It is nice to dream, AMZN going to 250+. Well it could, if MACD starts to turn up here. By the time you wait for the daily MACD to turn up it is usually to late to buy. The weekly MACD isn't even close to giving a sell. The trick is being able to hold onto the options if they go deep in the money, I would sure like to put some nice presents under the tree. Impeachment hearing eh! From a Canadian perspective, these hearings are great comical entertainment. I would be embarrassed if those were my political leaders trying to bring down a very popular President, who I think has done a lot of good, for having been caught with his pants down again. Wake up and look back on your other great leaders. Sorry, had to get that out. The market I think is going to live and die by the dollar right now. The falling 200 day average is just under 99. There is a strong correlation to the dollar, sometimes even on a daily basis. If the market hasn't already peaked it might correlate to a possible test of the 200 day on the dollar, which almost might also correlate to the President not being impeached. I don't think the time frame will fit though if this process drags on. The dollar has to get above 97 first. Incidentally the dollar bottomed before stocks in October. The put/call ratio is still keeping me out of the OEX for now. Look how critical the 580 level is on the OEX, if you are playing for a breakout to the downside. I have added the 20 day moving average(572) to the 15 minute chart. I don't think it will hold a second time. The volume/breath bands are suggesting longs are at risk. Adlinxert on the 15 minute chart paints a different picture compared to the daily. On the bullish side, this trin indicator(marked by an arrow)suggests we are forming a bottom for a break out to the upside. Notice with this indicator we can still get some pretty violent down days. Here is the hourly(I changed the rsi to 5) and the five minute.
The OEX managed to close above the TSF indicator so we could have continued upside as long as yesterday's lows hold. The put/call indicator just got worse, not quite having reached an extreme but enough that will keep on the sidelines still. Look at some of the earlier peaks, they didn't necessarily translate into a major selloff, the market sometimes just went sideways with wide intraday swings, kind of what we are getting now. There was plenty of "MOO" in Microsoft, but the stock is really going to have to move strongly from here to keep the momentum to the upside, I leave this one in Travis' hands. If you are holding DAL calls on my recommendation, the stock may now be on the verge of finally breaking out over the next two days. I would leery of holding any December calls though. The transports are what might still keep this market afloat. The hourly cycle looks to be bottoming this morning. Here is the 5 minute chart.
Where are we going from here? TSF is now close to making a possible reversal to the upside, the13 day ER moving average is in starkly different position compared to the summer plunge. The 14 day rsi indicator on the daily and hourly, I think is painting the clearest picture. We have a stronger peak compared to the summer peak on the daily. The hourly still has plenty of room for a rally. I am looking for the daily rsi to diverge this week maybe setting up for a great short trade. I caught a look at Travis' commentary before I updated, I will probably be looking to pick up some Microsoft calls as well . As for the OEX I don't see a safe entry point tonight for a long trade but it does look like what Travis calls a ninth wave may develop this week. The oddlot shorts were pretty active last week. Here is the 5 minute chart. On another note, we have added a Traders Press Bookstore to the index page, if you are looking for a Christmas gift, you might find it here.
The DOW trading system gave a buy signal yesterday, all we need is Master11 to go on a buy and maybe we can look at playing the long side next week. TSF is still a fair distance from signaling a possible change in trend. MAJ closed right on the upper band. The half hour and the hourly cycles look to be bottoming one right after the other. 574 looks to be tough resistance to crack on my intraday charts. This is starting to look similar to the July plunge. The market took a breather for a few days before continuing to plunge. 573 looks to be a good entry point for an intraday short but I doubt if I will be taking the trade. The short side so far is proving to be the safest trade but a VIX reading of 30 is usually associated with a short term market bottom. Have a great weekend!
First, I would just like to say, I think Jim has being doing an excellent job. Thanks Jim! Unfortunately my target price of 587 for going short was not hit. Currently the futures are trading near their lows for the session. My first thought, was to take you long on the open, as 569 has various levels of Gann support, daily, weekly, hourly and the five minute chart, the danger is some cycles are pointing down into the 7th as suggest by Jim also. All we may get is a feeble bounce and the OEX makes a possible run at the 560 level. My best advise still, is to stand aside, I think it will take a few trading days for TSF to come back into line with price.
I was way off on the 30 minute cycle bottom, it bottomed just before the close. The OEX fell a few points below 572-573 before abruptly reversing. The volume indicator hasn't turned up which makes me suspicious of this rally. Until the OEX closes above 592 I give the benefit off the doubt to the bears. Today may have been it for the rally, however power volume has started to turn up. I have no strong reference points on which to make a trade decision other than TSF(the white line). If the OEX manages to break above the line we could head a lot higher. The 3-vol-bar, chart is suggesting we made a strong bottom yesterday. We have no ideal short set up but neither do I see an ideal long setup for end of day traders. Here is the five minute chart. 587 may provide a good short entry point. Use 593 as a stop. At the money puts. I think the downside may be limited but a possible impeachment is still out their. Stay short if the OEX closes below 582. My best advise is to stand aside.
More like a boulder! Traders actually got an early morning blip to go short. The selloff at the end of the day wasn't as bad as it might have seemed with this intraday volume indicator diverging near the close. Too much too soon on the down side? Well if they try and rally it right on the open, I think that will be a great contrarian indicator as the market may still be suffering from excessive bullishness, and may be another shorting opportunity. The half hour cycle which has so far proven to be a good indicator is looking to bottom approximately two hours after the open. I see the up- trend as being intact if 572-573 holds today, so bears should be wary of a bounce from that level. This trin indicator still hasn't gone into the buy zone so we could still see further selling but this indicator could make a trip back to the lower band again without tagging the upper band as it did back in October, and November of 1997. If you went short, stay short as long as the OEX closes below the blue Gann line(577+-), on the five minute chart, and use 585 for a stop. Yes, the volume indicator did cross below the zero line, this current selloff should stay intact as long as the indicator continues down, the hourly doesn't look like it will bottom until Wednesday.
The OEX looks to have peaked. These sentiment numbers are looking very bearish, this volume indicator is just barely holding above the zero line. Usually the volume indicator will give a sell before adlinex. I have expanded the CBOE put/call chart. We haven't reached what I would consider to be an extreme, based on that chart. I think the OEX will drop like a rock once the lower Gann line(587) on the 5 minute chart is broken decisively. This trin indicator has already given a sell, if we are lucky we will get another sell signal if the market condolidates here with a possible retest of the current high. I have the feeling the high might have been on Friday and we may not get another rally to go short.
Jim asked me for a cycle chart on the hourly. Doesn't look good for the bulls early next week. MSFT looks to maybe be finally breaking out , but as I won't be updating next week because I will be in Vegas, I have to recommend closing out the position as I won't be able to keep an eye on the stock. If we are going parabolic here, DAL might be a good play with some January or December calls. Possible head and shoulders bottom. The E - day play if you are so inclined might be the Nov 570 puts on the gap open, take a double if you get it. 575 might also be a good spot to go short for an E-day trade or a possible pullback into early next week. I have no problem believing the OEX could peak at around 584, so I am not going to recommend any short positions as I won't be here. I would like to see cumulative breadth peak around the upper average to set up an ideal short position. Good luck next week and I will be back on Monday.
These next few days are going to be a real crap shoot. So far we have managed to avoid going short, I think the end of day indicators are very close to giving sells. CMO is trending down, CCI is just hanging above the 100 level , and MSI hurts to look at when you are playing E-week on the long side. The volume/breadth indicators don't look like they want to break above their middle bands, but it is the big caps moving the market currently. The upper price channel is at 568 now. I can't take you short yet, but Jim's method of scaling a short trade may not be add a bad idea if you are looking at December puts. The 568 level maybe a good entry point. I think the OEX could choke above 565. The alternative is breadth picks up here and we accelerate to the upside which is what I think may happen. Notice on the 15 minute chart, adlinev may break out here, and volume is not diverging on the 30 minute, so we may have enough power to make a run at 568, and then get a sharp intraday pullback setting up for a rally, where volume will start to diverge, that is where I want to go short, and I will be looking for that today or Friday. Look for a post around 11:00 am, and keep an eye on Jim's projected ranges. Here is what the five minute looks like for the open. Astocast in the Cycle section looks to be on target for the scenario I just layed out.
10: 30am
No ideal short set up. Real time charts are updated.
Pretty good description of today in yesterday's commentary. The OEX did bounce from just under the red Gann line on the 30 minute chart thanks to the Fed announcement, my volume indicator wasn't giving a sell either. The volume indicator still is not showing divergence and cumulative tick did not give a sell on the 30 minute chart. The OEX found resistance right at the target zone I had been mentioning for the last several days. I am still reluctant to make any trade recommendations as I am playing the one weekers and the Decembers are too far out to make it worth it in my opinion. I will make another intraday post at around 10:30 again. Cumulative tick did find support at the zero line on the five minute near the close so we should have a bounce this morning. Cumulative tick on the 30 minute may give a sell around the time I post. I think it will be a struggle for the OEX to make any move above yesterday’s high. CMO is continuing do drop. One positive, the price channel did shift up slightly.
10: 30am
No clear indication but cumalitive tick hasn't broken down yet, watch for a bounce at the red gann line on the 30 minute.
We may be close to a turning point here, in spite of PVI breaking out on the DOW as VIX rose slightly in a now rising trend, something maybe be up, as you would expect VIX to drop when the market rallies, maybe that will change today. MSI is now deep in the sell zone so longs maybe at risk. The problem for me is, who would want to go short before a possible interest rate cut, what if we get more than 1/4 point cut? The OEX bottomed just under the blue support/resistance line on the 30 minute chart, with cumulative tick giving oversold readings, as I noted on the chart, and then proceeded to rally into the close . MAJ on the 15 minute chart is close to the upper band so that indicator maybe indicating we are close to a short term turning point. Adlinex still has not broken out on the 15 minute chart either. Look for an update at around 10:30 again if I have something to say. Hit reload on this page. If the OEX can hold above 562 today, we could still see further rally, the price channel could also shift upwards. Volume hasn't yet diveraged on the 30 minute chart. I am holding calls from yesterdays dip and that is currently where I am looking to sell them into if I get lucky this morning, unless the OEX blasts though there. If you are either long or short going into the Fed announcement and you are on the wrong side, expect fast market conditions and whipsaws making for difficult exits. Jim might have an early morning update. I will defer to Travis and nix the short recommendation on Yahoo.
Interesting, if we get a gap up open this morning. The daily price channel is just above 559 and the the 30 minute RSI is close to overbought. A close above 559, and I think the market will continue to run up for a few days. A weekly Gann line comes in at 565, so we have some overhead resistance, whether that is a good short entry point or not, I can't tell yet, but it would coincide with the green Gann line. I did some volume work over the weekend on the 30 minute chart. Ideally we should see volume diverge and break below the 50 day on the volume indicator while the market makes a top on the 30 minute chart. Hit reload on the 30 minute at around 10:30am Pacific time, as I will update the chart. MACD barely averted giving a sell signal and we got a minor bouce off MAJ. Jim seems to have a pretty good grasp off the market right now, the only thing I can add to his comments and time frames he is projecting is, I am looking for the CBOE put/call indicator to make a possible trip back to the same level last seen in July. Here is what I think may start to happen today , and another chart on MSFT, weekly MACD maybe looking to turn up if we get a good rally this week. I am targeting at least the 120 level possibly by December right now. Yahoo looks to be topping out here, a few December puts above 185 maybe in order. One last note, PVI still has not broken out on the DOW ,so we could still just be seeing the early stages of an advance. Failure to have a strong up day today and we just maybe at a turning point.
The 553-555 price point looks like at good target to go short today if we are going to start to decline from here as suggested by the Cycle section, it is also where the falling moving average may sit on the 30 minute chart. Adlinev is looking to breakout here on the 15 minute chart. A failure to do so this morning on the open could spell disaster for the bulls. MAJ is at critical support as is the VIX indicator. If it looks like the OEX will blow through 553-555 number hold off. The OEX has to have a strong close today to negate MAJ. If the OEX fails to hold above 553, put holders may be in heaven if we get a decline into the close. The 17th has been talked about, and it would coincide with a possible MACD turn if the OEX continues to rally into the 17th and a possible Gann target of 565-570. MSFT still has the potential to breakout and is my one long play. I may take a crack at the Nov 540 or 545 puts today but I want a negative close to hold them into Monday. Have a great weekend!
