Mohan 23/04/04
Enviado: 23/4/2004 13:43Market Force: Bearish. Look for a flat to higher opening and an early run up in prices in the first hour to be Bearish for today.
Trade Setup Summary for Thursday, April 22, 2004:
Trade Summary: 1)S@1124.75/B@1129.00 -4.25 2) S@1131.00/B@1135.00 -4.00 3)S@1135.50/B@1139.00 -3.50 4) (Unofficial but highly recommended) S@1142.00/B@1137.50/38.00 for up to +4.50
Recap of Thursday's Action:
Good Morning and welcome to Friday's action.
On Thursday we saw a huge rally off the early lower opening.
In our Morning Call I was looking for higher prices to look to get short into which did occur but was caught off guard by the larger scale rally.
At the time of the BreakOut of the Hour One the High Five were NOT showing bullish characteristics and I believe that is what thew me off. Here is a summary of what occured.
Wrap Up: The market opened slightly lower today at 1121.00 and after a small dip lower began moving up.
The Hour One BreakOut was 1124.00 and as prices moved above the BreakOut around 10:44-45 we had a Bearish/Neutral High Five with the NAZ up only +6, TRIN at 1.05, and VIX up +.20.
It was difficult to see a BreakOut coming out of this and we entered a short recommendation at 1124.75. Prices pushed higher and we did not see any pullback coming and exited trade near 1129.00 for a -4.25 loss.
On the next move higher we had viewed 1131.00 as strong resistance being the Sell Pivot +4.25 and re-shorted the market there. Prices again continued to push higher and although we wanted to cut the trade sooner we had entered a 1135.00 stop which got hit quickly as prices jolted up for a -4.00 loss.
Resistance came in and the market was showing signs that perhaps too many bulls had entered the last run up and so we gave it one final stab on the short side at 1135.50. Prices held down for a while with some hope of a pullback but the market then launched another move higher with excitement about earnings reports and the nemesis of possible interest rate hikes coming subsiding. That 3rd trade was stopped out at 1139.00 for a -3.50 loss.
Later in the session I had discussed the 1142 area being strong resistance and referred traders to Monday's Morning Call briefing showing 1142-44 as being a big resistance spot. I did not officially recommend a short due to the previous losses but we did see 1142.00 pull back nicely to the 1137-38 area and I did Trailblazer updates guiding us back lower for those who did get short again (and I know there were a bunch of you). Good job on that short if you did it for up to +5 pts.
Coming into the close they are hammering em back down to the 1137 area fufilling our discussions about there being too many bulls on that rally that needed some pressure. So on balance not such a good day for us but with education from mistakes I can see what was missing in my analasys and have re-configured accordingly.
Today's Call & Briefing:
Our Headline Call for today is showing Bearish Market Force according to our 18 proprietary indicators and we will be looking for the right set up to get short after the first hour.
Yesterday's strong rally pulled back from the highs yesterday which should gather some strength ideally going into today's opening and early price action.
If we can get sustained early strength this will be a good sign for the re-emergence of Bearish Market Force for today.
The Sell Mode had been in an aberration and as explained on Monday's briefing we were looking for higher prices until Tuesday's spook lower move threw our analysis off. I had expected a return to the Sell Mode. This is the radical nature of the market in 2004 now. Here is some remarks from today's LIVE UPDATE SERVICE.
"1142 was a number I had given you on Monday as a possible goal up as the Sell Mode went into aberration.
When prices got smashed down on Tuesday it had appeared to re-open the Sell Mode but we are not seeing that with prices crossing over 1126.00 again. With the Sell Mode in aberration which we had discussed on Monday's briefing the goal up was 1142 and then 1144 before more resistance would come back in.
If you read Monday's Morning Call briefing again now you can see how Tuesday created the Confusion of the market appearing to be re-entering the Sell Mode.
If prices now hold above 1130 we are going to continue in the Sell Mode aberration. BIG RESISTANCE AT 1144.50 may finish off that aberration pattern to the upside and we will resume the lower move. Market is not expected to start pushing higher until after June while we expect a significant move higher heading into the end of the year."
So we will be looking today for 1144.00 to come into play to possibly finish off the upside aberration on the Sell Mode and return to the lower prices below 1130.00. Let's see how this pans out.
Value Area: 1,128.30 - 1,142.00
Trade moving above 1142.00 today and then RETURNING into the Value Area is a sign of weakness. If this occurs we could expect to see a move down to cover 75% of the VA range in the 1130 area possibly. Will need to see how the High Five and other indicators look when we get there.
Buy Pivot Target: 1,123.75 - 1,124.75
No trade expected at this pivot today.
Sell Pivot Target: 1,146.00 - 1,145.00
Look for big resistance up here especially if the High Five are showing signs of weakness. 1150.25 is +4.25 and that should cap off any higher run up attempts today with 1146 most likely stalling the buying.
10 Day "Pit Bull" Moving Average: 1,130.80
When we Crossed over this Pit Bull on Thursday it was a powerful move up. This was the level where we had taken our 2nd short looking for the Pit Bull to stall the move higher as we were expecting the Sell Mode to hold.
No cigar but we are looking for some confirmation of the return to the Sell Mode today if prices can move back to this Pit Bull area.
Pro Trader's Action
So we will be looking for a Sell signal on a flat to higher opening and early run up in the markets. Look for this opportunity after the first hour has transpired and around the 1144-46 area coordinated with the Hour One BreakOut.
Thank you for your response on the story I sent you about April 19-20. Latest update: Columbine High School disaster occured on April 20 and also Hitlers Birthday is April 20th. Coincidence?
Let's see if we can get the higher early move up for some shorting of the 1144-48 area today.
Good Luck and success with your trades. I'll see you in the action. Mohan
Trade Setup Summary for Thursday, April 22, 2004:
Trade Summary: 1)S@1124.75/B@1129.00 -4.25 2) S@1131.00/B@1135.00 -4.00 3)S@1135.50/B@1139.00 -3.50 4) (Unofficial but highly recommended) S@1142.00/B@1137.50/38.00 for up to +4.50
Recap of Thursday's Action:
Good Morning and welcome to Friday's action.
On Thursday we saw a huge rally off the early lower opening.
In our Morning Call I was looking for higher prices to look to get short into which did occur but was caught off guard by the larger scale rally.
At the time of the BreakOut of the Hour One the High Five were NOT showing bullish characteristics and I believe that is what thew me off. Here is a summary of what occured.
Wrap Up: The market opened slightly lower today at 1121.00 and after a small dip lower began moving up.
The Hour One BreakOut was 1124.00 and as prices moved above the BreakOut around 10:44-45 we had a Bearish/Neutral High Five with the NAZ up only +6, TRIN at 1.05, and VIX up +.20.
It was difficult to see a BreakOut coming out of this and we entered a short recommendation at 1124.75. Prices pushed higher and we did not see any pullback coming and exited trade near 1129.00 for a -4.25 loss.
On the next move higher we had viewed 1131.00 as strong resistance being the Sell Pivot +4.25 and re-shorted the market there. Prices again continued to push higher and although we wanted to cut the trade sooner we had entered a 1135.00 stop which got hit quickly as prices jolted up for a -4.00 loss.
Resistance came in and the market was showing signs that perhaps too many bulls had entered the last run up and so we gave it one final stab on the short side at 1135.50. Prices held down for a while with some hope of a pullback but the market then launched another move higher with excitement about earnings reports and the nemesis of possible interest rate hikes coming subsiding. That 3rd trade was stopped out at 1139.00 for a -3.50 loss.
Later in the session I had discussed the 1142 area being strong resistance and referred traders to Monday's Morning Call briefing showing 1142-44 as being a big resistance spot. I did not officially recommend a short due to the previous losses but we did see 1142.00 pull back nicely to the 1137-38 area and I did Trailblazer updates guiding us back lower for those who did get short again (and I know there were a bunch of you). Good job on that short if you did it for up to +5 pts.
Coming into the close they are hammering em back down to the 1137 area fufilling our discussions about there being too many bulls on that rally that needed some pressure. So on balance not such a good day for us but with education from mistakes I can see what was missing in my analasys and have re-configured accordingly.
Today's Call & Briefing:
Our Headline Call for today is showing Bearish Market Force according to our 18 proprietary indicators and we will be looking for the right set up to get short after the first hour.
Yesterday's strong rally pulled back from the highs yesterday which should gather some strength ideally going into today's opening and early price action.
If we can get sustained early strength this will be a good sign for the re-emergence of Bearish Market Force for today.
The Sell Mode had been in an aberration and as explained on Monday's briefing we were looking for higher prices until Tuesday's spook lower move threw our analysis off. I had expected a return to the Sell Mode. This is the radical nature of the market in 2004 now. Here is some remarks from today's LIVE UPDATE SERVICE.
"1142 was a number I had given you on Monday as a possible goal up as the Sell Mode went into aberration.
When prices got smashed down on Tuesday it had appeared to re-open the Sell Mode but we are not seeing that with prices crossing over 1126.00 again. With the Sell Mode in aberration which we had discussed on Monday's briefing the goal up was 1142 and then 1144 before more resistance would come back in.
If you read Monday's Morning Call briefing again now you can see how Tuesday created the Confusion of the market appearing to be re-entering the Sell Mode.
If prices now hold above 1130 we are going to continue in the Sell Mode aberration. BIG RESISTANCE AT 1144.50 may finish off that aberration pattern to the upside and we will resume the lower move. Market is not expected to start pushing higher until after June while we expect a significant move higher heading into the end of the year."
So we will be looking today for 1144.00 to come into play to possibly finish off the upside aberration on the Sell Mode and return to the lower prices below 1130.00. Let's see how this pans out.
Value Area: 1,128.30 - 1,142.00
Trade moving above 1142.00 today and then RETURNING into the Value Area is a sign of weakness. If this occurs we could expect to see a move down to cover 75% of the VA range in the 1130 area possibly. Will need to see how the High Five and other indicators look when we get there.
Buy Pivot Target: 1,123.75 - 1,124.75
No trade expected at this pivot today.
Sell Pivot Target: 1,146.00 - 1,145.00
Look for big resistance up here especially if the High Five are showing signs of weakness. 1150.25 is +4.25 and that should cap off any higher run up attempts today with 1146 most likely stalling the buying.
10 Day "Pit Bull" Moving Average: 1,130.80
When we Crossed over this Pit Bull on Thursday it was a powerful move up. This was the level where we had taken our 2nd short looking for the Pit Bull to stall the move higher as we were expecting the Sell Mode to hold.
No cigar but we are looking for some confirmation of the return to the Sell Mode today if prices can move back to this Pit Bull area.
Pro Trader's Action
So we will be looking for a Sell signal on a flat to higher opening and early run up in the markets. Look for this opportunity after the first hour has transpired and around the 1144-46 area coordinated with the Hour One BreakOut.
Thank you for your response on the story I sent you about April 19-20. Latest update: Columbine High School disaster occured on April 20 and also Hitlers Birthday is April 20th. Coincidence?
Let's see if we can get the higher early move up for some shorting of the 1144-48 area today.
Good Luck and success with your trades. I'll see you in the action. Mohan