Tuesday, October 23, 2012

Tuesday Notes:

/tf  -1.28% premarket -- huge   12 point move overnight.  

Entire rally from yesterday wiped out and more.

Daily charts are below 10 day MA -- and that's the major trend.  So all up moves - like yesterday's are fleeting moves because they are fueled by short term timeframe traders.   Longer term players are distributing and can't find size up there.

99 and 34 MAs on 1 min charts are trending down nicely on virtually all markets.  (except /zb !) so there's no reason to jump in long.  Especially not so fast.

/cl has a 5/34 x-over after dropping under 88.   There will be bounces.  But trading long while the 99 MA is on top is tough without clear divergent behavior.   Trend fighting.

/cl  -- -1.5%  to 87.31  -- death trap to longs hoping for a huge bounce.  Early is wrong.

/cl  -2%  under 87 -- hit 86.68.   Still in sharp downtrend.  No relief.

5/34 x-over on /tf  -- 809.80ish.   This was the 3rd xover , other 2 were immediate reversals.

So going to open deep in the hole.  Must follow rules.  Could be tricky.

/tf  810.1    99 MA on bottom -- so officially uptrend on smallest timeframe.  Price pays all the time. 

/tf -- b/o  and small double bottom pattern -- before 20 tick POP in 2 minutes..   same old pattern.

Trend Down Day signals -- but possibly oversold on major gap down  (Biggest in 3 months).

Market Signals rule.     /tf -- back to the abyss

Fear is powerful.  Traders will act irrationally down here.  Charts will be the most truth you can find.  Feelings and opinions will betray you the most.

GOOG is green.

probably some ppl think gap will fill.   GOOG and AMZN green (amzn flat)... but that's not much to go by.

-2031 advn-decn -- is very heavy.  Need to see some improvement first before a long could work.

/6e - triple bottom     5/34 xover   10:04

advn-decn and /zb  suggest small bounce here.    divergent.

amzn and goog would be the right names to play.

99 MA on top is signalling the correct direction:  DOWN.  Keeping me out of going long.

CSTR, goog, amzn  all strong though.  

shorted /cl on break of wedge -- was 40 tick drop in 2 minutes...  after pattern completed and broke.  Simple.  Still dropping too.  Ended up being 80 tick move -- to 85.97  (whole #! break).  Now tiny bounce.

MAs and Market Signals are clear -- trend down horror day.  No need to get emotional, predict, overthink, form opinions.

/cl   5 / 9 MAs - no x-over would keep you still in  86.02 now.   10:32 am.

85.69!   crushed.

You know what the whole game is?  Staying in winning trades as long as possible.  If you have a system that does that, you win.  Otherwise, you end up losing even if you win 80% of the time.  Magnitude of wins must be greater, so your system must allow your winners to develop and slow to get stopped out.

Trying AMZN long ...   futile.   Double bottom +   5/34 xover.    only  -.37%

long /tf paper for 16 ticks on triple bottom pattern then 5/34 xover -- sold into first resistance area.

amazing exit -- /tf dropped all the way (15 ticks) to entry a minute later.   Wonderful read intraday.

Sold AMZN for $11.25 lol profit.

/tf failure was right at the 99 MA by the way --

/cl coming off the bottom but 99 MA on top...   We're in Chop Mode -- midday. 

-2178  advn-decn.  i guess a long time ago i'd be buying every hour hoping for a rally.  Not anymore.   It's a fool's game to fight the Flow.

slight bump  at 11:52 ---   /tf above 99 day MA but still above all.  

AMZN now up .77% -- this was correct to focus on strength.  CSTR also  green.

divergences now... /6e  strong.    /tf  at 806.50 -- triple top level.  advn-decn off lows -- still -2100

small counterrally in effect.   /6e  advn-decn  /tf  -- possibly fading as I write:  12 noon.

99 below in /6e  and now /tf almost ---   short term -- up.

So now - buy /6e on dips to 99 MA. 

long UCO -- risking $200 on double bottom + xover  + potential news in Iran.    also advn-decn improving.   

/tf  up 50 ticks after double botttom and 5/34 xover.   Still running hard IWM at 81.

CSTR  up 1.8% -- showed its hand early. 

that "news about Iran"  was exactly the thing you DON"T want to trade off.   TF up 70 ticks on no news... UCO red... because I thought I had information that was useful.

UCO - stopped out.  Of course.

missed the run...  feeling lost.   Head not in it. 

bearish divergences appearing.

"Bearish $CL_F knows where it wants to go -- $SPX $SPY #crude  -- tweeted at 1:43 pm.  85.94  (now 86.31   15 minutes later)...  

If you stay long when 99 is leading from bottom -- it works.  Otherwise it doesn't. This is a good rule.

/tf  above 99 ma -- trending up (stay long)  but  double top -- so could be early warning.  5/34 xover but then negated.  so Signal #3 pattern?

/tf  now it's a triple top  +  5/34 xover -- early short?   811.5

if trying to enter early... better to get in at the resistance area  -- rather than the break.. cuz it may have to retest several more times.   Not until  99 is leading from the top/bottom is it trending.

So  today's lesson:  Must respect the rules --- which I did not follow.    /tf running to new highs.

This is about discipline and following RULES.  It's why it's so hard -- you make it hard.

/tf 815  top -- what was the market trying to do?  Get to resistance -- this was the 5 - MIN descending TL.  Clear as day.  It was the gap fill in IWM.  The target was crystal clear from the start.

So always use higher timeframe to know where the market is targeting.

Moving Avgs.  keep you on the right side of the trade.  Longer term Targets can get you out at the top - but also keep you IN the trade to target.   Market Signals hint at shifts.   Patterns provide entries.

/tf looks extended as IS near a major resistance area but it is definitely not a short.

You don't have to anticipate, think, or worry if you are following a set of rules.  You do have to follow the rules and it often won't feel comfortable.

Market Signals look solid here --  Dow -209 -- that's why this bounce can happen.

Did I trade well?  NO.  I did not respect my system
What did I learn about myself? I think I'm smarter than my system and the markets.  I am not humble enough.  But I think I'm humble.

what did I learn about the markets:  They can really deceive you if you let it.  But in reality, the markets are NOT very good at tricking you.  I am good at tricking myself by not trusting the signals which are being very clear almost all the time.

/tf testing 99 MA -- still acting as support.   Market Signals are turning bearishly.

AAPL   -2.8%

/tf  loses 99 MA -- and regains it.  

closes at 813 --  More than obvious -- entire rally was simply to close the gap and nothing more.

Was actually a very good day for daytrading.   Following a system will provide the most gains.  Going off the cuff is disastrous. 

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