Go Linux Go !! :)

It may go back to 30 area to retest previous level but IMO , from Monday on, the path is down.

may be DB for now at least....

nice little ride anyway....

Interesting setup

Lazy market

They had a great opportunity to play the "red" scenario out yesterday after marking lows but they refused to do it. Instead, more range bound action is still the name of the game. As I write this, ES is at 1166 after a nice dip but until 1162 is taken out, we are still in the same range.
We may get some movement early tomorrow but the expected lack of volume almost warranties bulls are pretty safe for now.

On Friday we may see some little surprises with payroll numbers but I will wait until Monday to see a real definition of this sickness and, only then, rule out "red" scenario. For now, I 'd be very cautious with longs :)

Quick note

Market remains in range bound. I was expecting a little higher prices to short but for now, they refused to break above 1171 area. Will wait until Wed morning, max. After that I expect volume to be too low to trade.
There is a possibility we rally a little AH to gap down tomorrow.

GL

View for next week

Both scenarios are probable, though I 'll be waiting to play the red one cause R/R is much better.

Covered all at 1162 -

Not interested in holding into the WE,

Daily net:
-2 pts
+11.75 pts
+0.50 pts
-----------------
+ 10.25 pts (not weighted)

added 25% to shorts at 1163.5

avg 1162.5

stops at 1165.5

reshorted at 1161.5 - 25%

this last 3 trades are to manage position, improve avg, stance remains the same.

covered 1157.75,

will reshort later

took some off at 1167.00

shifted stops to 1169.50

shorted ES 1169.50 50%

SL 1171.5

stopped after hours at 1164.25

added at 1163.5

avg 1162

added 25% to shorts at 1160.50

Re shorted 1160.50 - 25%

Covered all ES at 1162 (+13.25 pts on this last batch )

will reshort later

took some more off at 1167 -remains 25% in

stops shifted at 1173

took some off at 1173.25 ( to create cushion) - shifted stops at BE

Trying again at 1175.25 - SL 1177.25

covered all at 1169.75

may retry later

Market sickness won't last

If anyones think this can last , then they are nuts.

Took off some at 1162.25 (again )

reshorted 1165

sorry for the messy day guys, this is just a messy market, just absolutely sick and nutz....

Covered at 1166.75 - taking too long, may re try later

How can stocks market resist this without tanking is beyond reality.......

10 year T note Future.

took off some at 1162.25

reshorted at 1166

all out 1166, may reshort later

just took some off at 1167.25

just position management . Stance still bearish

Shorting ES 1170 upto 1174

heavily!
this suckers will get really slaughtered

Quick note

OK, bulls had another "glory" day. They made the pullback to 1146.75 (I expected similar level) and then ripped. Tomorrow they can have more fun, my target is 1172-5. In any case I stand for all the rest of my analyses which signals this is a BS rally which will end really bad for bulls. It will be fast, and unexpected (for bulls) and will let them little or no opportunity to get out. (like a professional robbery :)

GL

Charts review and trading ideas

Charts review:
Some of the charts presented last week did close week above their red trend lines, which seems to invalidate setups, however there are a couple of interesting findings at some major indices:






Trading ideas for coming weeks
My 2010 favorite Sector (for shorts) :)


Remeber this setup at Citi? I almost forgot it... :)

While we wait for Health Care bill's impact

It is quite obvious Health care overhaul ongoing process is affecting financial markets. Similarities with previous attempts to pass it through Senators are evident = consistent price pumping across all sectors with relatively low volume.... rinse and repeat.
Since the scope of this blog is not political related, I avoided posting about this issue but is evident it is having a ST effect and will likely produce more ST effects once is resolved. What I do like to analyze is Market data itself:




Hottest stocks where Health care related too


As Friday close we could see that Health related services and products were relatively strong as they have been during last month BUT all remaining sector did show weakness of Friday. We can read this in two different ways:

1. Traders are covering long positions overall to go long in Health care sector (betting the bill will not pass probably???)
2. Traders are being sucked into Health care sector, as they have been during many days, attracted by their great performance BUT if bill does pass, and Big Boys unload all the stocks they have been accumulating during this rally, the outcome will not be pretty for bulls....

• Another item which support this last hypothesis is the remarkable weakness of all small cap indices which is quite logical if we think what kind of companies will be most negatively affected by a new health care law (small companies will have comparatively higher health insurance's costs)

What media will not tell you about their rallies

Just to think a little about what media tell us and how can we cross check those messages with other more "objective" info sources. Not saying this rally is over ( not yet) but it is important not to over weight things....

This is what media will tell you about their manufactured rallies.....
(of course you if you want to cross check this confidence in economy, you should take a look at these charts )



But in any case, you can take your own conclusions by looking at this simple one....



"strong" rallies???? plz.... "well supported" maybe, but not in good shape in my view....

In a nutshell:





Within an historical comparison:

As far as I can see

Both Fib projections have been met. I really expected 1162 area to be intra day top (thus my previous posts) but 1165 ish was hit. In all cases I see 1145ish next pullback zone (thanks UI!!! :) . Up to that zone technicals supports my view, below that level my gut feeling says: beware bulls, there are a lot of "air pockets" below.
Can I bet the farm on it? not really, bulls have taught us to be very respectful about their "friends" but if mkt analysis is of any indication, I'd be looking for the "winds of change "
GL tomorrow

i know this is a mess, will clarify later - for now, gap down tomorrow

flat pattern is timing out---->not reversal but continuation bullflag

It is now or never Bears, !!! UPDATED

DJIndu just pierced 10730, if we are ever going to have a double top play , then it has to be now... or never...

update:
it takes guts to look down in such a mad-bull run, but this is what I see guys, they can overextend a little over 1161 (prolly 1164 ish) but some pullback is to come soon...




of course... more bull-train to come after any dip.....

Expecting marg. higher high AH and gap up tomorrow

But hopefully we will print ST top on Wed or Thursday as latest which will produce a healthy correction on this madness. Otherwise, this mkt can go beyond its own master's control

Bulls are favorits but...

Some trend lines to watch early next week

Trend lines, price momentum and mkt internals suggest ST top is near. Another marginal higher high is possible but I expect the top will be printed before the end of the week.

Beware of poisoned food...

I am hearing so many comments these days about how well are stock markets performing (making year highs, Nasdaq is up 86% just one year after the crash..etc). This seems to be a economy's results banquet if you only read newspapers. Some investors may feel tempted to jump in; hey you don't want to miss another rally like last one right?.
After all, banquet=food, and food=satisfaction. I'd agree, but be careful, if the food is poisoned, staying away may be the wisest option, yeah, you need to control your greed in order to do that but a quick look at some very basic fundamentals should make you think twice...

[source: Federal Reserve Bank of St. Louis]



So banks and techs making highs uh? Who are they going to sell their products and credits to?

source: Bureau of Labor Statistics]


charts borrowed from Vixandmore.


Ok, not convinced yet? sure why should you believe it if Citi Bank rose 17% in a couple of sessions....
Yes, but the trick behind may have an end soon:

Sucktor rotation

Hi guys

Someone was wondering today what the difference btw topping and consolidation patterns would be, since price action was quite flattish today. Well one way to tell about it is by looking at sector rotation since is a characteristic of all tops. This is what I found these days:




But if we look at last two sessions performance (specially today) the roles seems to have changed (rotated) We need to see continuation next week.





In brief: topping is already being produced but we will see marginal higher prices ST. Friday price action was just too easy to short as to be the real top.

My take for early next week is: they will gather more critical mass by sucking more bears with lower prices, prolly gap down. This will fuel the next run up toward new highs. Then the top may be printed.

maybe is unimportant but I wouldn't overlook it

OK, finally path #2 is playing out: ESH0 rallied from yesterday values directly towards 115x (1153.50 as I write this). I expect even 1157 values.
What is the meaning?: obviously bulls are loving this market and they believe it cannot stop, 1190 almost assured in some trader's opinion. So hesitant opinions like mine are just a joke for them. In any case this is my interpretation:

They successfully crossed the line and reverted 1086 major break down into a bullish setup through an historical rally .... hands down guys, money-printing-machine Team won! BUT
There are no a free lunchs, the ST correction will be fierce, even if it continues to go up after it.

Ok, who cares about my opinion anyway.... but you may care about this data from the Big-Boys' option plays..... pull out your own conclusions about their ST expected move.....




The Artisan of this spectacular rally (which can only mean economy is alive and kicking again :( ) at work:


this pic is borrowed from:

http://www.zerohedge.com/article/perpetual-motion-machine-drives-forward-unabated

Mid week recap

Well, seems our plan for early week worked out well. As projected in this post, we had a pullback (expected 1127,50, actual 1131) and a thrust toward highs (expected 1147,75 actual 1148).

Next steps should be weakness for the bullish cause, therefore Fiesta Brava (Spanish name for bullfight. I used that phrase as a metaphor: The bull fights, but everyone knows what its ending will be...)

There are some arguments as the chart below. But, I cant rule out a new rally towards 115x which make the path complicated: 1) we can test 1130 area and rally back up or 2) run directly towards 1153 and then drop. I am afraid #1 is more probable but in any case I expect a steep sell off towards 1095-1100 after.

Anyways, enjoy the party :)





DIA.
Remember DJI and DIA did not make a higher high on this last rally, so they may well be our leading indicators.




update:

Another view of Industrials: YM and Diamond pattern (reversal)

Fiesta brava!!

update: maybe there will be one more push towards low ES105x. After that, it will be Matadores time :)

(AND remember, never mess with these guys)

Next week: buy dip?.... beware of trick

I know my last posts seems to deny market action. And in fact I didn't think this guys could take it this high this fast ( my mistake), but their spectacular achievement does not add foundation to the move. Don't get me wrong, I am far of being a perma bear but I really regard to this rally as a fake... we will see the truth about it soon. Meanwhile this is my plan for early next week.

All that glitters is not gold- A todo cerdo le llega su San Martin

Watching DIA mar 105 puts, Interesting now at 0.89

Endless dirty tricks

I guess all this bullish BS is aimed to manage tomorrows Unemployment numbers by creating a big cushion, probably before a big sell off.
I have removed the hard stop I had 1123.75 and will play the AH range freely since more shenanigans are to come across. Currently holding only 25% position but willing to add if conditions line up.
Just hope mkt goes back to more healthy action after they accomplish whatever goal they have for tomorrow.

GL

Quick recap

Hi there,
Sorry, little time tonight so no charts for the moment.

Briefly:

1- SPY and SPX left us a red daily candle which gives continuation to our pattern
2- ES situation remains weak and we are expecting retest of lower levels, 1107-5
3- DIA still working as a leader into potential bearish leg (also Financial and Semis)
4- Keeping remaining short position from ES 1122.5

Half out at ES 1116 for + 6.5pts

Short ES1122.5 50 % SL 1123.75 - risky trade

Be extremely cautious with your long positions

I know this looks like bulls party but the lack of foundation of such a bullish moves is not FREE.

Covered all at 1122.25 for small profit- Timed out

It is just taking too long up here, with little or no selling pressure. Price wise is still interesting trade but risk rules make me cover.

GL

added to short position at ES 1123

Market analysis 03-02- Evening star

First of all, I wish to make clear that I still stands behind my analysis from yesterday. Evidently price was strong early in the morning but if we keep looking at the context, this bullish moves reveals weak foundations (low volume break out and diverging internals are only a few). Time will tell if it is fake or not. Meanwhile I anticipate what seems most probable outcome from my stand point.

This SPY chart let us see an interesting topping pattern (very similar to the Evening star). If I am right , it will lead to a red day and also probably a gap down. Ideally it will trigger a nice leg down.




Also, take a look at DIA. It had a hard time to pierce 02-22 highs ( made no breakout) and more importantly it closed just below 12-31 key level.

Covered some ES position at 1115.5

Stopped from ES at 1116.5 this AH

As I feared, this guys are powerful.

Some indications of exhaustion now made me took a half position short on ES around 1120 area. Mental stop at 1123

ES 03-01 Analysis

As you can see , there are technical arguments for a short here. So I am on the bearish side. However, and believe me I dislike "conspiracy theories", market is having an ungodly amount of "magic hand" since last Thursday and the power of these guys is unlimited so , we have to be super cautious....

GL

Shorted ES 1115 WTF!

SL 1116.5

Sorry guys, I posted this one with delay purposefully. I was picking tops and it is dangerous to share it RT since you can lose quite a bit if you don't manage position rapidly.
I have reasons to be very confident in this short,
Update: , DAX 03/02 opening:

Just covered remaining at 1111.5

Took 25% off at 1108.5

We need to be nimble at position managing here, this babe can run up hard if they turn the grinding machine on.

Short ES 1110.5

Mental stop at 1112.75