The Only Way Out Is Up

104 views

The overnight session was fairly quiet up until CPI data at 8:30am which pushed some sellers onto the tape. Overall the session is normal in range and volume and trading in the upper quad of yesterday’s session.

On deck this afternoon we have Fed Chair Yellen speaking at 1pm. We have the Baker Hughes Rig Count data out at the same time.

Yesterday we printed a short squeeze-type profile, P-shaped. Sustained trade below overnight low 4523 is what sellers want to see to take back the session.

Heading into today, my primary expectation is for buyers to work higher to test overnight high 4535.50 and take it out to target the NVPOC at 4543.50.

Hypo 2 sellers sustain below 4523 setting up a washout lower to 4500.

Levels:

05222015_NQ_MarketProfile

Settling Into Balance

312 views

Nasdaq futures are trading a touch lower as we head into cash open. The overnight session was normal in terms of range but volume is borderline abnormal. On the economic calendar we have a flurry of low/medium impact events to push through this morning. At 8:30am Chicago Fed National Activity Index and Initial/Continuing Jobless Claims data was out and saw little reaction from the market.

Late on this morning we have Markit Manufacturing PMI at 9:45am, a data dump including Existing Home Sales, Leading Indicators, and Philadelphia Fed at 10am, and Natural Gas storage stats at 10:30am.

Yesterday we printed a curious-looking normal variation day. Price managed to push up to new weekly high before sellers knocked it back flat into the close. The last four sessions have compressed price into a range—the first real contraction in volatility we’ve seen in several weeks.

The action has made the market profile chart a bit odd, so I drew a micro composite volume profile of the last 4 sessions to see better what’s going on here (green and red distribution pictured below).

Heading into today, my primary expectation is for a choppy 2-way open until we push through all the morning data. Look for price to stay contained between 4481.25 to 4504. Then look for buyers to come in and work price higher.

Hypo 2 sellers push down through 4479.25 to open up a liquidation down to 4458.75.

Hypo 3 buyers make a run for yesterday’s session high 4534 to target 4539.

Levels:05212015_NQ_MarketProfile

EVERYONE’S TRAPPED

333 views

After an impressive showing both up and down we’re back where we started when they rang the opening bell. ‘Bring Forth The Siesta’ was written when visions of this mediocrity flowed through my mind. We knew today would essentially be a wash—and a dangerous one at that.

Third reaction analysis, my go to distraction during important economic announcements, yielded a buy signal and buy they did, up onto the point where they found highly motivated sellers.

Yesterday’s picks fared well today likely because they’re fueled with thick data sets and positioned to deliver career-ending blows to the opposition, ala Option Addict’s deliverance of MOMO shorts today (hat tip).

The standoff continues as far as I can see, but I could not resist putting on a lotto long after 3rd reaction. I’d tell you what it is, but it’s either too late to take action or wrong.

All we need to do is sort out these trannies and the market can rally.

Working The Tranny Grind

201 views

Airlines are being burned up today amid increases in capacity or some other rabble I couldn’t care less about. I actually love when people discuss the whys behind a move, but I rarely over think them.

What I do instead is go to charts I’ve been closely watching. In this instance, I pull up the Nasdaq Transport Index. I can see the dark cloud that formed yesterday was a proper warning, but now I am thinking buy the dip.

We came in hot, but this is bracket low. Buyers have defended this region every time we’ve visited it. You, rather markets, have to convince me this time is different.   If not, back through the grind haus we go:

Tranx.x05202015

 

I was blessed with foresight and sold my $VA position for a small loss yesterday. It was a bit of luck and a bit of overall caution on my part.

Bring Forth The Siesta

191 views

Nasdaq futures are set to open a touch higher for Wednesday after trading a balanced session overnight on low-end normal range and volume. The GDP data out overnight from Japan turned out to be not much of an event and the US dollar strength held overnight.

Today we had MBA Mortgage Apps at 7am. Coming up we have the weekly Crude/Distillate report at 10:30am and the collective attention of traders will at some point be focused on the Fed Minutes due out at 2pm.

Yesterday we printed a normal variation down day. Buyers defended Monday’s mid around the close when a late wave of selling came through.

Heading into today, I expect any early excitement to quickly fizzle and the markets to go into chop mode ahead of the afternoon minutes. Look for buyers to make a push up through overnight high 4510.50. Look for responsive sellers to defend near 4515 and two way chop to ensue with 4498 as a floor.

Hypo 2 sellers push off the open, close the overnight gap to 4501 and continue lower to take out overnight low 4496.75 and push below yesterday’s low. Look for buyers at 4491.50 and two-way trade.

Hypo 3 strong buying up through 4515 to target 4531.25.

Levels:

05202015_NQ_MarketProfile

Where We’re Going We Don’t Need Roads

361 views

Would you believe me if I told you I am tired of seeing charts? For eons, they were my babies, I’d nurture them and decorate them with macaroni strings and stripes and the latest in apparel [indicators]. Now anything beyond a glance summons a dread so deep it cuts right down to existence.

Nevertheless they are my friends and I put them to the test day in-and-out (no burger).

I like copper here. Ask a Pelican about how I mismanaged my copper position earlier this year if you want a rousing tale of mediocrity. On these walls I decree it shant happen a second time. I’m giving myself room and pressing my heels into the walls of logic.

Anyone who studies philosophy long enough will fall entirely in love with mathematics, for they present immortal truths one can only achieve with their minds.

Beyond copper I am certain the market is about to plunge us into a brown bag. You can either fill said bag with a forty ounce of ice cold malt liquor or lay plans to trade your way out of it.

All starting with tonight, with tonight’s sit and watch the Japanese GDP party.

 

PS – How TF am I supposed to sell HABT?  Look at this chart lol

The Cycle Is Complete

250 views

You’ve expressed interest in how I go about the morning–mornings are sacred. They’re a time before distraction. Elder Raul always said the best thoughts came before sunrise, before everyone else thinks them, I agree.

It’s a time to nurture the soul. I rarely rise particularly early but I am awake and taking in the sunrise from bed and listening to the birds. Next I water myself and the plants—the tomatoes, the grapes, the onions, the flowers, the rhubarb, and lots of hearty greens.

Then a shower followed with applying exotic oils like argon, rosehip, and meadowfoam seed. This makes me feel like an ancient Egyptian. A hearty breakfast is prepared—if often must sustain me through a good part of the day. I practice temperance at all times but nevertheless seek to consume 30 grams of protein and lots of dark leafy greens.

Then I queue up the markets. In special instances, like this morning, I will start trading before the open but usually my activity is RTH. Since my trading is mostly during RTH it’s rare I will check a quote on anything outside of these hours.

Then I report for duty, here at the top echelon of finance greatness.

So many forces are converging today and it has me on edge. Facebook will complete its 10 day oversold cycle today. It’s flawless record of 9-0 has extended to 10 wins. If Exodus had emotion it would be feeling like Mayweather right now. Instead it diligently continues its job without the need to nurture its mind or body.  You may feel like you’ve developed an understanding of Exodus’s substance, but it is quite likely you’ve only scratched the surface.  It will be many centuries before man can truly grasp the form, of greatness, of the virtues of robotics.

Exodus insisted we short gold. Had you, you’re into the meat of that cycle now. Congratulations on your objectivity. The Chinese Burritos have been granted impunity to broad market softness for the time being.

Nasdaq Transports (TRAN.X) are reversing lower, the Nasdaq Semiconductor Index (SOX.X) is trying to pull a bugger of a bracket high reversal, the Dow looks chill, and every other index is diverging away from the Nasdaq weakness intraday.

Rose colored sunglasses, my proprietary timing model, signaled the short over the weekend.

The USD/JPY spot price have converged to an apex and then pushed higher, initially, but with Japanese GDP on the horizon for this evening it’s hard to commit to.

Then just for the hell of it we have FOMC minutes tomorrow afternoon.

Now is a good time to have some cash.  Keep it until we see some resolution, then hope you don’t have to chase ridiculously higher prices in momo.

 

Early Morning Squeeze

192 views

Nasdaq futures are up a touch as we head into Tuesday. Range and volume are normal and per the structure of the market profile we can classify the current action. It is a temporary phenomenon known as a short squeeze where price moves higher as shorts are forced to liquidate their positions. Once they are done doing so, the profile takes on a P-shape.

In the context of a downtrend this structure tends to occur at-or-near inflection points. In our current context, choppy range, it may also mean something. However, the higher time frame is up so it ‘s difficult to assign it too much weight initially.

At 8:30am we had upbeats stats on housing stats which slowly introduced sellers into the index. It will be interesting to see if sellers keep us south of 4521.50 heading into cash open.

Yesterday we formed a double distribution trend day and pushed higher to close the 4/28 gap up at 4515.50 before stalling out. Value managed to shift up near session high just before the day wrapped up. This suggests value, not just price, were on the move higher.

As I wrap up my post the short squeeze profile is deteriorating as sellers work into the tape.

Heading into today, my primary hypothesis is sellers push into the overnight inventory to close the overnight gap down to 4507.25. From here to 4504.50 I will look for signs of responsive buying. If buyers no show, then I will look for a continued move down to 4491.50.

Hypo 2 is buyers push off the open and reclaim 4521.50 early and sustain trade above it setting up another leg up to target 4531.25 then 4535.25. Look for responsive sellers up near 4539.

Hypo 3 buyers push, stall around 4521 and we reverse lower to fill overnight gap 4507.25 and then two way chop ensues.

Levels:

05192015_NQ_MarketProfile

Now At This Very Moment

274 views

I am majorly conflicted here. Today looks majestic. Just look at RGSE, an explosion of bear bits to the tune of sixteen hundred percent. The Nasdsaq spent a few hours trending, tranny’s are back on the streets, semi’s are semi-erect, and it’s a scorching 90 degrees in the murder mitten.

The open was so pretty I had to write a blog about it.

But then there’s my model, a tepid friend who without judgment nudges me in the ribcage and says, “Hey…sell.” So I am reminded to be unselfish here. If I catch wind of a stink, even a subtle note of feces carried across my nostril by a breeze, I will book some longs here.

THE Weekly Strategy Session, the lot of yous were too busy working on your dad bods to check into it. It’s telling a story different than what price action is. One of them is wrong. I am keeping an open mind whist being long of stocks. Keep in mind my ideas are forged on the same equipment used to enrich uranium and navigate the orbital space cannon (OSC). It would not surprise to me to see them granted immunity from a broad market selloff. Nevertheless, nothing is sacred in love and war. I had to squeeze one more cliché in, just in case you didn’t cringe yet.

GO LIFT OR PUNCH SOMETHING.

Goldilocks Open

226 views

Bulls have to be careful. Every time they’ve launched an aggressive campaign early Monday morning they’ve been lashed by Tuesday and whacked with bamboo sticks by Wednesday.

This open so far is just right. Not too hot, not too cold. The slower, the better, IMO.

The Only Way Out Is Up

104 views

The overnight session was fairly quiet up until CPI data at 8:30am which pushed some sellers onto the tape. Overall the session is normal in range and volume and trading in the upper quad of yesterday’s session.

On deck this afternoon we have Fed Chair Yellen speaking at 1pm. We have the Baker Hughes Rig Count data out at the same time.

Yesterday we printed a short squeeze-type profile, P-shaped. Sustained trade below overnight low 4523 is what sellers want to see to take back the session.

Heading into today, my primary expectation is for buyers to work higher to test overnight high 4535.50 and take it out to target the NVPOC at 4543.50.

Hypo 2 sellers sustain below 4523 setting up a washout lower to 4500.

Levels:

05222015_NQ_MarketProfile

Settling Into Balance

312 views

Nasdaq futures are trading a touch lower as we head into cash open. The overnight session was normal in terms of range but volume is borderline abnormal. On the economic calendar we have a flurry of low/medium impact events to push through this morning. At 8:30am Chicago Fed National Activity Index and Initial/Continuing Jobless Claims data was out and saw little reaction from the market.

Late on this morning we have Markit Manufacturing PMI at 9:45am, a data dump including Existing Home Sales, Leading Indicators, and Philadelphia Fed at 10am, and Natural Gas storage stats at 10:30am.

Yesterday we printed a curious-looking normal variation day. Price managed to push up to new weekly high before sellers knocked it back flat into the close. The last four sessions have compressed price into a range—the first real contraction in volatility we’ve seen in several weeks.

The action has made the market profile chart a bit odd, so I drew a micro composite volume profile of the last 4 sessions to see better what’s going on here (green and red distribution pictured below).

Heading into today, my primary expectation is for a choppy 2-way open until we push through all the morning data. Look for price to stay contained between 4481.25 to 4504. Then look for buyers to come in and work price higher.

Hypo 2 sellers push down through 4479.25 to open up a liquidation down to 4458.75.

Hypo 3 buyers make a run for yesterday’s session high 4534 to target 4539.

Levels:05212015_NQ_MarketProfile

EVERYONE’S TRAPPED

333 views

After an impressive showing both up and down we’re back where we started when they rang the opening bell. ‘Bring Forth The Siesta’ was written when visions of this mediocrity flowed through my mind. We knew today would essentially be a wash—and a dangerous one at that.

Third reaction analysis, my go to distraction during important economic announcements, yielded a buy signal and buy they did, up onto the point where they found highly motivated sellers.

Yesterday’s picks fared well today likely because they’re fueled with thick data sets and positioned to deliver career-ending blows to the opposition, ala Option Addict’s deliverance of MOMO shorts today (hat tip).

The standoff continues as far as I can see, but I could not resist putting on a lotto long after 3rd reaction. I’d tell you what it is, but it’s either too late to take action or wrong.

All we need to do is sort out these trannies and the market can rally.

Working The Tranny Grind

201 views

Airlines are being burned up today amid increases in capacity or some other rabble I couldn’t care less about. I actually love when people discuss the whys behind a move, but I rarely over think them.

What I do instead is go to charts I’ve been closely watching. In this instance, I pull up the Nasdaq Transport Index. I can see the dark cloud that formed yesterday was a proper warning, but now I am thinking buy the dip.

We came in hot, but this is bracket low. Buyers have defended this region every time we’ve visited it. You, rather markets, have to convince me this time is different.   If not, back through the grind haus we go:

Tranx.x05202015

 

I was blessed with foresight and sold my $VA position for a small loss yesterday. It was a bit of luck and a bit of overall caution on my part.

Bring Forth The Siesta

191 views

Nasdaq futures are set to open a touch higher for Wednesday after trading a balanced session overnight on low-end normal range and volume. The GDP data out overnight from Japan turned out to be not much of an event and the US dollar strength held overnight.

Today we had MBA Mortgage Apps at 7am. Coming up we have the weekly Crude/Distillate report at 10:30am and the collective attention of traders will at some point be focused on the Fed Minutes due out at 2pm.

Yesterday we printed a normal variation down day. Buyers defended Monday’s mid around the close when a late wave of selling came through.

Heading into today, I expect any early excitement to quickly fizzle and the markets to go into chop mode ahead of the afternoon minutes. Look for buyers to make a push up through overnight high 4510.50. Look for responsive sellers to defend near 4515 and two way chop to ensue with 4498 as a floor.

Hypo 2 sellers push off the open, close the overnight gap to 4501 and continue lower to take out overnight low 4496.75 and push below yesterday’s low. Look for buyers at 4491.50 and two-way trade.

Hypo 3 strong buying up through 4515 to target 4531.25.

Levels:

05202015_NQ_MarketProfile

Where We’re Going We Don’t Need Roads

361 views

Would you believe me if I told you I am tired of seeing charts? For eons, they were my babies, I’d nurture them and decorate them with macaroni strings and stripes and the latest in apparel [indicators]. Now anything beyond a glance summons a dread so deep it cuts right down to existence.

Nevertheless they are my friends and I put them to the test day in-and-out (no burger).

I like copper here. Ask a Pelican about how I mismanaged my copper position earlier this year if you want a rousing tale of mediocrity. On these walls I decree it shant happen a second time. I’m giving myself room and pressing my heels into the walls of logic.

Anyone who studies philosophy long enough will fall entirely in love with mathematics, for they present immortal truths one can only achieve with their minds.

Beyond copper I am certain the market is about to plunge us into a brown bag. You can either fill said bag with a forty ounce of ice cold malt liquor or lay plans to trade your way out of it.

All starting with tonight, with tonight’s sit and watch the Japanese GDP party.

 

PS – How TF am I supposed to sell HABT?  Look at this chart lol

The Cycle Is Complete

250 views

You’ve expressed interest in how I go about the morning–mornings are sacred. They’re a time before distraction. Elder Raul always said the best thoughts came before sunrise, before everyone else thinks them, I agree.

It’s a time to nurture the soul. I rarely rise particularly early but I am awake and taking in the sunrise from bed and listening to the birds. Next I water myself and the plants—the tomatoes, the grapes, the onions, the flowers, the rhubarb, and lots of hearty greens.

Then a shower followed with applying exotic oils like argon, rosehip, and meadowfoam seed. This makes me feel like an ancient Egyptian. A hearty breakfast is prepared—if often must sustain me through a good part of the day. I practice temperance at all times but nevertheless seek to consume 30 grams of protein and lots of dark leafy greens.

Then I queue up the markets. In special instances, like this morning, I will start trading before the open but usually my activity is RTH. Since my trading is mostly during RTH it’s rare I will check a quote on anything outside of these hours.

Then I report for duty, here at the top echelon of finance greatness.

So many forces are converging today and it has me on edge. Facebook will complete its 10 day oversold cycle today. It’s flawless record of 9-0 has extended to 10 wins. If Exodus had emotion it would be feeling like Mayweather right now. Instead it diligently continues its job without the need to nurture its mind or body.  You may feel like you’ve developed an understanding of Exodus’s substance, but it is quite likely you’ve only scratched the surface.  It will be many centuries before man can truly grasp the form, of greatness, of the virtues of robotics.

Exodus insisted we short gold. Had you, you’re into the meat of that cycle now. Congratulations on your objectivity. The Chinese Burritos have been granted impunity to broad market softness for the time being.

Nasdaq Transports (TRAN.X) are reversing lower, the Nasdaq Semiconductor Index (SOX.X) is trying to pull a bugger of a bracket high reversal, the Dow looks chill, and every other index is diverging away from the Nasdaq weakness intraday.

Rose colored sunglasses, my proprietary timing model, signaled the short over the weekend.

The USD/JPY spot price have converged to an apex and then pushed higher, initially, but with Japanese GDP on the horizon for this evening it’s hard to commit to.

Then just for the hell of it we have FOMC minutes tomorrow afternoon.

Now is a good time to have some cash.  Keep it until we see some resolution, then hope you don’t have to chase ridiculously higher prices in momo.

 

Early Morning Squeeze

192 views

Nasdaq futures are up a touch as we head into Tuesday. Range and volume are normal and per the structure of the market profile we can classify the current action. It is a temporary phenomenon known as a short squeeze where price moves higher as shorts are forced to liquidate their positions. Once they are done doing so, the profile takes on a P-shape.

In the context of a downtrend this structure tends to occur at-or-near inflection points. In our current context, choppy range, it may also mean something. However, the higher time frame is up so it ‘s difficult to assign it too much weight initially.

At 8:30am we had upbeats stats on housing stats which slowly introduced sellers into the index. It will be interesting to see if sellers keep us south of 4521.50 heading into cash open.

Yesterday we formed a double distribution trend day and pushed higher to close the 4/28 gap up at 4515.50 before stalling out. Value managed to shift up near session high just before the day wrapped up. This suggests value, not just price, were on the move higher.

As I wrap up my post the short squeeze profile is deteriorating as sellers work into the tape.

Heading into today, my primary hypothesis is sellers push into the overnight inventory to close the overnight gap down to 4507.25. From here to 4504.50 I will look for signs of responsive buying. If buyers no show, then I will look for a continued move down to 4491.50.

Hypo 2 is buyers push off the open and reclaim 4521.50 early and sustain trade above it setting up another leg up to target 4531.25 then 4535.25. Look for responsive sellers up near 4539.

Hypo 3 buyers push, stall around 4521 and we reverse lower to fill overnight gap 4507.25 and then two way chop ensues.

Levels:

05192015_NQ_MarketProfile

Now At This Very Moment

274 views

I am majorly conflicted here. Today looks majestic. Just look at RGSE, an explosion of bear bits to the tune of sixteen hundred percent. The Nasdsaq spent a few hours trending, tranny’s are back on the streets, semi’s are semi-erect, and it’s a scorching 90 degrees in the murder mitten.

The open was so pretty I had to write a blog about it.

But then there’s my model, a tepid friend who without judgment nudges me in the ribcage and says, “Hey…sell.” So I am reminded to be unselfish here. If I catch wind of a stink, even a subtle note of feces carried across my nostril by a breeze, I will book some longs here.

THE Weekly Strategy Session, the lot of yous were too busy working on your dad bods to check into it. It’s telling a story different than what price action is. One of them is wrong. I am keeping an open mind whist being long of stocks. Keep in mind my ideas are forged on the same equipment used to enrich uranium and navigate the orbital space cannon (OSC). It would not surprise to me to see them granted immunity from a broad market selloff. Nevertheless, nothing is sacred in love and war. I had to squeeze one more cliché in, just in case you didn’t cringe yet.

GO LIFT OR PUNCH SOMETHING.

Goldilocks Open

226 views

Bulls have to be careful. Every time they’ve launched an aggressive campaign early Monday morning they’ve been lashed by Tuesday and whacked with bamboo sticks by Wednesday.

This open so far is just right. Not too hot, not too cold. The slower, the better, IMO.

Previous Posts by Raul3