Big moves continue to be the norm in the overnight market, with the /ES_F seeing nearly 10 handles of upward rotation since the cash close. We’re off the high of the overnight session, clocked in at 1645, but not significantly and the market is still showing upward momentum.
It appears we may work to accept value above our first key upside price level 1639.50. Keep this level in mind today as it coincides with yesterday’s high. How we trade relative to this price will give us a strong sense of market sentiment heading into earnings.
I’ve highlighted this key level and other potential prices of interest in the following profile chart:
Mon Jul 8, 2013 5:51pm ESTComments Off on Don’t For One Second Forget it is Summer
Summer: when the women present their supple midriffs above skirts and now my new favorite, the high rise jean. Of course, it takes a certain physique to pull this look off. And as much as you think it’s skinny or curvy, it really all comes down to posture.
Summer: when the stock exchange stabs a cold knife in your back the moment you turn away. There are distractions abound, like my internet crush, Chiara Ferragni. Ladies, note the posture, stunning:
Today we printed a messed up looking candle on the SPY. Big deal, right? I mean every candle has been haggard. But I don’t like the positioning of this one, going into earning’s season. For all intents and purposes, earning’s season starts Friday, premarket. That’s when we hear from WFC and JPM who will set the tone into Friday’s tape and the weekend. It would be wise to focus on your risk profile into Friday’s trade.
We should get a sense of the front running during the week, we have our key levels above, any of which if accepted by the market would be a huge contextual point of reference.
Below, we have doji city…one bad day could very easily cut through all this nonsense.
So raise you vigilance this week, rank your positions, know your risk and targets and most important, work on your posture.
I took extra care and time preparing my profile analysis this morning, savoring it like peppercorn duck paired with a well concentrated Chianti.
There were major implications surrounding 1623.75 as it pertained to the proclivity of providing directional bias. I worked diligently to keep this level in your mind and more importantly mine to ensure appropriate steps were taken to adjust equity exposure according to the market’s treatment of the key level.
I’ve split Friday’s profile open so we can more clearly see and discuss the auction that took place. Before the open, the market traded just above 1623.75 and churned the level rabidly during the monthly Employment Data drop. The first two paragraphs featured here provide blow-by-blow commentary.
We lost 1623.75 before the cash market opened and experienced a subsequent drive lower fueled by a large burst of sell orders. After an hour of trade, buyers perceived the market’s current pricing as a discount, and swiftly auctioned price back into the opening range, then again rotating up to 1623.75. Their actions left footprints initially at 1609 where a single print buying tail printed, then at 1613.50 where they rejected the seller’s attempts to again rotate lower.
Overall, the day flashed of neutrality, mostly, when we saw the range extension higher get faded back to the mean at 1619.25. Only at this very moment, a very powerful move higher, nearly 10 handles occurred. I’ve separated said move away from the primary body of Friday’s profile and made it independent. That’s because at that very moment something changed and it needs to be treated as independent from the primary session. Independent like a good American, USA.
Overnight the ramifications of the above accomplishment played out, and now we’re coming into the week with a large gap up, over 10 handles above the cash close. Today may be particularly difficult to trade, especially if the market doesn’t establish a clear vertical trend in either direction.
Up above, you’ll notice large gaps between my reference points. That’s because we’re nearing the upper mouth of a huge long liquidation. However, these levels are all huge accomplishments for the bulls, and acceptance of any one of them should add conviction to the long trade.
Weekly upside targets in the S&P futures are:
I’ve noted these levels, and other key reference points in the following profile chart. You should click to enlarge this image, and keep it open on a tab:
We traded up to this key level in globex while celebrating our country’s independence. Now all we have to do is hold this level while the cavemen in Africa volley motor shells and Molotov cocktails at one another.
Gentlemen, be patient, let the trading day progress, and above all, keep this level in the front of your mind for it is a launch pad. Lets see which side we close on. Godspeed America, god damned speed.
Wed Jul 3, 2013 8:27am ESTComments Off on Keep in Mind Tomorrow is the Fourth
Which means today is the third, you follow? Let me explain:
We had a rather pungent selloff overnight, taking us as much as 13 handles off Tuesday’s close. We continue to be operating in a gap prone environment so mentally you should be prepared to handle such occurrences if you choose to hold positions overnight.
The key support today, on this shortened trading session, is 1592 which is only two handles below the overnight low at 1594. When I present the market profile to you, and you see the succinct manner in which it has located highs and lows this week, you’ll understand the gravity of this level.
Below 1592, price could begin working toward 1584, however given the shortened session, it would take a great deal of fear to press into these levels.
We’re right on the cusp of considering today’s gap to be of the pro variety, so it carries a lower probability of filling, but also a much higher reward. Let’s see who enters the market early on, if at all.
I’ve noted the levels I’ll be trading around in the following profile chart:
UPDATE: ON $F strength, I’ve swapped the dirty Brit Beatles song for the USA #1 Beach Boys:
Because when three months go by and every stock feels like a chase, you’ll pull out your weekly charts and be like, “Well when was that perfect setup and why did I miss it? Oh, I see, it was the sketchy week leading into the 4th of July, when I tread lightly.” And you’ll be like, “Damn, of course that’s when the opportunistic bulls went all capre diem, bastards!” This scenario will resonate even louder for the cash-heavy vacationers…
…Raul is never on vacation, even when on vacation.
I’ve accepted that travel for the next 3-9 years must be within the confines of an acceptable internet connection. Perhaps you’re like, “that’s sad, really.” You shouldn’t. I’m hungry, and we “all gone eat honey.” Mine is simply being deferred into my early 30’s.
We’re all staring at the same charts, and it’s hard to look away. SPY is like your favorite train-wrecked celebrity, blowing cocaine and walking through Hollywood naked. We’re disgusted, but a part of us wonders if we’ll ever experience such luxuriously-destitute conditions. You’re sure they’ll die or be arrested, but just then Richard Branson comes to their rescue, flying them off the streets in his spaceship. That’s the ETF SPY summed up in one paragraph.
It’s a totally new world we live in. Get out your space helmets friends!
So I’m Don Johnson long into tomorrow’s shortened trading session, fully prepared to hammock myself and drink cucumber water once the market closes. Then blow shit up, and then have a remote presence Friday, like an alien.
I’m over MAX HOLDING COUNT, currently holding 14 longs, like a box of dynamite.
Cash is only 10 percent and here are my longs, listed by size, largest-to-smallest:
TPX, F, Z, GS, FB, ANGI, SHLD, AAPL, IMMR, O, CREE, AIXG, ENPH, and YGE
I’m certain this list has little value to you because, well, it’s too many names. I’ll cut the solars on any additional weakness, but I couldn’t stand the thought of cutting them before they actually become fireworks…they’ve done nothing wrong.
O shot out of a clown cannon into the bell. The move lower looks way overdone, and inside 12631 we talked about how this is one of my favorite setups.
AAPL made it back to my basis, so I cut it in half. Sitting through that drawdown full sized was muy shitty.
F closed out at 52 week highs, fantastic looking chart.
ANGI is still “meh”
CREE: all year I’ve wished I had more, but all year I’ve been long so….I can’t beat myself up too bad.
GS needs to do some fancy bear-trapping, because right now, they’re asserting themselves rather well.
As much as I love software updates, I’m still having trouble getting my NinjaTrader platform to display profile charts. On top of that, most of my historical data was wiped out. I’m hoping I can recover the data.
Thus I will present the bar chart again today, and reference the key levels from the last two days of trade.
I had a profile running yesterday during the RTH, and the key take away from the action was the P-shape profile as we worked up into the long liquidation that occurred on 06/19. Buyers were able to squeeze the sellers early on with gap-and-go action, only to see the sellers overwhelm the tape after the morning’s dynamic move. The initiating sell orders (orders executed at the bid) began flowing in around 12pm, and pressed against a price “shelf” at 1616. For a moment it appeared they may not break the level and a second squeeze would ensue. However, they broke the level and were able to rotate us back down to the opening print.
I’ve noted where the shelf exists in orange on the following bar chart. I’ve noted other levels I’ll be keying off of as well. Note the light blue line at 1623.75, that is the origination of the big 06/29 long liquidation. I expect a test of this level soon, if not this week.
Just like that we’re thrown into the month of July, like a Christian catapulted into the Colosseum to feed the lions. The S&P futures via the E-minis have been all over the place, allowing traders to swing both ways intra-day with relative ease.
The main takeaway from the last 22 hours of S&P moves is we made new swing highs, taking us about half way up the big liquidation snap that started on 06/19. Even if today marks the high for the week, it’s a damn good one.
The important matter is how the market chooses to digest today’s action as we approach the kickass 4th of July. Ideally, volume tapers off and everything becomes rather boring. I would like boring as I sit 80 percent long, because really I only want to buy gigantic fyreworks (sic) and “blow shit up” to impress my relatives.
Imagine a scenario where we slowly print a higher low in-or-around 1600…wouldn’t that spook the bears?
Moving on to book talk, I sold ½ my YGE long for a 10 percent gain. My track record in trading the name is still negative, but it was nice to land a win. I still like the name even though it printed a nasty candle today. I’m keeping my little ¼ on a tight leash.
I added to my Z and GS longs, in that order. They’re about the same size now, which is about ¾ size. I see a similar pattern between the two daily charts which is yet to materialize, which means I’m early, which means the high probability hasn’t set in yet, which means I may lose money. I continue to jump the gun on my setups.
That’s all I did today, essentially pooling my wins from YGE into Z and GS.
I want to join the iBC crew on SHLD down here as I believe the price presents an opportunity to buy the name at a discount. However, I’m backing off in hopes of slightly lower prices. I may not see them.
Finally, remember when I bought RGLD sub $50 and then went on a dog and pony show, decreeing my greatness? Anyhow I only scaled a small bit off and a nasty gap lower made the trade a net loss, but that’s not what I want to turn your attention to. Instead, I want to discuss how I was offered sub $40 shares by the stock gods and not only did my spider senses fire off a buy signal, “The Fly” spoon fed us high probability statistics. And what did I do? NOT JUMP THE GUN! I stuck my head in the sand. It’s been a distraction to watch it rip 10 percent since then. Now that I’ve penned my frustration, I no longer care.
Mon Jul 1, 2013 8:04am ESTComments Off on July Kicks off With a Pump
When the clock struck midnight and it officially became July, the market went on a pure, unadulterated 16 handle run off the lows of the globex session. The move tested the RTH highs from Friday at 1610 before retracing just above 1600. A second test of the 1610 level occurred, giving us five touches of this level.
Should it be tested again in RTH, I’ll be playing for a move though it and up to 1614.
I’ve noted other key levels for today’s trade on the following bar chart. I upgraded NinjaTrader over the weekend and haven’t managed to work all the bugs out. Therefore I will be trading without my profiles today, aka V.F.R.
Fri Jun 28, 2013 8:38am ESTComments Off on After a Strong Week These Levels Are Key
The overnight market made upside progress throughout most of the session only to give up five handles over the last hour. The swoosh lower brings us to an interesting price level, 1606, which coincides with the single prints on yesterday’s profile.
After two days of the market printing neutral sessions, probing the large gap above and finding sellers, and the overall corrective nature of the market, it shouldn’t come as a surprise to see some chop/lower prices. The clear question is whether sellers are again able to dictate lower prices in the effective manner we’ve seen since earlier this month.
I’ve highlighted a few levels of support I’ll be monitoring to gauge any progress made by the sellers and other key levels in the following profile chart: