Posts Tagged ‘bullish’

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Chart Pattern Showing Previous Resistance as Current Support

Thursday, August 26th, 2010

Today is Thursday, August 26th, 2010 and the markets pulled back into the consolidation zone as I call it, -75 on the Dow and 9.75 for the S&P futures.

Today we did pull back inside of yesterdays range and after all is said and done, the market needs to make a stand here and now. If we hold, we rally. If we break down tomorrow, there is no more grace for this market as the breaking point will have been reached.

That said, I am not without hope that this market will hold on. I could only be blowing in the wind, but until I see how we close tomorrow, I will hold any judgments off until that time. Getting the daily direction right, really does not mean anything to my day trading and I could get this wrong, but I will be sure to play the short term swings as that I am sure of what will happen. Moves in my direction, long and or short as the day unfolds its hand.

Last week I mentioned that the market momentum was down in the daily and hourly and that is still the case, but I was and still am looking for things to turn back up. Thursday and Friday was my days for a significant market rally as stated last week. We did drop down a bit more than I thought, but my idea is sill alive by a thread.

There is really no more room for error as it is clear that other factors will be at work if we drop significantly through yesterdays lows. That said, a break of today’s highs will be a signal for at minimum a short term rally of significance. The maximum move up while still remaining in the context of this downtrend is around 1100 S&P futures.

So, to remain objective, which is a little easier now, a break of yesterdays lows will trigger a lot more selling and be considered a break down in the market, while a break above today’s highs will get a short term rally started at a minimum. Strong resistance is at the 1100 S&P level and we will just have to wait and see after that.

OK, I was waiting for the update and it just came in at 9:30 p.m. West Coast time for the “investment market newsletter survey” of professional newsletter writers. It did come in as suspected and as I wrote in yesterdays blog. The numbers did drop to 33.3% which is significantly bullish and a trigger point number. The last trigger point moved the market a month ago and now this is a second attempt at this bullish scenario. The position of the market the last time was a little premature just based on a pure technical picture. The market has done the back filling that it needed to do and looks like it could be ready for that larger move now. There is still no guarantee’s but I would say it is much more likely now that this is all complete and we have favorable sentiment numbers to prove those bears wrong at least for a while, which is all that needs to be done.

September and October are traditionally the two worst months of the year for the market and we will have to deal with that, but I would just love to see the market blow through that paradigm and prove so many wrong. The pure technical play of the market will confirm all of this shortly, but getting a jump on the potential shift at least mentally can be an asset.

Last week, I showed a chart of the S&P 500 market but I did it in the cash market. I will show you one today in the futures market since that is what I trade. It does look a little differently and reading the support here is actually right on target as you will see. I know the current financial environment is terrible, but I am not looking at all the reports coming out of which their are many, but just the technical picture. In the chart below you will see support coming in at which was once resistance weeks back. Lets look and see together if prices can stay above that line I drew on the charts?

In today’s trading, I did good, but was just focused on closing out the position that I carried over from the day before of which I rarely never do but on very rare circumstances. I closed out additional contracts today at +16 points and +12 points of which I was very happy. I had a few scalp trades to add to the total of which I was very conservative. I know that a trader will have his biggest losses when he has had some of his best gains. I only know that because of personal experience and share to those, be careful not to let your guard down in protecting your capital, because this is where it could happen. With that said, don’t trade in fear, because you will never reach your potential if you are are afraid of pulling the trigger. When you do, just be sure it is a method trade, what ever that is for you, and if you error, let it be on the conservative side.

The chart below is a small tick chart that I have scrunched together again. This the only way you could see a detailed view of what happened in today’s market turns and include the trade I had from yesterday. Tomorrow, I will go back to showing the first 90 minutes and if I can make it to the action on time, I will have my trades there as well.

I am going over to the coast of Oregon tomorrow morning to a town called Brookings. It is right on the beach and will spend the rest of the weekend there with my wife. So, if I can put on a few trades before 8 am West Coast that will do it for me and my week.

Good Trading to all who follow my blog. I hope you find your way through all the confusion in financial world with much success, Vince.

P.S.  Read today’s message from the “Daily Motivator” (on the right margin of my website) as it is a true motivation to live your dreams. Just click on the title “Imagine Intensely” which will likely be the second post in line. Be sure to read the whole thing by clicking on the title. This can be yours if you decide. Often that is all it takes to get things going.

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Sniper Day Trading Method, Works On Stocks Too

Wednesday, July 14th, 2010

Today is Tuesday, July 13th and no pull back as of yet after hitting my S&P 1080 target.

These target announcements is just a way for me to think out loud and share my thoughts. I don’t trade these multi day calls, although if I did, I would have cleaned up. I have called all of these large daily moves over the past year with excellent timing and results. Again, its just to give me an idea of what kind of day I can expect and where the index’s end the session’s, on there highs or lows.

I did see a minimum move coming from S&P 1036 to this 1080 area as called. We have hit that, but was looking for a pull back, it did not come. I can see in the night trading a gap higher just after today’s close. It is hard to say exactly what is next. Since we did not get the pull back and are pushing the outer limits of range, this market could go either way. There is a lot of news coming out the next few days and would expect the market to show good movement.

I can’t imagine the sentiment numbers coming out tomorrow will be lower, with this big rally. The opposite could be true. We could get pushed right back to the middle numbers with 45% bullish being neutral. Last weeks numbers were 37% and falling. We did come close to the trigger point and that is making we wonder if the bulls said, it was close enough, lets buy the market. It happened about 4 signals ago, in the same scenario, so it is possible with recent examples to back that up. The market went up for several more weeks un-interrupted.

I am traveling in the SF Bay Area today and for the next day or two, so I am taking a low profile. I don’t want to have to trade if out of my comfort zone. I can for sure and do many times while traveling, but I have made mistakes in the past that I think otherwise would not have made if I was not distracted. I need to keep my consentration up at all times while following the markets. If you get sloppy, or I,  you could get spanked, (hurt). No fun.

I want to start trading the opening bell very soon and will be doing so coming up. There are better moves and volume usually in the morning open, first 90-120 minutes. That is going to be my focus, but just need to change my schedule around, not an easy task, I am a night owl, as I write this past midnight on Tuesday, oh, now Wednesday.

That is it, for now, need sleep. Below, is two charts, one of RIMM and the other, FAZ.  The first stock is a popular day trading stock and the second is as well. Some people may not be aware of it, but it is Bear Index (3x’s Index) so this has  moves behind it, as the financial sector goes about its business. It moves in the opposite directions as the banks and finance companies. It is a good day trading stock as well. You can take a peak of there charts in a tick chart. Rimm chart is a slow time frame and the Faz is a little bit faster. OK, I will be back tomorrow. Good Trading.

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About Us

Thursday, February 25th, 2010

My name is Vince Tarantino and I am the originator of SniperDayTrading.com. Below is a little about myself and how I got started in the business.

I started following the markets in the early 1980’s. I was young and just getting started in raising a family, so my capital to trade or even invest was very limited or non-existent. This did not stop my interest in trading. I started to read a lot and observe what was happening in the financial markets. I remember in the early 80’s the Dow trading up to a new milestone of 1500. Many thought it would never last, but it just kept going higher from there.

The 1987 stock market crash did not surprise me. I saw the over exuberance and euphoria that I had learned about, but not personally experienced, until that time. Even back then I always looked at market psychology and how it relates to trading.

We were in October and the market was waving a big RED FLAG to me, saying sell, sell, sell. Within one week, the market sold off in a large way. I had a small put option position in Phillip Morris. It worked out well as the market dropped and I made a very nice return.

In the early 90’s, I saw the recession coming and the subsequent market drop from that. Market sentiment was so bullish it only told me another big drop was at hand. Within a week, the market broke support and the sell off was underway.

Just after the early 90’s recession, I was laid up with a back injury and had a lot of time on my hands. Thinking what to do for a new career. What better field than a stock broker, I thought. I found a small brokerage company who sponsored me and became a licensed stock broker passing the series 7 & 63 tests. This was something I thought I wanted, until I realized that I would have to be pushing stock to clients that might not be the very best for them in their situation. In that business, it happens. So I canned that idea, but never stopped learning and dreaming of the day that it would all come together.

What I regret most of all was missing the big move of 1995. I was not in a position to take advantage of the move of the century. My professional career had taken a different direction and I did not have the luxury to take advantage of that market action. I did still follow it, because that’s my passion. I saw all the “would be” day traders try their hand at making a lot of money in the markets and many of them did. The problem is, unless you are equipped to handle all of the other factors that I will be mentioning in this site, you will lose, plain and simple and most of them did.

These new hopeful traders only saw one side of the market – UP. They did not educate themselves on how to handle a dropping market. They had been hypnotized into thinking that there was only one direction. Many people, on paper, had become wealthy, but it did not take long to show them that they were not worthy to hold onto their newly found gains because of the attitude that “this is easy”. It’s never easy and not without sacrifice.

Let me tell you from personal experience. Most people who are very successful in day trading have gotten beat up pretty badly, almost without exception. Their pride gets in the way, with them saying, “I can do this.” It doesn’t take long for them and others to realize that it is not easy, especially without mentoring or some professional training.

The year was 1995 and market was trading sideways to slightly up, with a lot of resistance overhead, and then it happened. One of the most explosive moves in stock market history and I was only able to watch it go by without me. It lasted uninterrupted for roughly 5 years, with a big hiccup in 1998, but back to new highs through the year 2000.

During this time I started my own little business of trading commodities. This was the actual products. Buying and selling. I had partners who put up the money and did the shipping. It worked out well. This was at the high of the market in 2000. The dot com bubble had burst and the whole market was coming with it because it to had become so overvalued by historical standards.

Again, I saw this one coming from a mile away. It was waving flags in front of me, saying again, “sell, sell.” I tried to warn those who would listen. At least I did what I could. During this big market sell off I was trading high volatility stocks and was doing very nicely. I was able to put together a long string of winning days, over a month and half straight. Things were going well and I was content with my method and results, when I was rudely interrupted. I suffered some medical problems that made it impossible for me to continue. I never gave up on my dream, though, through many difficult times and set backs.

That day has finally come and I am very thankful to my family, who has been very supportive, and to God who was there with me through all my trials. As I continue to move forward in life, I will be sharing my trading ideas and experience with a select few who also have a desire and passion to succeed in this business.

I love to teach this stuff. I believe this is a time of abundance and blessing. Sharing and teaching is a way of giving back some of those blessings. It could not have come at a better time. The world financial situation is not getting any better. I will be keeping my readers abreast of the real economic situation on my daily blog.

Trading the market is not everything in life and I have come to know that. I have learned to see things differently as I have gotten older and that’s good. Knowing who you are as a person is so very important before you begin trading. I take time each day and thank God for my current good health, my family who loves me, friendships that I have built up over the years, and my involvement in my local community. This, I believe, is true wealth.

I live in a small town in Northern California. It is in a valley surrounded by mountains on all sides. Elevation is about 2,500 feet, so we get snow in the winter and I love it. I moved here from the San Francisco bay area after my two children were grown, over 3 years ago now. It was the best thing I could have done.

I live with my wife in a modest home and do enjoy a little gardening and my new Australian Shepard dog, “Buddy,” who has just been great. I always wanted a dog and now have the perfect place for one. He keeps me in shape. I do a lot of hiking, exploring, and some fishing with my free time. I live between two small towns of about 7oo people each, but have a bigger town of 7,000 just 20 minutes away. I and my wife Angela like to go to Ashland, Oregon just over the border for a variety of activities and cultural experiences.

It’s a different life, but I love it and again thank God for it. I am spiritually minded and it has served me well. It gives me hope in so much more than we are able to see in the world around us. I believe it is my destiny to help others and I feel God has given me a gift of giving. I need to be faithful and continue to pursue the gift He has given me so that I may be able to bless others in the coming days ahead. This site is a part of that. I pray that God will also bless you with what I write here and on my website to fulfill your dreams, and that you too will take the blessing and share with others your resources and talents. We can all do our part to make a difference.

May you be richly blessed all of your days,

Vince

For more information you can email me at vinnie@sniperdaytrading.com.

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Will Dow Jones Industrial support hold?

Monday, November 2nd, 2009

This post is for Fridays session, October 30th.

The market sold off like fiercely on Friday and took the Dow down about 250 points. The S&P was off about 30 points. I did think that a re-test of the Wednesday and Thursdays low would come, but not so fast. I thought we had at least one more day to top out for the counter trend rally. There was news that came out on Friday, not really sure what it was to tell you the truth, but I could only imagine that it wasn’t good and the market reacted to it. It is to be expected.

Let me tell you, that in the month of September and October, the general public has become bullish. The last two months has only produced paltry gains when compared to the gains of the previous six months. That is where all of the money has been made. The general public is always late to the party and I don’t imagine that this time is going to be any different.

Mondays session is going to tell all, at least for now. What I mean is as I was telling you last week that the Dow has been outperforming the S&P and that was a problem. Well, it is not only the S&P that it is outperforming but the other index’s, but in a bigger way.

Based on my experience and I did not see this or hear this from anywhere, but years of seeing price action at work, the institutions are lightening up their riskier positions and reallocating equity assets in the high quality Dow Stocks. I mentioned this a couple of weeks ago, if I remember correctly. That is pretty typical at market tops

The Nasdaq Index is at a double bottom from its most recent pivot point low, something that the S&P is thinking about doing, to follow suit. The Russel 2000 Index has already overwhelmingly broke its most recent pivot low, by a wide margin. The Dow on the other hand has not broken down yet at all, but is sitting right on a major trend line support.

So, the Dow is the strongest, next comes the S&P 500, then the Nasdaq and lastly the Russel 2000. If the Dow holds and moves higher, the other indexes will only be making a counter trend rally, but will still remain in a down-trend, stopping at overhead resistance. Once the Dow does break down, all of the other Indexes will only go down that much farther and faster. There is a lot of room for the market to move back to the middle of its range of the last 8 months.

The last thing I will say about all of this tonight is, “Earnings”. I don’t follow this much either, but just the big picture. The projected earning that Standard & Poors are putting out for the S&P 500 for next year are a bit of a fairy tale. They have been constantly wrong and now they are painting a wonderful rebound of large proportion in earnings. Anything is possible, but I doubt it. I had heard, according to Bloomburg, that the S&P has had declining earnings for 9 straight quarters and only this last quarter have they been able to increase earnings. Those increases are from very depressed levels, not that hard. The increase in earnings in my estimation is coming from cost cutting in various forms. You can only cut cost so much and for so long, before you can not cut anymore. Where are the increases in sales going to come from. No one is spending and no one is lending and money??? INTERESTING.

That is why, the market is going to adjust itself to reflect where it is going to be in 6-9 months from now, probable lower. Just now the S&P is turning their earnings, like this month. If you invest in these companies now, you are going to pay way to much. But that is what the public does. You needed to be invested at least 6 months ago to be able to enjoy some of this rally, not two months ago, like I talked about at the top of todays post.

We need to see what the Dow is going to do in Mondays session. If it to breaks support, then all of the indexes will have downside momentum working for it. But if it can hold, there is now room for it to clear 10,300, a complete 50 retracement from it’s all time high. The S&P numbers for the same retracement are 1120. We got close.

The sentiment numbers backed off just a little last week. It is sitting at 48% Bulls. A reading of 55% is considered bearish. We only got as high as 51. One last push to the numbers above could push the reading to 55%, the big word in there is COULD.

Friday’s session was incredible. So many great clear signals all day long. I only took one trade and it was split up, what I call a “T-2″.   The first half for +1 point and the second part for 3 1/2 points. I was in the market for less than 1 minute on the first part and 4 more minutes for the second part. I really only had my screen open for 15 minutes, start to finish. There will be plenty of other trading days to capture higher point returns. But my daily goal was meet, no struggle, no fuss, no mess. Just the way I like it.

Until tomorrow

 

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Daily chart of Dow Industrials with commentary

Wednesday, September 30th, 2009

Today is Tuesday September 29th and we had a consolidation day today. There was not a lot of movement during the day, other than marking some time and drifting sideways. That actually serves a purpose, in that it can bring in rotation. What I mean by that is, weak hands are getting out while stronger hands are getting in.  With this move as extended as it is, others would call the late comers as, Johnny come lately.   These are the people who are just now convinced that the rally could be for real and they want in.

There is still room to the upside but it is getting squeezed by some strong overhead resistance on the daily chart. As time is moving forward, the momentum is slowing. The resistance overhead on the Dow has hit an upward sloping line eight times and each time it has been met with a move off of that area. This one is very clear on the daily chart. The bottoms have been rising at a faster pace but not by a whole lot. What is developing is called a rising wedge and this happens to be in a up-trend. Do you know what happens when you have a pattern like this? What is the next move when the pattern is broken? Well, the pattern is by no means broken yet, and from the looks of it, has a little more room to the upside, but not much. Looks like 10,000 will be a likely target for the upside, something I have been saying for a while.

The bottom of the rising wedge would put it at around 9300, but that would be if it just fell off a cliff and went straight down, not to likely, but that is where support comes in at the bottom of the pattern. It will likely bounce at least once off of that level once it gets there and it will get there, that is for sure. As time passes, the support level will rise, eventually choking off the low, until it is broken. The tops have found resistence at a slower or lower trajectory and what you get is a rising wedge.

When it is all said and done, the pattern will break and at that break, you can expect at the very best case scenario, a move back down to the middle of the march rally. The low on the Dow was around 6500 and let us assume that the high is going to be 10,000 so a move to around 7900 will bring it to a little more than a 50% retracement. That will be the best case scenario. That will take place when the lower support is broken and again that is currently as around 9300 and rising.

I did just see another rising wedge in the context of the bigger rising wedge that I have been just discussing. That is inside the upper leg of the current move we are now in. Is is getting squeezed and has bounced off of that level with yesterdays low of 9640. So that is the where we are right now. If this small rising wedge gets broken to the downside it is going to more than likely move over and or down to the lower rising wedge that I had been discussing above.  That is the major support for the whole move.

With all the talk, I will now have to post a chart of what I am saying so that you can see now with your eyes what I am saying in words. So check below the Dow chart and see the notes that I have made on it to see if any of that makes any sense to you, hopefully it does.

The bullish sentiment is down to 46% and that is 1% lower from last week. This is going in the right direction and allows for more room on the upside for the bulls if they can muster it. A reading of 55% is considered extreme and we are well off of that right now. It is interesting to see what will happen. I will leave the possibility open that the upper line that I discussed where the resistance was coming in at multiple times, that is that can get broken to the upside, then you may have a new pattern that could form and that would a parallel channel. The lower yellow line will become exactly parallel to the new location directly on top of the highest peak. We can look at that if and when the time comes. We have plenty on the plate to watch and see develope.

Thats it for now.

 http://www.screencast.com/t/WAe6CAPyqO               Daily chart of the Dow

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Index’s Making Room to Run, buying time

Wednesday, September 23rd, 2009

Today is Tuesday, September 22nd and the investors bought the dip and we are back on top of the upper range. The momentum has turned higher and now we will see if the next day or two will produce the new breakout and sprint towards 1100 S&P and 10,000 Dow.

The market sentiment is allowing the move to go higher, because over the last few weeks, less market timers and general market followers have become less bullish. They feel that the market cannot go higher and is due for a drop, at least more of them do this week than last week. In fact the percentage has been going down over the last 4 weeks and the numbers are as follows. They are 51.5, 50.6, 48.3, 47.8. The last one was from last Tuesdays reading and has continued to decline. That will allow for more room for the market to expand before it comes to exuberant and falls. When you have skepticism like we are seeing in the face of a huge rally, that only add’s more room to run. It works in the opposite direction, because the majority is usually wrong. I will keep you posted on the numbers.

Below are the turning points for today in the 400 tick chart. This is about the equivalent to a one minute time chart. The volume was very light today and don’t think we even hit 1,500,000 contracts traded on the e-mini. I know the volume and larger swings will return, but it is not here yet.

I am very interested in how the market is going to handle hitting the 1100 S&P and 10,000 Dow. If we do see price rejection off of those numbers with a steep sell off for a few days initially, you more than likely will get a quick recover back up. So when the time is right, I will point out what to at least be aware of. It will be in that recovery back up that the we need to really watch. We will be watching volume on the NYSE and the ability to stay above that sharp pivot low. Usually at a top, you will see big down turn, big upturn and a failure or another breakout. It will be interesting.

I do believe this flu thing coming up will have an effect on earnings and could take the hot air out of the balloon on Wall Street. There is a lot of controversy over the issue and it is causing quit a stir. As of right now, it does not and has not been to much of a problem, but the powers that be, seem to think it is. This also should be on your radar to watch. The market very well may react to some event that suddenly makes things worse, what ever that may be.

One thing on my mind is the passage of the health care bill. I do believe the people at the top really want that bill passed. Most people know that it is going to cost them. I can tell you, Americans are not interested in shelling out more money one way or another. If they want to get it passed, I believe the stock market will have to stay up in these higher levels until that time. If we get the drop that I expect will eventually come, it is going to be a WET BLANKET for the passage of the bill. People will be screaming mad and more broke than they have ever been. So look for passage before the big drop. If there is no passage of the bill at all, then that to could send things down.

That may seem pessimistic, but if its true, isn’t that whats important. When, things are going good, they just are and the opposite is true. There is no recover as of yet. We may get one, but it has not materialized. The jobs picture is the worst in 70 years I just heard in California, over 12 percent and getting worse. The stock market always looks out 6-9 months out. Right now it is saying that a recovery in the numbers are going to start showing up. It may be that the numbers the market is reacting to are from the stimulus injected into the economy with no real staying power. If that is true and there is no real punch to follow up behind it, the air is going to come out and fast. We have all the ingredients for just such a reality. But as day traders, we need to look inside each individual day and find the  opportunities that exists, thats our job, thats what we do.

http://www.screencast.com/t/BDp915vYoDZZ            Turning points for 9-22-09  on the 400 tick chart

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Early pullback but market closed slightly higher

Tuesday, September 15th, 2009

Today is Monday September 14th and the markets pulled back but the pull back started on Sunday evenings night trading. From Fridays close to the session lows, was over 12 point, but the market started its recover and at the open it just continued all the way back up and then some. The S&P close up about 6 points but as I write this the aftermarket is off 4 points and now is very close to being flat for todays session. I think we may still have some downside coming, but again I will leave an open mind and just read the charts. Today we did hit a 50 % retracement point from not the all time high but a significant turning point (1433),  close to the all time high, that is being watched by numerous traders and investors across the globe. I will be watching closely for a downside break. Todays action put in a very large pivot point that if broken will send prices at a minimum back to the middle of the range. Tomorrow I will show you a 60 minute chart of where prices are likely to go when and if we get that break.

I wanted to make a comment on an article that I saw, about an Nobel Prize winning economist, Joseph Stiglitz. He said that the problems in the banking industry are now worst off than they were in 2007 before the crisis.  In the U.S. the to big to fail banks have become even bigger. He also stated that we are going into an extended period of a weak economy. This guy was the former chief economist at the World Bank. I am not easily impressed by credentials but this news also confirms similar reports that I have come to hear, about the same thing. There is trouble brewing out there and it will spell trouble for the S&P and there forward looking earnings projections. Keep your eyes open and be careful.

Below are some of the trades my method generated today. You can see the up and down arrows at key turning points. This is out of the 233 tick chart and most of them are in the up direction because that is what the market was saying at the time. I did think that we were going lower around the 10:30 am area, but the market quickly reversed and blew past overhead resistance to continue higher. I did see the trade at 11:30 pretty clearly after a long waiting period. Initially it did look short, but quickly saw things differently to adjust for the breakout.

Tomorrow will be an interesting day, because there will be a lot of news coming out which should bring in the volume, always a good thing.

Last point for today, the market sentiment numbers for last week softened up a little at 48% bullish. That is off about 3%. If we are going to go higher, this easing off is a very good thing. We were getting close to being to optimistic and that could be signalling the top, but that did not happen. If we are able to pull back over the next few days this would set the stage for yet another easing in the numbers. When the bulls take back control, there will be room to the upside for the numbers to adjust themselves to the upside, giving us the signal, but at higher prices.

That is it for now.

http://www.screencast.com/t/2CeF6TyV             Turning points for part of the session

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Bear Market rally continues

Wednesday, March 18th, 2009

Today is Tuesday March 16th and the last hour shows strength

The market had some good moves today in both directions. I saw a couple of 5 point sell off’s and a couple of 3 point sell off’s that were very clear. The moves on the upside had more room in them, especially in the late afternoon. I saw a couple of 5 point moves to the upside and a couple of 10 point moves as well. I had some of both to pick up my daily goal plus. Todays total was over $ 2,000, but I traded a little higher contract size of 5 to 8 to get it.

I had a little misstep in the early going but was able to recover. It was a mis-trade that cost me, but I was able to make up for it in the late afternoon in one of the nice rallies upwards that we had. I had manually put my stop in, but placed the order in the wrong direction adding to a loss, I traded my way through it and had some nice returns at the end of the day.

I have posted a chart of the hourly S&P and daily Dow. Yesterday I called the initial resistance top of the S&P and it was good for a very large move to the downside. Today’s open took the market up, back to the middle of yesterday’s range, selling off a couple of times on the way up. It wasn’t until the last hour that the market decided to advance up through the overhead resistance and push its way higher, it did not take me long to figure out that the market was strong and decided to go with it for some nice gains.

It is only in reading the charts that we can make a true determination on the current market direction. That is day trading “one O one”. It’s nice to call big directional changes and a lot of times they work out, but to place all of your market calls on what has not happened in the future is not wise, while day-trading. We are only trying to capture a few points in either direction with the prevailing direction being of no consequence. Trading up is just as good as trading down.

I will point out that the sentiment numbers did come out last week and they were only 26% bullish at -3% and 47 bearish at +3%.  So last week people became less bullish and more bearish. I think that is adding to the rally we are having. These readings are currently very bullish for the market and we are seeing some of that played out. A reading of 35% or lower is typically good for a move up on the markets and the last reading is 9% below that. So over all, don’t be surprised with the current move up. If the market does come back in the middle of the last rally and then overcomes the last pivot point high, it will have a lot more power behind it. On the other hand, if it can push through the current outside resistance and move up, it will have a higher failure rate, when it starts to drop. So I am all for a pull back, but when it comes to trading the markets, I don’t really care. I know we will find moves in both directions.

Let’s take a look at tomorrow, and see if the Dow can break through the outside resistance, it is coming up on it now. The Dow closed the day matching yesterdays high, while the S&P closed slightly higher than that. I have seen many times the indexes go slightly past their previous highs, only to fall back and fail, thus taking the late comers down.

http://www.screencast.com/t/AUgxJSONYx      Some of today’s trades “Live”

http://www.screencast.com/t/LRwBANuN          Still shot of hourly S&P and daily Dow

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Wall Street Rally – Mission accomplished

Tuesday, March 10th, 2009

It is Tuesday March 10th and boy did we get a rally.

It was nice to see the market rally today, because yesterday I stuck my neck out with a bold market call. I stated that the market should move up nicely off the low end support and rally up at least +185 points plus. When you see patterns and formations thousands of times, you can come to expect repeatable patterns when the conditions are right. That is what I saw in yesterday’ s close, a market that was ripe for a move up.

Technical Analysis is the study of price action patterns combined with support and resistance. It takes a lot of screen time to be able to spot those patterns so that they are second nature to your eyes. Meaning it does not take long to be able to identify whether a pattern is bullish or bearish and have the confidence to be able to place a trade in that direction.

I feel blessed to have the amount of screen time that I do, because it has made me a better trader overall. There are so few people who can process the amount of information you need quick enough to trade the short term swings and, as I said, I feel fortunate to be able to do so. As time goes on, I would expect that anyone who comes into my trading group would have the benefit of years of market knowledge available to them. It is not easy to be consistent, it takes work, and I feel, if you are going to cut down the time it takes to learn how to trade, you will definitely need a mentor. It does not have to be me, but it can be if you choose.

I did not have a mentor and learned how to trade by myself over many years. If I had the benefit of a mentor years ago, I could have learned a lot faster. One of the reasons I didn’t was I could not find anyone I could trust and who I thought really understood how the market flows. So, I worked through it all by myself.

You can see through my videos and postings and consistent trading that I do know how the market works and how to capture daily profit from it. I will soon be gathering up a group of traders who want to learn my method of trading and be able to pull good money out of the market each day. If you are one of them, send me an email message and I will get back to you with more details. I will write about this again in the coming days.

Today’ s trading went very well. I had 10 trades with 8 gains and 2 losses. I split some of the exits up for some increased profits again today and was still trading small, but had very good profit of around $ 1,200 plus for the session.

Again some of my trades below.

http://www.screencast.com/t/LnlvBx6z             Today’s equity chart

http://www.screencast.com/t/ZckxwreoV        Screen shot early trades

http://www.screencast.com/t/9kx1aNNQxfu    Live -some of todays trades

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