Tuesday, November 30, 2010

Quick SPX update

Judging by total inability of SP500 to decisively move away (up) from lower TDST lines (current and prior setups as well) it might just hit the fan tomorrow and when it does it normally falls hard after it bounce…feels like something is cooking and starting to smell.

(Disclosure – I did not get a chance to enter short on close, so I am flat going into tomorrow)


Monday, November 29, 2010

SPY/QQQQ Video review (Monthly)

[Video below is not posted on Youtube – to view, please, visit Trading To Win Blog]



Posted on Trading to win (this is the chart/"speculation" I referred during the video)

"August 22nd 2009

There is not enough data on S&P500 to attempt to find comparable data points in similar Market Crashes, so first chart is Dow Jones Industrial Average (even with DJIA, in spite of been created in 1986, I can only pull electronic data starting 1937)

The ONLY completed weekly DOWN wave took place starting 1937.

As you can see on the first chart below W2 and W4 retraced over 76%/62% of corresponding down moves and then multi year slow bleeding started with W5 in November 1938 and W5 printed low in April 1942. (from 156 to 93 - another almost 40% loss from W5 high)
Next chart down is current Wave count
and these 2 charts are as much of a DJIA as you will ever get on this page - this nonsense index is even more misleading in assessing market/economic health than broader indexes like S&P500"



Saturday, November 20, 2010

Thanksgiving Vacation

I'd like to wish to all of you and your families a very good Thanksgiving (You know my favorite saying: "Family first")

I will be taking entire week off the market and blogging and using it to recharge my "batteries" and move to my new home in Stamford, CT (fell in love with the house the moment I saw that birch in front of the main entrance, as you know birch - slightly different from North American - is almost like "National Russian Tree").

I've been living "in the bushes" for too long and really miss civilization and people on the streets not only during rush hour and in only few "in front of business' doors" locations.


Be good, stay warm, be kind (screw "nice")









You may keep yourselves busy coloring this pretty picture – if you dumb just like that boy to welcome the enemies into your home…oh, I forgot, that is just a propaganda – NONE invited anyone here….


Weekly Sector Report | 11/19/10 (by Leisa)

The total market index was basically flat at .15% change. Within the total market, banks, other financials and utilities were the most notable underperformers. Below is a graphic of the 23 sectors and the total market index. (Click all images to make larger).
Let's take a look at a WEEKLY chart of Total Stock Market Index that includes the volume@price bars:
The markets continue to work off overbought conditions.  As we saw last week, the market is still very fragile to news that surprises regarding sovereign debt. It is also worth noting that for the first time, bonds and stocks have diverged.  TLT has fallen with a falling stock market.  So while the flight to safety might be in the USD, it is not going into treasuries. I have created for you a chart book with the daily, weekly sector charts in addition to the table of 148 industries sorted by performance as well as short interest per sector.  It is a large file, so please be patient with the download.  You may access it here.

(I see that David has closed the site down until after the holidays.  No rest for the wicked though, so here is the sector report for those who use it.  Thanksgiving is my favorite holiday.  It is a holiday for gratitude. I believe that a grateful heart is the purest of all. May you have many blessings for which to be grateful!)

Thursday, November 18, 2010

Just a bounce or range establishing day?

2 thirds of today's gains came from opening gap.  SPY tries to hold 118.50sh support area, and even after this move TD Setup Buy count is intact, printing 7 today.

USO (AS I said yesterday I closed 1/3rd of long put, but I reopened 1/2 of that closed 3rd today into the bounce) did the same trick trying to hold older support/neckline and bounced almost all the way to TDST (I will add puts at 36 area)


Wednesday, November 17, 2010

Hump Day

Probably the only good thing about today is it's Hump Day, and we can finally move on tomorrow past this GM IPO fandango. Beyond all of that hoopla, China is worth watching here, imo- and watching this chart was quite fruitful to us in early 2010. Is this going to be a "here we go again?" I don't know, but beyond the noise about Ireland and Portugal, I think this is the horse to watch here.

Anyway.. here are a few charts, and a video Tyler found earlier- click to link- it would not embed for me.  (thanks, Tyler  ;-) )- and how apropos on the day when it’s announced The Dinosaur will be receiving the Medal of Freedom.  Whatever…


iwm_11_17 dx_11_17
qqqq_11_17 spy_11_17




Click image for video


Have a fabulous trading day tomorrow TTWrs! 

Good job as always as we navigate this swamp.  ;-)

Tuesday, November 16, 2010

Saturday, November 13, 2010

Blogger's email Broken.


It started in the beginning of November and I cannot see anything wrong with settings I used before, beside there were NO changes made to system settings.


Email is NOT sent out when I post directly to the blogs blog or post using LiveWriter – it only going out when I post new topic into the Google group itself.


Based on this info I think it is a problem with Blogger “BlogSend address” – it is NOT being sent out

(Settings è email&mobile è blogSend Address )


I filed support "question" (Blogger provides NO support) and I saw that quite a lot of Bloggers having the very same problem once in a while.


Brandt from Trade Guild is having the same kind of problem – we working to resolve it, but Blogger is not keen on resolving issues…


Lets hope it'll be fixed …soon

Thursday, November 11, 2010

Oily thoughts

First time in a very long time I see something I am really willing to trade in the near future, if not tomorrow.

Below are multiple timeframes of USO – poor man's /CL – on daily TD Sequential Countdown 13 Sell, Setup Sell, Fuji-San's ab-cd (which is as Trader Steve fairly noted is "nottin" more than an A-B-C of E-Wave) completed.



240min chart has formed Combo sell as well (though there is a chance that it might still go higher…there is always "a chance" even one on a million …and a lot of time in trading that 1 on a million is the one that works.


It is a brave new world out there, "we have a better chances of surviving if we stay together" [Gladiator]


Here is a very lengthy, but very good "bigger/saner picture view from Jeremy Grantham, surprise surprise – it is CNBS..ce (Thank you so much to

image Iguanadon

for finding it!)








Tuesday, November 09, 2010

Tuesday Turn-around

We all watched with amazement today as the tape actually did a decent pullback. How long does this last? Well, if recent history can be a guide, it's too early to tell. The drums have been beating louder and louder for the past few days regarding the tanking dollar and the parabolic rise of silver and gold, which always makes me picture a listing boat. This "could" be just a red herring ahead of the G20 coming up this week as the US heads off any world criticism regarding QEII and so forth- so it could be short-lived. I obviously have become extremely cynical toward the tape and normal market behavior. LOL Anyway- here is a handful of charts to peruse, and I'll see you all tomorrow. You're good, you. ;-)  Oh yeah.. one more thing on today’s pullback- WOOT! 

es_11_9 dx_11_9
tf_11_9 hg_11_9

Needs no explanation if you’ve been listening to the news out of CA.


Monday, November 08, 2010

Sunday, November 07, 2010

Weekly Sector Report | 11/05/10 (by Leisa)

The market showed no signs of fatigue last week. The broad market index was up 3.57% with a sweep of sectors positive across the board.  Below is the Weekly Sector profile compared to the broad market index (in blue). (Click to make larger).
Note that the more defensive sectors, healthcare, food/beverage, utilities, are lagging. Here's a chart of the broad market index (Click to make larger)

Prices are very extended and caution is warranted for longs.  Prices are approaching a heavy volume@ price bar (which I have extended and placed in a dotted outline).  It will be interesting to see how volume/price action react at these levels over the next few weeks.


To facilitate your personal study of the the sectors, I've created a downloadable PDF which contains detail sector information, summary sector information, and chart books for the summary sectors in both weekly and daily format.  It is a large file, so be patient with the download.

Thursday, November 04, 2010

Your Cash Ain't Nothin' But Trash?

Is it Friday yet? I didn't think so. This has really been the week that was, yes?

Tomorrow's Economic calendar includes:

Employment Situation - 8:30
FedSpeak from various notables beginning at 8:30 'til 11:15
Pending Home Sales - 12:30
Bernankespeak - 2:00
Consumer Credit - 3:00

Alrighty then, I have but one lonely chart for SPX and we hit a Fib 89 day tomorrow off of the August low. This might be the longest 89 days of our lives (for some of us,) but there you have it. I've also placed a Gann fan from a previous low just for kicks and giggles. See you all tomorrow, and hang in there. ;-)

In honor of GG

Wednesday, November 03, 2010

Trading Like Lab Rats

First we waited for the election, and then today's FOMC announcement, and now both are over and done with. So what next? Is it all priced in? Are we just lab rats in Ben’s grand experiment, while watching those who depend on fixed income suck wind again? (redundant)

I'll be honest, I have no idea. This knock down cold of mine has me pretty much out of the rhythm right now, but I'll start looking closer at possible patterns and Gann charts tonight. Anyway.. here are a few charts I am watching for clues. Not my best effort, but some food for thought and consideration.

Thank you all for keeping things moving in here in my absence, it means a lot. Trade well tomorrow. :-)

es_11_3 dx_11_3
vix_11_3 hg_11_3

They need to change this to I don’t like FOMC days.

Tuesday, November 02, 2010

Anything, but exciting…

2010-11-02_2106 In case if anyone wondered how DavidDT looks like…and how he handles this endless market boredom…yeah…now I don't know what is better – flash crash of slow market death in time of economic cholera…







IF I still believed in D-Wave I would say that hourly chart looks damn promising at least for pullback after quick runup into tomorrow's 2:15 BS FED "We Care about You" statement…Sell setup in progress and Wave 5 has not excided target by too much…yet.




On weekly – SPX is in week 9 of sell setup in progress – same old picture – no need to repost.


And finally daily – right at the critical point – not much of bearish signs here – looks like solid consolidation before breakout – I will wait for a least 2 days above TD Risk Level before I will take long trade…


I am just not excited about this market, I really don't care at this point if it will go up or down short term – I am on the sidelines most of the time and using this stale action to take care of my "other" business…plus I recently moved to a new place and… I have never imagined how much crap I need to buy to feel like I am home again…keeps me busy though…

Monday, November 01, 2010

Guest Post: The Unfavorable Game

Many thanks to our own HighPlainsTrader for allowing us to re-post his commentary from his own blog. If you have not been to his blog, you’re really missing out on some great posts over there. He is a tireless contributor to TTW each and every day, bon vivant, all around good human being and has brought so many new things for us to consider as we trade. We are all so grateful to have you here with us. Thank you again, HP. :-)


I have frequently quoted specific passages from books that I have read over the years, and my favorite passage for explaining what I do with my trading is this one from, "The Futures Game" (Teweles).

It is interesting to observe the way most futures traders play the futures game in relation to the possible ways that money games can be played:

1. The most effective approach to the objective of maximizing results is to play a favorable game on a small scale.
2. Less desirable, but still providing a reasonable chance of success, is playing a favorable game on a large scale with enough profits coming early in the game to avoid ruin.
3. A basically unfavorable game may yield profitable results (presuming that one insists on playing unfavorable games) if one plays seldom and bets heavily.
4. The only road that leads inevitably to disaster is playing an unfavorable game continuously.
The trader who trades on impulse or uses some other invalid method of making trading decisions is following the fourth route, which is crowded with bumper-to-bumper traffic.

I consider my options trading to fall into category #3 from that quote. It is basically an unfavorable game because there are so many moving parts. For instance, not too many days ago I was guessing that APPLE (AAPL) would fall after they announced earnings. I was right, the stock got hit for nearly 15 points right when they announced. What happened to my Put? It lost a shitload of value because, and I'm guessing, the implied volatility got crushed after the release of earnings. I was right on the direction of the stock and still lost money.

That was my first attempt at buying an option contract on an individual issue in nearly three years. I hate trading individual stocks because there are too many moving parts there also, too many in fact to begin listing them here. Suffice it to say that my preference for the options arena are the indexes, the S&P500 and Russell2000.

Okay to the point. I have a small account set aside just for playing with options contracts, and yes, I insist on playing that unfavorable game. However, because I can/do/have-gone/will-go all-in, this account has the potential to become very big very quickly; either that or it will blow up very quickly.

Recently my results in the unfavorable game have been quite stellar, you know, setting aside the Apple trade. Here is a picture of my last 7 trades on the S&P using Puts only. The red arrows mark my entry and the green arrows mark my exits.


What I am not showing in this chart is the reason for the entry, but I will tell you anyway. I've been looking for a high print in the MACD Histogram bars on the hourly chart to find a spot to take a position. And even though I am trading on an hourly time frame, I then look at a 15-minute chart and a 5-minute chart for the exact time to place the trade. That is, I am doing everything that I do in my regular day-trading account and my swing-trading account to move the odds as much in my favor as possible in this unfavorable game; I'm using multiple time frames for my trading.

So why am I showing this chart and talking about the unfavorable game? Good question, you knew I had a point to make.

I think it's important for traders, especially new traders who may be struggling, to understand that you have to be aware of market conditions on all time frames, you have to beware of the limitations and the dangers of the tools you use to trade, and most importantly you have to be aware of yourself.

When looking at those three things as they relate to my unfavorable game, I can tell you that I am aware of market conditions and I am using multiple time frames for my setups and my exits. I am using options on the big indexes and I am aware that those options come with moving parts that affect the value on a minute-to-minute basis, such the VIX, the underlying components of the index, news and economic releases, and the underlying trend, which brings me to the self-awareness portion of my trading.

When you look at that chart and see that my last seven options trades against the index (all winners) have been during an uptrend, you have to know that I am aware that I am the trend-fighter, or the counter-trend trader. I am aware of the fact that I am a reversion-to-mean kind of trader, especially when it comes to the unfavorable game.

I may switch back and forth from trend fighting to trend following with my day- and swing trading, but when it comes to the unfavorable game I am most definitely a trend-fighter. If you pull up a similar chart to the one I've shown and put a moving average on it, you will see clearly that I am looking for a pullback to a moving average. I am a trend-fighter.

This post is not an attempt to sell you or anyone on the best method of trading. There are as many people, in my opinion mostly losers who are trying to convince themselves more than trying to convince you, who will tell you that the big money is made by following the trend. I don't believe it, mainly because I live the other side of that argument.

This post is more about awareness and having a plan, and realizing that no matter what, when it comes to trading in the stock market or the futures market, you may have to be aware that you are playing in an unfavorable game even if you think otherwise.