Where is the Dow & others heading in 2005?

[roguetrader]

I have access to that information on a chart.....Do you want me to post it? It's not showing todays action but the picture is crystal clear.......

Yeah sure, post the charts thanks, be interested to see what you are looking at,

I was looking at a site the other night which allegedly tells what the NYSE specialists are doing position wise. Theonly problem being NYSE specialists are short-term traders and the info though updated every week has a two week lag, so in essence what you get to see is whether or not the specialists got it right.
ie currently it shows them reducing their short positions, now given the info is 2 weeks old that tells you that they caught the move from 1198 is on SPX up to 1220, which is very nice for them but not a lot of help for any of us in the here and now.
Similarly I'd say if they reduced the lag to one week you would see them all getting short again for last weeks dump.

 

[FetteredChinos]

hmm, the only one i can find without too much fluffing around is post 2014 on this thread. +240 from 3 trades.

a few weeks before that i picked up over 400 points just trading the weekly internal cycles.

it can be done, but those weeks are the exceptions rather than the norm.

also, to add to the bearish tone for today..

when days close in the top third or so of their range, there is a 75% chance i believe of the day's high being broken the next day, yet only a 50% chance of the next day actually closing up. vice versa for shorts..

you tend to get a bit of follow through early on (viz today) followed by weakness.

 

[rrtech]

This is looking like an uptrend day to me because it had a high open, rose afterwards and then had that curve down and then back up so it could close up over 100 points but the high oil price and possible start of a downtrend might prevent this fronm happening. Any thoughts?

 

[FetteredChinos]

overall we will probably close up.

BUT it is looking like either a lower high currently or a double top. either way the technical target for that move is circa 10320.

10370 needs to be broken and retested successfully for us to have a big day up (out?)

 

[roguetrader]

INDU making another attempt at the underside of that trendline.
SPX trying 1200. I would not expect much advance beyond here, though that is an opinion, and I would not trade that.

 

[JillyB]

Agreed.

Dow just failed to equal earlier high and in retreat again.

 

[User]

Here's the chart. S&P Institutional activity......its a little small but you can see the picture.....

If I just may add that the Large traders have now gone over to the long side.

Istitutions are short large traders are now long. Large traders are always wrong........

Institutions have a holding of around 37,000 contracts short.....thats pretty solid.....

Want more solid info?

Well, Nasdaq..........Nasdaq commercials (Institutions) not only unloaded the 7,000 contracts they'd been holding long, but established a net short position of about 7,000 contracts.

So Sell Sell Sell is my scenario........Just like I was saying at 10500 and even more when the Dow was above 10600....Now selling into strength seems sensible.......

 

[roguetrader]

Here's the chart......its a little small but you can see the picture.....

If I just may add that the Large traders have now gone over to the long side.

Istitutions are short large traders are now long. Large traders are always wrong........

Thanx for that User, why do you say large traders are always wrong, I have looked at some of these types of things from time to time, though as an intraday trader can't say I've ever made any trading decisions from them, but am familiar with the titles given to the participants, ie Large Traders, Small Traders, Commercial Hedgers. iven that we are the small traders, who are the large traders?

 

[roguetrader]

Internals holding near the highs on both markets here, but not making much progress, which iss a red flag for the longside. Resistance holding firm so far.
SOX still held below the 424 level.

 

[User]

Large traders have a decent ammount of capital but they are speculators

Small traders are the general public

Institutions are the commercials hedgers, the big boys that make the markets move....as we saw on Thursday and Friday

 

[roguetrader]

Ok, but as I understand it a lot of the money in the market isn't able to short, the traditional funds cant, they exert there influence on the market by moving in and out of long positions. That is why the dynamic of the market has changed somewhat lately, the introduction in large numbers of hedge funds who do short.

 

[User]

Ok, but as I understand it a lot of the money in the market isn't able to short, the traditional funds cant, they exert there influence on the market by moving in and out of long positions. That is why the dynamic of the market has changed somewhat lately, the introduction in large numbers of hedge funds who do short.

The dynamics may change but thats what makes the markets move. Clearly you can see from the chart that the institutional shorts are in tact......As the saying goes tomorrows another day...

 

[Racer]

I am really not convinced by this 'bullish' up move today, because a big chunk of it happened in very out of hours on futures.

end of quarter/half year messing about I suppose!

 

[roguetrader]

The dynamics may change but thats what makes the markets move. Clearly you can see from the chart that the institutional shorts are in tact......As the saying goes tomorrows another day...

Yes it is an interesting chart I will have to study it after close as the first thing I notice apart from the fact that they appear heavily short right now is that they were not heavily short for the Mar high to April lows period.

As for today Total volume on NYSE coming in on par with yesterday, Nasdaq total volume slightly ahead.
Market internals holding near the highs, resistance levels remain intact.
Breakout or breakdown this afternoon? Up would be a mamouth task, but we'll see.

 

[peterpr]

Ok, but as I understand it a lot of the money in the market isn't able to short, the traditional funds cant, they exert there influence on the market by moving in and out of long positions. That is why the dynamic of the market has changed somewhat lately, the introduction in large numbers of hedge funds who do short.

There are no rules or any other reason to prevent any market participant taking a short position in the futures market. In fact the 'large speculators' category taking long positions in futures are usually doing so to hedge possible losses on LT positions in the underlying market that they do not want to liquidate immediately - in other words they too expect a market fall.

With all due respect to User, his explanation is simplistic, not to say misleading, in the extreme. We've touched on this whole issue before in this thread so I've no intention of going through it all again. Suffice to say that if you want a succinct run down on the COT's categories and reports + their interpretation have a look at:

http://www.softwarenorth.com/trading/commitmentscurrent/cotnote.html

 

[roguetrader]

Little move out of the range here to fully test that resistance.not very convincing.
Internals still holding up well

 

[bulldozer]

There are no rules or any other reason to prevent any market participant taking a short position in the futures market. In fact the 'large speculators' category taking long positions in futures are usually doing so to hedge possible losses on LT positions in the underlying market that they do not want to liquidate immediately - in other words they too expect a market fall.

With all due respect to User, his explanation is simplistic, not to say misleading, in the extreme. We've touched on this whole issue before in this thread so I've no intention of going through it all again. Suffice to say that if you want a succinct run down on the COT's categories and reports + their interpretation have a look at:

http://www.softwarenorth.com/trading/commitmentscurrent/cotnote.html

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Pete and others,
The last few days leading into Options xpiry, I go heavily short on footsie futurers and maybe others too?[ in order to protect options positions going against us] This does NOT mean we think /believe the mrkts are heading lower! but others may read it that we are BEARISH.
I say this because FUTURES are used as HEDGE for other forms of derivatives. We need to do this if options positions are close to the bone and vice versa LONG on futrs against calls positions.

I'm speaking from an options writer/seller view point! :idea:

Bull
Not everything seems as they appear! :cheesy:

 

[roguetrader]

There are no rules or any other reason to prevent any market participant taking a short position in the futures market. In fact the 'large speculators' category taking long positions in futures are usually doing so to hedge possible losses on LT positions in the underlying market that they do not want to liquidate immediately - in other words they too expect a market fall.

Peter my understanding of Institutional funds is that their activities are strictly regulated in relation to what the fund was set up to do. Essentiaally they buy and sell stocks and when not heavily invested park their money in the bond market. They do not short stocks, it is not in their mandate. This is why hedge funds came about, if any old fund could run about shorting here there and everywhere there would have been no need for hedge funds and the ordinary funds would not frequently get their asses kicked in a bear market. That is my understanding anyway

 

[LION63]

The funds are only allowed to hedge their positions in the markets, they cannot decide to short stock that they do not already own. Neither is it a case that all hedge funds can engage in this practice, it depends on the mandate.

 

[roguetrader]

Still holding steady here INDU sitting at my 380-390 resistance range, SPX on 1200, SOX stuck on 424. Last hour could bring a little excitement.
Still nothing more than a bounce.