Don’t even try to read today’s intraday pattern. All that happened was 2 things… HESITATE and DELAY.
- Melt down on low volume, as bulls cannot push market higher (hesitate)
- Profit-taking for bears near the close (rally delayed)
That’s it… that’s all you need to know.
Technicals reveal: we are near the lows, we are at oversold levels, $VIX is flat yet market melt-off on LOW volume (market never rallies on a gap up day w/o volume). Volume picks up at the close and market gaps up to green.
Conceptually we define it: Market moves up on low volume to suck in all the “Friday we rally” callers. It doesn’t happen, volume not there, hence we head lower. Near the close volume picks up because bears don’t want to hold shorts into the weekend (classic pre-weekend cover squeeze).
All this nonsense happens because volume was light all day.
As I’ve stated before, the game has changed a bit since mid-February… I know because I’m in the market watching the tape (I prefer not to, but I do because these are epic times), and I can tell you its much much different. Lighten up on your trades and adapt to the new face of this market. Go long and short, yes both, and plan on losing on at least one of them. Don’t let that loss turn against you, but view the loss as the price to pay to adapt to the market. If you can’t understand that, go all cash. This tape has been so deceptive, its almost like you have to be in the market to understand it. Almost all of the tabbed-bloggers are unanimous that the market is acting very strange, as if we are ready to either crash or rally, and I’m trying to stay IN the market (long/short) just so that I can keep sharp and ready for it.
Have a good one,
-gio-
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Hehe. http://twitter.com/TradeIdeas/status/1290238088
this market is tough, but fun to trade intraday.
Lady G – you seem to be relying pretty heavily on a monday rally (according to your ppt posts)
Nice Post!!!
I am following you on Twitter, very interesting and entertaining. Thanks Gio. 🙂
@Mushroomz …sure. i’m only there to make a fool out of myself.
@hammy: this market intraday is tough and predictable at the same time. Odd no? ie, I took a nasty ride on an SRS short up 3 points on low pathetic volume, so I took my guitar and went playing music, came back near the close to let the trade unfold.
… i didn’t have handcuffs like ChartAddict, but I do have a guitar.
well having balls of steel in the short and long term can lead to some good results.
everyone is talking about s&p 600 or 555 or lower. i agree with them, but i don’t think i could stomach going 2x short, all in, no matter how much conviction i might have about it getting to that level.
going long oil for long term is also a little too much to watch, day by day. predictable? yes. tough? absolutely
…the hard part for me is that I am mostly a contrarian trader, so when the market sells off like it has been and the VIX not spiking anywhere, it confuses me and really lowers my advantage. As I said before, one of these have to catch up: either the VIX moves way up, or the market catches up to the VIX.
The market could move 10% either way very fast
It is most likely a sucker rally since it moved in the last 30 minutes without volume. This kind rallies are good for us to short into when we see any signs of weakness.
Still holding those swings trades,right?
@crude …yes sir. by a thread.