Some quick things, in note style, not prose:
On Thursday I entered SSO and the trade went against me... nonetheless I was "persistent" in holding that SSO all day LOL... I really did see bullish bounce signs, wasn't holding in "hope". (I always say "hope is not a valid strategy"). I could have held the SSO overnight and exited with a profit on it (because it did go up as I expected, but too late), but I exited with a loss on Thurs... didn't want the overnight risk... though the SSO did do the up down up that I thought the pattern would produce...only problem was that the DOWN came on Thurs and the UP on Friday...also I mentioned that the UP might not happen Thursday so I was aware of the risk.
Losses are inevitable in trading.
On Friday, you know that I planned to do a new swing TZA, as I posted this intention. I did enter as planned, then suddenly the TZA stopped behaving, so I sold that for a profit on Friday,instead of holding it. I sold, not for the profit, but because the chart pattern changed and I didn't like it. The TZA has risk of going down, so once again I'll wait... more details on the TZA in post below.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
Saturday, November 14, 2009
Short the Russell 2000 (TZA)?? Why I'm waiting...again LOL
Today, I entered a short position in the market (via long TZA) for a swing trade, but then later in the day I sold the TZA for a small profit. I exited, not for the profit, but because I didn't want to hold the swing. It was not "behaving", as I say, i.e. not acting as expected. I can always re-enter. Some (but not all) of the reasons that I abandoned the trade are listed below (the bullish points below, obviously).
These notes refer to the Russell 2000, NOT to TZA.
Daily chart
- Yellow Downtrend line was broken higher on 11/3 (bullish)
- Green Uptrend line was broken lower on 11/12 and backtested on 11/13 (mildly bearish)
- Stochastic did not make a bearish cross down. Instead, it bounced higher and avoided the cross (bullish). See black oval.
- RSI remains below its DTL (bearish) but is pointed up...possibly challenging / testing that DTL (higher prices). See black oval.
_MACD histogram bars are confused (uncertainty, could be bearish or bullish, latest bullish).
- Possible Broadening Formation Developing (purple lines)
60 minute chart
- Bearish stochastic cross (See black oval).
- RSI remains below its DTL (bearish) but is pointed up...possibly challenging / testing that yellow DTL (higher prices). The purple arrows show 3 possible paths.
- MACD histogram bars are rising (green line). Will they go positive and form a peak (yellow) or turn down and form a lower peak (purple)?
- MACD is at -0.59 (bearish)
- Accelerated uptrend line (dashed green) was broken, and forced the channel lower (green line). This is bearish, slowing (descending) speed lines. There is a possible third line even lower (not shown to avoid clutter). The break of a third is very very bearish and signals a trend change confirmation. However, those lines are in the 60 minute not the daily, but nonetheless important.
- Coil (symmetrical triangle) is present (purple lines). This could break in either direction, generally in the direction of the preceding trend but not always. On Monday, this could breakout in either direction, OR we can get a narrow range body on Monday that stays within the coil and doesn't break in either direction until later.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
These notes refer to the Russell 2000, NOT to TZA.
Daily chart
- Yellow Downtrend line was broken higher on 11/3 (bullish)
- Green Uptrend line was broken lower on 11/12 and backtested on 11/13 (mildly bearish)
- Stochastic did not make a bearish cross down. Instead, it bounced higher and avoided the cross (bullish). See black oval.
- RSI remains below its DTL (bearish) but is pointed up...possibly challenging / testing that DTL (higher prices). See black oval.
_MACD histogram bars are confused (uncertainty, could be bearish or bullish, latest bullish).
- Possible Broadening Formation Developing (purple lines)
60 minute chart
- Bearish stochastic cross (See black oval).
- RSI remains below its DTL (bearish) but is pointed up...possibly challenging / testing that yellow DTL (higher prices). The purple arrows show 3 possible paths.
- MACD histogram bars are rising (green line). Will they go positive and form a peak (yellow) or turn down and form a lower peak (purple)?
- MACD is at -0.59 (bearish)
- Accelerated uptrend line (dashed green) was broken, and forced the channel lower (green line). This is bearish, slowing (descending) speed lines. There is a possible third line even lower (not shown to avoid clutter). The break of a third is very very bearish and signals a trend change confirmation. However, those lines are in the 60 minute not the daily, but nonetheless important.
- Coil (symmetrical triangle) is present (purple lines). This could break in either direction, generally in the direction of the preceding trend but not always. On Monday, this could breakout in either direction, OR we can get a narrow range body on Monday that stays within the coil and doesn't break in either direction until later.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
Friday, November 13, 2009
TZA vs SPX... Russell 2000 weaker than SPX
I am overall bearish on both the SPX and Russell 2000 for now. As we know in these markets, that can quickly change from bearish to bullish. But until the signs reverse, I remain bearish. What would change my stance? Among other things, (1) They would need to make higher highs and higher lows (maybe they are in the process (especially SPX) of doing that now??? We need to wait and see). (2) The RSI downtrend purple line must break higher and then establish an uptrend line (also possibly happening now).
If I am bearish, why did I abandon my TZA swing position today? That's covered in a separate posting here.
Chart notes below. These charts are telling us much more than I have elaborated below, but here are some salient points:
Russell 2000 Daily chart (left side)
- Possible bearish double top, or complex bearish Head And Shoulders
- If the Double Top pattern (or HS) plays out, then a decline to 478 is expected on a break under 552. The 478 is a rough target, I'll define it more precisely later, but in that area.
- Note how the November peak (so far) is close to the August peak (around 589.58)
- Divergence power --- The bearish divergence between price and RSI (as well as MACD) from 9/18 to 10/16 forecasted that prices would decline after the 10/16 high. The slope of the purple price line is flat, while the slope of the RSI is down, suggesting a decline. Prices did decline very close to the prior low around 552.
-The RSI (and MACD) is still below its downtrend line, which suggests lower prices, and confirms the current downtrend.
- MACD histogram is bearish. Look at the last 4 green peaks, and notice that each one is smaller. Conversely, notice that each of the last 4 red peaks is progressively larger. This is a strong indication that prices will pierce lower than 552 (to the projected target of around 478.
SPX SP 500 Daily chart (right side)
- Price / RSI bearish divergences (just like the daily chart, above notes)
- Note that on 10/16 and 11/20, the SPX made a double high (around 1100 and 1105). HOWEVER, notice the Russell 2000 on the same dates...it made a LOWER high... from 625 and to 597. This shows that since 10/16, the Russell 2000 is weaker than the SPX.
- The slope of the Russell 2000 RSI DTL is steeper than the SPX RSI DTL, again suggesting that the Russell 2000 is weaker than the SPX.
The chart below shows how Russell 2000 is weaker than SPX. This is why I am seeking TZA.
The blog has cut off the right side of the chart but if you click on the chart, a larger view will pop up, showing the entire chart.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
If I am bearish, why did I abandon my TZA swing position today? That's covered in a separate posting here.
Chart notes below. These charts are telling us much more than I have elaborated below, but here are some salient points:
Russell 2000 Daily chart (left side)
- Possible bearish double top, or complex bearish Head And Shoulders
- If the Double Top pattern (or HS) plays out, then a decline to 478 is expected on a break under 552. The 478 is a rough target, I'll define it more precisely later, but in that area.
- Note how the November peak (so far) is close to the August peak (around 589.58)
- Divergence power --- The bearish divergence between price and RSI (as well as MACD) from 9/18 to 10/16 forecasted that prices would decline after the 10/16 high. The slope of the purple price line is flat, while the slope of the RSI is down, suggesting a decline. Prices did decline very close to the prior low around 552.
-The RSI (and MACD) is still below its downtrend line, which suggests lower prices, and confirms the current downtrend.
- MACD histogram is bearish. Look at the last 4 green peaks, and notice that each one is smaller. Conversely, notice that each of the last 4 red peaks is progressively larger. This is a strong indication that prices will pierce lower than 552 (to the projected target of around 478.
SPX SP 500 Daily chart (right side)
- Price / RSI bearish divergences (just like the daily chart, above notes)
- Note that on 10/16 and 11/20, the SPX made a double high (around 1100 and 1105). HOWEVER, notice the Russell 2000 on the same dates...it made a LOWER high... from 625 and to 597. This shows that since 10/16, the Russell 2000 is weaker than the SPX.
- The slope of the Russell 2000 RSI DTL is steeper than the SPX RSI DTL, again suggesting that the Russell 2000 is weaker than the SPX.
The chart below shows how Russell 2000 is weaker than SPX. This is why I am seeking TZA.
The blog has cut off the right side of the chart but if you click on the chart, a larger view will pop up, showing the entire chart.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
SPX chart
I will add commentary later....
Here's the chart for now.
Daily chart on left, 60min chart on right.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
Here's the chart for now.
Daily chart on left, 60min chart on right.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
Market going up? Down?
There are certainly many opinions out there, after this week's activity.
I need to do more analysis, to form a more intelligent opinion, but here's what I see right now (just my view, could be wrong).
I'm going to direct my comments at RUT (Russell 2000) this time instead of SPX.
In short, for me, the trend is down, both daily and hourly.
Daily RUT has mixed signals, indicating a possible bounce up. However, this is just a contratrend bounce. For me, the daily trend is down, until Resistance breaks higher. Also, there is a lower low (daily) and in process of making a lower high also (might have made it today).
The 60min RUT looks like it made a mini double top on Thursday. It declined close to the Double Top downside target and bounced up. This is normal and expected. Like the daily chart, the 60min shows a downtrend, with a contra-rally up. There are some mixed signals, both bearish and bullish.
Then why did I only daytrade the RUT (short) via TZA? Why did I abandon my swing position today (for very small profit/breakeven)? I'll add some details here later.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
I need to do more analysis, to form a more intelligent opinion, but here's what I see right now (just my view, could be wrong).
I'm going to direct my comments at RUT (Russell 2000) this time instead of SPX.
In short, for me, the trend is down, both daily and hourly.
Daily RUT has mixed signals, indicating a possible bounce up. However, this is just a contratrend bounce. For me, the daily trend is down, until Resistance breaks higher. Also, there is a lower low (daily) and in process of making a lower high also (might have made it today).
The 60min RUT looks like it made a mini double top on Thursday. It declined close to the Double Top downside target and bounced up. This is normal and expected. Like the daily chart, the 60min shows a downtrend, with a contra-rally up. There are some mixed signals, both bearish and bullish.
Then why did I only daytrade the RUT (short) via TZA? Why did I abandon my swing position today (for very small profit/breakeven)? I'll add some details here later.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
TZA updates
Note: I'm only posting occassionally here today. Taking a little break.
TZA daytrade plus SSO daytrade made back loss from yesterday, plus an additional profit.
TZA: closing my tza swing ...breakeven. dont like this action. last 1239. I did expect the decline, which is why i bailed on the daytrade tza at 12.76 at 12.32 cost for 3.57% (12.76/12.32)
TZA: there is a coil in tza 60min chart that just touched my speculative DTL of the coil, verifying that a coil is in place with 2 touches. this suggests that TZA could chop around on Monday, and should resolve in a thrust upward, but i'm on the sidelines with adding more tza. it could go back to 12.17 though i don't expect that. last tza 12.40
SSO stopped out at .67 sso...made profit on both.
SSO stop .67
TZA hit close to my .45 buy more price, but i'll pass. will wait till monday for more.
3:48
sold half sso .74. will keep other half into close.
stop .63 on other half.
3:33
quick trade sso 36.57 stop 36.47... not holding overnight.
3:23
TZA swing bought at 12.32. I am looking to add to the position if able today ...maybe at 12.45ish... but not yet. last tza 12.68.
3:05pm
just sold tza daytrade piece at 12.76 from cost 12.32. looking to buy back one more time today.
2:29 pm
TZA is behaving. Didn't come close to the 12.17 lowered stop. last 12.47. I will hold the tza as swing, and take profits on other half as a one day trade.
1:34
changed stop to 12.17
12:57
Bought TZA back at 12.31, stop 12.22. I am running tight stops in order to find the right entry, to protect against another surge down.
TZA did not breakout higher over .76 as I expected, so I exited that with a small loss.
I am looking to see if TZA puts in a higher low today, if so, I will probably re-enter it as swing...but my other setups and signals need to confirm that. I won't enter just on the higher-low alone.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
TZA daytrade plus SSO daytrade made back loss from yesterday, plus an additional profit.
TZA: closing my tza swing ...breakeven. dont like this action. last 1239. I did expect the decline, which is why i bailed on the daytrade tza at 12.76 at 12.32 cost for 3.57% (12.76/12.32)
TZA: there is a coil in tza 60min chart that just touched my speculative DTL of the coil, verifying that a coil is in place with 2 touches. this suggests that TZA could chop around on Monday, and should resolve in a thrust upward, but i'm on the sidelines with adding more tza. it could go back to 12.17 though i don't expect that. last tza 12.40
SSO stopped out at .67 sso...made profit on both.
SSO stop .67
TZA hit close to my .45 buy more price, but i'll pass. will wait till monday for more.
3:48
sold half sso .74. will keep other half into close.
stop .63 on other half.
3:33
quick trade sso 36.57 stop 36.47... not holding overnight.
3:23
TZA swing bought at 12.32. I am looking to add to the position if able today ...maybe at 12.45ish... but not yet. last tza 12.68.
3:05pm
just sold tza daytrade piece at 12.76 from cost 12.32. looking to buy back one more time today.
2:29 pm
TZA is behaving. Didn't come close to the 12.17 lowered stop. last 12.47. I will hold the tza as swing, and take profits on other half as a one day trade.
1:34
changed stop to 12.17
12:57
Bought TZA back at 12.31, stop 12.22. I am running tight stops in order to find the right entry, to protect against another surge down.
TZA did not breakout higher over .76 as I expected, so I exited that with a small loss.
I am looking to see if TZA puts in a higher low today, if so, I will probably re-enter it as swing...but my other setups and signals need to confirm that. I won't enter just on the higher-low alone.
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
TZA at 12.68
I just bought TZA at 12.68 for both daytrade and swing.
I will keep the swing piece overnight if it looks good at 3:50PM, else I will sell it and re-enter.
TZA needs to break over 12.83... if it does that then I expect it to surge. Last TZA 12.69
Stops could be set at 12.47 daytrade and 11.43 swing
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
I will keep the swing piece overnight if it looks good at 3:50PM, else I will sell it and re-enter.
TZA needs to break over 12.83... if it does that then I expect it to surge. Last TZA 12.69
Stops could be set at 12.47 daytrade and 11.43 swing
* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".
Subscribe to:
Posts (Atom)