Fully invested in secondary oils (100% long)
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Also the oils.
I wish you were here jwg. 'Looks like a bottom is in...
Selling is drying up as evidenced by an improvement in the tick (higher low) and a jump in the vix. The major oils have definitely reversed and they are the market leaders.
Thursday is often an important reversal day!
Rally time!
Chuck - I vote for option #3...
"Today was the beginning of a path to the moon!"
(as if you didn't know)
Have a fun trip!
Thanks frank - We just wrapped up the annual "Fortal" here in Fortaleza (basically the same thing as Carnival in Bahia) so I will post a couple of pictures of that too.
'Still bullish, and thinking today's dip was to be expected after 5 consecutive advancing days on the Dow. If so, we should resume the rally tomorrow after a slightly lower opening.
Yes ziggy - I am still long and strong. I was not the least bit nervous during the low volume consolidation this morning. It was obviously profesional accumulation under cover of terrorist threats, car bombings, etc. As I said yesterday, I fully expect a powerful rally this week. Let's Rock!
Yes, jwg - Thanks for continuing to share your expertise.
On a weekly basis, we have a "key reversal bottom" on every one of the major averages. The reversal must now be "confirmed" with "follow-through thrust" this next week. In other words, if we get a strong opening on Monday, accompanied by an increase in volume, we are on our way to confirming the reversal. If the entire week shows a powerful gain (which is what I expect) the confirmation will be complete. It would be reasonable to expect a pullback the following week, but that would be the last chance to get aboard the departing train IMO.
ziggy - I find that the way to enjoy this board is to post your own opinions and trades without commenting on the posts of others unless you want to give some friendly feedback. The keyword here is "friendly"
Have fun on the golf course!
ziggy - for the record I agree it's foolish to be short right now, although it seems most everyone else disagrees!
"markets are never wrong, although opinions often are"
xe2dy - You're right, ziggy was referring to post #3014 by dimension...
"
my immediate strategy is to remain short unless the NDX takes out it's daily 20ema, which repelled the advance friday and which has been a good CONSERVATIVE buy point when trying to catch a new leg up this year. After each of the previous bottoms this year, once the mkt managed to close above it's 20, it went on to make a new highs. Ofcourse, this time, after the 20, we have the 200ema to worry about...the previous failure to climb back above only a few days ago led to the largest decline on the NDX this year; will the market remember that in the coming days?"
airedale - 'Sounds great! Thanks for the update.
After 5 consecutive weeks of decline, the Dow has advanced for 3 consecutive days. 'Sounds like a major trend change to me...
IMO the bear trap has just slammed shut, and the bull market is back on track.
All aboard! (The train is leaving the station)
frank - Why not label your ba as B, and bb as C. Then we are in the early stages of 5 waves up.
ziggy - jwg posts virtually all his trades real time. If you don't believe it check his record. He is probably the best trader I have ever seen, even though he is not perfect. I always feel more comfortable when we agree. Good trading,
Rally time! A green close will trigger program buys!
pericollo - "CLU4"
method - here is a link... click on "markets"... you should be able to get intaday from any online broker.
http://bigcharts.marketwatch.com/markets/
a green close across the board will confirm yesterday's reversal bottom. The oils are still the srongest sector.
Ziggy - If the truth were known, you are one of the best traders I have ever seen! Thanks for sharing here.
On qqq 10 min. I count 3/2 down complete, with 3/3 up beginning now.
method - IMO this is a "major reversal bottom" which will take us to new highs on all the major averages... (probably wave 5 of the bull market that started in 2002)
method - Why not?
The qqq has been trading flat (consolidating) since the close...
ticks closed at best levels of day...
no sign of weakness for tomorrow.
c'mon bears! is that the best you can do?
cash - at bottom of a bull flag!
put/call ratios confirming this rally...
http://www.cboe.com/MktData/default.asp
chuck - 'Seems to me that the time to get "nervous" is when the histograms are showing divergence (like right now, for instance)
Scott - Right now the best buy would be the DIA 101 calls at .90 When the price advances 3 or 4 points, you can sell the 101 calls and "roll up" to the 104 calls. In the meantime, you will have more liquidity and less down-side risk.
On the qqq calls, you are right to buy the 35 calls. However, I would not sell the 36 or 37 calls in a bull spread, because it will limit your profit potential more than it will lower your cost.
A good guide as to what calls to buy is the one with the highest "dollar volume" (price times trading volume) because that is where the big (smart) money is going.
I am sure jwg would tell you to go even lower on the strike price, and buy deep in-the-money calls which is an even safer bet. In any case, stay away from way out of the money calls unless you are sure there is a "melt-up" imminent.
Dimension - I notice that the number of new highs on the NYSE just dropped to 13 which is the lowest number on your chart. Also, the COMPX has made a new low, whereas the NYSE has not (non-confirmation)
Maybe the bottom is finally in.
Dimension - re. program trading...
O.K. here is my theory...
Program trading is usually either one of two things...
1. Arbitrage trading between related indexes (SPX futures vs. SPX cash).
2. Computerized buy and sell programs based on proprietary trading systems.
One thing which has possibly contributed to the volume in the first instance is the decimalization of stock quotes, which in turn has enhanced volume and liquidity in general making it easier to do big basket arbitrage transactions.
Something that could be contributing to the second type, is an increase in the number of buy and sell signals due to the fact that we have been in a whipsaw trading range for the last six months.
Just guessing, of course!
cash - I agree, and that is why I expect a "melt-up" any day! In the meantime, these ups and downs are driving me nuts!
Isn't that what your system requires to go long?
I agree that there is a certain element of risk, but what else is new?
What ever happened to the "ending diagonal?" Isn't it still there?
frank - Everyone on this board seems to be a pretty good trader, and right now everyone on this board is either long and strong, going from short to long, or about to go long on the first sign of an upturn. I'll admit this isn't easy after such a murderous and relentless decline; but come on in, the water is fine! LOL
cash - good job! (buy some more at .50 if you can)
cash - my experience tells me you should buy the Aug 35 calls at .55 now, and roll up to the 36 and 37 calls next week, after the market advances. The 35 calls have the highest "dollar volume" which means that is where the big (smart) money is going.
frank - so far, so good... eom
methodibd - The confusion is with point #3... if traders pay a premium for the qqq, that makes the qqq "overvalued" compared to the ndx (not undervalued).
Arbitrage is usually done via the futures market (long or short), or by buying or selling shares of the individual stocks in an index (or a combination of the two).
In this case, they would buy the ndx futures or component stocks, and sell qqq shares.
xe2dy - high down volume ratios are often considered buy signals (oversold market). QQQ traders often pay a premium when they expect a near term rally. This can cause a rally in the NDX due to arbitrage trading between the qqq and the ndx.
airedale - re. AIG, Your chart shows clearly that it has completed three waves down. The third wave matches the first wave. This could be an ABC correction, and it could be over! (just a thought)