iBankCoin
I turn dials and fiddle with knobs to hone in on harmonic rotations
Joined Oct 26, 2011
3,741 Blog Posts

I GOT MY AUCTION

And now I patiently await tomorrow’s trading session.  I didn’t do much today: watched some surfing videos, put some finishing touches on a gnarly excursion, stared out the window, stared at a few tickers, and you get the point.  I was keeping myself busy to prevent buying everything.  I see setups emerging all over the place, but none quite triggered.  So I sit, enforcing discipline.

The good news is the S&P finally put in a quality auction encompassing 1498-1502.  I thought it may never happen.  Shedding my TZA clown shoes near the LOD may have been prudent, but I remain shoed up into Friday’s trade.  The fact of the matter is we finally put in an auction at these levels and now we can put them to rest.  If the bulls show up tomorrow they can drive a stake straight into the hearts of the flailing shorts.  I was 100% long into last weekend, and I may go back to that exposure into the weekend.  My broker loves me.

I sold out of BBY today.  It was my Super Bowl play and their commercial was a non-event.  They’re store is a non-event.  I remember when going to Best Buy was the thing to do.  Now if anyone offers me the opportunity to tag along I kindly refuse.  EVER HEARD OF NAPSTER BRAH?  It’s all there and elsewhere on the internets.

Completely aside:  You don’t realize how small your desk is until there’s a stack of work three feet high next to you.  I couldn’t care less.  I may actually outsource this brainless task.

BOTTOM LINE:  (There’s always a bottom line) We traded a range that has been a cock fight for weeks.  The bulls came out the victors and clawed back to unch (pronounced “OOO-N-CH”) after getting shot out of circus cannons this morning.  Follow through tomorrow equals clown bones everywhere for the victorious bull and I will buy more stocks.

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Getting Wiry Up Here

As we enter another day of trading this market, we find ourselves hanging around near the highs but not pressing higher, it can be rather unnerving to have a large directional portfolio.  Yet we continue to see a resilient market unwilling to give back much ground.  S&P futures were higher overnight, peaking out at 1511, the high water mark set on Monday.

We’re off the highs a bit as we approach the 8:30 hour, and I want to point out a few odd characteristics about yesterday’s profile.  I’ve separated Tuesday and Wednesday’s profiles to the right to highlight the odd mirrored auctions that occurred:

Odd, yes? Also, you can see we booked an inside day with both the range compressing and the value compressing into the prior day’s respective range and value. This signals balance. It also tells up the market is building potential energy, and the next move could have some major velocity. We still have the poorly auctioned range surrounding the 1500 century mark. Should we blast higher, I will stop keeping this observation in mind. But until we leave this area with authority, which starts with sustaining trade above the orange box I highlighted above, I have to keep my aggression in check and keep some cash on hand.

Cash level currently 20% with a 5% TZA hedge (clown college)

Here’s a throwback surf jam for Kai and people like him:

http://youtu.be/1gdG7TZUqY0

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Winter Log Jam

Today was a relatively constructive day for the bulls.  They managed to fend off a nasty lunchtime selloff.  There were several very curious features to today’s profile which I will cover tomorrow morning.  Whether or not you keep a profile while you trade, a normal price chart shows an inside day. This can signal balance and can also give way to reversal.  We closed in the upper third of the range on the S&P futures and the VPOC was shifted slightly higher.  These developments support higher equity prices

I took action early on scaling off ½ my ZNGA position around $2.80 and selling SU.  Like a chump, I did not realize SU reported pre-market and was corrected for my oversight.  I’m pleased to report I sold SU near the high today by applying chessNwine’s tried-and-true method of maintaining discipline and cutting shares when surprised.  His surprises-mind you-never come in the form of prescheduled earnings.

When the market dropped off rather unexpectedly I cut the net of my TSL position.  After doing so I reflected on the days I owned TSL, and wished I had it back.  Dumping her cold out of the blue while she was still performing well felt forced.  The stock still looks great.  Finally, I strapped a pair of clown shoes on and jumped into the burning building that is TZA.  I didn’t bottom tick the market, or top tick TZA, but I did buy it at a less-than-desirable location.

All of these lateral moves resulted in a cash position of 20% and a 5% position in TZA.  I feel underinvested already.

Top picks into the week’s end: ANR & ANGI…Zee’s have been cast aside for A’s in my binary ticker approach.  I still like APP too.  And I’m big dict in MOS & TPX if you didn’t catch that.

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This Angel is Posed To Give Shorts “The Shocker”

Keep an eye on Angie’s List this week as it flags near this key level. I love this ancillary housing play with a splash of social web experience. I like their recurring income stream via subscriber service and their disruption of the contractor game. Much like hotels cringe at the thought of a bad TRIP review, contractors must do the same. These companies are the real deal and ANGI shrugged off the downdraft in FB post earnings.

There are several talking points that keep me bullish on this name, but the core reason I’m long is this sexy little chart:

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No Change Yet

Yesterday the action in the S&P did little to change to overall outlook of the direction of the market.  We’re still trading within the confines of brackets and there’s still cock fight action surrounding the 1500 century mark.

Bears can claim a small victory over the bulls yesterday in not allowing the value to be moved higher than last Friday.  Notice the value areas overlap, but the Tuesday value area has a lower VAH, VAL, and VPOC.  Bulls need to contain the downside for the remainder of the week, else the likelihood of an exploration lower increases.

What I want to see most is a healthy auction, represented by a smooth bell-shaped distribution, occurring within the area of 1502-1498.  Once these levels are thoroughly traded, our next move is a high probability hand tip for the direction of the next swing.

The NVPOC from Monday is the major target for sellers today.  If they’re able to reach it, I would consider their ability to dictate the direction of this tape to be increasing.  However, I will monitor the area for signs of buying activity.  You likely want to cut losses out of your portfolio if we begin rotating down to 1496 with behavior that suggests we’re closing the NVPOC because you losers will participate 1.5x or more with the broad market selloff.  Unless they don’t…this could be telling of buyer interest.

Remember to be water.

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Eyes On $ZNGA

As we near the close I’ve decided to hold my shares of ZNGA long into earnings.  Rhino just came out with a well thought out piece on why the company is a short.  This is not good.  His batting average is high on earning’s plays.  However, like RaginCajun I’ve traded the name around these last few months building in a nice buffer on my position.  The joy of scaling, if you will.

With my colleagues thoughts disclosed and considering there’s three of us on this play (!) I thought I should give my two cents.  I have liked the chart for several weeks now.  It’s trudging along, popping eight percent on occasion, then being faded.  The company itself I ABSOLUTELY DESPISE.  I grew up playing real video games like Mario brothers and Street Fighter.  Then I moved onto Mario Kart and Golden Eye.  I was briefly addicted to Super Mario 3 (!) often timing how fast I could beat the game (blow the whistle toot toot!).  My days playing games trailed off around Halo 2 as I began to realize what a massive waste of time the games were.  Oh, somewhere in there I played a ton of Grand Theft Auto and Roller Coaster Tycoon.

Then they started making really lame video games that people played on Facebook and their stupid smart phones.  These games suck, all of them.  The people who play them are sloths, high on the $MJNA. 

OUR COUNTRY is full of sloth like creatures, and they play these wicked games.  That is why I’m long this dildo company into earnings.

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Gentle Bears

Today there have been bears all over Twitter, talking about laying the smack down at 1505 on the /ES.  Here we are, lingering at the 1505 level into the one o’clock hour, and I’m looking for the bears.  So far they’re force has been weak, and I’m expecting higher prices.

I got a bit ahead of the market this morning and went ahead and made TPX a full size position.  I like that chart, it’s a tight little pullback to support and it’s in a volume void of galactic scale as my comrade ElizaMae pointed out a few weeks prior. 

The highs today have thus far been poorly auctioned, but here we are retesting them as I type.  I’m looking for signs of sellers, but so far they’re not being very earnest.  All roar no claw.

There’s lots of session left but the bears will need to show follow through sooner than later otherwise the buy orders will start flowing back in.  I’m expecting a hand tip by 2:30pm.

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The Cock Fight

Yesterday was close to forming the rare PBR setup on the S&P future contract.  The characteristics are a P-shaped short squeeze profile followed by a b-shaped long liquidation profile.  Both profiles on their own signal the movement in price to be a temporary phenomenal fueled by shorts covering their positions or longs liquidating, respectively.

When you see the two profiles sequentially, it signals a dangerous environment much like a cock fight.  The moves are violent but until a cock digs their talons into the other fighter the play is to fade back to midpoint.

You can see the naked VPOC was finally closed up yesterday, that point has been on my mind several sessions as it lingered below.  We saw a decent reaction by the buyers down at 1490.25 making it a VERY significant reference point going forward.  Should we not see buyers remerge at these levels on a retest it could signal the environment has changed and reducing equity exposure prudent.

Elizamae asked me a few days back on my thoughts regarding the lack of auction in the four point range surrounding the 1500 century mark. I’ll reiterate that it resembles a bird fight, put that imagery in your brain. Violent flapping and chest puffing are the norm. Think Twitter. If we see a health auction of these levels today, the next move is our tell. Otherwise, the cock fight continues. Until proven otherwise, however, the prevailing trend has the edge.

http://youtu.be/nze096dqID0

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Why I Scale Out

Today was the quintessential example of why I scale out of stocks at logical price levels.  Check out the intraday action in TSL:

Pull up a daily chart of TSL and put your eyes on $5.75.  That’s a logical scale point.  If you want to be a chart chump like me you best learn to spot these levels and trade accordingly.  Now I still hold a 2/3 position but I’ve already booked over a 10% gain. 

I don’t love having a full size position on.  Until I get my first scale I’m looking at a potential for a big loss.  However, I know my probabilities and when to push my edge.  Now that I’ve booked a gain, I can put a stop in place and allow the market to decide whether I will get some cream or just the necessary bread and butter to be a consistently profitable trader.

Today Trina printed a huge upside shadow suggesting the presence of an aggressive–reactive seller.  It’s probably a conservative (hehehe, I kid).  I like to examine how a stock trades after such an escapade as it gives me tons of information.  Was today enough to work off the HUGE overhead supply from last year or will newly initiated buyers start hitting the exit too?

I couldn’t care less.  My job here is done.

I have to post the edited version of this song, because the video is essential:

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