The Wednesday's Big Rallies Could Be The Landmark Of A Trend Change.

10:40 AM
May be safe to close profited long positions. Markets may go slightly red tomorrow.
~~~~~~~~~~~~~
What is standing behind the Wednesday's big gains?
According to Reuters: "...Major central banks agreed to make cheaper dollar loans for struggling European banks to prevent the euro-zone debt woes from turning into a full-blown credit crisis.

The central banks' actions were intended to ensure that European banks, facing a credit crunch, have enough funding amid the euro zone's worsening sovereign debt crisis.
The moves followed an unexpected cut in bank reserve requirements in China, intended to boost an economy running at its weakest pace since 2009.
Further encouraging investors, the latest U.S. data suggested the U.S. economy was moving more solidly toward recovery. The U.S. private sector added the most jobs in nearly a year in November, while business activity in the U.S. Midwest grew faster than expected in November..."

So what should be my lesson? Stock markets reflect the health and the fundamentals of the economy. The economy is affected by political developments, economic policies and social/economic events. The investors (institutions/money managers) they have their way to approach news faster than us the retailers. The way investors read the news makes the way markets move. My lesson tells me that I will never depend on purely technical analysis to boldly forecast the markets especially when they are in an oversold/overbought state.



Reviewing My Game Setting Tuesday

..........

Bears: No Bears Setting because of today's "Euro Chiefs to Meet". I consider it a high risk for Bears. => So lucky this caution saves my Bears from loss from 3% gap up on Wednesday!

Reviewing My Game Setting Wednesday => I had canceled this setting before the market open.
Bears: Short 119.00-120.30 target 118.25-118.50
Aggressive Bears: Overnight exposure and target  116.32 - 116.82

10:47 AM
PSEC long settup: Price breaks out MA50 and trend channel, above Ichimoku Cloud. Stochastics and RSI9 crosse over.
I went long @9.11 => My setting makes score on this. It is an overnight position.


1. EURUSD Hourly: Is looking for the resistance 1.3567. When I posted before the open yesterday "EurUsd is sitting above 1.3407 and trying to beakout the rising wedge to make a reversal. It's price action certainly favors the bullish reading/setting of stock markets", a trader named Эрик from Seeking Alpha reminded me "If it does it will further form a cup and handle pattern". Oh yes, It's very probable. Thank you.

2. SPY Daily: Bears just need 3 days to reclaim all they had lent to Bears for 7 days. That says enough how eager and strong the Bulls are today, so Bears may be better to seek a hibernation for a week.

My Game Setting For Th 12/1/2011
I may think that markets will remain bullish till the end of the next week. Does this idea go a bit too far to a trader? Anyway, I will try to swiftly adjust my Game Setting according to the market signs. I think a pullback is a chance to buy at least for today.
Bulls: Buy on pullbacks. Target 126.80 - 128.30.
Bears: In waiting mode.

A stalemate in finding solutions for Eurozone Debts was seen and I expect a few red days comming

Reviewing My Game Setting Tuesday
Bulls may try to test 121-121.5 first and at that levels Bears may resume their battle.
Bulls: Limit the target at 121-121.5. May even consider to lower it down to 120.70 if it gonna be unfavorable. => It was a good call, Bulls had many chances to sell at 120.70. 
The Setting is worth to get +0.70 credit score if it said "Buy below the 120...".  
Bears: No Bears Setting because of today's "Euro Chiefs to Meet". I consider it a high risk for Bears.
Integrated Score from 11.23.2011: 1.20 (unchanged meanwhile it should be getting additional +0.70).

Market Outlook for Wednesday 11/30/2011


2. EURUSD daily shows heavy the selling pressure at 1.3407.
3. EURUSD hourly: Seems a rising wedge was formed and broken at 1.3317 at 2:00 AM that says the downward continuation trend is at higher odds than the reversal and that resumes downward pressure on stock markets.

4. SPY daily: Bulls was unable to win the 121.xx and 121 seems the goodbye kissing in short term.   My reading favors a red day today.

5. My Game Setting
Bears: Short 119.00-120.30 target 118.25-118.50
Aggressive Bears: Overnight exposure and target  116.32 - 116.82

8:14 AM
EurUsd is sitting above 1.3407 and trying to beakout the rising wedge to make a reversal. It's price action certainly favors the bullish reading/setting of stock markets.

Update my Game Setting: Nullification of the above setting because I don't know what standing behind this pre-market huge rally.

8:32 AM
I need time to digest what they say "China move gives Europe stocks a boost". Anyway chasing a huge move up is risky.
I may be a short term trend follower to buy the intraday pullback for day trade.


10:47 AM 
PSEC long settup: Price breaks out MA50 and trend channel, above Ichimoku Cloud. Stochastics and RSI9 crosse over. 
I went long @9.11

I maintain my forecast that this bounce may be short lived (two days max).

Reviewing My Game Setting Monday
8:23 AM
The SPY pre-market shows a big bounce of more than 2.5% supported by a huge bounce of DAX (>3.5%). A technical bounce accelerated by short covers and by a fresh hope about debt crisis action or/and by any other explanation?
But most important to me is the bounce is strong and I will increase the anticipated resistance of this bounce to 121.00 and will consider intraday pullbacks as chances to go long.  => If the user was decisive and swift enough, he may credited the setting 2 times +0.50 and +0.70 point. If he is strict, he may give +0.70 only.
Integrated Score from 11.23.2011: 0.5 + 0.7 = 1.20

Outlook for Tuesday 11.29.2011

1. EURUSD daily: Seems that the bounce has been capped by 1.3407 as I expected. A hesitation is seen at this moment and I suspect that 1.3212 may be revisited in few days.

2. SPY daily: With yesterday's huge bounce, the price got out of the steep falling channel and that wants to say some hope is looming. Bulls may try to test 121-121.5 first and at that levels Bears may resume their battle.

3. My Game Setting
Bulls may try to test 121-121.5 first and at that levels Bears may resume their battle.
Bulls: Limit the target at 121-121.5. May even consider to lower it down to 120.70 if it gonna be unfavorable.
Bears:  No Bears Setting because of today's "Euro Chiefs to Meet". I consider it a high risk for Bears. 

As a trader I'm better prepared for a bounce though I tend to think a bounce could be short lived.

Reviewing my Game Setting Friday
I tend to think that SPX/SPY will touch the support level at Fib61.8% today. I guess that Bears will take a short breather after the 115.83 and markets will be in a small bounce or consolidation before a further slide.
Bears: Short at a rebound when SPY > 118.00.
Bulls: Take a break.
My SPY@118.00 short position opened on Nov 23, 2011: If market slide below 115.83, will try to cover @115.66. If 115.66 missed, will try to cover below 115.83. If Bears cannot win the 115.83 today, the position will be hold. => When I saw signs of a bounce in Europe markets, I continuously adjust my cover price up, however I didn't act decisively enough. I would better covered it at the open @116.50. Finally I covered SPY at 117.5. I got only 0.50 point instead of 1.50!


Outlook for Monday Nov 28 


1. EURUSD daily: Bulls are not easily give up and 1.3407 would be their first mark of this bounce. It may need about 2-3 days to get there. Naturally this bounce favor stock markets. Bears may need more time to win 1.3146.

2. SPY daily: The bearish channel looks steep however many indicators are in oversold territory for the 2-nd day. It says that this fall is terrible however a bounce of some kind may be due and it will become certain  when the bounce of EURUSD is maintained.

3. My Game Setting
I try to show it in the charts today.

8:23 AM
The SPY pre-market shows a big bounce of more than 2.5% supported by a huge bounce of DAX (>3.5%). A technical bounce accelerated by short covers and by a fresh hope about debt crisis action or/and by any other explanation?
But most important to me is the bounce is strong and I will increase the anticipated resistance of this bounce to 121.00 and will consider intraday pullbacks as chances to go long.

If Bears Win the 115.8 This Friday, Do They Need A Breather?

I need to modify the scores system:
The old: Refer to my post 11/21/2011.
The new: It's the simplest. It's the difference of the close and open prices of the positions when my setting triggered. Ex, my setting opened short SPY@118.00 on Nov 23, 2011 and will try to close it at 115.80 in the next trading day. Should it happens, the setting will score 2.20 points.

Reviewing my Game Setting Wednesday:
I had expected a rebound to pick up some profit and to be able to get into shorts at safer prices. However it seems that this scenario remains only in imagination.
Bears: Short if SPY < 118.5. Overnight if Europe markets are in red. => Triggered @118.00.
Bulls: Long if SPY > 120.35 and Europe markets are in green.

1. EURUSD daily (11:05 PM, Nov 24 continuing) guided by a descending channel and is a continuation of a Head&Shoulders pattern. Seems it's idea for those who target 1.3146.

2. SPY hourly. It's obvious that the major bearish channel is unable to help an orderly retreat of Bulls. A steeper bearish channel is forming and it looks dangerous. No any substantial buying. There just a little hope about a limited bounce or a consolidation at the support 115.83 of Fib61.8. New resistances ~ 118.5 - 119.20.

3. Good news and bad news
German borrowing costs rise above U.K.'s
Fitch cuts Portugal to junk status
Dexia takes emergency funding
S&P getting closer to downgrading Japan
China: factory output growth to slow


3. My Game Setting (May be changed 1-2 hours before the markets open)
I tend to think that SPX/SPY will touch the support level at Fib61.8% today. I guess that Bears will take a short breather after the 115.83 and markets will be in a small bounce or consolidation before a further slide.
Bears: Short at a rebound when SPY > 118.00.
Bulls: Take a break.
My SPY@118.00 short position opened on Nov 23, 2011: If market slide below 115.83, will try to cover @115.66. If 115.66 missed, will try to cover below 115.83. If Bears cannot win the 115.83 today, the position will be hold.

9:22 AM
Update the cover target of the SPY short: 115.83
10:13 AM
Europe Markets bounce well. Must respect this bounce. Cover SPY short @117.50. Adjust the Re-Short target @118.5.
10:56 AM
With Europe Markets bounce more than 1.20% (CAC-40, DAX, FTSE-100) I think we may get a chance to short SPY at a better price than the one I covered @118.5.

Hope about a rebound is turning faint.

Reviewing my Game Setting Tuesday

My Game Setting (If I don't mention overnight, day-trade understood)

I think the rebound if any may be short lived (2 days max) and would be limited by the resistant range 1209.4-1215.7. => Intraday only, too weak to keep a green at close.

Aggressive Bulls: If SPY sinks below 119.25, long at it's breaking up this level. Or long at SPY pop-up above 119.25. Keep overnight if Europe markets are green and 121-121.5 are distanced. Must sell at green Wednesday. => Good setting (+1), long 119.30, closed 119.90. Because no green in Europe seen, overnight exposure was not triggered.

Cautious Bulls: Long if SPY > 120.35  => Not triggered.

Aggressive Bears: Short if SPY retraces downward from 121-121.5. => not triggered.

Cautious Bears: Short if SPY < 118.65. => SPY bounced back from intraday low 118.52. Poor setting (-1).

My integrated score from Nov 21, 2011: +1+1-1 = +1

1. EURUSD daily seems in indecision mode and framed by 1.3407 - 13567. However this candlestick count from last 8 may be very bearish: 2 selloff, 2 indecision - Doji, 3 bearish - Shooting Star.

2. SPY hourly seems to form a mini bearish channel at the lower boundary of the major one. May be bears will try the Fib50 at 118.5 once more.

2'. SPX daily: The two consecutive days closed lower than MA50 are adding more bearish to the market's outlook.

3. My Game Setting
I had expected a rebound to pick up some profit and to be able to get into shorts at safer prices. However it seems that this scenario remains only in imagination.
Bears: Short if SPY < 118.5. Overnight if Europe markets are in red.
Bulls: Long if SPY > 120.35 and Europe markets are in green.


5:50 AM updates
EURUSD 1.3567 broken down, 1.3146 expected. Europe markets dive -0.4 -1.xx %. It's highly possible that bears will master the US markets today.

10:00 AM
The EURUSD shows that Bears will definitely be ambitious to win 1.3146 to finish a perfect Head & Shoulders Pattern.

11:54 AM
Europe markets dive -0.9x -1.5x %! My keeping the short overnight triggered. SPY may target the Fib61.8@115.8 the next trading day.

12:15 PM
May be 116.71 is today's low. Seems some Bears are booking profit and some Bulls try to put a toe in water.

The rebound if any may be short lived (2 days max) and would be limited by the resistant range 1209.4-1215.7

Reviewing my Game Setting Monday
(I will change the scores system: Excellent for overnight positions which profit the gap next day (+2). Good for profit day-trade setting (+1). Neutral for non-profit day or overnight setting (0). Poor for losing day-trade setting (-1). Bad for overnight positions which lose the gap next day (-2). The Perfect (Score of +10) will be assigned to a call for a trend change of 15 days duration (only higher highs or lower highs seen for 15 day). The system is applied from this Monday).

Yesterday I said: "I would be better prepared for both scenarios, up or down". => Good preparation.

Aggressive Bull: Longs as long as SPY > 121.23 (Who believes the rebound). => Not happened.

Cautious Bull: Longs if SPY > 122.75.  =>Not happened.

Bear: Shorts if SPY < 121.23. => Short @120.20, cover @119.00, Profit 1%. Good setting (+1).

My integrated score: +1


1. EURUSD daily is in indecision mode and framed by 1.3407-1.3567.

2. SPY hourly is at the lower boundary of the bearish channel. A rebound will be challenged by the resistant levels ~ 121-121.5. A continuous diving will face supports 117-115.8 (The book target of triangle and the Fib 61.8 correspondingly).

2'. SPY daily, a very bad sign is it's price crossed down and closed below the MA50!

3. My Game Setting (If I don't mention overnight, day-trade understood)

I think the rebound if any may be short lived (2 days max) and would be limited by the resistant range 1209.4-1215.7

Aggressive Bulls: If SPY sinks below 119.25, long at it's breaking up this level. Or long at SPY pop-up above 119.25. Keep overnight if Europe markets are green and 121-121.5 are distanced. Must sell at green Wednesday. 

Cautious Bulls: Long if SPY > 120.35

Aggressive Bears: Short if SPY retraces downward from 121-121.5.

Cautious Bears: Short if SPY < 118.65.

The rebound if any may enjoy a short life time (2 days max) and has to face the 1-st resistances range 1240-1245.

11:00 AM
The Bear setting works perfect! (Bear: Shorts if SPY < 121.23). I think SPY target for today can be 118.5 (Short at open ~ 120.2).


Reviewing my Game Setting Friday.

"I expect a rebound day based on reasons I said above". >> Most times of the trading day are in rebound mode, DJ-30 +22% and SPX's slightly down -0.04%.  

Agressive Bull: Day trades the rebound and re-entries longs at a lesser amount for a probable overnight. >> Fairly good for day trade portion. Don't know the fate of overnight longs.
Caussious Bull: Plays the rebound and limited to day trade. >> That's me. I played the rebound and made very little profit, shifted to cash EOD.
Bear: If you had not yet closed your short at my call 12:46 PM, you can close it at appropriated moment today or adjust the stoplost! Gives way to bull at least one day! >> No commend.

1. EURUSD daily seems to challenge the neck line (brown) of the head and shoulders pattern for the reversal. If it can break out the neck line and win the resistances 1.3567 then 1.3697, a triangle pattern limited by 2 pinks lines can be developed. Otherwise the bears could challenge 1.3407 again and continue the HS pattern.

2. SPY hourly is in a bearish channel either limited by 2 pink lines or 2 blue lines. If it bounds up, the hard resistances are in a range 124.3-125.3. If it continues to sink, the supports are in a range 118.5-119.2.

3. This statistic is just an ornament of my technical analysis. I don't take it serious though I tried to simulate the following factors: Price development of last 5 days, MA50 last 55 days, Price vs Fibonacci levels last 35 days, Price vs MA50 last 2 days. Case 1 (black line) price below MA200 and case 2 no care of MA200 vs price. Data TC2007 available from Jan 1962, all symbols included into the scan, %day1 corresponding to Nov 18 gain, %day2 ~ this Monday gain (gain compares to the previous day close). Case 1 detected 7, Case 2 detected 11. The chart shows the average gains. The statistic slightly favors a rebound this Monday.

5. My biased market reading: We may see a rebound this Monday and it may be a real one to keep all major markets in green. The rebound if any may enjoy a short life time (2 days max) and has to face the 1-st resistances range 1240-1245. 

But I told myself not to expect a healthy rebound 

if a green in Europe markets is not seen!

4. My Game Setting

I would be better prepared for both scenarios, up or down.

Aggressive Bull: Longs as long as SPY > 121.23 (Who believes the rebound). 

Cautious Bull: Longs if SPY > 122.75

Bear: Shorts if SPY < 121.23

A rebound is very probable and it may be strong enough to make a green day.

Reviewing my Game Setting yesterday:
I wrote: "It's hard to me to imagine a green day today." >> Perfect anticipation.
Bear: Shorts at  rebounds.  >> Perfect.
Bull: High risk to play the rebounds. It's for aggressive ones only. >> Skill bulls made a little bit.

1. EURUSD hourly: Price bounces up and down between the Support 1.3407 and Resistance 1.3567 to form a range trading. For the latest 3 days bull has holding well above the support 1.3407. Bull can expect a positive day when price has crossed up through the MA50 to head to 1.3567.

2. SPX daily may find the short term support at a convergence of MA50 and Fib38.2 (1,205.60-1,209.60). Considering this is a combination support plus 2 big red days in a row which make the SPX hourly very oversold and therefore may due for a rebound day.
Pay our attention to a fact that from Oct 27 (the interim top day and the beginning day of a down channel limited by pink lines) all the rebounds from the lower end or from the middle line of the channel enjoyed 2 days alive.

My Game Setting:

I expect a rebound day based on reasons I said above.

Agressive Bull: Day trades the rebound and re-entries longs at a lesser amount for a probable overnight.
Caussious Bull: Plays the rebound and limited to day trade.
Bear: If you had not yet closed your short at my call 12:46 PM, you can close it at appropriated moment today or adjust the stoplost! Gives way to bull at least one day!

SPX looks like slightly bearish

EURUSD daily shows an ideally head and shoulders pattern which is few steps away from the perfect model if it can visit 1.3146. Yesterday's high of the bounce couldn't win the resistance Fib38.2@1.3567. Next target of bear could be to win the Fib23.6@1.3407.

SPX daily has made 2 consecutive lower lows. The fact that it couldn't make a higher high yesterday is really a challenge to bull.

SPX 15' shows that for 4 consecutive days Nov 11-16 only lower highs and lower lows are seen. The price seems to be guided by the bearish channel (pink lines) but not the bullish channel (yellow lines). SPX lost 1.94% in just 2 hours and 8 minutes showed how strong the bear.

A moment to review my game setting yesterday:

If it's a green day. >> Only intraday green
Cautious Bull: Books profit, at least half of positions if bull believes an intraday-green in the next day. >> Perffec if he closed all his longs when he saw the green intraday.
Aggressive Bull: Adding intraday longs and day trade. >> That was me who adding longs as I quoted in Cobra's forum. Closed half when it got profit and closed the remaining when I wake up at 3:00 and seeing my half profit evaporating. Would be ideally if you closed it at seeing green.
Cautious Bear: Waiting mode. >> Lost a chance.
Aggressive Bear: Shorts at bounce back if this bounce back happens near the end of the day. >> If you could do it, you would be perfect.

If it's a red day. >> bounce up from opent till 13:52
Bull: Closes positions at appropriate moments (bounces). >> That was perfect.
Bear: Shorts the market. >> You may get stress however you was happy at the end of day and seems you gonna have another happy day. Why I couldn't do it?

My game setting today
It's hard to me to imagine a green day today.
Bear: Shorts at  rebounds.
Bull: High risk to play the rebounds. It's for aggressive ones only.

10:35 AM
I had played the rebound by entering TNA and just closed it at a small profit. I have not been shorting yet. I think it'd be safely to see SPX greening first then to see it starts making a pull-back.
12:46 PM
Congrats all the Bears who shorted when SPX was a little green at 10:40 (I did not - poor me!).
Just to remind Bears, It's 2 days in big red! It is very probable a rebound day tomorrow, so bears can book profit now. Knowing enough is enough.
Aggressive bulls may long at this low for tomorrow's rebound.

I would like to review my yesterday Game Setting: If markets go red (It had been almost red the first 2 hours)

Cautious Bear: Closes the shorts they opened yesterday. >> It was a good call. Bear booked profit at a  more than the previous day close.

Aggressive Bear: Adds intraday shorts. >> Not bad if he was swift enough. Could be painful to be late in closing their position. Wonderful if closed all at about 11:30'.

Cautious Bull: Waits to see if confirmed green tomorrow. >> No commend.

Aggressive Bull: Buys at the intraday bounce from the lower slant. >> That was me who bough the bounce (but not from the slant - that was not happened). I made profit.


Nov 16 2011
EURUSD is bouncing solidly after 2 consecutive selloff days. The bounce could be short in magnitude but may be 2 days alive. Anyway, the bounce may favour another green day of stock markets.
SPX price vs MA20, 50, 100,  looks bullish when price has closed above these MA for 3 consecutive days.
SPX against resistances: There is a convergence of resistances from 1268 - 1273 made of from upper slant of the symmetrical triangle, Upper monthly downtrend resistant line and MA200.
SPX reading: Slightly bullish. One more day in green is probable.

Game setting: 


If it's a green day.
Cautious Bull: Books profit, at least half of positions if bull believes an intraday-green in the next day.
Aggressive Bull: Adding intraday longs and day trade.
Cautious Bear: Waiting mode.
Aggressive Bear: Shorts at bounce back if this bounce back happens near the end of the day.


If it's a red day.

Bull: Closes positions at appropriate moments (bounces).
Bear: Shorts the market.

The intraday trading:

11:32 AM (11:32 PM - VietNam) No mood to trade. Go to bed.
Happy trading all visitors.

I Need To Adjust My Game Setting.

When I am drafting this post, Europe markets are in red. The US markets are just followers of Europe ones these days and it is more comfortable to forecast another red day of US ones.

Reviewing my Trading Idea / Game Setting last 4 days I am not satisfied with last three ones. I failed to catch the bounces of Nov 10 & 11 and lost the chances to join bears camp yesterday. I even made a mistake to buy on dips yesterday.

Seems SPX is still in range trading for a while. Prices are limited by the slants of the pennant/triangles. Because the range is becoming narrower and narrower, I think bear safely counts to 2 to close their positions and waits to see what gonna happen the third day to decide.

My Game Setting Today: If markets go red
Cautious Bear: Closes the shorts they opened yesterday.
Aggressive Bear: Adds intraday shorts.
Cautious Bull: Waits to see if confirmed green tomorrow.
Aggressive Bull: Buys at the intraday bounce from the lower slant.

10:35 AM  

We may see some things different today: US markets gonna drag (I wanted to say: advance) Europe ones.

Surprisingly High The Bull Odds This Monday!

1. My reading of EUR/USD daily Head and Shoulders pattern gave me a bearish bias about the markets. However the bearish outlook may be threatened if this pair wins the next resistence Fib61.8@1.38251 by this Monday or the day after.

2. SPX daily looks as a bullish pennant (just a bit stretch) and on the way to upside it must win tons of converged resistances they are just inch above the Friday close. Also, the sell-off action of the Oct 31, Nov 1 and Nov 9 looks ugly that favors a bearish look of the chart. All together, my pure TA daily reading of SPX tends to a neutral outlook this Monday.

3. However It's surprising my statistic which gonna say "We are at very... very high odds to see an up day this Monday!". The statistic setting the daily price development like last 5 days (imagine a handwritten i) and the 5-th day close above the MA20. Data source TC2007 available from Jan 1963. It's 8 out of 10 we did see the 3-rd day closed in green.

Meanwhile with Yahoo data source, available from Jan 1950, It's 9 out of 11 we did see the 3-rd day closed in green.

4. Europe policy/political development: Italy austerity plan passed, Berlusconi resigned, Mario Monti (professor of economics and former European commissioner) asked to form a caretaker government led by technocrats. This is what the markets have been wanting. When Mr. Market finds his appetite he will try to get/buy more foods.

5. My trading idea: 1.+2.+3.+4. = Bullish
Bear: Plan may be delayed, may need more patience.
Bull: May be safer to buy the intraday low/pullback.
180-Turnaround: I must be ready for a 180-turnaround. If markets sell-off hard Monday, I'll swiftly join the bears.

Successful trading.

This Monday or next Monday, what do I mean here? I think most readers will read my blog on Monday so I am right according to ISO 8601, otherwise give me Islamic or Hebrew :-). Always ask your tolerance because I am a non native speaker and just begin to learn writing in English for a while.
http://en.wikipedia.org: Monday (ⁱ/ˈmʌndeɪ/ or /ˈmʌndi/) is the day of the week between Sunday and Tuesday. According to international standard ISO 8601 it is the first day of the work week. According to the Islamic and Hebrew calendars, Sunday is the first day of the week. The name of Monday is derived from Old English Mōnandæg and Middle English Monenday, which means "moon day".

The temporary easing of fears in Europe may favor some bounces in stock markets

1. The EUR/USD daily head and shoulders pattern maintains my focus attention. Whiles Euro debt crisis lingering may send the pair down to support 1,3405 and favor the bear, the bounces (that I think short term) from their sell-off bottom lately may head it up to the resistance 1,3697.

2. My reading of SPX hourly shows that a pennant is in the forming. The bounces will have 2 targets: The 1-st target would be Fib50@1,252.5 and the 2-nd target would be around 1,269 - it's the RL of the pennant. My unreliable/negative view to this pennant forming is that it's time frame looks stretch.

3. Because of unreliable pennant pattern due to stretch time frame, I tend to shift to SPX 15' and read it based on the intra-day price action against Fibonacci and Pivot Points.

My Trading Idea:
Bull can play the bounces, however based on the daily price action last 10 days I think bull'd safer minimize longs exposured overnight.
Bear don't be hurry to short. The bounces may be short in size but long in number (max 3 - I think) and it is unpleasant enough for bear. I will be patient with bear.

9:31 AM
UR/USD is approching 1.369 just an inch from the RL 1.3697. No! I definitely don't want to chase this bounce!


10:14 AM
Seems that we gonna see a pull-back

We are almost certain to see the lower low than yesterday low.

1. The Head and Shoulders pattern of EUR/USD daily has been confirmed and this pair may be heading down to the support 1.341.

2. The SPX hourly with Ascending broadening wedge effected and SPX may be heading down to the support 1,210 of Fib38.2 

3. My statistic shows that we are almost certain to see the lower low than yesterday low. With the daily price development like the last 3 days, my statistic from Jan 1975 show:
A) 6/58  =10.3% the higher low next day
B) 1/58  =  1.7% the equal low next day
C) 51/58=   88% the lower low seen next day
** All 12 counts from Jan 2009 to the Oct 31 show Lower Low:

My trading idea: Bear always can find good cover points if he wants to cover today. Bull has no need to be hurry to play the rebound.
Good trading!

9:53 AM
I am a bit surprised to see the Europe markets bounce on the news Italian bond yields ease. Rumor ECB bought their bonds. May be this is just a thin air. Can a sick elephant find a remedy from a cold pill?


10:38 AM
Indexes are just inch to yesterday low however all the bull ETFs have made higher high. It's time for many bears to book profit.

We are not trying to catch the falling knife!

Looking back to lately 3 sell-off days of this 5 weeks plus rally. I think we have no reason to catch the low today and assuming that markets will bounce straightly tomorrow. I think the probability of a lower low tomorrow is high.

The weekly up trend is maintaining

We did see the two consecutive bearish patterns in the 15' chart of SPY before the Nov 8 but they were not effective eventually and what we are seeing in the Nov 8 is the RLs are pierced out two times. This market development want to tell us that it is bullish in short term.

The 15' SPX shows almost the same picture and reading.

Now we shift our attention to the daily chart of SPX. I would like to make a count. We can see that we are enjoying the 26 days of up trend. During these 5 weeks plus we found only 2 consecutive down days which were coincident with the "Referendum Call" of Papandreou (That I am very pleased to correctly sugested that it would not happen or his government would fall). I will keep in my mind that Oct 31 2.5%-down day and if that sell off day happens again, we shall run out of the market as a thieves. All the remaining down days were single and they were pull back or buy-the-dip-days. Bears were short-lived and playing the short sell in those day must be swiftly.

So we may say the weekly up trend is maintaining. It means we'll buy the dips/pull-back but not to chase the rally.

Can we see the pull back? It seems that we gonna see it today Nov 9 when the T2108 is overbought, the SPX daily is about to hit by the monthly down resistance line, the Euro markets are pulling back, ...

And what about the EUR/USD daily? This pair is pulling back and it favors the pullback of US markets today. However it seems in the forming of Head and Shoulders pattern and it would be a threat to the weekly rally of US markets.

Conclusion: We must well follow the market movement and find the supports of the pull back today to decide the moment to buy the dip. Also, the size of the purchase is important as we can decide to buy more or to stay still or to quit the market the next day.
And my last idea is if the pull back is about the size of a sell off at more than 2%, I will hold off my intentional purchase.