Friday, January 29, 2010

And I Say to Myself....


Thank you DDT for bringing us on board with DeMark these past months!

SPX Weekly DeMark Sell Signal.. look where we are now..


Have a great weekend, traders! Rest up, plan your trades for next week, and we’ll all catch up on Sunday! Thanks to everyone, and big welcomes to some old faces that found our little hideout this week, and all of the new contributors as well! Remember the first time we played this tune on TTW? :-) It took us awhile, but we’ve finally arrived!

Remember: if Friday’s lows are lower than Thursdays week ..lower lows in at least some (one) Index.....of the Major ones.....”

Who said that last Friday? It was Osso! Guess what, the statement stands true for next week too…. Congrats Osso on your call!

"Remeber folks, this means we have a perfected TDSetup 9 sell, as this is the last day of January." - Osi

$SPX Analysis January 28th, ‘10




Thursday, January 28, 2010

Cognitive Disconnect

... and you just know they had to put up that sign due to multiple attempts to feed the crocs!

“Intuition is a combination of historical (empirical) data, deep and heightened observation, and an ability to cut through the thickness of surface reality. Intuition is like a slow motion machine that captures data instantaneously and hits you like a ton of bricks." - Arbella Arthur.

I had an epiphany today, after I took a few dozen bricks hit in the head. In a message to my trading Svengali, I realized I have waited nine long, teeth gnashing months to short this tape. Now all of a sudden I think it's time to get cute and buy the dips? A little late to that party, no? My point is to share what I'm trying to retrain my trading brain to do, right here, right now, and make it public in case anyone else is dealing with this too. Yes, there will be bounces, but the nature of this tape, the nature of the way they're delivering earnings (and most often now selling them off,) and other financial news has taken on a new bent. When Steve Lies-man is negative on his hero Benny, it's time to turn off the TV and trade the charts. They're telling us something already, in fact, they're yelling at us! Even on a retrace we could be looking at the bear patterns of the decade going on.  The tape will let us know.  Okay, so that's my little rant for the day and I'm ranting at myself, you're having to listen, sorry about that, but this is my trading family and we share and bare it all around here.  :-) We'll continue to swing trade intra-day of course, it's what we do, but earth to TTWrs, watch your back and watch your money, this is a slippery slope, where patience reigns supreme, and a little touch of intuition never hurt anybody. Much the way they ran this tape up, they'll do the same thing on the way down. The floor arrives when THEY decide it arrives, and it will go much further than we think sanity might allow. (just like the bear rally – will we ever forget?)

Tomorrow's economic news includes: GDP at 8:30 AM, Chicago PMI at 9:45 and Consumer Sentiment at 9:55.

Earnings include: ACI, CVX, FO and HON. Looking ahead to Monday will be: XOM, HUM and SOHU.
For a full list click here.


qqqq_thurs AMZN_thurs
spy_intraday_thurs spy_thurs

 For you Zig Zag addicts- here’s the most recent look at what he’s watching for the days ahead on the T chart.  Note, this does not include today’s price action,

but the time factor is still in play.


Zig Feb 8(2)


For EWrs, stop by Alpha’s blog for some great charts tonight, (but make sure you come back or I’ll send a posse out to find you.) Thanks for sharing, A!  Below is another chart he generously shares with us here on TTW.

all 60 mins alpha 

FX traders:  I was thinking last night that a good way to kick off learning about FX might be to do some Q/A we can publish here on TTW?  If you’d be willing to pitch in on that effort, let me know and we’ll do it via e-mail. 


Make sure to get some rest tonight, fellow traders, and we’ll see you all later!  FX Crazies - your mission is at hand!  G/L tonight and don’t get too crazy! (like me)


So - you want to be a trader?


• In 1973 Larry Williams published a book titled “How I
Made One Million Dollars Last Year Trading Commodities”
detailing his trading success that year. The next year he
lost the million dollars.
• Michael Marcus started with $30,000, borrowed another
$20,000 from his mother and then proceeded to lose 84%
of their combined capital (imagine trying explain that to
your Mom) before becoming a successful trader.
• In 1987 several commodity funds managed by Richard
Dennis lost 50% of their capital and were forced to stop


It is the most competitive field out there, not only we have to fight each other (yes – this is what we do), but we have to oppose enormous computing power of heartless machines turning trades in nanoseconds.


Here is a simple test if you cut to be a trader – if you can stay emotions free when you finish it – try stock betting…just don’t bet your house on it – that was a job of banksters. (Just remember – 99% of you will be better of sticking with just a test and not moving to real trading)


Step 1. Go to your bank on a windy day.
Step 2. Withdraw a minimum of $10,000 in cash.
Step 3. Walk outside and with both hands starting throwing
your money up into the air.
Step 4. After all of the money has blown away, go home
and sit down in your favorite chair and calmly say,
“Gosh that was foolish. I wish I hadn’t done that.”
Step 5. Get on with your life.


Those of you on Disqus today know that I was really jumpy and uncertain of market direction since yesterday night.  In spite of thinking that market has not completely corrected I had a feeling it had to go up – and up they moved the futures in after hour during BO speech. Glad I stayed with “bigger picture” and went short /ES overnight.  But in the morning my inner “bounce coming” voice made me take only 5.5 points of profit on /ES short (instead of 15) and soon after market open to close my short term long puts positions.  Anyhow, you all know that there was no meaningful move up and at one point bottom fell off and QQQQ were down 3% etc…

Missed profits, but shall not be too greedy - - why am I saying what I am saying?


ALWAYS have “bigger picture” in front of you and do not change your opinion unless market proves you wrong.


Have fun now – Keirsten reminded me of that movie – that was really fun time.

Where are my disco years :)


Osikani’s morning fix

As a look at the markets via the SPX/SP500, none of my comments from yesterday have really changed. Even today's ramp up job still respected the previous TDST as resistance. I post only the daily chart.




I take another look at the markets today, this time looking at the SPY, and using the Anchored VWAPs instead of DeMark. We use the SPY because as volume is not available on SPX, it means that my Anchored VWAP's cannot plot.
I will make a different post regarding the hypothesis behind the AVWAP. For now, just indulge me and read along with me. If the folks on this blog like this analysis, and request it, I think I will complete the notes on the indicator and have it released for free to members of this blog who request it. Unfortunately, it is still having the kinks worked out right now, and is too crude for release.
First we look at the weekly, plotting AVWAps from the major lows and highs. Note that there are really no highs, save the one at 2009/06/08, which was soon violated, and you will see that the buying AVWAP crossed over the selling AVWAP on the day of the violation.



Notice how every downturn never quite even reached the most recent buying AVWAP except the most recent one where you should notice also that this is the VERY FIRST TIME that ANY downturn has breached the most recent buying AVWAP. We expect AVWAPs to act as dynamic support/resistance, so does the breach then make the most recent buying AVWAP now into resistance?
We plot only 2 selling AVWAPs. The first is the aforesaid one at 2009/06/08, the only time we has more than 2 red candles in this crazy bull run. The second is plotted from the most recent high, and its line would be expected to be resistance. If it is breached, this downturn may well have been yet another bear trap.
Next, we use those same points on the weekly to plot the AVWAPS on the daily. This allows us to ignore many of the short term gyrations on the daily chart, which would otherwise be full of spaghetti, if we were to plot every swing AVWAP.



I have added in one AVWAP at the previous (to this most recent) swing high. Again, notice how this AVWAP, supposed to be resistance, was breached, and how the price breached the previous swing high on the day that the buying AVWAP crossed over the selling AVWAP. Also notice that that very line seems to have acted as resistance today, containing the up candle from the ramp job.
So, for the first time in this bull run, we have a cluster of support/resistance above the market. Remember that a support, when breached, changes polarity into resistance; so we have 3 of the most recent resistance lines clustered just above price, and it is the first time that it has happened in this bull run.
Does it really reflect a change in the market posture? I cannot say: the future will tell us. As we all know, the market will go where it will, no matter how much hopium we imbibe, and no matter how much we pray to the trading gods.


And here is the more traditional Osi Daily SPY update.


Wednesday, January 27, 2010

Born to Run

head2 Boy, did I miss all of you today! But.. there's nothing like a good outage to keep you in a position, so in the funniest way, losing internet today worked out to be a good thing! (not that I want it to happen any time soon again!) I know you traders are as wound up as I am right now, and doing a great job of not only pitching in, but taking time to teach the rest of us when time allows.  Thank you!

We have a lot of ground to cover, so let's get to it. What a week so far, huh? :-) The Big Speech takes place in a few hours tonight, and who knows what will be said and how/if/won't change thing on the charts tomorrow, they're going to move the way they're supposed to move regardless. The Senate will also vote on Benny tomorrow, so buckle up.

After finding support in many charts today in various ways, I think we need to stay hyper aware of resistance above now, and it won't be easy due to multitudes of gaps residing above, but we'll just stay diligent. We're looking to reload for more. I don't make predictive calls most of the time, as you all know. It's not my style. But I will say this: many of the bulls I know are still looking for that IHS target to come to fruition, and many bears are already in the "here we go down the mountain," mindset. I fall into the second category in all honesty, and have for a very long time. But as a precaution, if you're in the same frame of mind as me, please use caution on counter trading the corrections, because they can rip your lips off before you blink. The one quality that has stood the test of time in a bear market are the violent moves that can occur. So, be nimble, careful and not so over-confident that you reduce your capital to take the journey down.

Tomorrow's calendar: before the bell will be Durable Goods Orders and Jobless Claims. 10:30 is Nat Gas Inventory, and at 11:00 is the 3/6 note, followed by the 7 year note at 1:00. Don't forget we have GDP numbers before the bell on Friday.

Earnings include: MMM, T, BAX, LLY, F, OXY, POT, PG, RTN before the bell. After the closing will include: AMZN, JNPR, SNDK and RMBS. But this is just a brief snapshot, so study up on the
full list here if there's an important one I've missed that you are watching.

compq_wed indu_wed
SPX_wed spy_weekly
XLF_wed xau_wed
bdi_wed gld_gdx_wed

Okay FX addicts.. you have a new addict amongst you- I think we’ve lost MoneyFarm to your grips, so take good care of him for me!


Crank it up!  Let’s trade!

“In the day we sweat it out in the streets of a runaway Ameri-kan dream
At night we ride through mansions of glory in suicide machines”









2009-10-04_1931 DDT here with few boring D-Wave charts – be careful trading next 2 days – we have plenty of ABCs and deep 4th


2010-01-27_2058 2010-01-27_2113
2010-01-27_2110 2010-01-27_2057

iWant one too



Artist's Comments

A tribute to the fact that Jonathan Ive (head designer for the whole iMac concept that started the come back for apple/Macintosh) started out designing toilets and combs.

[Hat tip to humblestudent88 for finding this picture]



So, we have been presented with yet another iToy in an endless pursuit of iEmbrace Myself during future iDumbification of iWant society.

In the country where manufacturing base fell from over 40% of GDP in 1980th to just slightly over 11% now we continue to believe fairly tales that we can postpone payback in the form of total collapse of the system…and not only financial system which is on life support now by iPayTaxes.


Anyhow, I just closed (AAPL) long puts Feb195/Mar185 positions which I was opening yesterday all the way in the yellow rectangle with target for today in red rectangle – long rot the AAPL.



Here is quick ($SPX) chart for your enjoyment



and I am leaving you to be bad, but “I’ll be back


Tuesday, January 26, 2010

Cheshire Cat


We had another great day in TTW, and there will be plenty more to come in 2010.  Before I share what’s coming up tomorrow, I’d like to say I’m sure proud to be part of this group of traders on this blog. Not only the way they conduct themselves, but the ability to let things roll during the trading day and never give power over to negative emotions, or anyone seeking to draw that out.  I know you know what I’m talking about.  ;-)  Well done.  This is going to be short and sweet because those crazy FX traders have been keeping me awake every night and I’m lacking sleep. 

So, Y So SRS?  I thought I’d post up a couple of charts on the REITS and Home Builders tonight.  I do not, and I repeat, do not recommend trading SRS unless you’re an old hand at this widow maker- there are plenty of other ways to wipe the lipstick off that cat’s face.  (imagine having to give that cat up there a bath, and that’s what it’s like to trade SRS on most days!)  Here is a link to the top ten holdings for IYR  and one for XHB to look over as potential shorts.  But please keep a close eye for support/resistance and take your trades carefully.  I also have some Osi (tm) charts to share with you tonight- thank you Osi! 

Tomorrow on the economic calendar: New Home Sales at 10:00, and Geithner goes before Congress.  Hanky Panky is also supposed to testify, but I’m not sure if that takes place tomorrow or not.  From there we have Oil Inventories at 10:30, so please review the charts Doula posted throughout the day for our benefit.  After that’s all out of the way we’ll have the FOMC announcement at 2:15.  Get ready to rock and roll and strap yourself in your computer chairs.  Tomorrow night dear leader will bless us with a speech at 9:00 PM EST.  Looking ahead to Thursday, remember we will have Jobless Claims at 8:30 and Nat Gas reports for Mau and BigIsland at 10:30.  ;-)

Earnings for Wednesday include:  Before the bell- ABT, BLK, CAT, COP, GD, HES, CAT, UTX, VLO, WLP.  Post session will include: CTXS, GMCR, NSC, KNX, QCOM, JAVA.  By the way, Osi Systems reports tomorrow too: symbol OSIS.  Who knew he was running a conglomerate on the side?!!  For you crazies there will be two intra-day earnings announcements out of SUSQ and EGN.  Please research the time of those announcements if you dare to care.   See you all tonight/tomorrow.  Enjoy the tape, let’s hit ‘em hard again tonight and tomorrow!

xhb_tues IYR_tues



Osi Charts

osi chart 2 osi chart

CNB[S]C for Tards (Bears and Bulls alike)


Around 3:18PM EST CNBS brought about our mutual friend Bob Prechter with his eternal forecast of gloom and doom (not to overlook his amazing tact of repeating that he was right quite a few times…may be 3 or even 4…out of thousand times he attempted to predict market movements)

As always, we heard all the same, “Pee on Tree” A.K.A. “EW P3” has started … again… has started again..yes…has started..ah-ha, definitely, but this is beyond the point I’d like to make.
From the moment of interview started till market close Sue and all dimwits so called “plug a holes in flowed logic” kept saying the same phrase (how degenerate or corrupt or just nobody that teleprompter must be…):
“Market started to go down after Bob spooked it with his ridiculous predictions, market was just fine before that, screw all the bears, market would be fine if not bears” – you get the point, N'est-ce pas?

So, let see if any of that holds water (not even reminding TTWers’ projections for Monday/Tuesday)
Here is a chart of ($SPX) where you may clearly see that around 1:50PM EST Sell Setup has completed and was perfected on the very next bar.  Market started to slide immediately.
Right at the time of Bobby’s mumbling (yellow rectangle around that bar) market stabilized, and stayed totally flat all through that mumbling and some time after it ended as well.

So, the answer I’d like to know:
“How is it possible for any corporation to honestly make a buck when idiots are in charge, idiots work there, and idiots consume products of these needless corporation? The answer is simple – fraud, lies, machinations, workers abuse – because in spite of the fact that idiots are glad to pay for crap on all levels the only way they have money to pay is that they were GIVEN this money for nothing because idiots do not produce anything and don’t deserve to be paid.
The music is stopping for free money and for a lot of other things as well, might have already stopped …
Watch out…idiots…

Oilman mindset

 2010-01-26_1200One of Warren Buffet jokes.

A very successful oilman dies. He faces Saint Peter, who says, “You’ve been a good man and normally I’d send you to heaven, but heaven is full. We only have a place in hell.” The oilman says, “Any chance I could talk to other oilmen who are in heaven? Maybe I can convince someone to switch places with me?” Saint Peter says, “It’s never happened before, but sure, I don’t see any harm in it.” The oilman goes to heaven, finds an oilmen convention and yells, “They found a huge oil discovery in hell!” Oilmen are stampeding out of heaven to hell, and our oilman is running with them. Saint Peter asks him “Why are you going to hell with them? I have a spot in heaven, you can stay.” The oilman answers – “Are you kidding, what if it’s true?”

Moral? We expected this bounce, may be there is more upside, but I will stay with the original course of action and re-enter short positions at SPX 1105-1115 area per my expectation of “Higher Monday and Tuesday”.


($SPX) does not look like much except for kind of bear flag on hourly


2010-01-26_1152_001 And (AAPL) (which I am already prematurely short – what else is new- via Feb 195 puts acquired at $3.40 because I had to get out to eat…just added few more at $2.95)  looks like it might roll over by the end of today.



Monday, January 25, 2010


slippage ... *for now.* The thrill of having some volatility back in the market went MIA today, but we have a bit of a change no one seems to be discussing. What happened to Mutual Fund Mondays? It didn't happen last week, and it sure didn't happen today. Where's that late afternoon ramp up? I'm still skittish though, and looking around the corner for the boogey man to pop out at any moment, but so far, so good. I'm sure most of us watched the AAPL chart AH and saw what took place there. Yes, it started with the patented elevator up/down price action, but it fizzled... and it fizzled after hitting resistance well beneath its most recent high. As Osso said, it must be nice to change your accounting rules in the middle of the game, and I know I'd like to change mine too. In fact, I'd like to change my tax bracket while I'm at it. Pick-a-Pay mortgage? How about pick-a-pay tax bracket?  One down for AAPL this week, and one event to go…

One other side-note regarding our friend, Ben. Earlier this evening I heard Senator Bunning tell Krudlow there may not BE a vote this week on Benny. Imagine that! I have told several of you off of the blog to consider that possibility- how will the market react by Friday if this vote gets down to the wire? This should really be an interesting next four days, that's all I can say. We’re either getting our chains yanked here, or things are about to get very interesting.  We might all need neck braces before Friday.


Economic calendar tomorrow includes: ICSC-Goldman Store Sales, Redbook and S&P Shiller HPI before the bell.  At 10:00 AM: Consumer Confidence, FHFA House Price Index and State Street Investor Confidence.  Hitting the highlights on earnings tomorrow- before the bell will be BHI, GLW, DD, JNJ, NVS, TRV, X (marks the spot) and VZN.  Post session includes: BXP, DV, GILD, RFMD, YHOO and STLD.  For a full listing of earnings tomorrow, click here.



Let’s look at the fab four, and a quick look at the bullish percent indexes.  I’m still not sure what the game is with copper here, but BDI has a potential for a lovely pattern should it play out. 


SPY_mond indu_mon
QQQQ_mon gld_mon
bpcompq bpnya
bdi_mon copper_mon
zig mon 2 zig mon

I played this song over the weekend while I was doing my weekend “stuff,” and the lyrics just seemed so fitting for what we witnessed last week.  I already know this group is full of savvy traders, but I’d like to think we’re also way ahead of the curve when it comes to looking behind the purple curtain as we navigate through a daily serving of some of the most nonsensical information and circumstances imaginable.  Anyway.. my trading anthem for 2010 will be this song, and it’s also my wave at our Kiwi and Aussie traders here on TTW.  Take it away FX traders….. see you all for a fun-filled Tuesday!





DDT Here, added chart/analysis of feloow DeMark-ian – THANK YOU WALLY :)

Wallfly Yesterday 09:15 PM
3 people liked this.

Hope these 2 charts may be of benefit to some of those today who were asking about or referencing E-Wave/D-Wave. I've tried to keep it simple and hope its not too busy. We seem to be rapidly approaching a nexus this week or next and maybe this will help. Enjoy your trading.