IF THE MARKET REVERSES
AND GOES NEGATIVE TODAY,
SHORT THE CRAP OUT OF IT.
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AND GOES NEGATIVE TODAY,
SHORT THE CRAP OUT OF IT.
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Thursday, October 08, 2009
Wednesday, October 07, 2009
Rockin & Rolla
Here is a snapshot of overnight trading on Globex. If it continues, tomorrow should see a gap-up opening of 75-100 points on the DJIA. The good news is that 5 minute charts I have been following the past couple of days closed today clearly in Buy mode and the reversal Buy on the Daily charts from Monday is looking good. The bad news is this kind of rally is making my forecast of a hard down October look bad......
.......for now.
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Tuesday, October 06, 2009
Playing the game
First, the five minute chart that we have been following all day Tuesday
Next the Daily chart that we have been following for the past few weeks
Analysis
The market strength of the past couple days was unexpected, but by monitoring the short term trend it was possible to stay mostly on the right side of trading. This trend is dynamic, can turn on a dime, or in a few minutes and this is hard to characterize in a single evening blog. That was the reason I periodically threw up the 5 minute model today, its an example of how to be wrong on the forecast, but profitable in trading.
The Daily chart is more problematic. Today's rally was strong enough to generate end-of-day Buys on both BWT and ATR. Yet the five minute model remains on a Sell overnight. It happens. Personally, I am holding my short-term positions Short, based on how accurately this model tracked the trend today and upon my Intermediate and Longer Term forecasts that remain hard down for October. Should the five minute model flip Long tomorrow, so will I, that's how to play the game.
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5 minute models
Look how nicely the 5 minute models generated Sells around 9:00 am PT (noon ET). The DJIA is still up over 90 points (90 minutes before the close) but these Sells were all profitable.
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