iBankCoin
I turn dials and fiddle with knobs to hone in on harmonic rotations
Joined Oct 26, 2011
3,723 Blog Posts

NASDAQ with the modest +10 up gap into Tuesday, Walmart strong, here is trading plan

NASDAQ futures are coming into Tuesday with a slight gap up after an overnight session featuring extreme range and volume. Price popped higher overnight, making a new swing high before sellers knocked the price back down into balance. As we approach cash open price is hovering in the upper quadrant of Monday’s range.

Walmart reported earnings this morning that bested expectations, shares are higher by +3% in pre-market trade.

On the economic calendar today we have Fed Chair J.Powell set to speak to the Senate at 10am. At the same time e-commerce retails sales data is due out. at 11am we have 4- and 8-week T-bill auctions, and at 11:30am a 52-week bill auction.

Yesterday we printed a double distribution trend up. The day began with a pro gap up and after a brief open two-way trade buyers drove higher, nearly but not quite making a new swing high before flagging for several hours. In the afternoon the new swing high was finally made. We were choppy from then-on, eventually closing off the highs by a bit.

Heading into today my primary expectation is for buyers to gap-and-go higher, tradign up through 9369.25 and sustaining trade above it to set up a run up through overnight high 8417.25. Look for sellers up at 9435.75 and two way trade ensues.

Hypo 2 stronger buyers fill the 02/21 open gap up at 9459.25 before two way trade ensues.

Hypo 3 sellers sustain trade below 9369.25 then work down through overnight low 9291. look for buyers down at 9258.75 and two way trade to ensue.

Levels:

Volume profiles, gaps and measured moves:

Comments »

NASDAQ up a cool +170 into Monday, here is trading plan

NASDAQ futures are coming into Monday pro gap up after an overnight session featuring extreme range and volume. Price drove higher for the majority of the Globex session, trading up through last Friday’s high early Sunday evening and steadily campaigning higher for the duration of the session. As we approach cash open, price is hovering up inside of last Tuesday’s range.

On the economic calendar today we have Housing Market Index at 10am followed by both 3- and 6-motn T-bill auctions at 11:30am.

Last week kicked off with a gap down and Monday rally. Tuesday featured a choppy balance early on before sellers stepped in and drove lower. Selling continued through Wednesday morning until a choppy balance took hold well above the prior week’s lows. From then onward price rallied, recapturing about half the week’s losses. The last week performance of each major index is shown below:

On Friday the NASDAQ printed a double distribution trend up. The day began with a gap down in range. Buyers drove into the open but could not close the overnight gap on their first attempt. Instead price reversed the early open drive. Sellers could not however take out the daily low. Instead buyers renewed their campaign higher and by about 1:15pm the overnight gap was filled. The rest of the day was spent chopping higher.

Heading into today my primary expectation is for buyers to gap-and-go higher, trading up 9320.75 before two way trade ensues.

Hypo 2 stronger buyers trade up through recent swing high 9345.50 setting up a run to 9400.

Hypo 3 sellers work into the overnight inventory and trade down to 9188 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

Comments »

Back bullish again

Any caution expressed last week has been thoroughly rinsed off after updating my research early this morning. I am back to being bullish and need to put my money back to work asap.

A couple things happened last week at the House of Raul. I bit off more than I prefer to chew, labor-wise, and as a result I was worked into a lather and for no damn great reason except a few thousand fiat american dollars. It set me back on my own work and was distracting and by golly I worked clean into Sunday night finishing tasks I accepted, tasks for other people’s benefit.

Fine.

The other thing that happened was I was so heckin’ busy I didn’t even have the mental endurance to cue up Exodus for five minute in the evening and see what the algos are up to.

Error. Not fine.

Any performance going forward from this will inevitably be worse. It is just the nature of things. I accept this.

One thing I’ve learned in my eight years freed from the shackles of W2 corporate servitude is that if I do not do something it will not be done. It is my conviction that many an adult american don’t have the huevos to live like this—they prefer to have some insurmountable authority that they can pile their angst onto, should something not go right. It’s a low friction way to bullshit yourself into complacency.

If I did not wake up two hours earlier than I normally prefer to on this critical Monday, then the research I need in order to trade would not be done, ergo I could not trade this week.

Again, this is not fine. Opportunity is running high.

So that’s it. Models are updated an bullish on all fronts. I have to allocate some of my long-term capital that was shuffled into cash last Monday as well as position my swing account long. I am a bit late to the rally. Such is life when you’re distracted. Nobody here is out to do any favors.

Watch for Walmart earnings out Tuesday to give a pure proxy on the U.S. economy. All those employment and GDP data coming out of the government are useless. Walmart is America. Walmart will tell the story.

Back to work.

I will be back around 9am with a morning NASDAQ trading report.

Raul Santos, May 18th 2020

Exodus members, the 286th edition of Strategy Session is live, go check it out.

Comments »

NASDAQ heading into Wednesday coasting on fumes, here is trading plan

NASDAQ futures are coming into Wednesday gap up after an overnight session featuring extreme range and volume. Price was balanced overnight  after taking out Tuesday’s low briefly. We held a balance along the lows until about 5:45am when it began exploring higher prices. At 9am Fed Chairman Powell is set to speak. As we approach cash open price is hovering in the upper quadrant of Tuesday’s range.

Also on the economic calendar today we have crude oil inventories at 10:30am followed by a 30-year bond auction at 1pm.

Yesterday we printed normal variation down, but with a trend down in the final hour of trade. The day began with a gap up and after a brief probe a few ticks above the prior swing high the overnight gap was resolved. We then spend several hours chopping above the daily midpoint, then a few more hours in a tight chop below the daily mid, then the selling came in during the last hour. We ended the day down inside of last Thursday’s range.

Heading into today my primary expectation is for buyers to gap-and-go higher, trading up through overnight high 9169.50. Look for sellers up at 9200 and two way trade to ensue.

Hypo 2 sellers press into the overnight inventory and close the gap down to 9076.75. Sellers continue lower, down through overnight low 8997.50. Look for buyers down at 8952 open gap and two way trade to ensue.

Hypo 3 stronger sellers trade down to 8900 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

Comments »

Long in tooth: NASDAQ comes into Monday gap down here is trading plan

NASDAQ futures are coming into Monday gap down after an overnight session featuring extreme range and volume. Price popped higher Sunday evening, briefly making a new swing high and holding the gains until about 4:20am. From then onward we’ve been rotating lower. As we approach cash open, price is hovering near Friday’s low.

On the economic calendar today we have 3- and 6-month T-bill auctions at 11:30am.

Last week buyers took control of the tape. We spent al week auctioning higher across all major indices, with the NASDAQ and Russell leading the way. The last week performance of each index is shown below:

On Friday the NASDAQ printed a normal variation up. The day began with a gap up and after a brief two way open auction buyer stepped in and made new swing high. Buying continued through New York lunch hour before sellers stepped in around 1:15pm and send price back down to the daily midpoint. Then, by end of day buyers had rotated us back up to the highs and we ended the day there.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 9219.25 before two way trade ensues.

Hypo 2 stronger buyers take out overnight high 9285 before two way trade ensues.

Hypo 3 sellers press down to 9100 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

Comments »

Happy Mother’s Day, bullish for one more session

You gotta have huevos to press your longs through the weekend. That or an established system with proven statistics.

Our brains are funny things. We can take in super valuable statistical information, information that is objective and cold and dead and true. Then instead of doing what that information says to, we over-weight the first hand account of someone close to us—a relative or some internet guru.

That is how one stays firmly planted in the 90% loser category.

There is not much for me to say this lovely Mother’s Day Sunday. I usually do Mother’s Day big here at the House of Raul. Women, in general, worry too much. If we can do one thing for the women in our family it is to project stability on Mother’s Day. Prepare a bountiful meal. Host a gathering in a spotless space festooned with lots of living plants and cut arrangements. Send them home with leftovers and gifts. Then resume your purposeful persists, be them illegal hell cat street racing, writing or whatever it is you do with your time.

I shall press all longs into the end of Monday. If, per fate, we have some kind of a trend up Monday, then I shall push into Tuesday morning. These are just rules established in my trading plan years ago.

None of this is rocket science.

Keep it simple.

Raul Santos, May 10th, 2020

Exodus members, the 285th edition of Strategy Session is live. Our two key contextual sub indices are painting a really clear picture heading into May OPEX. How the next few days play out is likely to forecast the overall market direction into quarter end. Make sure you check it out!

Comments »

Undone: NASDAQ back on swing high, here is Thursday trading plan

NASDAQ futures are coming into Thursday pro gap up after an overnight session featuring extreme range and volume. Price drove higher last night, unidirectional, steadily rotating higher during the entire globex session. As we approach cash open, price is hovering up near the high print set back on 04/29 during globex hours. At 8:30am initial/continuing jobless claims data came out worse than expected.

Also on the economic calendar today we have 4- and 8-week T-bill auctions at 11:30am followed by consumer credit at 3pm.

Yesterday we printed a normal variation up. The day began with a gap up and after a brief two-way open auction buyers stepped in, leaving that overnight gap unfilled. Buyers took out Tuesday high and closed the 04/29 open gap. After exceeding it by a few ticks and sustaining the gains thru most of the session, sellers pressed in late day and returned us back down to the session low.

Heading into today my primary expectation is for buyers to probe above swing high 9144.75. Look for sellers up at 9179.50 and two way trade to ensue.

Hypo 2 full-on bull run, get up into the open gap zone and trend up to 9459.25.

Hypo 3 sellers press into the overnight inventory and close the gap down to 8952. Look for buyers at 8950 and two way trade to ensue.

Levels:

 

Volume profiles, gaps and measured moves:

Comments »

NASDAQ up a quick +110 into Cinco de Mayo, here is Tuesday trading plan

NASDAQ futures are coming into Tuesday pro gap up after an overnight session featuring extreme range and volume. Price broke free from Monday’s range early in the Globex session, around 9pm New York, and sustainted trade above it for the remainder of the night. Price worked up into last Thursday’s range before finding responsive sellers who rotated price back down to Monday’s range. Buyers rejected a return to the range and as we approach cash open, price is hovering up inside of last Thursday’s range.

On the economic calendar today we have ISM non-manufacturing at 10am followed by 4- and 8-week T-bill announcements at 11am.

Yesterday we printed a double distribution trend up. The day began with a gap down and after a battle of an open two-way auction buyers stepped in and quickly resolved the overnight gap. BUyers then continued higher, tagging last Friday’s midpoint before falling back to the daily mid. Buyers then rotated higher for the rest of the session closing on high of day, up in the top quadrant of last Friday’s range.

Heading into today my primary expectation is for buyers to gap-and-go higher, trading up and closing last Thursday’s gap 8934.50. Look for sellers up at 8948.25 and two way trade to ensue.

Hypo 2 stronger buyers tag 8988.50 before two way trade ensues.

Hypo 3 sellers work into the overnight inventory and close the gap down to 8796.25 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

Comments »

NASDAQ down -50 to start the week, here is Monday trading plan

NASDAQ futures are coming into Monday gap down after an overnight session featuring extreme range and volume. Price drove lower Sunday afternoon when the Globex markets opened for trade, eventually working down into the April 22nd range (two Wednesday’s back) before a responsive bid stepped in. After buyers worked back into last Friday’s range, we spent the rest of the session in balance. As we approach cash open, price is hovering just below Friday’s low.

On the economic calendar today we have factory orders at 10am followed by 3- and 6-month T-bill auctions at 11:30am.

Last week kicked off with a gap up. Monday was choppy. Tuesday was trend down. Wednesday trend up. Thursday choppy at the highs, Friday we went back down to weekly lows. Throughout the week the Russell 2000 demonstrated relative strength. The last week performance of each major index is shown below:

On Friday the NASDAQ printed a double distribution trend down. The day began with a gap down below the prior two sessions’ ranges. Buyer worked into the overnight inventory early on but were unable to reclaim the Friday low. Instead sellers stepped in and reversed early progress made by buyers and drove lower, trading down into the lower quadrant of Tuesday’s range before settling into a balance along the lows. We ended the week near weekly lows.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 8716.75. Look for sellers up at 8728 and two way trade to ensue.

Hypo 2 sellers active ahead of 8681 setting up a gap-and-go lower, down through overnight low 8556.25. Look for buyers down at 8527 and two way trade to ensue.

Hypo 3 stronger sellers tag 8485.25 before two way trade ensues.

Levels:

Volume profiles, gaps and measured moves:

Comments »

Here to debunk the rising wedge consensus

This entry shall be brief as it is already 65 degrees in the murder mitten and the forecast calls for sunshine and 70s. What I am about to tell you is based on the the following beliefs, which I hold to be true:

  • The stock market is an indiscriminate mechanism that regularly eviscerates the majority of short term speculators.
  • Beginners luck is real but doesn’t last long.
  • Traditional technical analysis is often made to be a fool.
  • Markets will naturally price in the COVID-19 economic shock.

First off, here is the rising wedge everyone is looking at. We can debate exactly where the lines need to be drawn (well y’all can, I dgaf) but the essence is here:

It is one of those technical patterns that anyone who has studied investing/trading theory has seen in a technical analysis portion of the book. There is one major flaw in clear technical patterns—we all see them. This leads people to make short term bets. Even option bets. The positions are loaded up, the backroom algorithms take in all this data, and then poof! said algos zero out these trades in one fell swoop.

To really screw the pooch, it works better if the move sort of starts to look like it is working. In this case, via a downward break from the wedge. This increases conviction in the technical set up. More people place bearish bets or raise cash. The algos jiggle with indifferent data, sounding the death knell in some otherwise quiet server room in Chicago.

I talk to a lot of people. I am a business man of the people. I do less talking and more listening. I listen to sentiment without applying any of my bias our perception to it. This I accomplish through a variety of mechanisms (it is complicated) but basically I am a mirror. Or a parrot. On some occasions even a mocking bird, but only if I need to demean someone into possibly changing their rotten ways.

Consensus is that the worse is yet to come. The real supply chains issues will hit in the fall, many say. This is said in real estate circles, manufacturing circles, not so much agriculture, but definitely from builders.

They are bored maybe and talking to me. They all perceive worse times coming.

The active traders I take seriously, they’re almost all expecting downside resolution.

These are just observations. Fine.

Systematically, I have reason to be bearish heading into the first full week of May. The wedge broke downward, whatever, what really weighs my bias is IndexModel. It is bearish heading into next week. However, that is only one week, and it is also the first full week of May. This is where everything becomes murky. Normally May is a time of celebration, or at least preparation for celebration—graduation, weddings, Mother’s Day and the like. It is when us northerners finally go outside in our bathing suits and relax.

But everyone has been “relaxing” for over a month now, sequestered to their homes. Some people love their home life, still others rue the day they can escape their family and return to the peace of their job/office/etc. These people may not know how to live, but they will be back to work. They will not be watching the stocked market as closely, they will be selling stuff, or sawing boards, or whatever it is people do for money.

Either thru leisure or jobber, attention will start to drift away from the markets. Markets will be markets, gyrating up and down until we establish a new, post-Covid value. Is that value lower than where we valued markets last May? I have no idea. Doesn’t seem like much has changed. If anything the proverbial deck has been reshuffled, but the winners are still winning and creating economic expansion.

So that’s it. I expect some downside early in the week which will serve to spook some investors into raising cash and cause active traders to increase their hedges/shorts. Then an about face higher, real vicious like.

Said simply—-the overplay for the underlay.

Raul Santos, May 3rd 2020

Exodus members, the 284th edition of Strategy Session is live, go check it out!

 

Comments »