Market Sense and Sentiment (MKTSS)

[bbgold]

Looking for the Bull flag now
Picked up the TNA as QQQ 55.50 was tagged on my computer as support and the SP tapping 1220 at the same time looked good. I am also not sure if I am using the Options quotes correctly but I had previously seen the hod on SPXU 13 Calls at 1.50 to target 14.50 resistance and TNA at 43 the 43 Call was trading at 2.30 targeting 40.70 as support so everything seemed to line up for me. A lot will depend on if this last week of trading is a Bull flag that will retest the top range of the Bowtie or not. I wanted to get some covered Calls sold before the close but had to leave.
How we open tomorrow should give us some indication of direction, either we hold support above the island gap or we don't.
If the QQQ recovers 56 and SP over 1240 then I believe 1250 will be tested again, and possibly continue higher, we shall see.

[bbgold]

Long TNA here, QQQ support 55.50
Will see if this test of the lower Bowtie gets some support.
TNA usually a late day rally on down days, we shall see.
14.50 was target for SPXU, too bad missed entry.
Will see if 14 retested as support and how much TNA might recover.

[RCKS]

Sorry Bob I will repost and boy I'm being proven wrong at the moment on market selling. I guess the impetus for down was the FOMC announcement and the lack of further QE III like stuff?
I am not watching this week really and I am not trading it, I hate trading expiration week.
Snoot may get his Island Gap closed yet.

[bbgold]

DAX worked, FTSE not
Need to add the ] to the FTSE chart
Yes, I am really liking the Forks from all the charts and would look for any spike low here to catch some buying to keep us in the trading range. The morning gap fill saw some buying support and I still believe any higher low will catch some buying support. The trading range should continue to widen if we copy the Bowtie.

[RCKS]

Forsake of discussion and future chart watching, Bob here is the FTSE and the Dax Daily charts, they will remain alive and they could be put in the stickies if you like where they could easliy be accessed by us and others.

[chartsstockcharts.com/c-sc/sc?s=$ftse&p=d&yr=0&mn=4&dy=0&id=p67456868979&a=250212975[/chart]

[bbgold]

Yes, I see it there
I was wondering if that would happen with the speculation of the Euro being broken up. We saw it before when the USD$ had declined when the Euro had strength that the Markets started following the EURO. It Looks as though indeed the USD$ might be back into the lead here.
We will have to see if it is a permanent switch or just due to the recent Euro/Bond speculation.
Tess was calling me to help, missed the spike to add SPXU, just watching now as 14 has been resistance.

[RCKS]

The disconnect is showing up in other places as well Bob. I know you believe the FTSE is what our markets follow but I would argue the DAX has had the greater influence over the last six months but today is maybe the first day where the FTSE and the US markets have diverged from the DAX and you see it in the Dollar/Euro as well.
If you look at the Dollar we have clearly diverged from it or disconnected. The last time we were testing 80 on the Dollar the market was making the 1074 low on the SPX.
Here are both the SPX Daily chart and the US Dollar chart together.

[bbgold]

No Volatility yet
I think the recent consolidation has put a damper on the VIX for now. Trend looks Up but all it takes is some further Euro speculation to get the VIX back into full swing mode. I am really surprised that this am the Markets completely ignored the bottom falling out of the Euro. Might be some programming change we talked about where the Markets are going to try and reset to follow the USD$ now? I think the buying is indeed coming in because of the Put volume as most have their positions hedged, as do I, in case there is a change of direction.
MKTSS has even reset back to the 100sma so this pivot could still go either way, but I anticipate still big moves in both directions, we shall see :)

[RCKS]

Where is the Volatility?
VIX is saying otherwise.
Next year we will have wicked moments no doubt but we won't see it until Feb or even later.
Bob go out and look at the Puts already in place for Jan., there are more bets being made on the downside then the upside. or another way to look at it, the market has a floor under it here. JMHO

[bbgold]

Morning Steve, Thanks
Yes, all I hear lately about the VIX is people speculating with buying Jan Calls on it. It looks as though most of the bottoms have been Market tops so I am leaning a bit towards the downside here, especially with the Euro drop. I think all the speculation of the Santa Rally and upside to SP 1330 might have everyone caught looking Long and all they get is an empty bag for Christmas, jmho. I think that the volatility continues and any spike high/spike low will keep reversing much like Sept trading. The Par near 30 might keep the sentiment Bullish but I still anticipate selling at most every top for now. I was looking at adding SPXU this am but will watch for what reaction the FOMC gives. I am still thinking ramp but will sell the news either on the announcement or any morning spike high. The same if we sell the news, it might offer a spike low in the am that gets bought. I think the low VIX is showing just that, no real direction anticipated until it happens?
Enjoy the Day!

[RCKS]

Good morning Bob
This is such a boring week, I have spent very little time sitting at my computer watching the market... 125 Spy is the magnet for expiration and there isn't likely to be any news to move us either side of that this week very far by weeks end anyway. The drop will not be revisited, IMO
VIX is the story really, it is saying it as clearly as possible, we have a stretch ahead where all the Euro issues will wait for March and the revamped efforts to put in place the new Treaties. Whether this turns into a bigger rally next week (Santa Rally) who knows but I think the VIX is saying yes it will.

[bbgold]

SP Futures 1230-1235-1238-1235
Futures trying to build a bit of an uptrend as seen in the FTSE chart. Looking as though 1238/1240 will be the resistance for now so watch for a breakout there but 1250 will be the next level of resistance. You can see in the SPX chart how each lower high has been getting sold off but the fact that the Futures moved back over 1235 and held support there looks bullish for now.
Just remember to be Safe with your trades.
Enjoy the Day!

[bbgold]

SP Futures 1250-1245-1240-1245
The 1245 resistance can be seen in the FTSE tops. Once again watch the Euro for a potential double bottom or a breakdown. Back to watching the trading range 1240-1260 with 1250 the pivot at the 100sma, so back below it here. The Markets have been drawn to 1250 but just be careful about any short term trades leading into expiration. For now the anticipation is another double bottom bounce from higher support at 1240, leaving a short term inverted H&S. Whether that will motivate the Markets to move higher is still uncertain. Remember the Bowtie, it is unusual to have a widening flag and remember it could still break either direction. Use some caution with any trades Long or Short and often it is Safest to take profits if a LOD at EOD and Support for Shorts and a HOD at EOD and Resistance for Longs. So use good judgement and don't get caught in the trap of wanting More.
Have a Wonderful Week!

[bbgold]

INDU 10 day chart
Really surprised at how tight the trading range has been this week.
Even though the INDU only moved 200 pts it sure felt like a lot more. I think a lot of it had to do with the extremes happening overnight?
Time to see if the Consolidation theory from the Ibox kicks in and we continue the trend to the upside eh?
Have a Wonderful Weekend!

[bbgold]

Thanks Steve, looks Good
Yes, with next week being OEX things will most likely continue to be hectic. I was just looking at the left side of the bowtie and realized it did have a 'diamond' pattern to it after the whiplash Nov1 centered by the big red bar in the middle. If that were to repeat I would think OEX week a good place for it. If we shift the diamond from Oct 17th to this level then I can see where 1330 would be a 'potential' target for a high. I would be leaning more towards a double top at 1295 if we do break to upside from here. Just as around mid Oct I think watching any diamond setup for a break will be worthwhile, but the left end of the Bowtie has me wondering if we get some big headfakes towards the end of the month. Things will certainly be interesting if we trade similar to mid Aug to beginning of Oct, which I am anticipating, but that should mean a lot of range bound trades available.
Really appreciate the charts and hope you have a Fantastic Friday!

[RCKS]

Hi Bob
I wanted to update that Daily chart in a couple of ways and not wanting to start over in recreating all the aspects I just extended the Bow Tie lines and added the orange extension of the Bearish Fork.
Not really happy with how the Black Bow Tie lines look but for now they stay as is because I'm not ready to throw a way the Orange fork. I want us to clearly breakout from that Orange extension and then it will go.
I am Bullish here but not in a big way. Next week we have Option Expiration to deal with and right now 125 SPY or 1250 spx would be the target in my book. So if we go up we will come back or vice versa. Next Friday should see us in this neighborhood.
Looking out to Jan Expiration I would Ma-Pain right now at 126 spy or 1260 spx.

[bbgold]

The 'Bowtie'
Here is the chart with the 'bowtie' and you can see so far the tests of it's top and bottom range. I would anticipate this to continue up until Christmas.
Will I be making trades based solely on the trading range?
Probably not but I will certainly be keeping it in mind.
Also look back to Oct 17th and you can see the 'diamond' pattern there to watch for.
Monday's have been good for reversal days, so if we end up flat today then watch for where the Market opens on Monday.
Have a Wonderful Weekend!

[bbgold]

SP Futures 1230-1225-1245-1240
You can see in the FTSE chart the Futures morning surge and pullback. Wednesday we had the close near hod at eod and resistance, Thursday a close at lod at eod and potential support. Today it looks as though we might get some recovery but possibly close right in the middle of the two. Remember the diamond pattern mentioned before mid Oct and keep watching for the squeeze and which direction the market will break. Also we could be working on the 'bowtie' from RCKS chart, which means the continued whiplash until the Markets find a defined direction. For now the bias will be Bearish until 1250 is recovered as support. Just as when the MKTSS Plan is above the 100sma and the SPXU/ShortPut type trades are only held for 1-2 days the same applies here when under the 100sma that TNA/LongCalls type of trades should only be held 1-2 days. The pivot will be the 100sma and whether it is inclining/declining and holding support/resistance. As long as the Markets continue to be volatile and have the whiplash we will once again be range bound until a defined break and the 100sma is clearly inclining/declining.
For now the trading range has again been widened to 1230-1270 with 1250 the pivot. That leaves plenty of room for short term trades but make sure and use Stops and Profit targets to lock in and protect yourself against potential reversals.
Good Trading and have a Wonderful Weekend!
Euro vs USD$

[bbgold]

SPX 1245 breakdown
Not looking good now unless it can be recovered
Plan now in Bearish mode until the 100sma can be recovered as Support again, for now Resistance. Would still continue to watch 1240/1245/1250 here for recovered support but jmho. INDU 12000 is critical support level, so far holding.

[bbgold]

Yes, just another News spike
Right now it seems as though News is coming out to hold the Markets down so the Longs can reload.
The higher low along with the attempted breakout looks as though some upside is still anticipated.
I am seeing the potential for another week of upside into expiration but am uncertain after that.
Thinking downside the closer we get to Christmas, we shall see.

[RCKS]

Bob interesting pre-market today, we were flat and then up 10 but when Draghi started his conference call and said using IMF was outside Treaty boundaries the market reversed and Futures were down 10. This is a Volcano Week, market seems poised to explode up but is very dependent on the news out of Europe nothing else really matters. We had improvement in Initial Claims and that was ignored, anyway holding my position for now.

[bbgold]

FTSE/Euro/SP potential double bottom
Looks as though we might get the same type of spike low this am as yesterday but with higher support. Would be a potential Long signal using the prior low SPX 1245 as a Stop. The Plan would use the volatility of the first hour of trading and 10:30 is a potential reversal period. Just make sure to use a Stop on any Long trades from here as the Markets have moved back below the 100sma.
My IRA is waiting for funds to settle so no trades for me.
Options would target slightly OTM Calls, again using Stop limit orders to protect against a continued breakdown.
Good Trading!

[bbgold]

SP Futures 1265-1260-1265-1260
You can see the whiplash in the FTSE chart as the Futures are testing the new trading range. So far the support seems to be holding but no breakout of the resistance. We are back to the consolidation period like Mid Oct where the SP was stuck between 1190 and 1225, now 1245-1265. To me the narrowed trading range means limited upside from here but I see a lot of targets at 1300. Personally I would think 1280 as a cap but that is just my own speculation. We talked about the diamond pattern mid Oct and to watch for the break to upside or downside and I think we are back to that again here. The MKTSS Plan would be Bullish with the inclining 100sma and support above it. Just be sure to use some caution and good stops as the Markets volatility/whiplash looks to continue.
Good Trading!
Euro vs USD$

[bbgold]

Max Pain rally day back to 2003/2002
I am pretty sure we started targeting these back in 2002 as Ihub search I found two from 2003 and one from 2002. When did da-cheif start calling them WWW days?
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=1543739&txt2find=max|pain
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=529123

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=529060

[bbgold]

Mid Oct type trading imo
Today was a near identical trading pattern to the Max Pain rally day mid Oct when SPX retested 1190 for a double bottom buy at support.
In my opinion we either mirror the recent bowtie or the diamond from mid Oct here and break to the upside. I think that would be in line with Tom DeMark looking for a top near Dec 22nd and Bradley turn date Dec 28th. We should at least get 8 more days of whiplash finishing with a spike high like Oct 27th, but could be a doji followed by a steep selloff rather than a bullish day.
So personally I think today will be the middle day to a diamond pattern similar to mid Oct Max Pain rally day, we shall see.
If you still have the diamond pattern trading chart you might want to post it.
Good Trading!

[bbgold]

Found a couple old boards
I thought that there was one more but I can't find it.
http://investorshub.advfn.com/boards/board.aspx?board_id=1442
http://investorshub.advfn.com/boards/board.aspx?board_id=1281
http://investorshub.advfn.com/boards/board.aspx?board_id=1320
Is LG still around?
Sorry to see that Zeev has passed :(

[bbgold]

Ah, I remember Da Cheif :)
Don't think I have been over to SI since 2001 lol.
I thought he had a board here for a while?
Right now I am remembering the last Max Pain rally day when SPX had the gap down to 1190 support and then rallied into eod. I don't want to be stuck with SPXU on a repeat of that, especially with SPX low right at prior targeted support 1245, SPY 125.
The covered Calls will keep me in SPXU to 12.65 and still break even from the 13.80 hod.
For now the speculation is some repeat of why it is called Max Pain Rally day, so playing it Safe.

[RCKS]

Good morning Bob
Don't give me credit for WWW, it belongs to this guy.

http://www.siliconinvestor.com/readmsg.aspx?msgid=27809768

[bbgold]

Exit 3/4 SPXU at 13.70
Looking like some potential support for QQQ here so taking some off the table. Might look to sell Calls on remaining, will see if Markets follow FTSE to lod at eod or we bounce here.
Sold Dec 13 Calls on SPXU at 1.15 for remaining shares.
Would be in line with MKTSS Plan taking advantage of 1st hour of trading on a gap.

[bbgold]

SP Futures 1255-1265-1260-1250
Not sure what the News is other than the Euro dropping.
I think it is Germany's Merkel won't agree to merging fund bailout.
Looks like Steve's WWW day is off to a Wild day.
So far FTSE is looking like a trend down day, we shall see.
QQQ premarket low 56.83 below yesterday's low of 56.90, watch for breakdown/support there

[bbgold]

Thanks Steve, I like it
Yes, I am hoping we get a mirror to the other side of the bowtie so that we can get at least one good test of lower support. If we could get 2 tests of lower support before OEX that would be even better.

[RCKS]

Bob here is my spx daily chart, if interested checkout my comments on northam's thread.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=69660953

[bbgold]

SP Futures 1245-1250-1260
Once again the Euro reverses overnight. It was back to resistance but helped by German factory orders showing strength. Again you can see a potential double top in the FTSE and the Euro testing at 1.34. Possibly just a bear flag on the Euro so would watch 1.34 for support or breakdown. Once again SP back to watching 1240/1250 as the support levels with 1260 potential resistance. Again the anticipation is a double top selloff to retest support, we shall see.
QQQ premarket high 57.55

[bbgold]

Thanks Steve, looks good
Yes, I totally agree with the topping black bars for a potential repeating pattern here to downside.
Yes, the Euro speculation could get another puff of sunshine before the week is out.
Yes, I really hate that most of the speculation/reaction happens overnight and we are left either ecstatic we picked the right trade or left holding the bag on a reversal.
Still hoping I can get some kind of swing trade going but a morning gap might be worth it to lock in some profits.
So far the Euro chart shows yet another breakdown, but would not be surprised to see another bear flag uptick tomorrow.
We saw a lot of steps on the bounce coming up that I think will repeat going down.
Did you see the next big Bradley turn date is Dec 22nd?
Of course it isn't specific as to upside or downside but I would be a bit shocked if we get downside until then, but it is possible.
We shall see

[RCKS]

Hi Bob
I am short (Puts) tonight, I may be early.... nothing new in that but I do think we drop tomorrow.
Here is Cobra's Market summary tonight and he lays out a few reasons for why he thinks we may have at least a short term top.

http://www.cobrasmarketview.com/2011/12052011-market-outlook-was-the-top-in/

I think you can see his stuff, always does a nice job.
I still think we could have a very quick advance up to 1300+ late this week. All tied to the Euro News about Treaties and an attempt to keep from being downgraded by the S&P. It will happen in the overnight for us.

[bbgold]

One of your older charts
This chart seems to have the DMI/ADX crossover and MACD negative turn we normally look for with the MKTSS Plan? Is there any significance to the declining ramp of the CCI and peaking Stochastic much like early November? I know some traders follow the declining CCI ramp as a weakness indication, lately nearly a H&S type pattern. I am not sure if it is similar to an MACD reset to 0 though?

[bbgold]

Was on the road this am
Tough to get a swing trade to downside here, need to stick to intraday I guess. Now I am wondering if we mirror that bowtie wedge early Nov here? Still looking a lot like early July except we are cycling from the bottom here rather than the top. It certainly Looks like an Oct type rally but Oct we were a long way from resistance. I still anticipate we trade much like mid Aug-end Sept with a lot of whiplash but the Markets just don't want to listen to me lol.

[RCKS]

The 200 ma on the SPX sits just ahead, I anticipate we will tag it today or tomorrow maybe close above it and then start a correction. The correction should be underway by Wed ahead of the Euro summitt that will write new treaties, giving the ECB more power over all the countries in the Euro. If this gets put in place it is likely to be very bullish for the market, even if it has resolution problems in future weeks.

[bbgold]

Ditto, Euro 1.345 resistance
Interesting to see the Euro bear flag in a much lower trading range yet the Markets are right back where they were Friday?
Will have to see if we get a breakout at 1260 or another pullback to support.

[TREND1]

SPX_D with RSI in terms of price
.

[TREND1]

RCKS
"You look to follow the Trend in the bigger picture, so my guess is you are only looking to re-enter the TZA, because you have the larger Trend Down? "

PS: The above is 100% Correct at this time
No positions at this time.
Maybe that is why I have time .....

[RCKS]

T1
Are you in a trade directionally? Like TNA in this case?
If I have how you trade?
You look to follow the Trend in the bigger picture, so my guess is you are only looking to re-enter the TZA, because you have the larger Trend Down?
I am currently long and have been since approximately 1190 or so, so I will likely hold over the weekend, the close today is important to me. I need the market to believe in the move and it does that with a strong close.
Seems like every day the middle is essentially sideways

[TREND1]

04_SPX

[TREND1]

RCKS
Thanks for the 1260 comment.

[bbgold]

Prior to Euro drop, LOD at EOD and Support
I was looking for another LOD at EOD and Support at SP 1245 but the Euro waterfall has me thinking possibly more downside here. If we close below 1250 but above 1245 we could still move either direction next week. Below 1245 close and Markets could get spike low on Monday.

[RCKS]

Rmember the Window for MP doesn't open until next Wed., I have us potentially a lot higher by then. I will add, today needs to close green and preferrably above 1260, for my little view to hold water.

[bbgold]

Yes, with high Call volume thinking Down
With the QQQ high Call volume I am thinking a move down would generate the most revenue here. Once the Put volume starts picking up, say at 56/57 strike, then I think we move back up. I still think the QQQ is more apt to generate the moves in relation to Max Pain, jmho.
Will be watching SPX 1250 for potential support or breakdown.

[RCKS]

Bob the way to think of WWW is its the beginning of the window into Max-Pain settlement or the move to kill the most options as possible both Calls and Puts. So it can be a big sell off that moves us back into MP area from above, the area that is most lucrative for the Sellers of Options, most often the market maker.
Remember the Seller keeps the whole premium if the Option Expires worthless.

[bbgold]

Added SPXU 13.38
Stop at 13.28 for today. Still trading ahead of the curve and the MKTSS Plan signals so not really a Safe trade. Looking at the breakdown in the Euro and anticipating the Markets to follow. SPXU hod is 13.60 so will need to see a move above that going into eod for a Hold over the weekend.
QQQ support at 57 so would also like to see a breakdown there and resistance into eod.

[bbgold]

Ah, Max Pain rally day
I thought that was what you meant but had not heard the WWW lol.
Yes, I have not looked at Max Pain yet this month.
Looks like a lot of volume at SPY 126 strike today but so far Max Pain around 125? QQQ Volume/OI more spread with 57 the max Puts and 58 the max Calls today, that would certainly draw us towards 57.50.
The QQQ might indeed be the motivating factor here now as I see the Euro has dropped considerably since premarket, but the QQQ still moving higher. It does look like the Markets are trying to shift away from the Euro for now?