionally I just saw on Fox Bus, Neil Cavuto two “experts” that said buying volume will be extremely heavey tomorrow. That a pip squeak contry like greece is scaring people and the scared people are selling while the strong are buying.

        out of the next breath its States cannot pay there bills etc…..

        If that were to be the case you would think futures right now would be exploding

        • That should tell you something Jim… do the opposite of what the media tell you. They want people to buy, so they can take their money too. I don't see any rally coming tomorrow. I see another gap down coming.

          • Don't get me wrong. I am a bear at the moment. I just get pissed off at the media that spout off when there are no and I mean no charts that support their position.

            If you were managing other people's money why would you buy until the market has given turn signals.

            Bunch of crooks or irresponsible people.

            I appreciate your perspective.

  20. On a side note…from Dr. Housing Bubble

    http://www.doctorhousingbubble.com/pasadena-rea

    “Today we got more startling news that 1 out of 7 homeowners is either in foreclosure or has stopped paying their mortgage. With over 51 million mortgages in the U.S. that means we have 7.2 million mortgages in this distress pipeline. By the way, this is a new all time record yet somehow you still have people claiming that not paying your mortgage is somehow a sign of a healthy market? It isn’t and this just means the shadow inventory figures are enormous. We have enough in the pipeline for years to come. California is the king of shadow inventory. We have more properties in distress than we have on the MLS! Is this any surprise given the amount of Alt-A and option ARM junk still floating around the system?”

  21. Wow – what a day. I feel like the gods have been watching over us. THANK YOU THANK YOU THANK YOU!

      • Sorry, I was transferring funds and setting triggers. I will not be using leverage on the way back up.

        • Mon…I have dr appt tomorrow morning 10 CA time and would like to hear your thoughts on triggers so I can set mine…sure as >>>> something happens good tomorrow and I miss it…

          • Bigbad – I hate to give advice because I have no idea what I am doing. But, I have trade triggers to sell my puts at SPX 998 and trade triggers to buy about 50-60%% of my capital at SPX 994. (I am somewhat concerned that the sell orders won't trigger in time for the capital to be applied to the buy orders). I have orders for a spattering of diversified stocks, single etfs (a lot of commodity stocks, some biotech, etc.). Then, I will buy another 30-40% IF we get to 967. If we get to 875 (that's a big if), then I will take the final 10% and will buy leveraged instruments like calls.

        • Monica, you are so right about the triggers. I was just following the action using a sell order and got frozen out.

          Hate the idea of triggers but they seem to be necessary.

  22. Congrats Red! You really nailed it this time. I had a feeling this time you were on track. Good luck to everyone here and let's continue to bank coin. 🙂

    • Just remember NewBear, we have 2 target ranges going down tomorrow. One is the 980-990 area, and the other is the 875 area. I believe it will be the 875 area because of how high we are dropping from.

      The higher it is, the farther we fall. That's why I think the lower target area will be hit in a flash crash tomorrow. Go luck to everyone in OBB.

      • Red – I don't know about 875 tomorrow but that would be cool! Anyway, the majority of my purchases will be made around 994 and 967 and if I have to ride a wave down then so be it. No leverage for me unless we get to 875.

        • Since my puts are May, if we don't get down there, they will just be exercised and the Ameritrade will be pissed at me for making them do it. I will monitor it tomorrow, and as long as they don't go down, I will be able to close them out myself at 980-990, should it look like that is the bottom.

      • Yes I agree, the one thing I've learned is to never underestimate or overestimate the market. Because it can exceed your expectations to the upside and downside.

  23. EVERYONE SET YOUR TRIGGERS!!!!!!!!!!!! I got locked out of Ameritrade for 1 hour and it could be worse tomorrow. Trade triggers may not provide for the best execution but it doesn't matter! Last time I tried to buy at the bottom and the market moved so fast, it was very difficult.

        • It was something unreal I was holding OIH puts and during one of the crash days I couldn't even get a quote the spread was $20 at one point, I crossed my fingers a put a market order in. I didn't get confirmation of the fill for at least half an hour while I was biting my nails.

        • Hi Mon,

          I must have missed your post earlier. What kind of triggers are you setting… you are talking about a buy order off a bounce? I am worried setting a market order because if the spreads are huge you may get screwed. Just wanted to see what you meant. Thanks in advance 🙂

  24. Today we completed the first 50 pt. slip zone that I detailed on Tuesday night.

    I posted a chart earlier in the day showing you the twin containment in this region. The first bounce today came off the containment pt. that held the $SPX during 5.6.2010 low & the second bounce came off light purple containment.

    I posted this earlier in the day
    The precise low of the 5.6.2010 came from light blue containment so should that break another 50 pt. slip zone down to burgundy containment which held the $SPX during 2.5.2010 low.

    Best you could hope for is a $SPX reaction to 1095 area

    Well we got our reaction off the twin containment pts. & our reaction high in the $SPX was 1095.09
    The close today was real interesting because the last 3 minute surge means the $SPX closed below both containment pts.
    http://www.flickr.com/photos/47091634@N04/46246

    The open tomorrow will be interesting.

    Have a good night!!!!!!!!

  25. Carl at day’s end:

    1075-1115 estimate for today (40 points, ~2 times normal)
    1069.50–1094 actual range today (24 points )
    Market was 5-21 points below Carl’s range.

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

  26. We are now in a New Moon Trade, which tends to favor TZA.
    TZA opened up 7.8%, and the opening gap was not filled. TZA was up 15.4% at it’s high, and closed up 15.1%.

    AmericanBulls had TNA with a Wait today. TNA was down today, so TNA will be a Wait again for tomorrow.

    AmericanBulls had TZA with a Hold today. TZA was up today, so will be a Hold for tomorrow. The buying price was $6.10, and TZA closed at $7.68, up 25.9% in 3 days.

    Volume for TZA today was 60% above the 1 month average. Good for TZA.
    Volume for TNA today was 104% above the 1 month average.

    $RVX (VIX for $RUT) closed up 23.5% with TZA up 15.1%. No divergence Good for TZA

    TZA had been down 3 days, up 2, down 1, now up 3, but up a lot lately. Good for TZA.

    The low for TZA was from 18 days ago at $5.30. Today’s low was $7.10, 33.9% higher. Good for TZA.

    Today, Ultimate Oscillator for TZA rose from 48.1 to 56.4 (+8.3) while TZA was up 15.1%. No divergence. Good for TZA.

    MACD fastline above zero rising & slowline below zero but rising. Good for TZA.

    Bollinger Bands for $RVX (VIX for $RUT): Today, $RVX climbed above and closed above the top Bollinger band. MACD both lines are rising pretty much vertically. This might be the first day of a 3-day sequence ending in a $RUT buy signal. Good for TZA for the time being.

    Bollinger Bands for $RUT: Today, $RUT had a very long red candle that closed below the lower Bollinger Band. MACD is falling sharply. Good for TZA.

    On the NYSE, down volume was 73 times the up volume. Usually, the market bounces after a number this large. Maybe not the next day, but the day after that.

    TZA had a much higher high & much higher low & much higher close (good for TZA)

    Money flow for the Total Stock Market:
    $ 42 million flowing into the market 2 days ago.
    $ 264 million flowing out of the market yesterday.
    $ 1,568 million flowing out of the market today.
    Good for TZA.

    I will post the AmericanBulls candlestick interpretation a bit later.
    Overall, Good for TZA for tomorrow.

  27. Anyone want to guess where it could spike down bottom tomorrow?
    A 10% drop would be about 960

  28. Red – futures are sitting at 1065 now. Interesting – great call on your part and thanks so much for all the support.

    • I'm thinking tomorrow will be like Feb. 5th, a doji… meaning a large drop in panic for the first few hours of the morning, and then a hard reversal into the afternoon.

      • I hate those, I've been caught short on those hard reversals before and it was very painful

        • I have too NewBear…

          Just look for the 980-990 area, and watch what time it is. I suspect the selling will stop around 11am to noon est. If the market is in that range by then, I'd say the selling is over.

          Of course it could fall to 875, but then I'd expect it to hit 980-990 very early… like 10am or something, to allow it to continue falling on down and end by noon.

  29. Red,

    Like your stuff, dude.

    Hey, whoever posted that stuff about Paul Levine, thanks! I found it and viola, containment points to the tee!

    How about the pi ritual?

    Its great the way you share amongst yourselves.

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