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20
Nov
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5:14pm
The Pennant is now confirmed and broken, the bulls pushed the market to prior support/now resistance, but failed to break above. While a small bounce could be in the works due to a double bottom, this market is probably going to crash.
This is a 60 minute of the SPY, the red line represents bottom support of pennant.
3:19pm
New Low for the ES means pennant as been broken, and we’re heading towards 2002 lows, and towards a possible 650-675 target of the pennant. Expect some possible buyers at 768 (or under it).
1:57pm
Possible head and shoulders formation, as move higher is on light volume, if bears take this one, we’re in for a confirmed break of pennant formation. What are you guys thinking?
1:40pm
Volume is a little strong on the downside, but the 2 PM reversal time should pretty much decide this market’s fate for the next 2 weeks.
1:25pm
Some more consolidation.. could bring more buyers, but the 830-840 level is still far away.
12:37pm
I’m liking this rally as a bull, some resistance as prior support, maybe we can consolidate for another move higher.
11:30am
Very clear bull flag forming on the ES, could help us move higher.
11:16am
Market still getting that rally it needed to have yesterday. If the bulls fail today, then we will consider this market broken, however this is the fakeout rally that was missing in yesterday’s trading. If we can rally above 830, I can see more upside.
10:48am
First hit of 20 SMA 10 minute candle, serving as resistance.
10:43am
The market has finally found some buyers, the volume was strong on the first buy candle, but whenever the market needs to consolidate downwards to extend the move higher, it does so on strong volume, and that makes it really hard to read the charts. Keep in mind that the bulls have to do whatever they can to bring us back above 830 so that the pennant is not broken.
10:12am
Todays’ volume is incredibly light, but price-action trumps volume, and you have to respect the bears’ capability to push this market down. The absence of the bulls keeps me very nervous on this market. I am not playing this market either way, until we get some form of consolidation or pattern. We are also way too far away from the 20 SMA to be shorting.
12:00 am
Hey guys, today like yesterday is a crucial day for the markets, as the markets will decide if yesterday was a fakeout or a breakdown? We will have to track the price action and the volume today, but you have to give the bears the benefit of the doubt as they managed to push down on strong volume yesterday.
Megaphone:
:
Broken Down Pennant:
Good Job to those who were on the right side of the trade yesterday, I certainly wasn’t, but we do have some signs of a possible bounce (MACD bullish divergence), and of course support, if you believe in the megaphone formation. In any case, trade the market very cautiously on any rally. What are your thoughts?
2 hrs left for the option writers.
crap..talk myself out of QID at 86…hope you got in hk
November 20th, 2008 at 1:15 pm
Tom, got in at 86.17 & just sold already. I don’t trust the markets as they’ve been choppy. I still think QID could go to 80-76 range if markets rally today and opt exp.
I used the 5min chart and $86 hit the 200ema on the dot and that’s when i entered.
Let’s try and do it again later today.
For those who asked for my opinion on UA
UA gapped up from 18 to 21.5 on earnings and crappy guidance. It hit two textbook-case resistance levels and came crashing down, filled the gap and headed higher this morning. I made two round trips on this stock last week and this week – both times for quick doubles.
I still have Dec 17.5 puts. I see this stock in single digits soon. Kids love the brand. Too expensive for most parents to be able to afford their products. This stock is toast, a la LULU.
November 20th, 2008 at 1:09 pm
THANKS, think I should wait for the EOD to short, or what is the next resistance for me to set an auto trade to short this stock today?
SPY reversed directly on the Fib retracement from the close high on Tues
I am thinking that this market is going to crater… Dow stocks all up on low volume. Gives better short positions IMO.
in need of forming an inverted H&S to break through VWAP?
Don’t know how low it’s gonna go but ES is getting ready to turn down. 790ish.
November 20th, 2008 at 1:39 pm
Sensational call there Shanky!
November 20th, 2008 at 1:40 pm
TYVM!
looks like ready for the 2nd attempt at the VWAP
danaeric just posted with agreement that markets tank after 230pm.
Tom,
What do you usually use for entry & exit. Do you use the 5min/10min/15min charts? Usually i like to use the daily for confirmation and direction and than zoom in on the intraday.
Do you use stop loss at same time placing order.
hs looks like it will take tru the lows
Back to testing the daily VWAP. The more times we test it the less likely it is to hold. My bear claws are coming out again…
November 20th, 2008 at 1:30 pm
i’m leaning bear too. volume is better, but doesn’t seem like a strong enough push to get very far…just opex and a bounce from hitting lows.
Took me a while but I found it. ES 5m in channel up all day. Starts top trendline near 9:35 then connect the dots. This will provide solid road map for the days actions.
November 20th, 2008 at 1:30 pm
VIX might be forming a bear flag as odd as that sounds. Testing 100ma and soon top of channel. If it holds and the ES bounces off bottom of channel could be good. If not it won’t be good.
Up Channel forming on 10m es
November 20th, 2008 at 1:28 pm
higher highs, higher lows
Why do I feel like yelling TIMMMMMBBBBEEEERRRRRRRRR… No technical analysis to back it up… Weak bailout of automakers was about the only hope of any good news and it fizzled quickly.
November 20th, 2008 at 1:31 pm
We’re getting to that point of heading one way of the other. If we go the right way you can keep breathing. If we go the wrong way…
November 20th, 2008 at 1:34 pm
If we go the wrong way….take an aspirin and hope you don’t have a seizure…HA HA
VIX giving off signs that this will only be a test of the top trendline. Let’s hope I’m right.
November 20th, 2008 at 1:34 pm
Do you mean vix testing the top (and going back down) or the market testing the top and going back down.
November 20th, 2008 at 1:37 pm
I might have read that one wrong folks. VIX may have some pent up frustration hidden in the RSI and MACD 15 and 30m. I would not be long here. VIX looking more like a bull flag (as it rightfully should). Let’s hope I don’t know what I am talking about.
November 20th, 2008 at 1:47 pm
VIX bull flag means the bull for VIX bad for markets.
OK could be getting ugly. ES taking out the lower channel first time today. Hope this is a fakeout. Might be a good time to enter a short if you are feeling lucky – we’ll – do ya – PUNK.
Boy this is a great time to short. I’m guessing VIX might close testing the high. This would form a double top that might be worth playing long going into tomorrow. But what do I know? Bold call. Time will only tell.
November 20th, 2008 at 1:48 pm
You need a vacation my friend.
November 20th, 2008 at 1:52 pm
That’s a big 10-4 good buddy. I may be getting dillusional, but I made the call and I’m sticking with it.
November 20th, 2008 at 1:54 pm
Atta boy. btw, I loaded the boat with URE at $3.60 this morning.
November 20th, 2008 at 2:08 pm
OMG – Wow I missed that one. Well done. I’ve got a feeling we’ll be there again. I’m holding mine from yesterday till 2010. I’ll dump it when I’ve cleared 600%. Not a bad trade.
Tom,
IS QID worth looking for entry now???
November 20th, 2008 at 2:05 pm
30m is putting in tails over its 20 MA and supported by a LT trendline at 88.6. It’s in a battle right now. Setting up a possible bull flag. Looks like it might have some more upside via MACD and RSI. If you play it put in a tight stop and be prepared to sell it before the close. Make your own decisions and do your own homework. Not worth the risk to me.
I’m thinking higher from here. Yen crosses well off the lows. GBP/JPY looking very bid here. This could be a leading indicator of what is to come for equities. I’m long ES.
Pete
November 20th, 2008 at 2:06 pm
Can you explain this? Or blog on it? I’d love to understand these realtionships more. TIA
November 20th, 2008 at 2:18 pm
Sure. Yen crosses (EUR/JPY, GBP/JPY, AUD/JPY, NZD/JPY and USD/JPY) are highly correlated to S+P Futures (80%). Not exactly sure which one leads but the correlation remains.
Since my last post 10 minutes ago ES has come off about 10 handles, so have yen crosses. It’s always good to watch yen crosses and ES at the same time. Sometimes I see ES moving higher, but EUR/JPY hasn’t yet, so I will immediately jump into EUR/JPY and make a few pips if it hasn’t moved yet.
Pete
November 20th, 2008 at 2:10 pm
I hope you are right, but I see it setting up differently.
November 20th, 2008 at 2:16 pm
i also want to understand these relationships…if you have the time…thanks..
November 20th, 2008 at 2:18 pm
From 1:00 yesterday –
Yen crosses coming off there lows now. We could get a small pop higher here in ES in the nearterm.
Pete
I remembered this one – lot’s of us went long. I see it differently today.
November 20th, 2008 at 2:20 pm
It did go up 5 handles yesterday since my post ( a few minutes later). It was short lived, cause it came right off again.
November 20th, 2008 at 2:30 pm
We did get the bounce. Gotta be nimble. In no way am I dissin your call. I like them a lot.
November 20th, 2008 at 2:35 pm
I know it’s frustrating, but you have to be quick to take profits in this market before they evaporate. Yesterday after my post ES went from 930 to 935 and then lower. I was not quick enough get out with a profit and sold lower. But the relationship remains between yen crosses so I always have my eyes on them and ES.
Does is look like the QQQQ is forming an M A pattern? big M little A
i think lower. i bought puts…in my head i see a wave starting from yesterday into today…i dunno why i see that… and this is the wave down….and possibly big…
VIX setting up eerily similar to yesterday.
C is leading the charge lower, just like yesterday.
a small flare fired
If the VIX spikes like i think it will and puts in a double top I may swing a long play.
November 20th, 2008 at 2:26 pm
Today’s 80.35 was a 100% retrace of the drop from late Oct till early Nov if you ignore that tall wick up to 89.53. Amazing.
Clear head and shoulders formed with break down.
Get ready for a flush.
Strong morning volume – wear afternoon volume on the push up.
November 20th, 2008 at 2:24 pm
Strong morning volume on the push up weak afternoon volume on the push down – got it right that time.
back to 1st support soon
head and shoulder form on ndx on 1-min, 3-min, 5-min, 15-min charts
November 20th, 2008 at 2:45 pm
H&S still valid?
ES is clealy outside of intraday channel and VIX has topped resistance. Gonna take a miracle to turn this bad boy around, but we got lots of time.
November 20th, 2008 at 2:38 pm
Volume has been hard to read today. Call me crazy, but with the 10m STO and CCI oversold, and MACD and RSI higher, I say a buy program is about to kick-in to save the options writers a few billion.
5-, 10,- and 30-year yields down even more today. Over 7, 7 and 6%, respectively. Only 30 min to go before bonds desk closes. Unlikely to retrace some of those gains in the next 30 min.
Unless Hank pulls another trick up his sleeve at 3 PM on this options Thursday, it is possible to see a massive dumping of stocks soon.
November 20th, 2008 at 2:38 pm
What is more, no the T-bond yields are significantly lower than the panic yields in the wee LEH filed for bankruptcy.
November 20th, 2008 at 2:43 pm
Yes, unlike yesterday, I have been watching bonds, and we’ll be watching at 3pm to see which one is the dog and which one is the tail.
i still say it’s going south…
In this type of market action we are simply waiting for someone to tip their hand and show what direction they want to take it. Every trader I know is ready to go both long and short….it just depends upon the momentum going into the last hour…..nuts.
Here’s a trade I just put on today. This is my trade and not from Citibank or any other bank. Went long GBP/USD today at 1.4790
stop loss 1.4500
take profit close to 1.6000
I think we’ve seen the low. Take a look at the daily and hourly charts. I’ve put a lot of money on this trade so if I am stopped at 1.4500 it will hurt. But I really believe we are going to see 1.6000 again before 1.4500 It may take a few weeks or even a few months but I have time. That’s my view.
Pete
November 20th, 2008 at 2:42 pm
The dollar wont be getting any weaker with all these people buying treasuries. We made new multi-year lows today on the TNX.
November 20th, 2008 at 2:45 pm
Well I do like USD weaker from here, but I especially like GBP/USD a lot higher from here.
ES breaking a down channel. Might try to make it up to 795.
that was a nice drop, i’m up 55% on my puts so far…i think it’s going to go even lower…volume is drying up a bit too…
Unless something happens VIX 15m says short. I’m not playing it. I’m hoping we test the top of the VIX and rally late or close there which is a place I may be tempted to swing a long trade.
November 20th, 2008 at 2:52 pm
when you feel like pulling the trigger for long, let me know, i might get out of my puts and join you. i wouldn’t be surprised to see a bounce and pop at the EOD, but i think we’ll test the bottom again first.
November 20th, 2008 at 3:01 pm
i’m out of my puts. no idea where it’ll go from here…
3pm and money pouring in …… GO FIGURE!!!!
November 20th, 2008 at 3:05 pm
I mean out, out.
November 20th, 2008 at 3:03 pm
Careful….you about made me want to jump in
November 20th, 2008 at 3:07 pm
Oil selling off hard here. 49.62 last. Might have something to do with the equities dropping now.
Mohan, in post #132, you stated, “Unless Hank pulls another trick up his sleeve at 3 PM on this options Thursday, it is possible to see a massive dumping of stocks soon. ”
Excuse the ignorance, but what do mean by “options Thursday?” Expiration is Saturday (so, effectively Friday), right? TIA.
November 20th, 2008 at 3:15 pm
OEX100 options expire on Thursday. Manipulating around OEX expiration is a trick they pulled in the past. It was very openly – once in 1998 and in September of this year. I can post an “educational” note about this on StockTock later. Essentially, as the OEX options close, they come out with some market moving news. In 1998, it was a 75 bps interest rate cut. In September it was the news about the bailout plan and banning shorts. Further more, in September 08, they extended OEX100 options trading to 10 AM Friday, Sept 19. They always cease to trade at 3 PM on options Thursday.
In Oct 98, the market rallied over 300 points in the last hour. Earlier in the day, blocks of PEX calls were purchased. That is how they save options sellers then.
In Sept 08, market rallied over 1000 points from 2PM on Thu to 10 AM on Friday yet again saving the put sellers (houses).
One has to watch OEX calls prior to the close.
break 1st support right around 3pm. very interesting.
November 20th, 2008 at 3:11 pm
SPX was within 4 or 5 points of the low of the day and Vix is well off of its high when the low was set
spinning top time?
Citi is still leading this market by a few minutes. It has been for a few days now.
November 20th, 2008 at 3:14 pm
You said that yesterday. I need to look intot that.
VIX 15m MACD cross not crossing WTF?
ES almighty blue channel support at 756. (Just in case)
S135 from post 131. I hope you are right. My powder is dry.
November 20th, 2008 at 3:18 pm
Nope. Didn’t happen, but a retest of 777 might spark some covering, he pondered.
GOOG new low of the day.
November 20th, 2008 at 3:24 pm
Large vol on the green candle for GOOG
November 20th, 2008 at 3:50 pm
Holy Crap!!!
approaching 2nd support again
HK you would be up about $3 on the QID trade you wanted earlier.
November 20th, 2008 at 3:17 pm
i wish i had held my puts haha…not much volume right now…might really break next support…
I think that H&S measures to about 755, right?
My magicnumber is 770.
VIX 78 getting close. 2pts from hopeful double top or death.