The Market

Well, if you don't know already, this is what a strong bull market looks like. impressive!. 3 week thrust of trump rally followed by a minor 1 week pullback followed by another 1 week thrust. amazing. Traders falling over themselves chasing momentum, Both institutional and retail. As Van Halen would say EVERYBODY WANTS SOME!. The market continues rotating in and out of sectors/stocks to the upside. virtually all sectors now are on the move. There are more securities participating in the rally hitting highs, volume is picking up, and liquidity is slowly moving back into the market, cash is being put to work, buying risky assets. Still there is a lot of chop, one day your stock is up 3 bucks the next day its down a couple bucks. that is unless your GS. That stock virtually single handedly lifted the DOW to where it is right now. Nevertheless this market so far has been perfect for everyone, swing and day traders. Jesus himself could not have given day traders a better trading environment to play in. The wicked volatility of pricier equities coming off highs on minor pullbacks then reasserting themselves to retest highs are high value targets. That is what you should be trading, market leaders on pullbacks. Here is what i'm watching for next weeks trades. NOC LMT HUM. these have been leaders in this rally all along and are now pulling back, crossing their daily hulls to the downside. wait for price stabilization and institutional commitment, (heavy volume). NO STABILIZATION, NO BUY!. I don't have to tell you to keep your stops tight. remember equities are not called risky assets for nothing. though the market at this point has achieved lofty levels, Its been one hell of a move, Here are 3 reasons why i will trade into Christmas without much worry.

1) Seasonality ( The street does not usually take down markets during holidays and especially Christmas holiday. I believe the market will chop but it will chop higher. great for day trading.

2) End of Quarter ( The street usually lifts markets at the end of quarters, it has already, but i believe it will continue thru December.

3) Earnings season ( The street usually lifts markets into earnings season. I believe this rally will continue into earnings with chop.

You have no idea the power of any one of those 3 variables. Any one of those is huge, but 3, that's epic. still, i'm no fool, markets can turn on a dime, especially after an overbought rally like this. again, that's the purpose of stops, in case things go awry. and the daily hull crossunders by the market leaders NOC LMT HUM CI ANTM and AET is a major concern, for when securities cross under their daily hulls that's usually indicative of a multi week move about to unfold, but that has yet to be seen, and i will trade them until proven otherwise. I will post under this topic periodically, I hope no one minds.

I think you are thinking about all this WAY to much.

This is no "trump" rally. This was gonna happen regardless of whoever won the election. The market doesn't like unknowns and uncertainty, once things were decided the market continued doing what it was doing.
I was enjoying your little spill , up until you said "stops" then it was like a vinyl record being scratched by the players needle. Also, I hope you are not trading what you "believe" because you should be trading the evidence. You should be trading into Christmas because of the evidence (regardless of direction) not because you "believe" things will keep lifting. That's just a one direction mindset. Trade the evidence only, the market doesn't care about what anyone believes, it is always right.

Hey Richie thanks for the post. my thread is just a viewpoint from my perspective. like there are billions of people on the planet there are billions of ways to trade. its not a my way or the highway kind of thing. Its more like hey this is the way i make money consistently in the markets. the ways are endless though, and I'am always open to new ideas, hell, i might even learn something from you. so please elaborate on your process for risk management. your post was kind of a bash and run, but you did not even mention how you control risk, and for the record my thread is for the new guys starting out. guys like you already have your trading process formulated. my thread is not for experienced guys like you, its for new guys that want to learn another angle, and learn or try something new or different, so please let us know how you control risk. the new guys would love to hear it and i surely would love to hear it. I would love to learn something new! one can never learn enough!

My apologies if my post appeared as a "bash and run". It wasn't meant to be, but I can see how someone would see it that way. My apologies for that as it was not my intention.

I just have a single question. Do you make your living trading?

If you don't then you should not be providing insight to "new guys" that are just starting out. I'm not there yet, but soon very soon.
Like I said before, you think about all this WAY to much. Trying to make elabrate stock markets predictions is just a silly waste of time. Just leave that to the financial media cause they are usually wrong anyways. I don't trade on hunches or "predictions" about what I think the market "might" do, I trade the evidence. If the trade is up I go up, if it's down I go down with it.

I don't get to control anything but the process. I have rules for the money and I have rules for entering and exiting trades. I control the process. You can't learn what I do from me. If you want to learn what I know you'll have to take the same classes I have. I'm sorry, I don't mean to sound like a butt-hole or be ugly to anyone.

Most of the folks that lurk this forum are former or current Gary Williams students. There might be a hint there.

All I can tell you is this. Don't waste your time trying to "guess" what the market will do next. Just be ready to move with it when it moves. In whatever direction that may be. You'll never out guess the markets and the market is always right. Just do what it's doing. The Market isn't your enemy, but a Market Maker sure can be, and there is a difference. That's pretty much all I can add, as it appears I've wasted many words already.


Merry Christmas to all
R

Hey Richie no worries. To answer your question. trading is all i do. no 9-5. GOD FORBID. trading is my life. well to make money anyway. as for Gary Williams, no i don't know the guy. now ask me if I've heard of Paul Tudor Jones, Martin Schwartz, or Michael Marcus. Like i said before you will trade your way or the way of Gary Williams and i will continue to trade mine, self taught. But even though i make my living trading the markets I'am smart enough to pay attention when any other guy on this board has some good ideas. one can never make to much in the markets. no such thing. and if someone comes up with some cool ideas for example like mntman, or netarchitch I'm all ears. these guys come up with trading ideas and put them down into codes. fantastic. wish i could do what they do. that's why I'm on this board. looking for those special creations. these are the very guys i think about as traders. how awesome could these same guys be trading. I have done well for myself. Now I'm gonna give a little back now and then. Guys can take it or leave it. everyone has a choice. or just take away this piece or that.

Trader - what is your strategy, if you don't mind me asking?

Devil of course i don't mind you asking. I was going to layout my strategy over time but i can do it here and now in a nut shell, but be forewarned, its nothing exotic and rather boring. its also not for everyone, especially those with unbendable concepts already embedded in their heads. I think its a rare attribute found in very few traders. the ability to accept something new even if it works and implement it in their trading. I do it all the time. I always try out new tactics, i throw out the old if something better works. I'am always searching. I'am always looking for a lower risk edge. What i do is nothing special, nothing new, i'm sure many traders use a combination of what i do. With that said, i have also always believed trade your personality. Don't trade someone else's. it might not fit you. it might not feel right. Though here i have also never had a problem. screw feeling right. does it work or not. yes or no? yes ? then why not give it a try. but i do get it, the trade your personality theory. It is true. without further ado, this is how this Trader swings his line.


SWING TRADING:

Without a doubt the simplest and laziest way to trade, yet also one of the most profitable ways to pull capital out of the markets. When entering a swing trade i try to always trade in the direction of the market. I take a top down approach. market, sector, stock. Yet, my biggest money has always been in beaten down sectors!. I'm good at catching turning points and scalping for some good change. Before entering any trade the daily vix should be below its daily hull and or coming off a big move. the stock should be above its daily hull. If you are trading against the VIX your gonna get killed. not many traders pay attention to the vix, damn shame. Its one piece of the success puzzle. The weekly hull on the security should be up as well. trade against the weekly chart and your dead. the daily and the weekly should be in gear/lockstep to the upside or downside. As you can see my buy trigger is the daily hull my sell trigger is the daily hull. everything revolves around the daily hull. why?, because i have found when the daily hull turns negative or positive its usually indicative of a multi week turning point, not always but enough to trade on it. on the daily i look at the 50ma, 89ma and 200ma, but only for possible support/resistance turning points. on the weekly i use the 50, 34 and 200MA, for the same reasons. I use Heikin-Ashi Candlesticks on both charts. I never leave home without them. my trades are most always entered when i feel we are at a bottom/top in the S&P. again, i go with the flow. Volume should be strong in my buy candidate . no volume no buy. volume should also be strong in the s&p!. no volume no buy. the studies i use are volume based. Volumeflow, BetterVolume, TimeBased Volume. I also use RSI, I hate trading when RSI goes overbought, it gives you an idea a massive move has already been completed. I still trade in this overbought condition though because the condition can persist for weeks to months. i'm not benching myself on the sideline because of one oscillator. Also, while i'm trading i'm watching other stocks in the same group i'm in. it they begin to turn, it gives me a heads up of what to do next with mine. a preemptive strike so to speak. I use one hell of a lot of discretionary trading. If it does not feel right/look right i'm out. If i'm wrong no big deal. i can always come back in and play. who cares. not to say F bombs are not dropped in this house all the time. oh hell yes. I'am a shitty loser and a boring winner. its just business to me, but things get a lot more fun when i'm day/position trading, but ill save that for another time. I hope others will take the time to post here and let us know how you do it. don't just come in and say this sucks or that sucks, bring something relevant to the conversation and tell us how you do it, and what we can all do to improve the odds of success. I would love to see how other guys do it. get detailed about it. don't just give us 3 sentences. and i hope someone gets something out of this. as i said, nothing new nothing special, but it is the complete package of how i swing trade and take on other traders, for to make money in the markets someone has to lose.

Damn good selloff in NOC and LMT. These key leaders have now breached their weekly hulls to the downside.

Trader - thanks for the insight.

Still taking all that in and reviewing it for myself.

I'll respond back later with thoughts.

LMT acquired at 10:19 am @ 252.05 - 800 shrs. now lets see if i can scalp anything off this.

AMGN acquired @ 145.45 1K shrs. will hold this until it hits 150.00 ( UNLESS MR TRUMP TWEETS AGAIN! )


LMT SOLD @ 254.02 ( hated that trade. 1 pt bid/spread, robbery! it might go higher, i don't care. its all over the place.


These are position trades. at least 3 days.



Edited 4 time(s). Last edit at 01/18/2017 04:15PM by Trader.

AMGN SOLD @ 9:15 AM @ 149.59


I don't mind playing fed announcements, but not this one. one can always get back in. right now, i just want to protect profits.

Market has begun to churn. For the last 3 days stocks and Indices have been seeing heavier volume without gains. stocks not holding gains. so whats that? distribution!. I still don't see a meaningful pullback during December, but i see a lot of chop. maybe even one more move up before Christmas. Are markets prepping for a January pullback? If so how deep? I love doing a forecast of what i believe the markets might possibly do. always, days to weeks out. when the event finally does happen my head has already played out the scenarios and its much easier to trade no matter what the market does. I'm not asking myself what should i do. You wont always get it right, but you will get better and better and this will increase your confidence as a trader when you do.

Volatility Rising. just in time for January. The honeymoon is over. Big boys now taking positions in the VIX. They are betting on upcoming volatility. VIX goes up, market goes down. eazy peezy, simple dimple, this isn't rocket science. Still trading in the moment with no forethought of the future? leave that rookie taught stuff for the amateurs that will never swing a big line. The allies are about to land on the beaches of Normandy, take cover. The next couple days to weeks are about to get one hell of a lot choppier, with heavy risk bias to the downside. Indeed market bottoms are a piece of cake to call and can turn on a dime. tops on the other hand are much harder to call and can take 4 - 5 weeks to play out. The VIX helps to expose market tops. With this said, we might get a pop Thurs/Fri. Don't get excited, the market is just money trapping.



Edited 1 time(s). Last edit at 12/28/2016 04:15PM by Trader.

Trader - I like you're perspective.

The end of the year is usually down or choppy like you said. The people I know who day trade took this week off and are taking a break. I enjoy reading you're views on the market.

Take care

Thank you djpl8!, I appreciate that!.



The SPY has now crossed its daily hull and is now attempting to break its 2 week correction and test new highs. the VIX has been turned back at its declining 50 MA and has moved below it daily hull. I would normally be positive about this, but this is what will keep me out of the market till i get more clarity.

Pros:
1.SPY daily hull crossover ( actually all Indices have crossed over )
2.VIX daily hull cross under and weekly as well!
3.Dow about to hammer thru 20k?
4.Market in rally into earnings mode? This is a positive. ( But what will the stronger dollar do to bottom lines of the multi nationals? )

Cons:
1.Weak volume so far. ( that makes this rally questionable and unconvincing )
2.Securities getting overbought on daily and weekly charts again.
3.MoneyflowIndex continues to drop.
4.50% of my 48 securities that i trade have crossed below their weekly hulls.
5.market has gone into gapping mode. ( demand or the illusion of demand? )
6.Dow Jones overbought on its monthly chart.
7.The Russell now at the top of its monthly 3 yr rising trendline ( will it break that pattern for the first time in 3 years? )
8.During the trump rally. these were the indices returns. SPX +9.00% DJI +10.00% RUT +20% COMP +9.00% ( These figures are approximate) If you got any of these returns in 1 year that would be respectable. we got them in 3 weeks without a meaningful pullback.

Here is something i have never mentioned in my post. I know many would not agree, but i have always believed the market is the most rigged game in town. the market is not your friend. it is your enemy. every time you trade you step into a minefield. these are the enemy combatants.

1. Market Makers
2. Corporations. ( Releasing hyperbole media stories to manipulate their stock to go up or down )
3. Great traders ( looking to out trade you )
4. Slippage

With all this against me i always want an edge when trading. what ever that edge is. If i don't have an edge, that includes a clear direction of where the market is going, I step aside. I wait for the market to tip its hand. This is what would make me come back into the market.

1. Heavy trading Volume ( with upside thrust )
2. All markets hitting new highs ( slamming thru old highs on good volume )
3. More securities hitting new highs ( very low participation right now )
4 More securities crossing their weekly hulls to the upside.

All this could play out in days. confirmation in days. in the mean while, I will wait, for money is harder to make than it is to lose.

Markets doing somersaults trying to hold these levels. trying to bring in as many buyers as they can near the top?. Zero buying conviction right now. The path of least resistance is still down. The biggest most relevant corporations announce earnings in 12 days. Oil, Aerospace, Industrials, Transports, HMO's. anything after that is filler. So maybe the market has 2 weeks of upside potential?, but where is the follow thru volume?. Today the SPY traded 56% of average volume. one might say great!, light volume pullback. but where is the heavy upside volume?. Still, the market is due for an upside pop, and this market is still in gapping mode. Markets can and do move up with light volume at times. Is this going to be one of those times?, or is the market churning and rolling over? I'm still betting on the latter. Trading markets with light volume increases risk. when one buys who is there to propel your security higher?. you need momentum, so far the market is lacking this.

Today:

-1.7 A/D RATIO
-2.6 VOLUME RATIO

A zero conviction market equals zero conviction trades and higher risk.

Enjoying reading this, thanks!

Got a question in the VIX, how do you usually apply it when monitoring the markets or specific stock you are wanting to trade?



Edited 1 time(s). Last edit at 01/16/2017 11:36PM by FTS919.

Thanks FTS, glad someone enjoys my ranting. my wife hates it. she hears market analysis from sun up to sun down. that's what she gets for marrying me. she knew what she was getting into!

In a nut shell i don't usually trade the markets when the VIX is over its 20 period hull. for that matter if its even flirting with the 20 period hull, touching it or close to it. (over or under). as you can see the markets extreme chop over the last several days proves there is a tight correlation between the VIX and the markets. when one goes up the other usually goes down. when one embarks on a major swing the other gets killed. Right now the VIX is coming off its 2 month trading range lows. I notice it keeps getting closer to the declining 50 ma. this interaction indicates the VIX is most likely stabilizing for an upside move. when that 50 ma flattens out. look out. The market continues to hold into earnings, but churning lower. If we don't see a good selloff by February i would be very surprised. Where we stand now this market is not for the faint of heart. at this point this market is strictly for day traders/scalpers. very fast and very good day traders and scalpers. Swing traders should sit this one out until the next big up swing or you will be praying to your Gods for redemption. The pillars of this market are cracked and deteriorating. The street is doing everything they can to prop this market up by rotating stocks up and down but they cant do it forever. eventually the market will follow the path of least resistance. that path is down. If by chance we don't get a good selloff by February then we will have boat loads of chop for some time. A day traders market. We shall see, but i expect a selloff. how deep the cut? that has yet to be seen, will the selloff feed on itself? right now this is a treacherous trading environment designed to take away your hard earned money. stocks are all over the place. there is no rhythm in the markets, this makes trading all the more difficult. we want to come back and fight another day, so caution and patience is key in this market. one more thing. don't trade earnings announcements. leave that to the gamblers. that nonsense is very high risk. Tuesday UNH announced good earnings and the announcement was met with selling, Today Goldilocks, GS, (Goldman Sachs) also announced good earnings and was met with selling. Good earnings are not being rewarded. what happens when the big guns announce bad earnings?. why bother, its just not worth the risk.

1/12 Dow was down as much as 176 pts. Dow finished down 63
1/13 Dow was down as much as 75 pts. Dow finished down 5
1/17 Dow was down as much as 105 pts. Dow finished down 59
1/18 Dow was down as much as 56 pts. Dow finished down 22

One might perceive the markets being able to come back stronger at the end of the day as strength. not me, volume on all these days was below average of what is usually traded. 100%+ would indicate true strength. what this indicates to me is a market slowly rotating lower, though so far we have had a very orderly selloff. earnings, the street wants you in for earning season, screw em, don't take the bait. you get in when its advantageous to you and only then. you pick when and you pick how. Friday is inauguration day. there is no reason whatsoever for the markets to move up Friday. everyone and their mother knows who the next president of the most powerful nation in the free world is, and their is nothing he can say that he hasn't said already to push these overbought markets higher. Still, we know the stupidity of markets. anything is possible just to get more players in near the top. It must also be noted that Robert Payne's Rising Tide is indicating a possible market pop to the upside, possibly coinciding with the address, but this time i don't expect the move to be very strong. It will be interesting to see how strong the move is compared to the last 2 upside indications it has given.

SPY still in a 3 week trading range. A protectionist address by Trump you would think would have been a negative for the markets. so far the market is saying otherwise, but I believe earnings are holding up this market, as i said they would awhile back. besides this, not one of my 48 has been hit hard by bad earnings. of course its still early. I usually get at least 2 securities that go down 9 - 15 pts. This is the week i said was key for the market. The heavy hitters announce this week. the companies that announced earnings already were not rewarded but instead sold off. now i see they have all come back to pre earnings price. Are earnings that good? is the economy that good? are Trumps protectionist policies that good? Are the markets pricing in better bottom lines with Trumps new polices?. I don't know. what i do know is the market is holding up so far. I have been day trading but have not been able to hit any home runs in this market. I'm coming away with scraps. Trades must be perfectly timed in this market, upside moves are followed by fast downside moves. I will not swing trade but i will day/position trade. I do not have the temperament to swing trade at these levels after the prior move without a correction. so far no serious upside volume for the last 20 days other than on inauguration day and today. It is possible this is one of those markets that may move up with ultra light volume. These are harder to trade. much harder. you don't know if its a fake move or not. Tight stops are in order. The market could also be testing highs set 1 month ago. will those highs be broken?. Now this is important. The SPY is in a 3 week trading range. 224.96 low to 227.71 high approx. we are now at the high end. Today the SPY hit 228.08. It broke out then closed below the top of the range at 227.60. If the SPY breaks out to the upside all markets most probably will continue moving up, I'm thinking its going back to the bottom of the range. If we do get a breakout in the days ahead the markets should do so with heavy volume if the big boys are in. if not, the big players are still on the sidelines. VIX continues moving under its 20 hull and 50 MA and is now at 2 year lows and at the bottom of its range. We have not had a high volatility upside move in 2 months. Guess what usually happens when we reach these levels.? VIX goes up. Market goes down. the suspense is killing me.

Markets pulling away from 3 week pause with break away gaps. all reasoning would now suggest a continuation of the madness. 1/3 of my 48 are overbought on dailies and weeklies! VIX now at 3 year lows. why does this feel like the 2000 dot com bubble?. Volume flow picking up ever so slowly. not one of my 48 has announced negative earnings yet. shocking, best earnings season ever! If the markets can hold these gains into the end of next week with some decent volume, this would indicate we have more upside to go. crazy. Correction from last post. VIX has not had a high volatility upside move in 3 months, i originally posted 2 months. At this point from a short term view i would expect some kind of counter reaction from this move. by Friday the most relevant corporations will have announced earnings. when we get that variable out of the way that will be one less driver for this market, Then lets see if she can keep pushing up. I will continue to day trade and go with the flow with one eye on the exit.



1.8:1 A/D RATIO
2.4:1 VOLUME RATIO

SPY Volume today 101% of daily average. volume is picking up, and that cant be retail because retail is irrelevant in today's trading world.

Something interesting, and food for thought. since 2014 i have manually been tracking the S&P 100 highs and lows in my log book nightly. here is what i have found. when the S&P 100 had at least 7 - 8 trading days within a 2 week trading period with at least 12 highs or more on those days, the market reached a top. It has happened 3 times since 2014. Today makes day 2. we had 22 highs. approx.



Edited 1 time(s). Last edit at 01/25/2017 05:12PM by Trader.

As others have already expressed, I have enjoyed your analysis and thank you for taking the time to post it. With ten plus years of studying the market myself, I understand how unpredictable it can be, but we are in the business of making money on probabilities. BTW, I did read your 9/10/16 market post on your thoughts through late Oct. to early Nov., KUDOS on that one.
I see the VIX hit a low of 10.3 today, THAT IS LOW, likely to see at least a short amount of relief coming soon, maybe next week or right after the first of the month pop; this could also fall in line with your historical S&P data, so it would not be a surprise. I do have a day JOB so I can only swing trade and these choppy periods are difficult to say the least; I do manage to pick up a few bucks on covered calls, though I always prefer straight up trades. I will be taking low risk short entries with tight stops as they are beginning to develop while expecting them to be short overnight to 3 day trades, and as with all bullish markets I will be ready to go long with the appropriate setup.
Have a great weekend.

Thank you Progress!, Your analysis of the markets short term view is exactly what i was thinking. Feel free to drop in and post your market thoughts anytime. We may not always agree with each other but that's ok, different viewpoints open the mind to alternate possibilities. On 01/26 two of my 48 finally got hammered. MCK down 13 pts. and WHR down 18 pts, negative earnings. back to a little bit of normalcy. Also on 01/26 the S&P 100 had 17 new highs, that makes 3 days with highs above average. With the prior breakout i expect the market to chop and backfill this week. just a bit. I don't expect anything big. After that i expect another test into highs. If the rally is real more securities should begin to cross the daily and weekly hulls to the upside. I must mention though some of my 48 already have crossed and are extremely overbought. These could always pause and others could be used to push the markets higher. That wouldn't surprise me. Another variable that did not dawn on me till this weekend is Trumps corporate tax plan, to reduce corporate taxes from the 35% tax bracket to the 15% tax bracket. The GOP is pushing back and said they would settle on a 20% tax bracket. That's a 15% tax reduction!. Let me tell you here and now that's huge. For the corporations that make massive amounts of money this tax reduction will affect them in the best possible way. Is the market pricing in this possibility? If so, an S&P 500 move to 2400 is possible. This is the price target that is floating around with a 15% tax reduction. If true all corrections should be shallow and upside thrust should be strong. This week should be telling

Markets still all over the map. pullbacks have been shallow for some stocks. vicious for others. Markets continue to be in magical gapping mode coinciding with the media spin machine news stories. this is a sure way to lose money, buying those manipulated gaps. I hit and run for some decent change this week but i had to work for it. no freebies in this market. for 5 weeks the markets have done nothing but chop chop chop. hitting highs here and there but chopping to hell. The market has gone nowhere. Monday - the dow was down as much as 203 pts. the street used Goldilocks as usual to lessen the damage. The Dow finished down 107. The masters of illusion are at their best when it comes to masking underlying technical damage. This is how the street fools rookies and pros alike in the world of market speculation. They will take the Dows heavy weight champions and beat them up for a couple rounds. in this case, the champion is Goldman Sachs. they took it down for 4 days, by Thursday it was down to the tune of 18 points. By Friday the media spin machine uses Trumps Dodd-Frank review as a catalyst to pump GS. what does it do?, It goes up 10 pts, and this pushes up the Dow. All week they used GS to manipulate the Dow, but of course all the indicies have their go to stocks. Now all the indicies are ready to test new highs again. On Monday the VIX had its biggest up day in 3 months. This rocked the markets. It pushed past its daily hull and 50MA. by Friday it moved back below both with the rise of GS. Amazing what one security is capable of. well, the right one anyway. The VIX is now in a wedge. It appears ready to move to the downside again. We shall see how much this week.

Recently i modified the Rising Tide to view what the DOW 30 components are doing. using this study was the easiest way i could think of to do just that. Remember if one index fails, they all fail. in today's world, most markets are correlated.

These are the stats for this week.

Monday - Rising Tide dow 30 (DAILY). low point. 18 stocks over 50MA. 12 stocks under 50MA
Monday - Rising Tide S&P 100 (DAILY) low point. 63 stocks over 50MA. 37 stocks under 50MA

Wednesday - Rising Tide dow 30 (DAILY) low point. 17 stocks over 50 MA. 13 under 50MA
Wednesday - Rising Tide S&P 100 (DAILY) low point. 58 stocks over 50MA. 42 under 50MA

market deterioration continues.

Thursday - 3/4 of my 48 were under their daily and weekly hulls. On Monday 99% were under.

Friday - 1/2 of my 48 are under their daily and weekly hulls. now moving up to declining 50MA and daily and weekly hulls.

This market is still holding up. but is still one very dangerous place to be. I'am finding less and less easy trades advantageous for me. This market wants you taking huge risk like the idiots that go to Vegas and piss away hard earned money. or the fools that go the horse races and think they have a way to beat the system. I had a friend like that, every weekend he would go to the races, this went on for about 20 years till he finally gave up. he could not do it. So why would anyone want to gamble in the stock market casino if the odds are not in your favor? right now, the house holds all the cards.


Enjoy the Super Bowl!

What a difference a week makes!. So the story goes the market is pushing up on Trumps coming corporate tax cuts in the next 2 - 3 weeks. I don't know if i would be Swing Trading at these levels but this trading environment has gotten a lot better for day/position trading. Though the market is a bit over heated at this level using the RSI study and several of my 48 securities are overbought on daily and weekly charts, again, It does not matter, the market continues to push higher. The VIX is at 2 year lows and has moved out of its declining wedge to the downside. the manipulators are now making trading as easy as it gets. buying the dips into a rising market is a success again, but for how long? Does that matter?, Just trade the facts?, I would say yes, just trade the facts for now. over the course of the last 6 days the market has repaired some serious underlying damage to individual securities. SPY was under its weekly hull for 3 weeks. During this time frame the market damage occurred. The SPY just crossed back over its weekly hull this week. Now only the DOW and the Russell need to cross over.

Short Term: SPY is now in a rising channel. On 01/06 SPY hit a high then pulled back for 10 days. On 01/25 SPY hit another high then pulled back for 10 days. We have now hit the top of the channel again and another high. Does the SPY pull back again or go parabolic into Trumps corporate tax cuts in 2 - 3 weeks. What ever the scenario, I'm betting we don't get much in the form of pullback until the tax cuts are announced. That is a huge catalyst for this market.

8 out of my 48 stocks are under their daily hulls. ( Daily hulls now rising into declining weekly hulls )

21 out of my 48 stocks are still under their weekly hulls. ( Big question is can these 21 cross their weekly hulls. That's important.

Volume is not great in this rise but it does not seem to matter right now. money flow is rising again even at these levels. I'am by nature a pessimistic trader, my pessimism usually keeps me safe and in check 85% of the time, I question everything. that's how i personally beat the markets, but it is what it is. Right now the markets don't care about weak volume or a historically low VIX. The markets continue to repair and push higher. One must respect that fact and don't fight the tape, at least till we get the corporate tax reduction!, Though It does feel strange trading instruments with minimal pullbacks, no it feels insane. It feels like this market is being chased by fund managers. 25 years ago I would have never paid attention to external/internal forces affecting the markets, But I was a stupid trader then, just trading the charts. clueless of the markets internals and externals. Over the years one should take in as much information as one possibly can to help formulate good buy and sell decisions. This will reflect on your bottom line and help keep you out of trouble, as opposed to ignoring everything except a chart and trading in the moment.

This is my final post for a spell, I will jump back in soon enough. As Motley Crue would say, Knock Em Dead Kid

Major Tom to ground control. I have exited all positions. I might be a week or 2 early, but the market is now exhibiting some exhaustion, and i must lock in profits. Hope anyone that traded this rally made some coin. Trading this move was actually fun for a change. Fast money in a short time frame is never a bad thing.

Since Trumps first speech to congress on March 1st the market has chopped its way down, though all the major indicies are still near highs and securities are holding up relatively well so far even though securities are unable to hold small gains on attempted rallies. Also notable is all the negative market news all the sudden. On the rallies you had predominantly positive news, now mostly negative on the downside. Amazing how fast things go from positive to negative and negative to positive. More proof that the media and wall street sleep in the same bed. Earnings begin again for the next quarter in about 5 weeks. Its not often that we go from one earnings season to the next without some kind of pullback and then a rally into the new earnings quarter. This is why i believe the market will remain in chopping/gapping mode for a couple more weeks. Then rally into earnings season. This is what markets usually do. Its a good bet, its a high probability trade. Presently this market is a bit unforgiving with such wild chop. would anyone think otherwise after another leg up? Once again the market is in day trading mode. In this market i would not use anything less than 15 min time frames. 1hr 2h 4h time frames are ridiculously slow for the chop we now have. This type of trading environment is designed to take your money, be quick be nimble. as always tight stops are in order, and remember in this market you will be wrong a lot. I find it very strange the VIX has not moved much for the last 5 days while the market has dropped, Presently the VIX is not a useful tool for it is moving down with the markets, odd. could it be so much money is pumping into the markets their are no bets on a major pullback?. Is everyone assuming all of Trumps policies will be implemented? So far he has delivered nothing but i know these things take time, but so far nothing but talk. Should he not deliver on his corporate tax cut promises things will get ugly fast. That's a good thing, we can buy cheaper, for this market is very expensive. Its priced for perfection. So in mid March we get another rate hike? according to Yellen, yes. how many rate hikes can this market withstand?. It is my belief until they kill off the market leaders this market will not sustain a major selloff. So far most of the market leaders are still within striking distance of new highs. No fear in this market yet. I say yet, So shorting this market at this early stage would be ludicrous. So far it just feels like we are pausing to take a breather. After the run we have just had, only a breather, crazy. As for the technicals, not great, a bit overbought for my taste, but not bad either, and we know this market can undo damage rapidly as buyers swoop in and buy the dips, but will that continue?. by the lack of serious selling so far i would say yes, but its going to be a choppy little ride for awhile.

Happy Trading

The Markets appear to have entered swing mode. If markets can hold these gains into the close we are most probably looking at another leg up. Markets must follow thru with these gains into Friday to be real. thus we must see what the counter reaction will be. Another leg up means a rally from here into earnings. Dear Lord these are indeed days of thunder. full disclosure, I'am in 3 swing trades. Everybody wants some. I want some to! This is madness! Though another leg up is likely, I believe its possible it will be a choppy move up. not a parabolic move up, but this does not really matter to me, parabolic or choppy, what matters is the swing direction. This is what is pertinent.


Markets close with most of their gains. now lets see what Thur and Fri have for us. Is their follow thru?



Edited 1 time(s). Last edit at 03/15/2017 03:03PM by Trader.

Zero follow thru on Thursday and Friday. We will have to wait another week to see if another breath thrust is in the works. What i find interesting is the abnormal volumes occurring in individual securities with no upside price moves to match that heavy volume. Heavy volume with no upside price move = churn?. Churn after a market move we have just had = Distribution = Top?. Stocks are not following thru on gains yet volume is explosive. This is troublesome indeed. It almost appears the market is holding/waiting for Trumps economic policies to be implemented. All does not appear to be as rosy as it seems. If you punch up a grid of multiple stocks using the 15 min time frame you will see that opportunities for short term trading are abundant, If you do the same for daily time frames you will find not so many. This market is still choppy, still selective, and rotating in and out of securities. Only in 2 swing trades now. Take profits when you can. This market has a short memory, and does not appear to have the conviction of the traders that matter, Institutional traders. Its looking more and more like a pump and dump dog and pony show. If you cant watch your trades live time, don't trade. Its not time yet.

Trader - I agree with your last couple of post; backed by the fact I was in long trades that reflected your commentary, my long trade stops were hit this morning. Swing trading is almost impossible in the current market chop of the last couple of weeks, though I have been trading with some success using the inverse ETA, SPXU for the quick market pull backs and I stay with my watch list for my long position setups. I have taken more hits recently than I like due to the chop, but that is always the case when the market is in a narrow range before the next move.

My directional bias is based on the current weekly trend; but for my swing trades I always look at the daily for my swing direction and the weekly to assist me in setting my initial profit targets. Currently for me to see a trend reversal on the daily I am looking for a lower high followed by a lower low on the daily chart. That does not mean it will not continue to chop but it does give me a directional bias. Currently the DJI and S&P may be forming a lower high on the daily charts while the Nasdaq is showing signs of a double top formation; confirmation of a reversal for me will be lower lows on the daily charts possibly this week. The Weekly chart does rule the overall trend direction but it can take several weeks to change the long-term direction; the caveat is that the daily can warn me to a possible change in the not so far future and forecast some high probability swing trades in both directions. Just a healthy pull back on the weekly charts will produce a nice trend on the daily for weeks; also, the Bollinger Bands are coming together just in time for some renewed volatility going into earnings season in April and don’t forget the VIX that has also been in a very narrow range for several weeks. Full disclosure, I did enter a short market position today, but that my change tomorrow in this current market climate.

Current market conditions will quickly liquidate those who do not follow or do not have proper trading rules that protect their assets.

Good call on the markets Progress!


Well if today is any indication, the poops about to hit the fan. These are the percentage gains for the major indicies over the past year as of 03/20/2017.

SPX 28%

DJI 32%

RUT 42%

COMP 37%

These gains are astonishing by any standards. Would anyone expect anything less than a good pullback after these gains? I wouldn't. I mentioned before this market would not come down until they killed off the Generals. Well, they have finally begun to take out the leadership. Without leadership, this market can not hold. This selloff has the potential to get biblical, the exodus has begun. Today, the first shot across the bow was fired. The markets have been artificially propped up for some time now, bringing in as much capital at the top as they possibly could. Remember, the markets are designed to take your money not make you money. Now its time to pay the piper. Heavy volume in so many securities with no upside moves to match that volume meant top/distribution. Now what?, The big guns announce earnings in 5 weeks, I expect this selloff to go global for at least 2 - 3 weeks, minimum. You will get rallies here and there, they will be unsustainable. Morning pops will be sold off, the markets will be money trapping. Here, one goes to cash or trades faster. Traders that have made money in the prior months and think they are special are about to get schooled by the markets. All markets that were moving up will now be moving down. It will get more volatile and choppy. How deep the cut? who knows, but after the gains the markets have achieved I would expect something serious. There is no greater teacher than the market itself, all you have to do is take the time to read the tea leaves. Those tea leaves are now telling me the institutions may very well be taking profits from the monster gains they have made over the prior year. Who knows, the selloff could be sharp and fast, but would you catch a falling knife? Better to step aside and wait till the smoke clears. Any money made by most traders over the prior months will now be given back, for most traders have to be in the markets all the time and this strategy is a recipe for disaster, this is a no no. Its ok to go to the sidelines once awhile, and this appears to be one of those times. Capital preservation is key now. Protect what you have made. Perhaps the markets will find support at the rising 50MAs?, If not the rising 89MAs?. Either way one should wait for the indicies to stabilize after the selloff to give indications for the next entry point, This, or trade volatile minor price swings intraday. Do the latter only if you are really good. As of this write the 4 week percentage losses are as follows for the major indicies.

SPX -2.17%

DJI -2.12%

RUT -4.75%

COMP -1.87%

Technicals: Markets oversold on many hourly charts. We could get a pop in here. I expect it. markets also working off overbought conditions on weekly and monthly time frames.