Mohan 10/11/03
Enviado: 10/11/2003 11:25Early drop in the markets with S&P500 pressing lower to see prices recover into the later session. Higher opening and early rally today will be bearish for the market.
Recap of Friday's Action:
Good Morning and welcome back from the weekend. Hope it was a relaxing one for you.
On our Headline Call on Friday we were looking for a regular, strong type rally for the day which we were looking to sell off later in the session. We had stated that we were looking for the market to rally to make new highs above the 1061.00 price and that "if our Headline Call is going to be wrong then hitting the BreakDown (again) FIRST would be a negative and the market would probably sell off".
This is what occured on Friday as the market staged an early, early rally and ran up smacking the new 1061.30 High on the big S&P500 cars (1064.50 on the E Mini) BEFORE pulling right back lower. With the High Five bearish/neutral we went ahead and bought the B/D at 1058.75 minus 2 points (or lower) only to find the market getting hit with all kinds of bad news later in the session.
Nasdaq made a new 52 week high just before news of a Saudi Arabia terrorist attack hit the streets. Continued news of NY Attorney General Elliot Spitzer moving to take action against a number of mutual funds while the Bank of England and the reserve bank of Australia were raising interest rates this week.
It was Friday and as we had warned with the market hitting the BreakDown for the 3rd day in a row ...they sold off in a mild fashion. We were able to simply tighten up the stops as we got into the later part of the session and when they busted through the days lows sold out the long positions.
A very decent week with up to +25 S&P500 points available following our TCF Trade setups.
Today's Call & Briefing:
Today is going to be a bit more tricky than most trading days and we want to be extra careful today. Here is why.
If we get a HIGHER OPENING today and an early run up then we could see additional pressure coming on the markets all the way into the close. However, if we see prices pressing lower EARLY on a flat to lower opening then we are expecting to see the prices recover later into the session.
This would be the ideal situation to inspire the markets attempt to keep trying to push up over the Dow 9900 level and once again approach 10,000 before the end of the year.
The difficulty is that we are expecting to approach a "rollover" in our Market Force Buy mode indicators to a Sell Mode pretty soon on any upcoming up moves. There really hasn't been any strong fuel on either side of the market but inspite of this prices just keep climbing overall.
So for today we are going to be seeing an important test of how this weeks Market Force is going to set up and we will be watching the opening today along with the early first 20 minutes of trading action/direction.
TCF TRADE SETUPS TO WATCH FOR TODAY: If we get some strong, bad news in the morning that is causing the markets to reel then we need to be on the lookout for a Bear Ugly day and get short for continued lower squashing of the prices.
If we do NOT get this bad news scenario but things are relatively tame BUT THE PRICES ARE MOVING LOWER ON THE OPEN AND FIRST 20 MINUTES then we will want to be buyers for the day. The key will be watching the Buy Pivot target and the subsequent (-4.25) stop/pivot.
There is a chance of a BreakOut Buy today if we get a lower mild opening and the S&P500 prices quickly recover above the opening with the Dow Flat (under +50) with NAZ strong (up +12-15). So be on the lookout for this.
Value Area: 1,055.00 - 1,060.00
Trade below 1055.00 is bearish for today. Holding consistently below the Value Area could end up giving us a flat day with a lot of indecision.
Be willing to stand aside if the market does not give us clear information on the TCF setup we want to enter.
Buy Pivot Target: 1,046.50 - 1,047.50
No Trade at this target today. Watch for the -4.25 stop/pivot at 1042.25 to give us some support. If not and we blow through that price we are going to need to get short if the High Five are looking bearish. Use the reflex bounce if this occurs to 1045.50-47.00 to get short.
Sell Pivot Target: 1,057.75 - 1,056.75
If we OPEN HIGHER ABOVE 1050.40 and move higher first this morning then look to go short NOT RIGHT AT THIS PIVOT BUT UPON RESISTANCE ABOVE at the 1062.00 area (+4.25) or slightly below. The idea is to want to get short up here on an early move up on a higher opening but to give the early move room to "hang up near the highs" for an hour or so before further sell off occurs later in the session.
10 Day "Pit Bull" Moving Average: 1,048.90
We are almost sitting on this price on the close and as such we now are at an important crossroads. We want to see if S&P500 prices are going to drop through this area decisively to the downside or to find support on any attempts to drop through this area and gradually move up again.
This is one of the reasons for the caution today. Let's see how the prices treat the Buy Pivot Target, the -4.25 stop/pivot at 42.25 and the B/D combined with the High Five.
An early drop lower which finds support lower and pushes back up slightly above the Pit Bull here is going to most likely make another run higher. There are strong arguments for both long and short bias today and we need to see some confirming evidence of market reaction to the various setups we have described here.
The best thing in trading our TCF Trade setups, as you have seen, is to get aboard clear setups with the backing of the Headline Call and the High Five. With our approaching these key areas today we are going to be looking for additional evidence crucially needed to setup our trades this week.
Pro Trader's Action
Well, it appears we are getting out of the lethargy of super tight ranges that have been haunting us for some time now and hopefully getting back into more volatility.
As mentioned we have strong cases for both sides of the market today but the primary bias is to the upside on a lower opening and early run lower. There simply are Too Many Bears in the market and if we can get the sequencing for bullishness to return after today or tomorrow then most likely prices are going to run up again and test the 1080-81 area mentioned on Thursday before the upside is fully exhausted on a temporary basis.
Today will be key so let's keep our research solid.
Have fun trading today and be willing to stand aside if things are muddled or not clear. We could be in for a "Line in the Sand" type day after early volatility where things stagnate and stall around the Pit Bull price area.
Good Luck, Mohan
Recap of Friday's Action:
Good Morning and welcome back from the weekend. Hope it was a relaxing one for you.
On our Headline Call on Friday we were looking for a regular, strong type rally for the day which we were looking to sell off later in the session. We had stated that we were looking for the market to rally to make new highs above the 1061.00 price and that "if our Headline Call is going to be wrong then hitting the BreakDown (again) FIRST would be a negative and the market would probably sell off".
This is what occured on Friday as the market staged an early, early rally and ran up smacking the new 1061.30 High on the big S&P500 cars (1064.50 on the E Mini) BEFORE pulling right back lower. With the High Five bearish/neutral we went ahead and bought the B/D at 1058.75 minus 2 points (or lower) only to find the market getting hit with all kinds of bad news later in the session.
Nasdaq made a new 52 week high just before news of a Saudi Arabia terrorist attack hit the streets. Continued news of NY Attorney General Elliot Spitzer moving to take action against a number of mutual funds while the Bank of England and the reserve bank of Australia were raising interest rates this week.
It was Friday and as we had warned with the market hitting the BreakDown for the 3rd day in a row ...they sold off in a mild fashion. We were able to simply tighten up the stops as we got into the later part of the session and when they busted through the days lows sold out the long positions.
A very decent week with up to +25 S&P500 points available following our TCF Trade setups.
Today's Call & Briefing:
Today is going to be a bit more tricky than most trading days and we want to be extra careful today. Here is why.
If we get a HIGHER OPENING today and an early run up then we could see additional pressure coming on the markets all the way into the close. However, if we see prices pressing lower EARLY on a flat to lower opening then we are expecting to see the prices recover later into the session.
This would be the ideal situation to inspire the markets attempt to keep trying to push up over the Dow 9900 level and once again approach 10,000 before the end of the year.
The difficulty is that we are expecting to approach a "rollover" in our Market Force Buy mode indicators to a Sell Mode pretty soon on any upcoming up moves. There really hasn't been any strong fuel on either side of the market but inspite of this prices just keep climbing overall.
So for today we are going to be seeing an important test of how this weeks Market Force is going to set up and we will be watching the opening today along with the early first 20 minutes of trading action/direction.
TCF TRADE SETUPS TO WATCH FOR TODAY: If we get some strong, bad news in the morning that is causing the markets to reel then we need to be on the lookout for a Bear Ugly day and get short for continued lower squashing of the prices.
If we do NOT get this bad news scenario but things are relatively tame BUT THE PRICES ARE MOVING LOWER ON THE OPEN AND FIRST 20 MINUTES then we will want to be buyers for the day. The key will be watching the Buy Pivot target and the subsequent (-4.25) stop/pivot.
There is a chance of a BreakOut Buy today if we get a lower mild opening and the S&P500 prices quickly recover above the opening with the Dow Flat (under +50) with NAZ strong (up +12-15). So be on the lookout for this.
Value Area: 1,055.00 - 1,060.00
Trade below 1055.00 is bearish for today. Holding consistently below the Value Area could end up giving us a flat day with a lot of indecision.
Be willing to stand aside if the market does not give us clear information on the TCF setup we want to enter.
Buy Pivot Target: 1,046.50 - 1,047.50
No Trade at this target today. Watch for the -4.25 stop/pivot at 1042.25 to give us some support. If not and we blow through that price we are going to need to get short if the High Five are looking bearish. Use the reflex bounce if this occurs to 1045.50-47.00 to get short.
Sell Pivot Target: 1,057.75 - 1,056.75
If we OPEN HIGHER ABOVE 1050.40 and move higher first this morning then look to go short NOT RIGHT AT THIS PIVOT BUT UPON RESISTANCE ABOVE at the 1062.00 area (+4.25) or slightly below. The idea is to want to get short up here on an early move up on a higher opening but to give the early move room to "hang up near the highs" for an hour or so before further sell off occurs later in the session.
10 Day "Pit Bull" Moving Average: 1,048.90
We are almost sitting on this price on the close and as such we now are at an important crossroads. We want to see if S&P500 prices are going to drop through this area decisively to the downside or to find support on any attempts to drop through this area and gradually move up again.
This is one of the reasons for the caution today. Let's see how the prices treat the Buy Pivot Target, the -4.25 stop/pivot at 42.25 and the B/D combined with the High Five.
An early drop lower which finds support lower and pushes back up slightly above the Pit Bull here is going to most likely make another run higher. There are strong arguments for both long and short bias today and we need to see some confirming evidence of market reaction to the various setups we have described here.
The best thing in trading our TCF Trade setups, as you have seen, is to get aboard clear setups with the backing of the Headline Call and the High Five. With our approaching these key areas today we are going to be looking for additional evidence crucially needed to setup our trades this week.
Pro Trader's Action
Well, it appears we are getting out of the lethargy of super tight ranges that have been haunting us for some time now and hopefully getting back into more volatility.
As mentioned we have strong cases for both sides of the market today but the primary bias is to the upside on a lower opening and early run lower. There simply are Too Many Bears in the market and if we can get the sequencing for bullishness to return after today or tomorrow then most likely prices are going to run up again and test the 1080-81 area mentioned on Thursday before the upside is fully exhausted on a temporary basis.
Today will be key so let's keep our research solid.
Have fun trading today and be willing to stand aside if things are muddled or not clear. We could be in for a "Line in the Sand" type day after early volatility where things stagnate and stall around the Pit Bull price area.
Good Luck, Mohan