tag:blogger.com,1999:blog-947237681666122369.post3505482102325729558..comments2024-03-18T14:37:21.899-10:00Comments on Pretzel Logic's Market Charts and Analysis: SPX and Euro Updates: Still No Change Since ThursdayPretzelLogichttp://www.blogger.com/profile/11613859771824863784noreply@blogger.comBlogger171125tag:blogger.com,1999:blog-947237681666122369.post-42938853081434715572012-01-04T02:42:47.854-10:002012-01-04T02:42:47.854-10:00 ESH2 1253.50 closes the Tuesday's gap, 1248 i... ESH2 1253.50 closes the Tuesday's gap, 1248 is bottom of Bollinger Band.katzo7noreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-91533867471342369942012-01-04T02:36:28.897-10:002012-01-04T02:36:28.897-10:00I want to touch back on some things I said on a pr...I want to touch back on some things I said on a previous thread. <br />"Is a triangle a trending form or oscillating one?" We broke out of that triangle, obviously on Tuesday. <br />"By all rights the $SPX<br /> should have hit (or will hit) 1319; that is the top of EW5 for this up <br />move." There are measures I take that say this will not happen, that the EW5 will abort before this level is reached. BUT, we trade what we see, not what we think. <br />"Break out of triangle or fake out, to be determined? TL on <br />stochs await a break to the downside, displays RUT triangle in a <br />different way." I just took a look at $RUT/DAY. Hmmmm, the stoch high on Dec. 27th still stands and the stochs are sloping down?? Still awaiting the break of that TL. <br />"Is this action really an ABC corrective move to balance the first <br />impulse off the head? Or is it a base (a break of 770 of the $RUT and it<br /> will be a base)." We are now exactly at were we should be for the C to be played, $RUT is 752.28. <br />"If corrective at first C insert an A; at second C insert a B; at extant <br />right 5 insert a C -- <b>this still could go a bit higher if A = C.</b>" It did. <br />"About triangles ... they tend to break out <br />to one side, then do the opposite." Is this one normal, or is it the exception? katzo7noreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-12511374697216752792012-01-04T02:24:24.207-10:002012-01-04T02:24:24.207-10:00Is it me or have the news wires been eerily quiet ...Is it me or have the news wires been eerily quiet for the past 3 weeks? There are events out there that would've tanked the markets a month ago, but now are getting little press and no reaction: Italy's disappointing bond auction last week with yields approaching the magic 7% mark; Iran's naval exercises in the Strait of Hormuz threatening the flow of 40% of the global oil supply. It feels like we are due for some bad "news".matsterynoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-4315084554211201852012-01-03T23:00:40.433-10:002012-01-03T23:00:40.433-10:00Something will cause a gap down this morning, some...Something will cause a gap down this morning, some news article, etc. putting in an island top. The set up is there now. Look on my chart, EW5s are a bit unpredictable. We also have a Bollinger Band breakout (BBB) which means we will at least move to the lower Bollinger Band level which is around 1248 ES. Also too many indicator candles are appearing at the 5.katzo7noreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-68671079833421000432012-01-03T22:51:33.879-10:002012-01-03T22:51:33.879-10:00Take a look at the MACD on my 120 posted chart and...Take a look at the MACD on my 120 posted chart and you can see why the corrective portion of this move was not set up yet. And then take a look at the MACD now on ES 120.katzo7noreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-73909879974013937462012-01-03T22:44:38.065-10:002012-01-03T22:44:38.065-10:00Rookie, what the chart says is correction to this ...Rookie, what the chart says is correction to this move was and is not upon us yet. I said below 1269 would start the ball rolling, we got to 1267-8 and the set up is not there yet.But it is close. On a previous thread I stated that I felt that A could equal C (120 min.), this is what happened. Will this be an island top? A gap down tomorrow will do that. Gaps like this IMO are not sustainable.katzo7noreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-52121745844596192082012-01-03T20:41:32.089-10:002012-01-03T20:41:32.089-10:00RT, I sympathize with your sweating - not a good f...RT, I sympathize with your sweating - not a good feeling. Right now, we're in a no-man's land. We've broken above the 12/7 high, tied the 11/8 high, but have yet to take out the 10/28 high. And even if we take out the 10/28 high, there's the 1303 neckline resistance. And yet, the sentiment is very bullish, which in the short terms translates to momentum, not reversal, imo. And yet, the EW count from PL suggests a reversal now or sometimes soon. It's crazy, all these "and yets."<br /><br />Suppose we open tomorrow at where we closed today. If I were in your shoes, I would cover all the shorts and buy a long straddle. That way, there's a chance of making some money on either sides of this crazy (possible) whipsaw and it might get you back to, or close to, break-even. At least, you've taken away the (presumably) huge short position you're holding now and can then relax a bit.<br /><br />Your objective at present should be two-fold: (a) Take away the "unlimited" risk. (b) Give you a shot at making back some of your loss.dust_devilnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-55797328422431673772012-01-03T20:09:37.679-10:002012-01-03T20:09:37.679-10:00BTW, the other thing I like about the swing trade ...BTW, the other thing I like about the swing trade with (some) options idea is that at or before the pivot, the implied volatility will be low, hence the options will be relatively cheap. Far out of the money makes them even cheaper.dust_devilnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-21489161476737561262012-01-03T20:02:55.802-10:002012-01-03T20:02:55.802-10:00One of the lessons I've learned from that was ...One of the lessons I've learned from that was that snap ups following declines are quick and vicious. It's part of the challenges of shorting. One must take profit *before* reaching the target. But then - and this is a problem I was/am wrestling with in coming up with a good short-side trading strategy - one cheats oneself of the "let your winners run" half of the asymetric bargain, the half that's supposed to make up for all the little losses from stops. Currently, my thinking is this. At the top, in anticipation of the big drop, buy a combination of inverse ETF and far out-of-the-money put options. The options will be cheap. Then on the downslide, take profit at logical places with the ETF and leave the options to run at the "final" support level that you hope, hope will break. If it snaps back, you can still sell the options for some money. In the worst case, the options become worthless, but your life is spared.dust_devilnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-34150541671321132322012-01-03T19:51:09.601-10:002012-01-03T19:51:09.601-10:00same here. I think i've had shorts every time ...same here. I think i've had shorts every time we've gapped up huge. or at least it feels like thatmavrichnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-40194066780998656122012-01-03T19:39:20.791-10:002012-01-03T19:39:20.791-10:00What really killed me was that Bernanke gap up aft...What really killed me was that Bernanke gap up after Thanksgiving. Killed me big time, with those triple inverse ETFs.dust_devilnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-53717537001398166822012-01-03T19:37:17.355-10:002012-01-03T19:37:17.355-10:00Ouch!Ouch!dust_devilnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-54964398359330647362012-01-03T19:26:33.559-10:002012-01-03T19:26:33.559-10:00yeah, this thing needs to rollover soon, I'm s...yeah, this thing needs to rollover soon, I'm sweating quite a bit at this point. This santa rally has cost me nearly all of my gains since early november.RockyTopnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-87129820654057507942012-01-03T19:20:39.851-10:002012-01-03T19:20:39.851-10:00Brian I'm interested in where you learned or d...Brian I'm interested in where you learned or developed your rules? I've only been trading for a short time now so I'm keen on developing a winning system/strategy.mavrichnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-52426776703806681902012-01-03T18:29:40.384-10:002012-01-03T18:29:40.384-10:00Yes, I absolutely liquidated and even if there is ...Yes, I absolutely liquidated and even if there is a major gap up tomorrow morning, there is NO WAY that I'd have held that position overnight and exposed myself to the possibility of a devastating gap down. <br /><br />I got into the mess I got into due to a rather amateurish form of 'holding and hoping'. Continuing to hold overnight would have been more of the same.brianhutnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-64822739342471885262012-01-03T18:29:31.320-10:002012-01-03T18:29:31.320-10:00Don't beat yourself up too bad. Happens to th...Don't beat yourself up too bad. Happens to the best of us. We are, after all, still humans, and we are emotionally-driven beings. Regardless of whether we personally think of ourselves as highly rational or not, every single human on the planet is motivated to action by emotion *first*, and logic second. Trading forces us to try to go against our natural and deep-seated instincts -- and sometimes instinct wins. <br /><br />You're a very smart guy -- I have faith that you'll learn from it, and it'll make you a better trader in the long run. :)Pretzel Logichttp://PretzelCharts.blogspot.comnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-45962750645379505832012-01-03T18:23:49.873-10:002012-01-03T18:23:49.873-10:00I agree. I'd have sold as well. Especially i...I agree. I'd have sold as well. Especially if we are facing the possibility of 1,300. brianhutnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-12071203888848314202012-01-03T18:04:41.474-10:002012-01-03T18:04:41.474-10:00It is insofar it was total amateur hour nonsense t...It is insofar it was total amateur hour nonsense that got me there. <br /><br />This one was SO AVOIDABLE. The market actually performed EXACTLY as needed for me to do just fine and come out ahead. I just decided that it wasn't good enough for me and I'd hold out for more.<br /><br />Something that in my rulebook you are NEVER supposed to do when you are on the wrong side of the trade and the market gives you enough of a bounce to get back to netting out even. <br /><br />In this case, the market actually gave me a larger than expected bounce to make some real money. 1,276 back up to 1,281 is five points. I never count on getting more than three.In another sense though, I'd be one hell of a lot more panicked if I traded that move exactly right to get back to even or ahead . . . but not even that ever materialized.But when it does give me that . . . and then I don't take it. And even worse I end up with a huge loss, well yeah that burns hard. Feeling pretty damn gullible and amateurish right about now. brianhutnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-77799288099209723662012-01-03T17:46:21.174-10:002012-01-03T17:46:21.174-10:00RE Usually, these are the same folks who were bear...RE Usually, these are the same folks who were bearish in early October <br />Yup. So many of these "professionals" are nothing more than trend followers. So if I may throw something back rhetorically at those guys: We saw tremendous whipsaw within a huge lateral range last year. So if THAT's the trend, why should it suddenly become a linear upclining market? The justification is, the PTB will have things fixed; they know about all the problems. Hmm.dust_devilnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-86706506833460026992012-01-03T17:41:10.761-10:002012-01-03T17:41:10.761-10:00Thanks for the condolences everyone. I only lost ...Thanks for the condolences everyone. I only lost today because I violated MULTIPLE very basic and understandable rules that I know VERY, VERY WELL. <br /><br />But I thought I could ignore them today. And I substituted a few other assumptions that simply know far better than to be entertaining. I was actually at even just eight minutes before the close, and when we climbed up to 1,281 I was up pretty huge. The position itself became very, very large as we moved down to 1,276. That part of the trade I executed perfectly. Buying the exact right amounts at the right times to be able to get myself back to being even or ahead.I call this a 'stick save' trade. I generally have a two to four per week. They're very fucking nerve-wracking. Because you are buying ever larger positions into the teeth of the move against you, under the assumption that the market has predictable retraces that will get you back to even, especially in slow moving markets, which today was.The whole point of the stick save is JUST TO GET BACK TO EVEN or just slightly ahead if you are lucky. You are NEVER supposed to hold out for greater gains though, even if it means you will be selling most of your position 'early', meaning before the retrace is over. Retraces are NOT dependable for big gains. And should NEVER be used to produce big profits. And with stick save trades your FIRST JOB IS TO REDUCE RISK once you are back to even by getting back to an appropriate position size. It's a very cardinal rule for me. And which I broke repeatedly on numerous occasions through the last hour of trading. There were NO LESS THAN FOUR distinct moments that would have been normal sell moments. And had I acted on any one of them, I wouldn't have lost a cent. So because I was the holding out for more when EVERYTHING should have been screaming to me to unload and sell, I lost one hell of a lot.All in all, it was TOTAL amateur hour bullshit and wishful thinking that I should know way better than to EVER allow at this point in my understanding of things. It happens to everyone sometimes, I suppose. But there really is no excusing this in my mind. I know way better than to do what I did. Especially by now. And so in that sense, I had it coming.brianhutnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-39871337336199041472012-01-03T17:37:27.205-10:002012-01-03T17:37:27.205-10:00Yeah, I've been getting a lot of the same. It...Yeah, I've been getting a lot of the same. It reminds me of an article I saw about 3 days ago: "Why Gold is Due for a Big Correction." I started laughing. Gold just HAD a big correction -- where was this guy when gold was $1900/oz? <br /><br />That's the trick with calling big turns -- they always seem wrong, because most of the time, things have been moving in the opposite direction.<br /><br />But yeah, it's good to hear so many are bullish now. Usually, these are the same folks who were bearish in early October.Pretzel Logichttp://PretzelCharts.blogspot.comnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-18298343221940129942012-01-03T17:28:31.661-10:002012-01-03T17:28:31.661-10:00And another newsletter just came into my inbox pro...And another newsletter just came into my inbox proclaiming a new bull market is in the cards!dust_devilnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-53639377757543357832012-01-03T17:12:26.823-10:002012-01-03T17:12:26.823-10:00its okay brian, i was also burned today. I was up ...its okay brian, i was also burned today. I was up 15% for the year and now im only up 4%mavrichnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-19404257364665615922012-01-03T16:52:02.228-10:002012-01-03T16:52:02.228-10:00Earlier, I noted that the negative divergence on 1...Earlier, I noted that the negative divergence on 10-minutes Stochastics printed on 12/29 failed on 12/30. In hindsight, I wonder if that was a warning of a gap up the next day (today)? Just wondering.dust_devilnoreply@blogger.comtag:blogger.com,1999:blog-947237681666122369.post-62734839561342532532012-01-03T16:46:52.066-10:002012-01-03T16:46:52.066-10:00Man, the op-eds on marketwatch are all bullish. Ti...Man, the op-eds on marketwatch are all bullish. Titles like "Your major risk in 2012 is missing the upside" and "Risk creates opportunity." Even the Aden sisters are guardedly bullish on stocks, to quote, "could surprise on the upside."<br /><br />I'm holding calls presently but it's only for the short term. At the present rate, we should approach 1300 pretty soon. I expect a reversal then, because PL's Minor (2) c on today's 2nd chart fits perfectly.dust_devilnoreply@blogger.com