Path For The US Today

[Trader333]

On a purely historical basis, the "experts" that are interviewed on both CNBC and Bloomberg are wrong far more often than right with regard to predicting market direction.

Also bear in mind that for any trade to take place someone has to take the opposite side of the trade. So for TA to work some traders have to view the TA signals differently, (or be using different TA) to have a trade take place. An example would be the SR trader who sees an overbought TA signal and shorts the market. Their trade could be taken by another trader who is a trend trader and sees the new high not as overbought but as as signal that a new breakout is about to occur and goes long.

Based on this no TA will consistently work and if it did there would be no market to trade as everyone would want to go long or short at the same time with no-one to take the other side of the trade.


Paul

 

[stoploss please]

So basically, everyone sees the same patterns but interprets them in different ways.

I have the same sort of battle with myself as I am trying to trade off hourly charts because I find the smaller time frame entry levels more whippy. However, I am trying to take into account where we are in the smaller time frame so as to optimize my entry. That is when it gets confusing.

Andy

 

[SUNSEEKER]

Paul,

I think you are right in your view about TV gurus etc. Those that do so, however, rarely have anything to sell unlike brokers etc. I know things have changed a lot over the last 3 years with advice, and thank God for that.

Imagine I go on Bloomberg and say that the FTSE should top at 4200, and the it goes to 4225, and then turns down to head much lower, that would be a good call. The problem is of course those who short it at 4200 with a stop at 4220. They will be stopped out of an otherwise good trade, because the trade did not go their way immediately. So although it was a good call, it could lose some traders money.

What Chris Locke is doing is using cycles to forecast turning points in the market. These cycles originate from a variety of sources too nemerous to mention. The Spiral Calendar is the work of Chris Carolan. He has tied in emotional highs and lows in the stock market with the full moons over the last many 100 years, and has proven (to me at least) that the fibonacci growth sequence ruless these emotional events in the history of the markets and the world for that matter. Without having spoken to Chris Locke about this, I suspect he is calling for a high on the 2nd July and then down into 29th of July, where the Spiral calendar is forecasting the next "event" will take place. What that event is, no one knows. I hope and pray for all of us that it will not be anything as horrible as on previous events on this particular cycle sequence.

 

[Skimbleshanks]

I am trying to trade off hourly charts because I find the smaller time frame entry levels more whippy.

Just a thought ... if you are trading one hour charts, remember that the US market is six and a half hours. Some software programs make the last 30 minutes into a 60 min bar, while others appear to combine the last 30 minutes of the day with the first 30 minutes of the following day, etc.

In case you hadn't realised, you can get false information and signals by using 60 min bars. You might prefer to use 30 min instead if you are unable to fathom out what your software does with the odd 30 mins at the end of each day!

 

[SUNSEEKER]

ON HOURLY CHARTS

I trade off hourly charts and I have had to do some major re-work off my charts because of the 6.5 hour issue. So what I have done ( very time consuming work!!!!) is to revise the data over the last 10 years so instead of having 7 entries I have 6 entries per day. The first entry will cover from 14:30 till 16:00. The work was lenghty because I had to asses what the highest high was from the 2 first entries per day, and what the lowest was. That was a lot of Excel lines.

HOWEVER, the edge I gained was phenominal. The number 6 has got some profound implications in both Fib, and in Geometry, even in the bible, but I wont bore you with that...

Sun

 

[jpwone]

Hi Sunseeker

another fan here. Really enjoy your commentary be it on the telly or the web.

I went 100% cash last Thursday and am now running small day trades using 10% of capital. I still cannot see were the major economies have turned the corner and suspect that poor US data (figure fudging aside) will start to catch up with the current bullish view. Unemployment has to be paid for and better company results based on cost cutting are going to be seen for what they really are - declining revenues in business and increased social costs. The geo-political situation (primarily North Korea) is very wobbly and it is not going to take much to trigger a crisis in the political arena.

I think the most vulnerable of the indices is the Dax and have been actively trading this for the past couple of weeks. Just waiting for that first chink to appear in the US armour and then will build into Dax shorts and MUV2 (currently short in this). I expect the Dax to give up all recent gains.

The bear might have been quiet for a spell but its still there and it still has teeth and its getting hungry.

JPWone (John)

 

[SUNSEEKER]

Today is fairly straightforward in terms of the expected path.

I am expecting a push higher for the first 10 minutes of trading, but it may not really materialise to very much. I am, as I wrote in the earlier email, expecting a weak first part of the day. We should move down fairly sharply from around 14:45 or so into 15:15. From then on we should see a move higher for 20 minutes. From then on the pressure is on the downside until the 17:30. For the next hour it gets a bit messy, but by 19:00 the surge higher should be underway.

Good luck and I hope you can make use of it. My compliance manager is not happy and the usual disclaimer applies: This is NOT trading advice. All trades are your OWN responsibility. The Expected Path is a theoretical exercise.

 

[bonsai]

As this seems to be a US thread, thought you might like to see
this. -Copied from another Board -

DOW Prediction [9270-9379] Aggressive: [9235-9430]

 

[SUNSEEKER]

what exactly is the prediction?

 

[bonsai]

ah, well that's the problem with predictions !
but its good for the day, if thats what you mean.

I gather its a home made data mining exercise
but the track record has been fairly good.
doesnt help you to know when to enter a trade !

 

[stoploss please]

As I try and avoid the first half an hour, I did not think it

mattered but in hindsight and after you have both pointed it out,

I will take a look at the 30 minute bar.

I use ESignal. The first bar starts at 2pm. ie 2 to 3, 3 to 4.

Anyway, we then get to 8 to 9 and then they stick in a tiny bar at 9. Doh.

Cheers
Andy

 

[purplekiwi]

With reference to Bonsai's prediction, it comes from emetrix
I believe the idea is that these are predictions for high and low for the day, if it hits the high then sell if it hits the low buy. Then just sit and only exit if the other extreme is hit or there is a reversal of 30 points. This is my interpretation from reading the website!

I think Sunseekers contribution is far more useful - I did very well yesterday - thankyou!

 

[bonsai]

purple
the predicted range is one thing
but how you trade it, goes beyond calculating a possible range.
That's a whole different ball game.

PS:
I just saw 9238 go through

 

[options]

Agree with that Bonsai. You have a link to that site please?

 

[purplekiwi]

www.emetrix.biz

Bonsai - I am not saying I agree - don't shoot the messenger!

Purple

 

[bonsai]

purple
the comment wasn't directed at you
but at 'Salska'
I think he should have settled for getting a handle on the ranges
and let it go at that.
Suggesting how to trade it is one step too far,imo
But I guess people pestered him for more ?

 

[options]

Ta Purple, I'll take a look once this dow settles.

 

[SUNSEEKER]

Good morning,

Yesterday was a rather strange day and I suspect that the big option players are trying to keep the market in a tight range for the option expiration on Friday. If this is the case the game plan is highly likely to get the SP500 above 1010 to target the 1021 area. This would work out well with the expected path for today.

Don’t get me wrong. I am not really bullish here, but I know how the option arbitrage firms can manipulate the market in low volume environments. As their agenda is to keep the market flat to higher it coincides with the general trend and it is mistaken for the bulls buying. Once these games are over and done with, the market should see a very good correction. This may not happen until 2nd July. I do however see the upside limited from here.

The FTSE 100 will hit good resistance around 4225, which was the high around November last year. The bulls have spent a lot money getting it this high. If we fail around these levels it could be a very fast trip back down to 4000.

The Dax continues to defy gravity and it is getting kind of amusing to see this index up 50% from the lows and continue to surge higher. The bulls better pray that their parachute work once this baby begin to roll over. That is of course if you like me believe that the bear market is not over yet.

The expected path for the US today is fairly positive. Yesterday’s path was a really mixed affair with both good and bad calls. For today the picture looks like the bulls are back, but there should be some negative vibes during the morning hours.

From the opening bell the pressure should be on the bulls, and I expect the market to be under bearish pressure till 17:00. There should be a 15-minute positive influence from 14:30 to 14:40. From 14:40 to 15:05 there should be a negative influence. From 15:05 to 15: 30 there should be a positive influence. This could be finished 5 minutes earlier depending on the mood of the day. From then on there should be negative influence till 16:20.

After 16:20, which is around the time FTSE 100 closes, there should be a slight easing in the negative influence for 10 minutes or so, and then more pressure on the negative side till 17:00. During the lunch hour in New York the expected path gets a little murky, but there should be roughly 1 hour of positive influence till 18:00, after which there should be 1 hour of negative influence. From 19:00 the influence is positive, but it doesn’t really kick in until 20:00 where the influence is positive for 30 minutes followed by a pause for 10 minutes. The remainder of the day the influence is positive.

If you have any feedback or comments, I will be happy to try to answer. the email is [email protected]

Sun

 

[Helenqu]

Lovely to read such a well written commentary

 

[bonsai]

DOW Prediction [9250-9347] Aggressive: [9127-9383]
big difference today ?