Wednesday, September 30, 2009

Never mind!

Here is an updated hourly bar chart of day session e-mini trading. A couple of hours ago I said that the high volume, down side break from the trading range of the past two days meant that the e-minis were headed for 1020. But the picture has changed dramatically since then.

The e-minis have rallied past the breakout point (dotted horizontal red line) and above the midpoint of the day's range so far (at 1051). This should never happen if the break earlier today represented selling by longer time frame traders. Instead I now conclude that that selling was done by weak longs and by aggressive bears. And the buying this morning (on bad news) was done by longer time frame traders. The implication is that this mornings shake out strengthened the technical condition of the market. A move to 1091 (the top of the green dash trend channel and the dash red line at the next significant midpoint resistance) is now underway.

22 comments:

Piazzi said...

we are in a wave 3 of 5, what fooled you was the C leg of 2 of 5

as long as 1041 area holds,

that count is valid

The true strength of a trader is not in 100% being right, but in his ability to adapt and react

Great Trader, you are, man!

extrader said...

No one really knows how to play this game, only the Big Boyz!

nuff said

vito said...

Hi Carl as always thank you for your blog.
Never say never LOL if you don't like the markets direction wait a few and it will change.
Fickle thing that it is...
Thanks
Vito

extrader said...

Well, now that we have a clear signal to the top again... On this move up to 1058, ES needs to hold 1054 support and if the rally is strong enough, prolly will test 1062 resistance, if it blows past that next resistance 1074!

ex

Kishore said...

It appears that a lot of people took short positions in the morning. It turned out to be a bear trap! Sooner or later, the longer-term trend on daily charts always wins. But it so easy to get carried away by the down moves.

Top and bottom calling is a popular thing to do, as it boosts the ego, but it sure is not profitable.

andi said...

nope..carl has to revise again in OCT..This was a classic end of month dressing..volume on a selloff is still impressive..And the upper trend line (of the downward channel) is being touched ..i am opening shorts that i covered in the morning..market is headed o 1020 by next wk

RAW said...

I am reminded of the bold warning scotch-taped to a conspicuous red telephone behind the bar in a little tavern in San Francisco financial district:
"Don't obey alien instructions."

vito said...

Hello RAW
OMG I know what the means..
Vito

vito said...

Hello all
Before you think I am crazy there is a story of a floor trader who never told other traders what his system was other than he got his picks from spacemen. When in reality he was just using a simple money management stop and reverse system.
Funny stuff
Vito

Kishore said...

andi, the bullish flag (the channel) on 30 min charts can break too, to the upside. Moreover, there is clear upward channel on 5 min chart. Now, we even have a bullish flag, even on the 5 min chart.

However, you may be right but the probability for a down move is low and it is high for an up move.

For me, it is fun to learn from your experiences because I have had enough bad ones of my own. But then, don't just disappear from this blog if you are wrong. Otherwise, we will surely miss you.

Kishore said...

andi, I see a head and shoulder topping pattern on the 30 min chart. Do you see that too? But have n't we seen those before? What should we do?

septizoniom said...

i have been following your blog for near a year now. i do commend you on your general instinct for the medium term (there may be a lot of reasons for this accuracy); however, i find it somewhat specious for you to proclaim, such as you do today, the reasons for market movements. i just don't see how you can know what you assert. at best you are a very skillful instinctual medium term market caller

andi said...

kishore, watch USO & EEM here..besides dollar index...don;t trust too much all the bearish pattern of late failed beacuse of ben shalom bernanke

Adam Berkowitz said...

i think a characteristic of a successful trader is the ability to change their mind based on a reappraisal of the technicals...

who knows if this reappraisal is accurate, only time will tell...

having said that, i too am biased to the long side (on the intermediate and the longer term time frames)...

good trading to you carl,
adam

mfm9800 said...

Hey, this is Carl's blog and Carl damn well gets to say whatever he wants. It's the only blog I follow and it's more than useful to me. If you want to run your own blog, then go for it. But don't dis Carl. You're allowed to think whatever you want, just be more careful in posting it. This blog has always remained respectful. Let's keep it that way.

extrader said...

Looks like 1054 will hold... good time to get long here and see if we can test 1062 by EOD!

andi said...

kishore: looks like selling perking upp..poor carl was right in the first instance

extrader said...

Time to change ur mind again!

Teich said...

This second drop in /ES today has about half of the volume of the first one. I see a positive divergence in the market.

extrader said...

Today was one of those days where you had aggressive traders on both sides of the tape, and in the end it looks like the sellers took control of this market!

Looks like 1060 is resistance on ES...

MaverickUK said...

Both the FTSE and S&P have posted key reversal candlestick patterns today. I think we are going down. It is quite possible the tops are in. On the SPY it did double top at 108.05. It did this last week.

The FTSE seems to have double topped today.

karim said...

A valuable post and it much helpfull to all.Thanks a lot for your post.

Karim - Positive thinking