Wednesday’s Trading – 4/21/2010

Unlike the NDX futures (NQ), which rocketed to a new high on Apple’s earnings overnight, the SPX futures (ES) were not able to make a new high of their own. The rally high for the ES is 1210.50 from Thursday morning and they were only able to tag 1209.50 overnight. So, today’s open may be portentous.

100 thoughts on “Wednesday’s Trading – 4/21/2010

  1. STRING>>>2TH FIXER….about bonds…looks like they want to rally…TLT may try to close that huge gap down near 91…i still want to sell more bonds into this rally and am not interested in TBT now

  2. Not so fast on the downdraft. I have SKF at 17.8 & 17.3. I need to add one more batch at 16.7 (ATL) before we head down. 😉

  3. GEORGE>>..dollar looks ready to explode upwards…that will create a serious headwind for stocks and a serious correction…STOCKS ignored wave 1 up in dollar..( remember i posted months ago that dollar rally will NOT stop stocks from going up as CONVENTIONAL wisdom did at the time???) well i DONT think stocks can ignore WAVE 3 up in dollar

  4. SCOTTY>>>was it you who was hot on gold..??corollary is gold will not be able to ignore wave 3 up in dollar either…if it can.. buy gold with both fists

  5. Phil,

    Thanks for heads-up on dollar. I think you’re on to something there about certain times will/will not fit the coorelation.

  6. I would have liked to stayed on the BBT bus, but earnings are tomorrow. Don’t like those rides in a tunnel.

  7. Stringm,

    Smart. Earnings on BBT, good, bad, whatever, usually make the stock go down if the previous day is up. Buy the rumor and all that…

  8. phil says:
    April 20, 2010 at 3:52 pm
    george …here comes the post triangle thrust upwards
    GEORGE>>>guess that was it this AM….now i am looking for a test/ break of mondays low …will buy there for 5th wave up

  9. Phil,

    Agree. That’s consistant with the megaphone. Up, down, big up. Unless it’s a Miff’ed Market Myth.

  10. 2thfixr noted yesterday that the SPY 15min MACD was negative. Within that, the stochastic made a move to the upside and the MACD never did go positive. Using that indicator alone and following it as a signal would have been okay. There are times, however, when the stochastic will make the MACD cross to the upside, like when price reaches the 15min 36MA and bounces. Just things to look for.

  11. 2TH FIXER….if gap from tue near 1200 is not filled be aware we could blast upwards to 1240 1250 quickly and not get the chance to buy @ 1150

  12. GEORGE..i would prefer to see a SHARP COLLAPSE here for a nice C wave down that could be bought in the 1180 area….a tepid correction here warns of UPSIDE EXPLOSION ahead

  13. Phil,

    “Sharp” is what I’m looking for. Here’s hoping that happens.

    However, SPY nearing its 15min 36MA support so it may want to stall or try to bounce there ~$120.66.

  14. Is INTC & the SMH consolidating the earnings pop – bullish
    OR hibernating – …
    Too bad SKF did not fill my last order could be a fun ride down now.

  15. phil says:
    April 21, 2010 at 9:27 am
    STRING>>>2TH FIXER….about bonds…looks like they want to rally…TLT may try to close that huge gap down near 91
    WOW>>>>>gap nearly closed on spike up

  16. Phil

    And it seems odd that bonds would rally if the stocks are set to shoot to new highs. I am contemplating selling my 10 10yrs I have.


  17. Phil,

    That was a nice pop on SPY at your 11:52 post. I agree about using profits to trade again. Compounding is great.

  18. I’m not forgetting that big intraday gap up SPY made yesterday. That could be the reversal point if it goes down to there.

  19. George

    I have been playing with my set up and simultaneous crossovers. I have started watching for the crosses to occur on the 60M that result in a positive MACD Hist. Then I wait for the first pull back on the 5M and as long as I still have positive 60M Macd I buy the pullback. I don’t give up on the 5M till I get the Slow STO up close to 80 or if it falls way under the 36MA. All of this is based on the 5M 36MA being higher than it was 8 bars back. Seems to be working pretty well. The other thing is I started buying half and then adding the other half when the 60M price clears all the MAs, 6,21, & 36.


  20. Sold my sso at the close yesterday then bought puts,cant say i wasn’t sweating bullets after AAPL earnings.Yes Phils those calls were from Friday 1189

  21. Now if we bust that 1197-1200 gap we could slide to 1180,dont want to bounce back up here at 1200

  22. Sorry all, just got done doing some BIG dental work this AM (like, Special K sized–root canal, post, cores, bridge, etc…) so more than I ever make in the market….haha

    Thanks Phil for the explanations of your thinking. As I said before, looking for TBT below $47, so today may be the day….but I think I’ll wait until I’m sure where the market is going to head first. As you know, if the dollar rallies, stocks go down, Treasuries are going to get bid up to a low yield (higher price) and TBT will get closer to $40 for a nice long term buy then. Appreciate your sharing your thoughts. I agree, if 1200 doesn’t get taken out shortly, 1235+ is on the horizon.

  23. Scotty,

    I don’t think it would do any good. This was pre-planned by Phil. 🙂 He called it.

  24. Scotty,

    FWIW, 30min is still negative while SPY tries its comeback. Takes a lot to turn a freight train.

  25. Hey 2th, I hear GS needs a good bond picker. You’d get to extract the good ones. A little twist I know but you’d be fabulous!

  26. George,
    I didn’t pick up any more SKF @17.02 my third limit was 16.7. Still happy to have my two batches. :mrgreen:

  27. Hank,

    These inverse will smoke one day. Maybe at the end of summer, around that time frame.

    I still have K’s Sympathy Shares and they’re ragged at the time being. Was waiting on $80, have reduced that to $20. Could get that today – yeah, right!

  28. Can you imagine being at the GS mortgage desk? “Hello, mmm Mother Mayhem Departttt – Mortgage Department how may I place your order?”

  29. Ok, enough bashing from Grasshopper. If I’m going to do it I should be getting paid for it. Never gratis bash. It’s stooopid.

  30. George what do think ,had s&p on the ropes,wait for tomorrow morning? No pop today from aapl earnings,so unless someone else totally blows out maybe one more attempt down

  31. Scotty,

    SPY made a counter move but not a reversal yet. I expected that to happen after a mild drop. Nothing significant yet as to a reversal back to the upside. When the higher time frames get broken, it’s an opportunity for a counter but it takes some big moves to overcome them.

    Naturally, anything can affect price movement, but from what I’m seeing there will be more downside. Whether that results in a trend change or merely a continued correction, I don’t know.

    That being said, I pay attentioin to the position of the MACD trendlines. If say the 15min trendlines are above zero but have crossed to the downside moving toward the zero line, they are still trending up while making a move down. The lower time frames (as well as the 15min stochastic), say the 5min, tells which immediate direction price is moving.

    Right now, SPY is still in an uptrend and made a correction on the 1 and 5min while the 15min is still okay. The 15min would need to be taken out for a reversal.

  32. Thanks George your a Georgia Peach,I try to trade the waves and retracements. I need to learn your way

  33. Gang

    It looks like y’all had a better ride than I did raquetteball game. So George did you ride the down and the up the last hour? What went on? looks wild, was that volitile enough for you. Looks like there might end up being some trapped bulls after hours too. Sure looks different than when I left. I miss all the fun, guess that’s what I get for being an ahole.


  34. Stringm,

    My wife and I play racquet ball twice a week. Good workout. Yes, I got both sides of the market. Luv them waves. I could almost feel the distribution but I don’t know who’s doing it. It tried to bounce off that 30min 36MA and did a good job for a while. Not sure it can hold up tomorrow.

  35. George

    Well if I am looking at this right SSO closed @44.61. AHs it is 44.30. The 5M 36MA is going down. There will be work to do to turn it around. The 30M looks to be headed up, but not all my indicators crossed before the close, and AH they sure wouldn’t. I smell another down move on account of the Senate move today. The bankers will try to punish them for more Regs. It is a tangled web they weave. I have always been Red, White, and Blue to the core, but I am afraid America has lost it’s moral values. I hope we turnit around.


  36. String and George,
    I’m loaded with SDS as pointed out to Phil earlier today looking for downside. AH has it at $29.26 which puts it above the 9MA, which is above the 36MA on the 15 min chart. The MACD is above zero and with the rise in AH trading, looks to be creating a Humpty (I think that is what you mean by a touch and bounce on the MACD). I’ll cover if a new high is made (1215) because it invalidates the two possible counts that indicate a downward move, but I’m looking to sell half at 1165 with an eye toward 1155 or less on the remainder if the more dire count comes to fruition.

    Yes George, this week has been a nice week finally in the trading arena. Rode SSO up for a nice gain into Tuesday AM, and have broken even with SDS so far two days later waiting for downside. However, GILD dropped 10% overnight, and I happen to have some PUTS that increased in value nicely. I’ve got a stop placed on them in case GILD tries to trade up from here, but that made my day when I woke up to see that move!

  37. Phil, I lied about TBT. I had an alert in Chuck’s system and thought it was just for a beep/warning, but I actually had a buy at $46.75 in place. Got a decent fill of $46.72. Looking back, I see a nice support area at $46.50 since February. I’m looking to sell some off at $50 or cut bait at $46.25. What do you think, Bond King? I know you feel the market is going to possibly head lower and drive Treasuries up in price (flight to safety) and/or the dollar is strengthening as well. Hence the stop at $46.25.

  38. Tooth

    If your SDS trade works, your TBT will not. IMHO you are betting against yourself. If the market tanks, the monkey be a bond buyer.


  39. Tooth

    I also don’t want my dentist making a trade decision on a 15 minute chart. Take care of those teeth man, that’s your life blood. I think you should be looking at Weekly, Daily, and 60M. I am no brain surgeon, or even dentist, but I have fought this beast a LONG time, and it can consume your thought processes. Your best bet short term is to look the horse in the mouth. FWIW


  40. Yerk

    What is your perspective on the Bund auction today. Was it really weak as presented at ZH? Gross luuuves the Bund, so it has to be great, Right? Also what is the real sentiment in Germany about bailing out Greece? Is it a damned if you do or damned if you don’t deal? Or is it the Greeks like in the butt, so give it to them thing?


  41. Thanks String…appreciate your thoughts. yes, I am betting against myself, but they are two different bets.

    There are three $SPX EW counts valid right now. Two of them call for a move down from here and are both invalidated if a new high is made (1215). The other is pretty bullish, but is the only valid count *if* a new high is made. Seems pretty simple to me: buy SDS and enjoy the ride to the target, or get stopped out with a new high. The 15 minute is the shortest time frame I’m looking at for confirmation of the move, that’s all. This is a short term, swing trade of days to possibly a few weeks.

    The TBT trade is a simple channel bet, and I actually like the fact that it is contrary to the SDS trade. The channel runs from $46.50 to $50. I’m buying near the bottom, and will sell most near the top. If it violates the bottom of the channel, then I get stopped out but my SDS is golden. If my SDS gets stopped out (and I switch to SSO), then my TBT should run up to $50.

    Does that help you understand my thinking and my trades?

    PS–I always focus on my job, not my trades. That is one reason why I gave up scalping (except on days off). Can’t stay plugged into a chart all day while working.

  42. Tooth

    I will have to digest that in the morning when the Keystone Light effect has dissipated. I am not into EW or trying to predict where the market is going. I just work with MAs and other indicators. I use the MAs as support and resistance areas. I like them because I can quickly tell if I am right or wrong. I take a lot of losses, but they are little baby ones. I also use the pivot points to trade around, but I can also devote full time to it. I am an old retired fart, and I like to play with it every day, especially during the winter. Now that summer is here I will back off and try to play the daily chart, buying when the STO is below 20 and moving up, and selling CC when it hits 80+. I will give more thought to your post in the morning. Hope to see you in Phoenix some winter. We can meet at Turf Paradise, I know you like to gamble.


  43. Tooth

    I said Retired, a better description would be Retarded. I hope your swamp cooler is working, summer will soon be on you.


  44. Stringm,

    You’re hardly “retarded” with the way you program SD.

    Speaking of which, on one of my webinars, there was a big ta-doo about “average daily range” – not average true range (ATR) but ADR. It was rather impressive what I was seeing and it could be useful.

    I’ll find the calculation and see what you can do with it – if you want.

  45. K

    I will give this a look. I don’t know Baguettes, but I know that Ciabatta thing you had worked great! I use it once a month at minimum, Thx!


  46. I used to work at a race track (taking bets, not making them). I don’t gamble on things with two or four legs….cards, dice, and stocks. 🙂

  47. Tooth

    I don’t do channels, but I look at overbought and oversold. I think that is close to the same. I try to find things that are oversold Slow STO under 20 on the daily. I then look at the weekly MAs are and try to se where support is. I then look at the 60M to see when all my indicators start to turn up. I can see on the weekly that the 21, or the 36 is under the price bar. If the daily is low STO and the weekly has support under it, I feel real comfortable buying when the 60M price starts moving up. If it fails I get the hell out of Dodge pretty quick. I be all able saving capital.
    If it works I hold till the daily gets up to oversold and I sell covered calls when the MACD starts to roll over. Sometimes I buy them back and sometimes I just get called away.

    If you buy something at the bottom of a channel, then when it gets to the top of the channel you sell covered calls. You just don’t care where it goes, because you will be making money, unless it goes down. Then you buy a Put when it gets dangerous that your position is hosed. That way you make money on the Covered Call and the Put and you still own the stock.


  48. Glad we’re still friends even after I called you a liar 🙂
    I will try this weekend but i know you love easy to make breads and this might be just one of those

  49. Tooth

    I will do a better job of spelling and splaining that tomorrow! Mavericks are coming on and I have my “Dirk is My Homeboy” shirt on.

    Later Dude


  50. Yeah, make sure Dallas wins so the Suns can have a nasty rematch with them….

    I understand your covered call strategy, and depending upon when expiration is, I will sell some against the position when it gets near the top as well. But, with TBT, would hate to get it called away, or take the meager premium (with a VIX near 20, not much premium there!), while watching it slide back or lose money. A $3 channel is just a buy and sell type of trade. A $10 channel would be more condusive to the style you are laying out. Basically, I’m playing 10 year rates from 3.66 to 4%. If it breaks above 4%, I want to own TBT. If it breaks below, get out and watch the rate plummet.

  51. 2thfixr:

    “If it violates the bottom of the channel, then I get stopped out but my SDS is golden. If my SDS gets stopped out (and I switch to SSO), then my TBT should run up to $50”

    Like the ballast in a boat.

    FXP had some nice rips today. Did you notice?

  52. Mitch,
    I just trade a few things, mostly SDS/SSO. And since I work all day, have to make conditional orders and swing trades. Hope you caught the FXP train.

  53. Futures Prices
    Market Last Change %
    Crude Oil 83.94 +0.26 +0.31
    Natural Gas 4.069 +0.028 +0.69
    Corn 369.00 +3.75 +1.02
    Soybeans 1006 +12 +1.19
    30yr Bond 117.40625 -0.18750 -0.16
    10yr Note 117.187500 +0.421875 +0.36
    NY Gold 1148.2 -0.6 -0.05
    NY Silver 18.145 +0.067 +0.37
    Emini S&P 1202.75 +2.25 +0.19
    Emini Nasdaq 2028.25 +2.75 +0.14
    Emini Dow 11080 +21 +0.19

  54. hmm…
    Futures Prices
    Market Last Change %
    Crude Oil 83.20 -0.48 -0.58
    Natural Gas 4.054 +0.013 +0.32
    Corn 369.00 +3.75 +1.02
    Soybeans 1006 +12 +1.19
    30yr Bond 117.50000 -0.09375 -0.08
    10yr Note 117.187500 +0.421875 +0.36
    NY Gold 1143.8 -5.0 -0.44
    NY Silver 18.015 -0.063 -0.35
    Emini S&P 1195.25 -5.25 -0.44
    Emini Nasdaq 2015.00 -10.50 -0.52
    Emini Dow 11027 -32 -0.29

  55. yikes, nas down 13.50 as shown on cnbc
    might have entered short trade at yesterdays close or better but won’t do that now…wait and see…

  56. frustrating outcome so far…i don’t want to short…so if the market turns back up, maybe then its a sign of climbing the wall of worry and i won’t want to short then either -ng-

    and the fly says better to be long than safe…well that’s what he said yesterday !

  57. Haha. What is the fly doing?

    All I can say is these next few days ( rest of this week and whole next week) will be interesting because I’m noticing one indicator begin to have cross up of moving averages and it hasn’t done it since OCT2008

  58. Tooth

    Well the Spurs took home court advantage away from the Mavs. Suns might be looking at a trip to SA.

    The market and bonds might tank together this time like you are positioned. I get focused on what has been happening, and not what could change. All that money has to go somewhere. If stocks, bonds, gold all go down at the same time, where does the money go?

    I am still thinking on your plan. Not that it will help you.


  59. String,

    I have an idea where capital will flow; to where it gets returned with more of same and a decent payment for credit risk and interest rate risk.

    Call me an old fogy but I like putting capital directly with companies that are growing and are successful or will be so with my help.

  60. George,

    I understand its terribly low from average so doesn’t make a difference but if we have crossups it will be very interesting.

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