I think I’ll be getting in a put spread Anthony, so the decay won’t effect anything. Since Turbo Tim thinks we are going to 132 something I’d look to sell the 132’s and buy something higher… then I’d want 132 to be the bottom to capture the most money.
Well, that would be nice. Would still be able to pick up some puts at a nice price. But I think any pop tomorrow, once the MACD and stochastic look slightly overbought, I’ll be going short. Not too fond of holding things over the weekend, but this look like one that’ll pay-off. Taking two classes, about 2k each, on different options trading/strategies, so hopefully i can bring some support to the blog
Yes, next weeks’ weekly puts will be open tomorrow so I’ll be looking to get put spread on them or just straight puts.
When you think about what they just did today you start to see it more clearly. This last sell off looks like the perfect 5th wave down to end the sell off on the SPX in EW terms. Then you see the double bottom on the ES and think it’s done too.
That leaves the market open to rally now when you “just” see those types of analysis. The bears that got short eariler this week are happy as the “bear flag” on the daily chart played out as the market dropped.
They see this as a bottom just like the bulls do too. If I didn’t play attention to the weekly, daily, 4hr, 2hr, and 60min charts on both the ES and SPX and just focused on the double bottom for the ES and the 5th wave down for the SPX, I’d probably go long here too.
But…
The weekly pressure on the market that is continuing to push the daily deeper into oversold conditions… along with the 4hr, 2hr, and 60min charts having now “just about” worked off their oversold conditions simply doesn’t support any huge rally to start.
You just can’t get a big rally started until that weekly stops putting so much pressure on the daily chart, which is putting pressure on the 4hr, 2hr, and 60min charts… which is keeping them from getting up above the zero level on their MACD’s.
This simply tells me that we’ll tank tomorrow and/or Friday once these shorter terms charts exhaust themselves from rallying off their very oversold levels. There simply isn’t any positive divergence yet on the daily chart, or even signs of it curling back up on its’ MACD’s.
Plus, this will be the 2nd close below the 200dma on the daily chart and that is the mark of death for it when the weekly is so bearish. If, and that’s a big “IF” they do get any rally going tomorrow morning the 10dma around 1396 spx is about the max I could see it going to.
But, I’m not really expecting anything big tomorrow. If it does happen though (maybe from something Bernanke says today after the FOMC meeting at 2pm) then we’d be very lucky to short from there.
Thanks.- well, we are pushing back up, so there still seems to be a nice opportunity to get short. Might do a bit now, and then a little more tomorrow if they decide to pop it up a bit early on. But, hopefully a small pop tomorrow so I can load up some weekly puts
Certainly looks like we missed a nice way down. Bummer. The 4h, 2h, and 60min charts on the ES are already about done to the upside but the SPX is lagging. It rolled over a little earlier then I expected as it followed the ES.
So, tomorrow this should continue after a small move back up (maybe?) to trick the shorts into thinking the bottom is in (we are at a double bottom on the ES right now, and it’s common to rally from that).
But since the SPX has broken through the double bottom and put in a lower low the ES is likely to break to, on it’s 3rd hit sometime tomorrow. So many bulls/bears will be getting long here from the ES double bottom, but the 4hr, 2hr, and 60min charts have come off their lows at oversold levels over the last 4 days and won’t likely have the power to start a huge rally.
For a good rally to start you need to get a run at it from very oversold levels on the MACD’s and Histogram bars, on the various short term charts. You won’t go very far up from levels where you are getting close to overbought. If the SPX makes it up to just below the zero line on the 2 hour chart with the MACD’s that’s about all I’m expecting it can go.
Why not go up to +7.5 you ask, instead of just below zero? Because it’s fighting downward pressure from the larger time frame charts like the daily and the weekly. They will keep pushing down on the 4hr, 2hr, and 60min charts until they to become very oversold. Then they can all rally together.
But we aren’t oversold to that extreme yet on the daily and no where near oversold on the weekly… as it’s just getting started. So while some EW people will see this move down today as a wave 5 that completed the entire move down from 1464 spx on 10/18, they fail to see the technical side of it.
You don’t rally from MACD’s that aren’t oversold extremely. In fact, as they go up you create a divergence and put in lower low on the market while putting in a higher low… which is what is happening right now on the SPX.
But, the problem is the huge downward pressure the weekly chart is putting on the market, which is keeping the daily chart in oversold levels and pushing it down deeper. Once the 4hr, 2hr, and 60min get up to just below zero on the 4hr, about zero on the 2hr, and a little above on the 60min I think that will be about as high as they can go.
Then I think they’ll all rollover together from the pressure the weekly chart (and daily) is putting on them. If those charts were bullish then these short term time frames could rally to +7.5 or higher, but when the larger charts are bearish they usually just go up to around zero and then fall back down again.
That certainly would fool people. By chopping, I think that will make most want to go short before the fed anyway, and it just doesn’t seem like them to give us a decent idea of where things might go
Yeah, I saw that. 132- that’d be one hell of a bear feast
I think I’ll be getting in a put spread Anthony, so the decay won’t effect anything. Since Turbo Tim thinks we are going to 132 something I’d look to sell the 132’s and buy something higher… then I’d want 132 to be the bottom to capture the most money.
Well, that would be nice. Would still be able to pick up some puts at a nice price. But I think any pop tomorrow, once the MACD and stochastic look slightly overbought, I’ll be going short. Not too fond of holding things over the weekend, but this look like one that’ll pay-off. Taking two classes, about 2k each, on different options trading/strategies, so hopefully i can bring some support to the blog
If I had to guess I’d say we might see a retest of the 200dma around 1381 spx tomorrow as hitting that 10dma at 1396 seems impossible right now.
Yes, next weeks’ weekly puts will be open tomorrow so I’ll be looking to get put spread on them or just straight puts.
When you think about what they just did today you start to see it more clearly. This last sell off looks like the perfect 5th wave down to end the sell off on the SPX in EW terms. Then you see the double bottom on the ES and think it’s done too.
That leaves the market open to rally now when you “just” see those types of analysis. The bears that got short eariler this week are happy as the “bear flag” on the daily chart played out as the market dropped.
They see this as a bottom just like the bulls do too. If I didn’t play attention to the weekly, daily, 4hr, 2hr, and 60min charts on both the ES and SPX and just focused on the double bottom for the ES and the 5th wave down for the SPX, I’d probably go long here too.
But…
The weekly pressure on the market that is continuing to push the daily deeper into oversold conditions… along with the 4hr, 2hr, and 60min charts having now “just about” worked off their oversold conditions simply doesn’t support any huge rally to start.
You just can’t get a big rally started until that weekly stops putting so much pressure on the daily chart, which is putting pressure on the 4hr, 2hr, and 60min charts… which is keeping them from getting up above the zero level on their MACD’s.
This simply tells me that we’ll tank tomorrow and/or Friday once these shorter terms charts exhaust themselves from rallying off their very oversold levels. There simply isn’t any positive divergence yet on the daily chart, or even signs of it curling back up on its’ MACD’s.
Plus, this will be the 2nd close below the 200dma on the daily chart and that is the mark of death for it when the weekly is so bearish. If, and that’s a big “IF” they do get any rally going tomorrow morning the 10dma around 1396 spx is about the max I could see it going to.
But, I’m not really expecting anything big tomorrow. If it does happen though (maybe from something Bernanke says today after the FOMC meeting at 2pm) then we’d be very lucky to short from there.
Dow Jones charts: http://niftychartsandpatterns.blogspot.in/2012/11/dow-jones-support-and-resistance-levels.html
Thanks.- well, we are pushing back up, so there still seems to be a nice opportunity to get short. Might do a bit now, and then a little more tomorrow if they decide to pop it up a bit early on. But, hopefully a small pop tomorrow so I can load up some weekly puts
Certainly looks like we missed a nice way down. Bummer. The 4h, 2h, and 60min charts on the ES are already about done to the upside but the SPX is lagging. It rolled over a little earlier then I expected as it followed the ES.
So, tomorrow this should continue after a small move back up (maybe?) to trick the shorts into thinking the bottom is in (we are at a double bottom on the ES right now, and it’s common to rally from that).
But since the SPX has broken through the double bottom and put in a lower low the ES is likely to break to, on it’s 3rd hit sometime tomorrow. So many bulls/bears will be getting long here from the ES double bottom, but the 4hr, 2hr, and 60min charts have come off their lows at oversold levels over the last 4 days and won’t likely have the power to start a huge rally.
For a good rally to start you need to get a run at it from very oversold levels on the MACD’s and Histogram bars, on the various short term charts. You won’t go very far up from levels where you are getting close to overbought. If the SPX makes it up to just below the zero line on the 2 hour chart with the MACD’s that’s about all I’m expecting it can go.
Why not go up to +7.5 you ask, instead of just below zero? Because it’s fighting downward pressure from the larger time frame charts like the daily and the weekly. They will keep pushing down on the 4hr, 2hr, and 60min charts until they to become very oversold. Then they can all rally together.
But we aren’t oversold to that extreme yet on the daily and no where near oversold on the weekly… as it’s just getting started. So while some EW people will see this move down today as a wave 5 that completed the entire move down from 1464 spx on 10/18, they fail to see the technical side of it.
You don’t rally from MACD’s that aren’t oversold extremely. In fact, as they go up you create a divergence and put in lower low on the market while putting in a higher low… which is what is happening right now on the SPX.
But, the problem is the huge downward pressure the weekly chart is putting on the market, which is keeping the daily chart in oversold levels and pushing it down deeper. Once the 4hr, 2hr, and 60min get up to just below zero on the 4hr, about zero on the 2hr, and a little above on the 60min I think that will be about as high as they can go.
Then I think they’ll all rollover together from the pressure the weekly chart (and daily) is putting on them. If those charts were bullish then these short term time frames could rally to +7.5 or higher, but when the larger charts are bearish they usually just go up to around zero and then fall back down again.
Might’ve missed the early boat on the sell-off
That certainly would fool people. By chopping, I think that will make most want to go short before the fed anyway, and it just doesn’t seem like them to give us a decent idea of where things might go