Wednesday, October 06, 2010

Nothing Written in Stone

Today was great if you were short some of the tech names or the NDX, and you might have even had a good day if you were short the RUT, but there was nothing at all to write home about regarding the Dow or the S&P. While the dollar is so far finding support at the .786 retracement, it barely budged all day from that spot, and the EUR/USD is still clinging to a .618 retracement level with no visible negative divergence that I can see on the chart. The big name banks ended mixed today with GS and JPM in the green and BAC and C closing red. This was the potential sector rotation I mentioned last Friday unfolding, and I’d sure like to see them all roll over before I get too crazy on shorting. It ain't over 'til it's over, in other words. You can come up with a thousand reasons why we could crash right here, right now, but the cracks just aren't quite big enough yet for me, at least, to get too excited. I like the potential of the timing cycle here, but price remains king of the hill for now. Don’t forget AA kicks off earnings season officially tomorrow after the close, and next week those same big banks kick off their earnings. We could easily be seeing them melt-up for that occasion.. and then again, maybe not. We’ll see.

Finally, this blog is our trading home, and it’s been a rare occasion that any of the moderators have had to edit or delete comments, but please keep the political banter and length of posts to a reasonable level as the important trading comments tend to get lost, and it becomes difficult on a busy day to sift through them all to find the trading information we’re here to share. Homey doesn’t like that. Thanks for your help and cooperation on that issue. ;-)

Yep, I’m dragging the /ES Gartley out once again that I’ve been tracking for a month. We are at a 1.27 time extension of XA and AD as of today’s daily candle, fwiw, although “legally” the time on this pattern can extend to a 1.618 extension. Still, we could be close now. Regarding copper, you’ll see there’s a long tailed daily candle right at the top of a channel, but for now, the trend remains bullish.

es_eod_daily_10_6 es_hourly_eod_10_6
hg_eod_10_6 vix_eod_10_6

My siren song for a turn in this tape… composed by the one and only Michel Legrand

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