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[Dwer]

We will be looking to be buyers off an early washout low if that is what occurs. Usually days following a day like Wednesday with a powerful move lower are more risky so use extra caution.

Trade Setup Summary for Wednesday, January 28, 2004:
No TCF Trade setups for Wednesday due to FOMC meeting.

Recap of Wednesday's Action:
Good Morning and thank you for joining with us today.

Well, we got a strong washout in the indexes yesterday when the Fed did not express their prior expectation to keep interest rates at current levels. That sent the market into a tailspin first finding support where we had mentioned on yesterday's briefing at 1134.25 (after popping through the Pit Bull) then smashing through that 10 handles lower.

This may be just the action we need to see the TCF setups getting more back into gear now that the seemingly "forever" bullish equation had some egg thrown on it.

Today will be an important factor in viewing the price action to see how they play out. Again, I am extremely hopeful that Wednesday's action will get us back into expanded ranges and nice volatility as the Bulls and Bears duke it out all the way to election time.

Certainly it would have been nice to be short around the BreakOut and have held short all day but that is not important.

The important thing for us who follow the 21st Century Futures briefings is to get this market trading again and not just going strait up or strait down. We earn our paycheck by having a daily wrestling match between the bulls and the bears. That is how these TCF setups came to fruition.

Sometimes, as mentioned yesterday, there are periods of strait up or down action and they are a little more difficult to trade for intraday traders like us and systems that are proven will survive during those periods and not get shredded. That is a sign of a truly good system and approach and that is what has occured with our TCF methods.

Today's Call & Briefing:
We are going to be patiently looking for a spot to go long on an early washout in prices from the Johnny come lately Bears in a panic to get short.

If this occurs we may see one of our Trailblazer setups occur on that early move lower.

We are now officially in a SELL MODE which I had expressed to you would begin when we got an OPENING hard day down. We saw that both yesterday and today.

Now keep in mind that that doesn't mean they are simply going down for a while but we have to keep an eye out on the lows of Wednesday to see if the Sell Mode goes into what I call "An aberration". This is where the prices keep dropping but buyers keep picking up the lows and moving em beyond the previous days opening price range. I'll keep you posted on this.

THERE IS A GOOD CHANCE WE WILL JUST STAND ASIDE TODAY IN TRADING AND LET THE DUST SETTLE.

The ideal is to buy a washout low and get a rally off of that back to early support which hopefully will be in an 8 point range so we can see our TCF setups stretching out again.

As a professional trader I don't want to be so anxious to get in on the buy side unless there is some true assurance that we have washed out at least for the day. The reason is that in doing that in the past after a day like Wednesday sellers are waiting in the wings to crunch the market lower on any reflex bounce off the lows.

You seem smart at first buying as they bounce nicely but when they come back to your entry and then shove the whole trade down your throat it is not a pleasant experience. What often happens too is that the early bounce you got conditions you to feeling good about the trade and you don't want to cut out of it. Then you stop gets nailed and you feel a bit dizzy.

We want to avoid that and sometimes the best thing after a day like Wednesday is to just stand aside or at least be willing to trade 2-3 hours into the trading day when things are clearer.

TCF TRADE SETUPS TO WATCH FOR TODAY: First let's PLAN on being buyers on a washout lower move. See about waiting for a few hours first before trading it and if we miss a reflex rally then ...so what. Better to be safe after a day like Wednesday.

Look at the BreakDown and the High Five at the time. If the High Five is NOT that bearish then look to subtract a few points, WATCH FOR A TRAILBLAZER PATTERN where the spike bars drop below a third level drop, and then get long.

You can also watch for a series of -1000 TICKs as a sign of a bottoming. Combining the Trailblazer pattern with the TICKs getting hammered is a good sign of a bottom.

Let's only look for this pattern to get long on and avoid the rest for today.

Value Area: 1,131.50 - 1,148.00
We are far below the VA and as such this is a bearish sign. Rallies are more than likely going to get hit but our underlying Market Force indicators are bullish for buying lower moves today.

Once long a trip up to the bottom of the VA at 1131.50 would be a strong probability.

Buy Pivot Target: 1,120.00 - 1,121.00
No Trade at this target today. Watch for 1115.75 as a support price.

Sell Pivot Target: 1,143.25 - 1,142.25
No Trade at this pivot today.

10 Day "Pit Bull" Moving Average: 1,139.60
Wow! Now you see what is like when the prices smash through the Pit Bull. The market floor at the Pit Bull just gives way and they come crashing down.

So now we are in a Sell Rallies mode with the Pit Bull as long as they can hold below it. Watch this area for new upside resistance OR AS A SIGN OF A POSSIBLE ABERRATION ON THE SELL MODE IF PRICES PUSH RIGHT BACK ABOVE THIS.

Pro Trader's Action
Let's be on the cautious side of buying today. Perhaps being willing to wait 2-3 hours in the trading day may allow all the selling, reflex rallies and more selling, and the general consolidation to wash out.

Our Market Force indicators are in a Sell Mode officially now. They have been pending being in a sell mode since early January but with NO TRUE OPENING DOWN DAY of any magnitude there was never an entrance into the Sell Mode.

Now we go on Aberration Watch to see if prices consistently hold below the Pit Bull and other points of resistance...mainly that whole 1138-43 Area.

Good luck today, be patient in looking to get long on a BreakDown if that is what we get, watch for the Trailblazer long spikes lower beyond the 3rd level down move to get long, and have fun. Be willing to stand aside if a clear washout pattern does not unfold. It is usually a sign that they are going lower.

All the best, Mohan