The LOL-Pattern is basically a failed WTF-Pattern. In other words, you get one of those WTF spikes, but suddenly it reverses and the entire spike is erased. It makes you just laugh, whether you held long or short into that pattern. At the end of the LOL-Pattern, Bulls are like, “whatever, I broke even”, then laugh. Bears are like “Whoa, that was close. I almost lost my profits.” Then they laugh. Even those on the sidelines are like, “whoa, glad I didn’t buy that rally” then they laugh.
We had a nice LOL-Pattern in the final 32 minutes of trading.
These LOL-Patterns usually occur after important announcements, ie Fed rate cut/hike, Stimulus announcement, etc.
You must avoid the LOL-Patterns if you’re a day-trader. Swing traders, just ignore them.
Speaking of LoL…
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You crack me up!
The action in the last 30 mins was insane.
Unfortunately, the LOL pattern is found only in hindsight, making it impossible to determine beforehand.
So true. I LOL’d out loud while reading it because every word of that is sooooo true. I was short all day and when the LOL pattern hit I really wanted to add to my shorts but I just didn’t have the guts too.
Because you never know when the LOL pattern is going to morph into the “let’s squeeze the shorts” pattern.
Gio- that is great. What a mess
LOL so true. Great blog.
in my eminent crudity, I actually shouted LAUGH OUT FUCKING LOUD! when said events occurred.
So, you’re a comedian now, wizard ninja? 😀 Nice work calling the intraday action today, Gio strikes again.
Hey, Gio, how about a post, with your thoughts on the Daily VIX …,,chart,
,,,Ryan
@ryan… will do, sometime soon. all i can say for now is that despite market testing lows, $VIX couldn’t break out of that channel. It’s been a while since the VIX started moving again, but today we finally had our first spike up all the way to 51.18. yay. there’s some strong medium support at 54 so if we get close to there I will think about playing contrarian and go long. However, the VIX hasn’t really moved anywhere, and continues to trade in the wedge pattern since November. i will chart all this later.
-gio-
LOL pattern…WTF
How the fuck – prey tell – do you avoid the LOL pattern?
@Alvari40 … there are several ways:
1) a WTF pattern is likely to turn into a LOL pattern when the market is flagging. ie, we had a combo intraday bear-flag all day + a multi-day flagging pattern near THE LOWs. The idea is, bulls are chicken.
2) If I were long into a WTF pattern, I would exit after it retraces back about 1/2-way. Then tell to yourself “this is not how we are going to make money in this market. I will wait for better trends.” The idea here, is to play better probabilities.
Gio –
Thx for the explanation. What I saw today (and I was one of those longs that broke even) was a push that late into the day smack into the monthly pivot for the Naz futures. I told myself that “that was it” for the day – call it good, but no. After a day like today, with the shitty internals we had, and an inability to rally off the lows to take the futures smack into the monthly pivot was the resis level that should have been a clear exit signal. Combine that with your intraday and multiday flags – no brainer.
I call that the bird pattern. The chart is giving you the bird. If there is a big spike in volume along with the price spike, then you are getting the double bird.
ROFL @ the lol pattern i LOLed!
LOL at The Count; he should replace Geithner!
This LOL pattern is likely to stick around as banks and insurers continue to bleed out. Here’s another name for a WTF pattern in a market that cannot be revived: The DNR Pattern (“Do Not Resuscitate” for those unfamiliar)
Thanks for the Vix insight throughout the day Gio. Hoping for another spike up to swing long since I haven’t played much on the short side. I was a bit confused by the spikes around the 3PM EST hour. Great to watch and learn from the vixmaster.
that LOL pattern was a warning shot from the PPT ??? … like on several heavy down days, after 3 p.m. it smells for PPT action .. many people anticipate it and produce the move in a self-fullfilling prophecey while the real PPT stays out … that maybe has happened here yesterday…
personally i think the PPT doesn’t act on monday to wednesday, thursdays close or fridays close are best points to achieve a stabilization or follow up in the market
I must have watched that Count video 10 times today.
@Optimatis …i was thinking the same thing. I’m looking for a Thunder Thursday, with the Thunder from the right. Good spot for short-cover rally.
i am looking forward to follow your action via twitter on thursday, gio.
Why fug around?
Buy the trend, SLV & GLD and their progeny: SLW, PAAS, EGO, RGLD, GG and one I added today thanks to the PPT:
IAG.
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