I like $GS as a market proxy here. It’s already swept its August low, rejected it, and is showing positive divergences against the market at the turning points in the last two days as discussed in After Hours with Option Addict last night.
Right now the question is “to flush, or not to flush.” It’s a good idea to start nibbling if you haven’t already. I started some buying on Monday, and will continue to do so into weakness. It occurred to me last night that with many bulls watching the lows, the biggest pain trade right now is for the market to have already hit its low, with everyone still waiting for it. Most analogues call for a final breakdown, but remember, those lows were not levels that any human traded…which may need to be taken into consideration here. Starting small commits you to the process, and last night when futures were ripping, there was a sense of grief and regret that many were still sitting there waiting to buy and thought they had missed it. If you’ve felt that, try a little into a move lower today/tomorrow.
I had also mentioned that after the Fed, we’d see many folks rushing into the bear camp. Most experts are already there, but take a look at the September ending AAII survey. 40%!
On the day, I am focused on the following:
The USD/JPY needs to hold its lows.
Divergences. Same instruments…$IBB, $EEM, $FXI, $NYMO, etc that we watched work earlier in the week.
$GS
Breadth/Initiative buyers
I will be doing another round of buying into further weakness today, if all above conditions are met.
OA
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You’re great OA! Thanks for the step by step guidance!
+1 OA’s increased blogging last few days has been so timely and precise in this rudderless market.
Why GS as a proxy? Seems like selection bias.
“It’s already swept its August low, rejected it, and is showing positive divergences against the market at the turning points in the last two days.”
I tend to look for “quality” names to diverge first. Part of my overall risk cycle model. Maybe it’s selective, as I’ve always used it in these situations.
Tell you what, let’s roll with it, and when this is all over you can grade it accordingly.
I have a few other examples of this…but here’s one from Oct 9, 2013. Stocks bottomed, $GS was in front of that reversal.
http://ibankcoin.com/option_addict/2013/10/09/when-all-else-fails/
Fair enough. I’m not instigating, just wanted to dig deeper into the idea.
Sure, I understand. It would seem random at face value. It’s basically like the idea of using AAPL to lead the Nasdaq/market.
See for me, it WAS AAPL today. Was weak off the open, and for me, was a tell that market can’t rally without it.
For me it was, Goldman is green while the market is off 1-1.5%. Everything will be fine.
nice support to look at there @ 128 (woaaa) . btw i don’t think GS -the firm- will be around like it did 2008 and after for too long ..they will recycle in something else in the next years..may be a financial scandal ( or insider probe ) around the corner .. who knows.. . ..
?
what you question , bro ?
about GS being primed for a financial scandal ? just a guess. could happen in a time . . .
That or what 128 is in reference to?
last big resistence left unchecked / near 2012 higs /
Of…?
about a financial breakdown ..100% sure they will now about and act quite a time before me -or anyone else
*know
the thing we’re talking about ..GS price .. 2012 highs..weekly time frame if you need
Oh, you are saying $GS to 128? No wonder I was so confused.
yes bro .. i was looking long time frame .. in a case spx check 1500 circa .. only support left unchecked .. not that unfair in a bear cycle and foremost TA wise
I agree with FXI, EEM and energy.
looking like a big hour for USD/JPY
I don’t see how GS is a proxy for the whole market. The only index that has matched/exceeded August lows is the russell. For me at least, I want a retest if not reversal from the August lows on SPX/COMP. If I get left behind on a move up that initiates before then, so be it.
High five, Wally.
What just happened with that bump?
Let me just get this question out if the way. So what’s your plan, OA?? Jk
ROFL
Hah!
Bios getting hammered
Yeah, smashed to the tune of 1%. Blood in the streets for sure.
1%? I saw 3%+. Xbi
Both IBB and XBI are down 1%.
Interestingly enough, neither followed this move down beneath opening lows. Divergence?
XBI is down 3%. not sure where you are getting 1%. But I agree, haven’t hit their opening low yet.
“You can’t fuck up something that’s already fucked up”. – Bishop
we are going to smash through the lows and not look back.
we go get check the bull trend support then we resume
TLT intraday lows are getting smashed…elevator up for the financials
TWTR be all like, fuck dis
I just got long coffee here and also shorted $SBUX
a long coffee with no sugar for me
Geez, the moves are intense here…
Chief – why do you think we smash here?
no not today but when we reach the lows we go right through. I just think the charts patterns are so bearish that they should resolve a lot lower.
High yield bonds at new lows today. Also something to watch.
109 has been a key level around AAPL this week, needs to push up here or risk a drop like yesterday
On the lighter side – a lot of the charts for today looks like stegosauruses…
depending on the time frame , a lot of charts look like a giant bear claw
I was thinking giant bull phallus.
you mean the end of a giant bull phallus ( being eaten out by a giant invisible squid )
It already was…but now he’s getting aroused down here.
i’ve never seen a bull penis this slack as of late , bro ..lol
It a series of Rorschach tests
Picked up some $LABU at 15. Stop at 14.
Divergence: Natural Gas stocks vs. /NG
fwiw, I’ve been way too early in looking for a bottom.
Looks like some divergence here from the JPY – is this due to the weather messing with traders or is something else going – Yen has had a decent rally but not moving the indexes like it had been