Mohan 14/05/04
Enviado: 14/5/2004 14:19Market Force: Bullish (Cautious). Look for a slightly lower opening and early price drop to support the market above 1090.00. Pressing too much below that will throw the Bullish Market Force into Caution with further downside. Holding that price area (1190.00) should send em higher again.
Trade Setup Summary for Thursday, May 13, 2004:
1)@@1096.50/B@1101.00 -4.50
2)S@1101.00/B@1197.50 +3.50
3)B@1096.75/S@1092.00 -4.75
TOTAL: -5.75
Recap of Thursday's Action:
Good Morning and welcome to Friday's trading action.
On Thursday our Headline Call was looking for contined bullishness on a lower opening especially but with a Caution if we got a rally going too early above 1099.00. This is what I had said in the Thursday "Morning Call".
"Although NOT EXPECTED be on the lookout for Caution on an early rally ABOVE the 1099.00 area and an early price rise. This would tend to "throw water" on a continued higher move."
Here are my Wrap Up comments for our Live Trading day which was a bit rough on Thursday with mixed Market Force signals.
"The market gapped down today on the open and then pushed higher pretty quickly in the first 30 minutes.
With the way the market was acting we had determined that prices were going to head lower off the early highs around 1098.00. We got short on a resistance pattern at 1096.50 and were looking to hold short or get out if they pushed much above 1099.00.
We never got any juice to the downside on this trade and jumped out at 1101.00 for a -4.50 loss.
After a rise to the 1102.00 area signals came in suggesting the highs were in and we re-entered short at 1101.00. We covered up that short at 1097.50 for +3.50 profit as the market stalled and indicated we would get another rally.
We had originally pegged a trip down to the open at 1092.50 as possible but the contrasting signals were strong so we got long at 1096.75. It was unfortunate to get long a bit early as the prices fell lower stopping us out at 1092.00 where we had placed a hard stop for a -4.75 loss.
The market later did rally back up to the 1098 area off the lows but the pattern today was more difficult to read then the last few sessions. So on balance we had a loss of -5.75 on the day "
Today's Call & Briefing:
The Market Force readings today, as they were on Thursday, are still a mixed bag. Overall if the S&P500 futures can hold above 1090.00 then we can proceed with an attempt to rally and open up the new Buy Mode.
If we press below that in the price action and hold lower with a negative High Five then it will be difficult to see a rally get going. So far under more "normal" 2003 type market conditions we would have had a powerful BreakOut rally already. I've seen the type of setup we are in many times over the years but I have to honestly say that 2004 is a TOTALLY different underlying market structure.
Already though I am starting to see reoccuring patterns that are revealing some of the nature of this newer 2004 market and how it should be handled. To discover these things takes many market samples which include Market and Indicator setups that work one day, fail in a similar situation the following week, and then work again the following week under different circumstances. We are then able to compare and reconfigure the setups to discover higher % occurances and develop accurate rules for trading those occurances.
WHAT TO WATCH FOR TODAY: Be on the lookout for the Hour One low to occur first today on a lower opening and mild push lower. If we get that and the first Hour One pivot is hit first then we will be looking for a trade entry in that area based on the Trailblazer indicator/chart formations, the underlying Market Force confirmation, and the High Five indicators.
If we move near the Hour One high first and trade through it there is a very good chance that we will Get a BreakOut Buy today. Although it's Friday which can tend to be a weaker or less volatile trading day with the market pressing down the last 5 sessions we should be able to BreakOut if we get NAZ and TRIN support.
Value Area: 1,093.20 - 1,098.00
Holding in the VA is going to be Neutral for today but more bullish if we get a lower trade early and then rise into and hold in the Value Area. If a BreakOut occurs above 1098.00 then we should be able to stretch towards the Pit Bull zone around 1103-4.
We really want to be Cautious committing to either side today.
Yesterday was a classic example where we had put out a Bullish Market Force Headline Call but with the warning mentioned above in the RECAP section.
We got that higher run up, the bulls got all excited, and down they came nearly 10 handles. I got some overly bullish emails too which were way too confident on that bullish side after seeing my Live Trading recommendation to be short. I'm sure the downside pressure humbled them out a bit which was necessary.
As S&P500 traders and especially if you are following our work it is important not to be "bullish or bearish" at all. I have to use these terms to get the job done but really it is all based on very short time frames and the Market Force indicators can change on a dime.
I always feel sorry for the person who sends some dumb email to me touting that "I am wrong for being bullish (or bearish)" because they are simply interpreting my Headline Call according to their lack of experience.
Thursday was a good example of that switch in bias and I usually try to give the warning on the opposite side of our Headline Call of what would need to occur for us to switch directional bias.
Buy Pivot Target: 1,089.00 - 1,090.00
This price zone may hold em up today but we need to let the first hour pass so we can see what the real market primary morning trend will be after things settle. Watch for support at the -4.25 stop/pivot at 1084.75.
If they cannot hold this area then the Buy Mode will be struggling to open up. Actually, as mentioned, trade below 1090.00 is a negative for further rally today. We need to see prices popping up with exuberance above this 1090-1095 area...not just lollygagging around in that zone like on Thursday.
Sell Pivot Target: 1,100.50 - 1,099.50
Watch this zone and above at 1104.75 for prices that are "hanging up" in this area. If they are stalled up at the 1100.00 handle then we are probably going higher. This is actually what is expected to occur today or Monday.
We are still confidant of a new Buy Mode but the NEWS IS JUST SO NEGATIVE it is hard to see how we can get a genuine bullish mood going as we wait for the next BS atrocity to occur. There is an agenda to promote this stuff on the public and it's getting a little tiring and boring. Time for a change.
10 Day "Pit Bull" Moving Average: 1,103.60
We keep trying to close in on this Pit Bull number and then falling back.
When we move into a Buy Mode the prices rocket through this Pit Bull and don't look back. That is what a new Buy Mode fells and looks like. The bullishness is obvious and usually a little too late as price plough through the Pit Bull.
Still it is an ideal price indicator to monitor everyday for support/resistance and sentiment.
If one was really a patient, long term holder of the S&P500 futures contracts (Sorry, not for me) I believe that a very effective system could be developed around the Pit Bull using our work for 2week to 2 month hold type positions. I am trying to encourage any of you who may like a long term hold type approach to do some research with this. After watching the Pit Bull for over 3 years I am convinced there is a trading system there.
Pro Trader's Action
Today is another rather murky day with the Market Force indicators and I am going to be willing to stand aside today if we do not get some real clear signals after the first hour.
We need to all be willing to identify those stand aside days and just face that somedays are better left alone regardless of where the market goes IF the Market Force is not clearly giving us clues.
You can see from Thursday's trade that the market is trying to decide now if it is going to open up the new Buy Mode or head back into lower limbo for a while longer waiting for a better news environment.
Let's see what the first hour brings today. Good luck and I'll see you in the action. Have a great weekend. Mohan
Trade Setup Summary for Thursday, May 13, 2004:
1)@@1096.50/B@1101.00 -4.50
2)S@1101.00/B@1197.50 +3.50
3)B@1096.75/S@1092.00 -4.75
TOTAL: -5.75
Recap of Thursday's Action:
Good Morning and welcome to Friday's trading action.
On Thursday our Headline Call was looking for contined bullishness on a lower opening especially but with a Caution if we got a rally going too early above 1099.00. This is what I had said in the Thursday "Morning Call".
"Although NOT EXPECTED be on the lookout for Caution on an early rally ABOVE the 1099.00 area and an early price rise. This would tend to "throw water" on a continued higher move."
Here are my Wrap Up comments for our Live Trading day which was a bit rough on Thursday with mixed Market Force signals.
"The market gapped down today on the open and then pushed higher pretty quickly in the first 30 minutes.
With the way the market was acting we had determined that prices were going to head lower off the early highs around 1098.00. We got short on a resistance pattern at 1096.50 and were looking to hold short or get out if they pushed much above 1099.00.
We never got any juice to the downside on this trade and jumped out at 1101.00 for a -4.50 loss.
After a rise to the 1102.00 area signals came in suggesting the highs were in and we re-entered short at 1101.00. We covered up that short at 1097.50 for +3.50 profit as the market stalled and indicated we would get another rally.
We had originally pegged a trip down to the open at 1092.50 as possible but the contrasting signals were strong so we got long at 1096.75. It was unfortunate to get long a bit early as the prices fell lower stopping us out at 1092.00 where we had placed a hard stop for a -4.75 loss.
The market later did rally back up to the 1098 area off the lows but the pattern today was more difficult to read then the last few sessions. So on balance we had a loss of -5.75 on the day "
Today's Call & Briefing:
The Market Force readings today, as they were on Thursday, are still a mixed bag. Overall if the S&P500 futures can hold above 1090.00 then we can proceed with an attempt to rally and open up the new Buy Mode.
If we press below that in the price action and hold lower with a negative High Five then it will be difficult to see a rally get going. So far under more "normal" 2003 type market conditions we would have had a powerful BreakOut rally already. I've seen the type of setup we are in many times over the years but I have to honestly say that 2004 is a TOTALLY different underlying market structure.
Already though I am starting to see reoccuring patterns that are revealing some of the nature of this newer 2004 market and how it should be handled. To discover these things takes many market samples which include Market and Indicator setups that work one day, fail in a similar situation the following week, and then work again the following week under different circumstances. We are then able to compare and reconfigure the setups to discover higher % occurances and develop accurate rules for trading those occurances.
WHAT TO WATCH FOR TODAY: Be on the lookout for the Hour One low to occur first today on a lower opening and mild push lower. If we get that and the first Hour One pivot is hit first then we will be looking for a trade entry in that area based on the Trailblazer indicator/chart formations, the underlying Market Force confirmation, and the High Five indicators.
If we move near the Hour One high first and trade through it there is a very good chance that we will Get a BreakOut Buy today. Although it's Friday which can tend to be a weaker or less volatile trading day with the market pressing down the last 5 sessions we should be able to BreakOut if we get NAZ and TRIN support.
Value Area: 1,093.20 - 1,098.00
Holding in the VA is going to be Neutral for today but more bullish if we get a lower trade early and then rise into and hold in the Value Area. If a BreakOut occurs above 1098.00 then we should be able to stretch towards the Pit Bull zone around 1103-4.
We really want to be Cautious committing to either side today.
Yesterday was a classic example where we had put out a Bullish Market Force Headline Call but with the warning mentioned above in the RECAP section.
We got that higher run up, the bulls got all excited, and down they came nearly 10 handles. I got some overly bullish emails too which were way too confident on that bullish side after seeing my Live Trading recommendation to be short. I'm sure the downside pressure humbled them out a bit which was necessary.
As S&P500 traders and especially if you are following our work it is important not to be "bullish or bearish" at all. I have to use these terms to get the job done but really it is all based on very short time frames and the Market Force indicators can change on a dime.
I always feel sorry for the person who sends some dumb email to me touting that "I am wrong for being bullish (or bearish)" because they are simply interpreting my Headline Call according to their lack of experience.
Thursday was a good example of that switch in bias and I usually try to give the warning on the opposite side of our Headline Call of what would need to occur for us to switch directional bias.
Buy Pivot Target: 1,089.00 - 1,090.00
This price zone may hold em up today but we need to let the first hour pass so we can see what the real market primary morning trend will be after things settle. Watch for support at the -4.25 stop/pivot at 1084.75.
If they cannot hold this area then the Buy Mode will be struggling to open up. Actually, as mentioned, trade below 1090.00 is a negative for further rally today. We need to see prices popping up with exuberance above this 1090-1095 area...not just lollygagging around in that zone like on Thursday.
Sell Pivot Target: 1,100.50 - 1,099.50
Watch this zone and above at 1104.75 for prices that are "hanging up" in this area. If they are stalled up at the 1100.00 handle then we are probably going higher. This is actually what is expected to occur today or Monday.
We are still confidant of a new Buy Mode but the NEWS IS JUST SO NEGATIVE it is hard to see how we can get a genuine bullish mood going as we wait for the next BS atrocity to occur. There is an agenda to promote this stuff on the public and it's getting a little tiring and boring. Time for a change.
10 Day "Pit Bull" Moving Average: 1,103.60
We keep trying to close in on this Pit Bull number and then falling back.
When we move into a Buy Mode the prices rocket through this Pit Bull and don't look back. That is what a new Buy Mode fells and looks like. The bullishness is obvious and usually a little too late as price plough through the Pit Bull.
Still it is an ideal price indicator to monitor everyday for support/resistance and sentiment.
If one was really a patient, long term holder of the S&P500 futures contracts (Sorry, not for me) I believe that a very effective system could be developed around the Pit Bull using our work for 2week to 2 month hold type positions. I am trying to encourage any of you who may like a long term hold type approach to do some research with this. After watching the Pit Bull for over 3 years I am convinced there is a trading system there.
Pro Trader's Action
Today is another rather murky day with the Market Force indicators and I am going to be willing to stand aside today if we do not get some real clear signals after the first hour.
We need to all be willing to identify those stand aside days and just face that somedays are better left alone regardless of where the market goes IF the Market Force is not clearly giving us clues.
You can see from Thursday's trade that the market is trying to decide now if it is going to open up the new Buy Mode or head back into lower limbo for a while longer waiting for a better news environment.
Let's see what the first hour brings today. Good luck and I'll see you in the action. Have a great weekend. Mohan