Posts Tagged ‘market rally’

Markets Rally on Que

Tuesday, April 26th, 2011

4-26-11;   Markets Rally on Que.

Well, the markets rallied strongly, as mentioned in yesterdays posting. I wont’ rehash it all, but said that we were ready to rally. The last call short for 25 S&P + points bounce right off called support and rallied as I said it would. Then said that today the market would rally big and it has. Well, the rally for now holds, so we will see what happens to the rest of it. No trading again for me today as I will be ready tomorrow. Good Trading to all.

Market Advances With More Still to Come !

Monday, October 18th, 2010

T0day is Monday October 18th, 2010 and the market did continue its advance as called in yesterdays blog with the Dow up +80 points and the S&P +3.75 points on the close.

In yesterdays blog post I said the market would likely advance even though the market at the time was down over 8 S&P future points (about 80 Dow Points) on its way to over -10 point S&P points and rallied as I thought it would. It is the start of another wave coming this week which should get the S&P to 1200. Their is a little left in this market and it is getting played out as we speak.

One statement that I could not forget from yesterdays writings was, “The rally would not end until all the shorts have covered and the longs are all invested”. That stuck to me for a while, because that is what I think is now happening. The big decline that everyone was expecting in late August/ early September, never happened and those traders and investors that went short then are the ones who are helping cover this market to new high ground. We are now around 140 S&P points above that low turning point on the S&P with a little more to go.

Everyone needs to do a little soul searching and come to the realization that the economy is being pumped up from various directions. I won’t go into what I could at this time, but just know, markets are a lot bigger than you and me. We just need to know who is playing and what is their objective to know the next move. You will never come a realization of fact until you see things as they are and not as you want them to be. Far to many people are seeing things as they hope, dream and wish, but its not about us and what we want in this world. It is about what is and what are you going to do about it. Harsh words, I know, but this is the only kind of thinking that will keep you on the right side of the market.

Their is a time to bearish and a time to be bullish. Late August in general, was not a time for a bearish position. Just like what is potentially shaping up now as not a time for a bullish position. So, be like a doctor and take the pulse and heart rate of the market. Do not see it as you want it to be, because the market is larger than you and does not really care what you or I think. Try and see the masses and what are they doing and why are they doing it. Their you will get answers as to the real intentions of what is taking place.

In today’s trading I did have a quiet morning to follow the markets. I often don’t trade the early market open, but I am trying to change a long habit of trading when ever. With a solid methodology, a trader can do this, but it could end up being more work than it has too. Meaning, if trying to trade the slow mid day portion of the day, most traders will struggle with issues. Market to slow, no patients to wait for the setup, anxiety, forcing trades are just a few problems traders will face during the 9 to 11 am West Coast time. It could serve as a good time to learn or get ready for the afternoon session or what have ya, but as a rule, traders should be very careful trying to trade during this time.

Back to how I did today. I took a few more trades than I wanted to, but enough to get what I came for. I know that on the open, the market is not always going to show its hand so quickly, so I was ready for a couple of scalp trades. The two I took, were just a little out of reach, I did not get filled on the first one and did not reach the second one when I want to get cover. It all worked out in the end and chalked up another winning day. Nothing earth shattering, but we have to take what the market gives and it was not putting out a whole lot in the early morning. The chart below.

Good trading to all, until next time, Vince over and out.

S&P futures hit 1080 in Mondays Night Trading

Monday, July 12th, 2010

Today is Monday, July 12th and a pretty flat day on the Street.

No great volume or movement today as the market looked like it was putting in a top, only to have the market rally towards the end of the day. In the night trading, currently, we are seeing 1082 as the high, finally hitting the S&P futures 1080 + or – as called, but no market reversal as of yet.

The charts below, are from today’s action. A few trades early on, 10 minutes of trading in the morning and 30 minutes of slow trading in the late afternoon. I had limited time to trade today, but that was fine. Daily goal met.

That’s it for now, more in tomorrows posting. Good Trading.


Unemployment Numbers to be released Friday

Thursday, June 3rd, 2010

Today is Thursday and general market was up slightly with a strong finish into the close.

The S&P, Dow and NASDAQ markets were all up slightly at the close with a strong come back from earlier session losses. I believe there are unemployment numbers coming out tomorrow and it is expected to be an important figure which will propel the market big one way or another.

I did not hear the speech, but someone said that the President was speaking and made a comment about great unemployment results to come. He seemed to be upbeat about the news tomorrow. Well, let me remind you of a time that he addressed the markets before. It was two days before we hit the S&P 500 low of 666 on March 6th or 3/6.

The point is, two days before the market hit that bottom. I did hear a speech by the President that was so very upbeat and encouraging. He basically said, the stock market is a great buy, but not in those words. I had never remembered a previous president doing that, but it may have happened. Again, back to the point. Two days after that speech, the stock market shot up over 400 hundred points on the Dow and it has not looked back since.

Now, I had heard of a very upbeat speech that was given today about unemployment and that you can expect this and that. Well, he seems to have pretty good timing in the past, is he going to go two for two, maybe ?

The market is in a position to rally, but there is one thing I would have liked to have seen today that did not happen. I was hoping for lower numbers on the bullish sentiment that was released this week. It came in basically the same, around 39% bullish. That is not really good enough to get the call the I was looking for, but that does not mean we can not rally. Many times the numbers will push back and forth in the middle as a fight is taken place between the bulls and bears. Its just that when you get extremes, we often see bigger more predictable moves. OK, enough on that.

In today’s trading, I was trading very small, just 1-2 contracts. I was coming off a few days of very big gains and moved my contract size down to insulate myself. It did not change anything, as I still traded well and hit more than my daily goal. I probably traded for about 8 S&P points of total profit. Much more than the 2-4 points I shoot for on just a regular day.

There are times through out the week and month that I have been pushing it and I have done very well. I usually don’t like to trade for a long time. I know that it is often times best to get in and get out. If you have good profit for the day, book it. Go do something else or enjoy some of the freedom that trading offers you. Many traders will say, that they like the idea of being a trader, because it will afford them more time freedom. That can be true but only if you exercise it. Taking time away from the markets can give you a fresh perspective. If you trade all day, every day, you will get tired and burned out which can produce mistakes. You need to be fresh and on high alert. It is to easy to place trades out of boredom as the action slows down, so be careful of that.

As I say that, there is a place and time for study. It is important to get screen time in if you are new to trading. It has been said, that good trading is more like an art. That can be true, but you can learn this art or trading by exposing yourself to market data. I feel, every serious trader needs to keep learning and one way to do that is, by looking at past data and becoming exposed to different setups, reads, looks and situations. You can still do this while the markets are closed as you go over past data. There is a value to it, even if some think not.

Seeing how the market reacts in certain price action setups is important. You need to put your mind inside the price and feel the moves and try and experience what other traders may have been feeling for them to push the market up or down as you see it unfold. Again, this is past data and it does help. Looking now at live data is different, but if you remember what setups you seen that worked out before, you will over time, be able to identify them as live data unfolds or that is what you need to strive for. History repeats itself and that sure is true in the trading markets. Find the history of the past and apply it to the future. You will be glad you did as that is what will turn out a winning day, week, month and year.

Good Trading to all

Market Rallied on Queue, so far…

Tuesday, March 2nd, 2010

Today is Monday March 1st and the market rallied on cue.

We did see the rally on Wall Street that I was mentioning, but it did not have all the bells and whistles that I was looking for, like increased volume and conviction behind it. It still counts and maybe its a warm up for tomorrow? All the index’s closed at the high of the day with the S&P +11 points about 1 %. The Nasdaq was the big mover at + 1.5% on the index.

If you look at a chart of the S&P 500, the Dow Jones Industrial and the NASDAQ, you will see that the NASDAQ is in the lead right now. With one more day like today, it will be right at its old highs. I did see this previous outperforming as a sign of internal strength, giving me one clue to a market rally. The other was the low sentiment numbers, which are coming off quickly, but still a bullish scenario and lastly price action itself. The position of the bars themselves, tells a lot if you know how to read it. For many, it may just look like lines on a chart, swinging up and down, seemingly without order, but that is not the case.

I don’t want to build up any false confidence in the current price patterns. Every trader needs to be careful at all times and expect the unexpected. Let me point out a surprise scenario as the market is not out of the woods yet. I have seen many times patterns in the daily charts that look just like the one we have now, that draw the unsuspecting in, only to quickly pull the plug and take it down hard. There could be bad news looming and that could be a catalyst for just a scenario. The idea of being a day trader is as the word describes, we follow the action of the day. I know there may be position traders that out there that will hold several days and they may find many of my past market calls helpful to see the possibilities, but as day traders, we look inside each day and should attempt to read the price action charts to determine if we are in an uptrend or downtrend. Then, you will be well served to find a low risk entry in the direction of the dominant trend for the time frame you are in to capture a piece of the move.

It is best not to try and pick tops and bottoms. It really might feel good to do that when you can, but this really only feeds our ego’s and does not bring us closer to becoming professionals but more like amateurs, so try and not do that. If the market is not trending up or down, but range bound, you will have to find your way to catch a piece of those moves and take what the market gives you. You can’t take what the market does not offer, so, keep your expectation in line with the current price action. That is important and it should be remembered to keep yourself from getting frustrated and controlling the greed factor. If those two emotions come out of the bag, you could be toast for the session. So, keep a lid on it and one way to do that is keep your trading expectation in line.

Once you get good at catching 2-4 points and it could just be 2+, that is often enough on average to do very well. To average that, it is best to catch a bit more now and then, to cover any future loosing days you might have. The key is, having in mind the ability to capture two small points for the session. If you have in your mind that you are going to crush it today, with high expectations, often that will work against you. Stay calm, be realistic and quietly take what the market gives you and move on.

Long term readers of my blog know that I have a 4 S&P point stop for the day (Dow=40 points) That is when you have to throw in the towel. If you don’t have a point where you stop for the day, you only open yourself up for a possible whip out day, which you cannot allow under any circumstance. Controlling your loses is mandatory, it is not an option. Success will depend on it. Even if it means having a losing day, that can be a victory, because you stood your ground and stopped trading when you were supposed to. It is only one day and you can make it up down the line, just put it past you and keep your focus on trading properly.

Don’t trade against the market in the acceleration phase, (while the market is driving forward ). You will see a shift in power or a transfer in momentum as the market rolls over. At that point, you need to use your entry skills to get in and risk little. My Emini Trading Method, will teach those traders who need structure and a method to follow, that is clear with rules to identify which direction you should be trading and how to enter and risk no more than one S&P Emini point while doing so.

If you have your own trading method that shows promise, you may want to consider adopting some of the idea’s above, it could increase your bottom line.

In today’s trading a few trades only. I could only take what the market gave me, and it wasn’t a lot, but enough.

I wish all my readers the best,

Round 2 for possible surprise rally? or Not !

Wednesday, November 25th, 2009

Today is Tuesday November 24th and the major market index’s are showing signs of life.

The short-term trend is just barely down and I am measuring this on the 120 minute bar chart. Any significant uptick will turn it UP, so we will have to see what tomorrow brings us. The daily trend is clearly still up and as well as the weekly. The monthly will have to wait still yet another month to make things clear.

That is how it measures up as far as the technical picture is concerned. As mentioned, any significant move higher from here will more than likely spark a big short covering rally. We are pretty much in the same place as we were 4 days ago.

The trigger points have been clearly established and now even more so at this point. Pressure points are  built up on both sides of the fence. This is where you need to be careful and wait for confirmation to buy into the argument of a solid longer term pull back. We are not there yet and the price action is confirming this to be true AT THIS POINT. 

The bullish sentiment, as of its last reading 46% is in the middle of its range. A reading of  55 is considered very bearish and 35% bullish. We are in the middle. The bearish sentiment is very weak which does signal a bearish tone, only 22% of the experts are bearish, which is really not good for the overall bullish argument. This represents conflicting attitudes and does not represent a consensus on future direction at this time.

That being said, you still have to give the benefit of the doubt to the bulls, until and unless the markets say otherwise. So lets see what happens. As I said last week we are in a position to spark a big short covering rally. We have not been able to take this market down as of yet and it may be that the positions are just building. That may be true, but the same can not be overlooked for the bullish side of the argument. A break out over the most recent high could spark a rally that Wall Street was not expecting and with it, bring a wave of buying that will only cover loses for the short sellers.

We really just need to let the market tell us, but don’t be surprised if we get the surprise rally I was talking about. Stay open-minded until it becomes clear as day.

I did place a few trades today and I will have to say, I was not to happy with it. I was a little early on a few trades and I had to endure a little heat. The first trade I did intentionally place a larger stop to accomodate the volatility, 6 ticks. The market went against me 5 and was still alive. That was really OK, because I intentionally allowed for it. A couple of the other trades were a little a to early and should have waited.

I don’t like to have the feeling that I am going to miss a rally, that I am pretty sure is coming. I hate that. I need to be OK with missing it.  Today is worked out, the trades did not go more than 3 ticks against me but it did not have to even come to that, if I had waited for the right timing.

Maybe my next session will be better. It may look like I am being overly critical of myself given the good results, but I don’t look at it that way. Doing the right thing at the right time is the most important, not the results, because I know that if I do the right thing most often, the right things will automatically take care of itself.

Thats it for now, I will probably not trade on Wednesday. The price action is usually a little strange during this Holiday week, although today looked pretty normal overall.

Until my next post, I wish everyone a Happy Thanksgiving to you and all of your families.

Vince

http://www.screencast.com/t/ZDUyZjk0Yzgt

Wall Street Rallies Catching Many by Surprise

Tuesday, November 17th, 2009

Today is Monday, November 16th and Wall Street rallies, catching many by surprise.

One day, a trend does not make, but it was nice to see the market keep its footing and start tossing out the bears. If we get another day like today, it could set off a  feeding frenzy . The Bulls will be goring their way through those Bears like nobody’s business, leaving a mess behind them.  

It has not really happened yet, but I only point out the possibilities. Last week, I just could sence it. Everyone thought we were going down. In fact, I am sure that they were surprised that we even made it back up to the higher levels by the end of the week.

Today’s close was very important and I was watching it. If we had a steep sell off at the close, that was not going to be good. It started to look like it was going to happen. Just after I picked up about 4 points for the session, the market stalled and went sideways. I finished trading, but I totally saw the break short late in the day. It started to look like it had legs, but it stopped right where it had to, to  mount a counter trend rally back up. It made half of the sell off back and we ran out of time. This is 50% back up off the little sell off, typically a continuation point for a sell off to continue.

The Dow was up 136 and the S&P +15 points at 1109. The S&P is about 10 points off from hitting its 50% retracement (1120) level from it’s all time high and the Dow has already done it.

Let me draw a line in the sand. This will help define things a little better. If the Dow and S&P break down below last Thursdays low, we are going to get some selling behind it. This is what the Bears want and the orders will really kick it to dump shares that were accumulated over the last months.

On the other hand, if we can contain the sell off and mount a rally similar to today, it is going to bring out all the Bears from their hiding place and they are going to have to cover their short positions only adding to the rally that already is under way. That is why I say, it could be a frenzy. If I had to pick one, I would have to pick the latter, I think a lot of people made up there minds about this market going down a long time ago. I was one of them, but I repented, from my ways and now see the light. The light I am talking about is that I need to remain open-minded about direction and not make my mind up before price action tells me too.  Although, this is what I said months ago, “I would have to see what is going on when we get there and combine that with market sentiment”.

One common mistake traders make all the time is that they try and pick tops and bottoms. It might be fun to try but if you are doing it with trading and investing capital, it usually does not work out for the majority.

It is best to let price action tell you what is happen and let the hero’s pick the tops and bottoms. We will not have far to trade-off the highs to see if in fact they are able to take it down. The last pivot low for the Dow is 10,171 and the S&P is 1085. With this market being only 25 points off that critical level, it pays to wait. Just the week before it was at 1029.

So, the trend it still up and I would say, we are smack dab up against resistance in all the index’s. If it closes higher from here, it is going to spark a big rally coming out of nowhere. At the same time we have to stay above the last pivot low as  just mentioned to keep the rally alive. A break of that level, could end it.

That is it. Now we wait. There is a lot of news coming out this week. This is a link that shows what is coming out and at what time. http://www.briefing.com/Investor/Public/Calendars/EconomicCalendar.htm  All traders should know these data releases. The news is not as important as the time of its release is, (my opinion). Don’t be caught off guard. Most of the news looks like it is coming out before the open, but Friday has a 7 am new release this week.

I believe everyone should always have a stop in place as they put on a position and that means the same second. If you don’t, it will only be a matter of time, that some event or unusual news release catches you or just  market action, takes you and your account down, sending you to the corner.

I will talk about this and other things next go around, until then,

Good Trading!

Where does the market go from here

Sunday, May 24th, 2009

This is for Friday’s post May 22nd, which I did not write.

In Friday’s trading, I did not have a very good connection, I was traveling and not in my home office and my data was freezing because of that, so I elected to just make a few calls on direction but not trade at that time. Later in the session, I was able to link into a faster data connection and took a few trades to a get double daily goal.

I was trading small, but picked up my points with no problems. I remember taking 9 trades and only had one very small loss of  1/2 point. I had some split trades in there, half the order comes off first and the other half later (T-2) , usually at a better gain.

The market sold off on Friday during the last 15 minutes of the day, another close at the lows of the day after trading higher through out the session. That again should have an impact on Tuesday’s opening market.

Trading Lesson:    Generally, when the market sells off early in the session while it is in an uptrend on the daily, you can often see the market come back and close at the highs of the day. The same is true when we are technically in a down market. You will see the market rally early in the session, only to close at its low of the day. We have been seeing exactly that the last three trading sessions. It happens all the time, so it’s one of those things to keep in mind. If you don’t know if we are in an no trend or downtrend, you have work to do.

Where do we go from here?  Since last week, we had broken the wedge that was forming to the upside, that I had been talking about for weeks, but we do not yet have a lower low from our most recent pivot point. Some of my daily indicators are pointing down and some have yet to turn down. From the price action that has recently taken place over the last three trading sessions, I had become bearish on the daily, but with caution.

On Wednesday I stated in my blog, the short term top was in and lower prices were coming off of the price rejection I saw that day and hitting the adjusted outside purple line that I had talked about for a month. All of that has happened and now we will have to see if the last pivot low is going to hold. There are things happening that say it can hold and at the same time, there are things that say it will drop down and break the low, which will bring in more selling. I don’t know which one it will be yet. Pure price action says there is no violation yet, while momentum says it should break. I am going to have to let the market decide and you should too at this point.

We have come off 50 S&P points from the top at 930 to Thursdays low of 879. A month ago I had said 940 or so would be the top of this little run and was off about 10 points. I just needed to re-adjust my lines and last Wednesday I saw that.

Anyway, let’s just let the market decide. If it does break the low, we could see a move down to 847 to 850 on the S&P. It’s not too steep but it would naturally find initial support there at a parallel channel taken from the most recent tops. That lower end of the channel comes in at around the level I just mentioned. Again, we will have to see what happens first. It would appear that is what is going to happen, but if price action changes to reflect something different, I will look to re-asses. With the Gov looking to take control of GM, that could tip the scales south for now.

The financial networks always try and come up with a reason why the market did this or that, but fail to realize that much of the price action would happen that way regardless of the news – just a personal observation.

Last week I was talking about “Price Action”. I wanted to clarify one thing, the difference between price action and price patterns. I believe I was pointing out a “Head & Shoulders” formation that developed in a 5 minute cash chart of the S&P from Wednesday’s sell off. Anyway, there is a difference between the two and I wanted to make that clear.

Price Action is a collection of price movements based mostly on support and resistance. Prices are pushed above and below their mid point.  While price pattern is the collection of price movements that cluster to form identifiable patterns. When those patterns are broken, you can draw a conclusion that will yield a highly predictable outcome. Price action is what takes you to the point where you can see the formations coming together. It is almost like, which came first, the chicken or the egg?

In this case, price action comes first, then comes price patterns from the price action. I hope that helps clear up any questions you may have had about that. If you were not even aware of the difference, you now have it explained.

http://www.screencast.com/t/lcQ9oHq5q Friday’s equity chart

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

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