[Noob Post] Can we consider Dow's head and shoulder?

[justtradin]

selling more wfc aug 25 puts for 1.89 acb 1.19.

JT

 

[bchung3000]

Hi JT,
so profit = 0.70?

 

[justtradin]

0.63

 

[justtradin]

down on my july 145-150 gs calls
My july 55 rimms puts are up to 7.20 from 1.90 a week ago

 

[bj139]

down on my july 145-150 gs calls
My july 55 rimms puts are up to 7.20 from 1.90 a week ago

Nice trade:clap:

 

[justtradin]

Thank you.

Better lucky than good.

JT

 

[bj139]

This is just my thinking, not advice. If you want to make money do the opposite.
I'm looking for a return to SP1150 starting near 7/2/10. If I see any strength by the close I may buy some TNA or BGU. An extended trendline from the January highs through the May lows may provide support. Also, the McClellan Summation Index is showing positive divergence indicating more stocks are advancing than declining relative to the June lows.

 

[bchung3000]

Hi BJ139

I am actually thinking about the combination of head and shoulder pattern together with elliot wave principle..if starting from 24/04/2010, point 1 at 08/06/2010 and point 2 at 21/06/2010..it doesnt look good to start any long position..

anyway BJ139 could you kindly elaborate a little bit on divergence? i've never got that right..not even once

Thanks
Brian

This is just my thinking, not advice. If you want to make money do the opposite.
I'm looking for a return to SP1150 starting near 7/2/10. If I see any strength by the close I may buy some TNA or BGU. An extended trendline from the January highs through the May lows may provide support. Also, the McClellan Summation Index is showing positive divergence indicating more stocks are advancing than declining relative to the June lows.

 

[bchung3000]

Hi JT

Im super new in warrant. so i didnt really understand the 7.20 from 1.90 part..could you kindly explain a little?

down on my july 145-150 gs calls
My july 55 rimms puts are up to 7.20 from 1.90 a week ago

 

[bj139]

Hi BJ139

I am actually thinking about the combination of head and shoulder pattern together with elliot wave principle..if starting from 24/04/2010, point 1 at 08/06/2010 and point 2 at 21/06/2010..it doesnt look good to start any long position..

anyway BJ139 could you kindly elaborate a little bit on divergence? i've never got that right..not even once

Thanks
Brian

I think your Elliot wave thinking is good. There is a five wave subwave down starting April24 till June6. Then 1 wave up till June21. The third wave down might end now or later. I have posted more information on divergence here: http://bj139-trading101.blogspot.com/2010/07/sp500-back-to-1150.html

 

[bchung3000]

Thanks for the info BJ139
I guess i have been using the same method for day trading (divergence), with the stochastic. Just that i didnt realise that it's called divergence. Is there Convergence then?

I think currently Day Trading would be a better method until the big downtrend is confirmed. Would you agree?

 

[bj139]

Thanks for the info BJ139
I guess i have been using the same method for day trading (divergence), with the stochastic. Just that i didnt realise that it's called divergence. Is there Convergence then?

I think currently Day Trading would be a better method until the big downtrend is confirmed. Would you agree?

I haven't heard of convergence in technical analysis except in a triangle the two trendlines converge. Divergence means a trendline drawn through price lows or highs are at a different angle than with trendlines drawn through the indicator lows or highs.

I posted mysome of my daytrading experiences on my blog at:
http://bj139-trading101.blogspot.com/2010/07/violating-trading-rules.html

 

[dpinpon]

Im expecting a bounce from here, so went long half an hour before into the close. Good luck and nice weekend to all.

 

[bchung3000]

I haven't heard of convergence in technical analysis except in a triangle the two trendlines converge. Divergence means a trendline drawn through price lows or highs are at a different angle than with trendlines drawn through the indicator lows or highs.

I posted mysome of my daytrading experiences on my blog at:
http://bj139-trading101.blogspot.com/2010/07/violating-trading-rules.html

haha bj139 i think we are having the same problem here. Last night i made a terrible mistake costing me about 50 points.
I missed the major support in the daily as well as 1min chart, the 9620 level.
I guess day trading is more about small profit, never be greedy, and really stop yourself out when the short term trend is no longer in your favour.

so far my current issue is when to stop myself out.

as for your concern. i always remind myself not to "chase the dragon", meaning not to chase a sharp movement because i tried it a few times and each time i ended up losing HAHAHAHA

bchung3000

 

[bchung3000]

Im expecting a bounce from here, so went long half an hour before into the close. Good luck and nice weekend to all.

I noticed that it always goes the opposite direction 15-30min before the close. Not ALL THE TIME though, so i never risk to get into any trade before the close, like 3.30 onwards.

May I know how you saw a bounce from there?

 

[dpinpon]

Totally agree bchung, ive done this only the 2 past trading sessions, before those days were too risky. On thursday bought cemex stock at 2.30 pm (that is 3.30 pm for you) and sold it next day in the first 15 min of trading session for close to a 1% in profit, thats not much but Im kind a kamikase trader and went full long. On friday I bought same stock at 2.15 pm, even though market on monday is open in Mexico, volume will be real light so im planning to hold it over the long holiday weekend. Lets see if can sell it at the opening bell or hold or even scalp on tuesday.
As for a bounce from here concern, I see big divergence in MACD, loosing steam when getting close to the psicological 1000 mark in S&P 500, right at the 38.2% Fibbo, support on weekly 100 sma, possible daily measure movement from top 1130-1080 to bottom 1080-1020 and a terrible down day streak. But, im pretty aware of the hefty H&S pattern we just confirmed this week and could get swamped in a blink of an eye, so my stop should be tight.

 

[bchung3000]

Hi dpinpon

Looks like you are actually trading the pre market, in my opinion i think that it's not very profitable because the price can go haywire during the premarket, bullish this min and bearish the next and it's almost unpredictable. I lost some bucks on that before

For the last minute trading (before the market close), i am still trying to prove if the last 15min of the day before market closes provides good opportunity to trade, looks like the trend doesnt change from the last 15min all the way to closing.

I am never good at divergence/convergence. Please correct me if i am wrong in any way. I would say the divergence in terms of Stochastic (14,3,3) is more significant, probably my MACD setting is wrong. on my MACD i see an almost parallel decline from the tops, not sure if it is considered as divergence.

Rumor says target for the decline can go all the way down to 900 for dowjone and 400 for s&p according to elliot waves the megawave. Not sure if it's going to happen but what i think is it will go back to the neckline level, 1040 for s&p, making a 2nd chance to sell then continue the bearish movement.

Would folks agree with me?

Totally agree bchung, ive done this only the 2 past trading sessions, before those days were too risky. On thursday bought cemex stock at 2.30 pm (that is 3.30 pm for you) and sold it next day in the first 15 min of trading session for close to a 1% in profit, thats not much but Im kind a kamikase trader and went full long. On friday I bought same stock at 2.15 pm, even though market on monday is open in Mexico, volume will be real light so im planning to hold it over the long holiday weekend. Lets see if can sell it at the opening bell or hold or even scalp on tuesday.
As for a bounce from here concern, I see big divergence in MACD, loosing steam when getting close to the psicological 1000 mark in S&P 500, right at the 38.2% Fibbo, support on weekly 100 sma, possible daily measure movement from top 1130-1080 to bottom 1080-1020 and a terrible down day streak. But, im pretty aware of the hefty H&S pattern we just confirmed this week and could get swamped in a blink of an eye, so my stop should be tight.

 

[timsk]

Rumor says target for the decline can go all the way down to 900 for dowjone and 400 for s&p according to elliot waves the megawave. Not sure if it's going to happen but what i think is it will go back to the neckline level, 1040 for s&p, making a 2nd chance to sell then continue the bearish movement.

Would folks agree with me?

Hi bchung3000,
You appear to be trying to predict the future which has proved to be a tough gig for traders in the past. That said, you may well be correct and, if you're prepared to back your opinion with real money, you could hit a home run and clean up big time. Alternatively, you could lose a little - or a lot - depending upon your risk management strategies. Either way, you're gambling, IMO.

The trouble with technical analysis is that so many traders (me included) look at charts and see patterns like H&S forming and expect price to complete the pattern and do what it 'should' do. Projecting one's own views onto the market in this way is very easy to do - it's almost natural. However, as I know to my cost, it tends not to be profitable! So, in answer to your question - the best traders that I know often have an opinion about where the market's headed in the coming days and weeks, but, under no circumstances would they let that influence their trading. Furthermore, if they think it's likely to fall, it wouldn't stop them from buying the market if their set ups and entry triggers indicate a long trade. Personally, I'm not good at doing this. All too often I allow my opinions to dictate my actions with inevitable results. Consequently, I never spend any time trying to figure out where the market is likely to go.
Tim.

 

[bchung3000]

Hi bchung3000,
You appear to be trying to predict the future which has proved to be a tough gig for traders in the past. That said, you may well be correct and, if you're prepared to back your opinion with real money, you could hit a home run and clean up big time. Alternatively, you could lose a little - or a lot - depending upon your risk management strategies. Either way, you're gambling, IMO.

The trouble with technical analysis is that so many traders (me included) look at charts and see patterns like H&S forming and expect price to complete the pattern and do what it 'should' do. Projecting one's own views onto the market in this way is very easy to do - it's almost natural. However, as I know to my cost, it tends not to be profitable! So, in answer to your question - the best traders that I know often have an opinion about where the market's headed in the coming days and weeks, but, under no circumstances would they let that influence their trading. Furthermore, if they think it's likely to fall, it wouldn't stop them from buying the market if their set ups and entry triggers indicate a long trade. Personally, I'm not good at doing this. All too often I allow my opinions to dictate my actions with inevitable results. Consequently, I never spend any time trying to figure out where the market is likely to go.
Tim.

Hi timsk

actually to be honest i am trying to roughly gauge where it is going to, not the exact point of course, to help me be biased which side i should trade with more caution and which i should trade heavier.

What is IMO by the way?

Of course we would hope that pattern would complete to gain our confidence in where it is heading to, if it doesnt complete then too bad i'll not be trading it.
Anyway i am more of a day trader instead of longer term trader, therefore knowing whichever direction has higher odds gives me confidence for farther targets.

i still buy the market if my setup hits even if it's likely to fall yet i would not place heavy trades and set huge target.

we always follow the big picture arent we? like if you are day trading you will llook at daily chart, end of day trading you will look at weekly chart and so on.

glad that you can join our discussion cheers!

Bchung bRiAn

 

[bj139]

I was studying the daily and hourly charts and considering the comments on CNBC and Bloomberg. I mentioned in one of my previous posts that the Elliot wave count on the hourly chart looked to be early in this move down. I agree with the previous post about not relying on predictions exclusively and I try to remain flexible in my opinion since THE MARKET IS ALWAYS RIGHT. Anyway, subtle clues do exist as to the line of least resistance of the price trend. The hourly Elliot wave count still looks incomplete. The TV experts are all talking about a bottom any time and I still see no clear divergence in the daily or hourly chart. Combined with this I am ALWAYS early in my prediction of a reversal and I see a reversal any time now. In the past, I have noticed a reversal hits me in the head like a hammer. Then I don't believe it since I am so beaten up by my previous attempts at finding a bottom. Therefore I believe the market has further down to go.