Thursday, October 9, 2008

Surprise surprise...no intervention this morning.

Hey, It's been a while I haven't woke up without domestic or global intervention. What a change !!!

I know it is the historically extreme oversold condition that is attracting the army of suckers to this. But washout is inevitable, the question is when and how.
Considering that there will not be another intervention this morning, here is how I see it.

If we open higher, which looks like we will, we will print a top around 1005 or 1015 on ES. It is been pretty clear to me that during this final leg that started with a breakdown of 1055 level this week, we kept printing lower highs, starting with 1042, then 1026 yesterday, I think it will be 1005 or 1015 this morning.

Soon after the opening bell, we start selling. I expect a test of 940-950 range sometime intraday. From there we reverse and close the day above 1015 on ES

This is my final trade on the short side in this cyclical move. I am not crazy about it. These last few weeks has been the best times of my entire career. In two weeks, I almost tripled two of the futures accounts. I am up over 70% overall. I have been trading this market on the short side for months now. I think we are pretty close to the end of this era.

Again, this is my last index trade on the short side in this cyclical move, I plan to shift to the bull side after I get what I want. If not, then as I said, I can let it go around 1040 if we pop there. Not a big deal after all those profits of 100s SP points.

103 comments by xTrenders :

PCap said...

3M LIBOR up to 4.75, and 3M Tbill at sub 3/4.

TED Spread at 4.22 currently

This does not look good.

Darwin said...

Does not look good for bears?

Atilla M. Demiray said...

bulls

anabolic said...

Good morning Atilla.

So from what you say, there might be 2 scenarios.

First would be we sell down to reach 940-950 area which u will go long.

Second is if there is no washout and we go up all the way.

If the second scenario pays out, you would close ur short at 1040 rit? would u immediately switch to long?

Thanks.

Atilla M. Demiray said...

1040 is not a scenario, it is an accident case

I will post when I cover and/or go long

anabolic said...

ok thanks!!!

Atilla the best!!!

Lawrence Chiu said...

Atilla,

The Treasury Department announced that they may take ownership stakes in banks. Isn't this considered an intervention?

http://www.marketwatch.com/news/story/us-may-take-ownership-stake/story.aspx?guid={0AB6EE9A-D3FA-497F-9568-EC03721A2E84}&dist=hplatest

kam said...

What is the SPX equivalent for 1005-1015 ES?

Tony said...

There is no 'set' equivalent.

Right now we are at SPX 3-4 points lower than ES. That may fluctuate either way.

SPX refers to actual price, ES is the December contract (if you are trading ESZ8).

Same thing for YM for the Dow. I've seen it trade -10, I've seen it trade +10 from spot.

angus said...

Atilla, I've been following EWI for their longer-term forecast, they say there is more downside both intermediate term (after a bounce either from here or slightly lower), and longer-term. Although I am with you on your short-term estimation of a good bounce, I totally belive there is more downside.

Hedge funds are still liquidating, the 401K crowd is still liquidating, and let's not underestimate the triple Dow theory sell signal from a few days ago (Dow, Dow Transports, Dow utilities - all three making new lows simultaneously). Dow theory is something many long-term investors follow in order to make portfolio adjustments.

So, while I am with you in the short-term, I am against your intermediate and long-term prediction, but hey you need a pair to tarde:)

BH_Trade said...

"What is the SPX equivalent for 1005-1015 ES?"

Over the last 2 weeks (day session only) ES has averaged SPX+4.50

Atilla M. Demiray said...

angus said...

Although I am with you on your short-term estimation of a good bounce, I totally belive there is more downside.

-------------

I am expecting another crash like move today, to 940, that sounds like a more downside to me

We should print a bottom once we get there

angus said...

Atilla, when you say "cyclical down move" and "end of this era", what time frame do you mean?

what is the lengtch of the "cycle" and the "era" in your mid?

Thanks!

kam said...

Thanks, guys.

anabolic said...

Atilla,

Can you let in on a little secret? I would like to know what is your main timeframe that you use to get the intraday levels?

buylo said...

940 is long way to go, we will see, trust you are right

Atilla M. Demiray said...

angus said...

Atilla, when you say "cyclical down move" and "end of this era", what time frame do you mean?

what is the lengtch of the "cycle" and the "era" in your mid?

Thanks!

Thursday, October 9, 2008 9:48:00 AM EDT
--------------------

For the next 2-3 months minimum

Lawrence Chiu said...

Damn, you're amazing Atilla. The ES high was 1010 today, right in the middle of your 1005 to 1015 range, and now we're heading down in a huge way.

Mad props to you.

PCP said...

/ES printed 1010 and now the banks are going negative. Good call again Atilla. I am not participating in this down move but will look for the leg up. Mentally, I am exhausted by this down move.

I am still not sure how you came up with the 1005-1010 range. If you get the chance, please post the trendline you are watching. If it's a gut feeling, please post the guts too ;-)

sahmtrader said...

Atilla, for going long later in the day, what ETF do you suggest? Is UYG adequate (given potential failings of banks in the coming weeks and months)? Thanks.

Atilla M. Demiray said...

First Nazdog and semiconductors will come out of the climax

they will lead the market higher today once we print the bottom

financials and realestate should be ok for the initial upmove as well

ETFs of choice for the upside play once we test 940

QLD USD UYG URE

sahmtrader said...

Thanks!

Joseph said...

Thanks for your calls, Atilla - spot on over the last while!

I've seen it asked but don't recall an answer. What's your take on gold? Been alot of interest during this crisis and I made alot of money on gold stocks yesterday (out today and waiting for the 'crash').

Thanks again!

Atilla M. Demiray said...

Gold should have plunged but the current panic in the stock market is keeping the commodity range bound. However, it is still fully contained by bearish trend structures I defined a while ago

check this link

http://xtrends.blogspot.com/2008/09/gold.html

Atilla M. Demiray said...

once we put a bottom in stock market, gold will likely crash

Rose2797 said...

Atilla: Thanks for your constant update. What do you think about ETF Dig, UYM and stocks such as FCX, BHP and ASA

Atilla M. Demiray said...

Commodity related stocks will follow the upside leadership with delay

Dont buy commodity ETFs and commodity stocks to play the initial upside

You can buy them tomorrow or later, they will catch up with some delay

Atilla M. Demiray said...

the strongest upside reaction initially will be in tech, financials, realestate today

but first we will sell off hard, we will climax, washout

be patient

Joseph said...

Thanks!

AJ said...

Atilla,

Awesome is the only word I can think of.

If you can post some of what you see, that would help teach the group to fish as opposed to giving us the fish

thanks

Atilla M. Demiray said...

AJ said...

Atilla,

Awesome is the only word I can think of.

If you can post some of what you see, that would help teach the group to fish as opposed to giving us the fish

thanks

Thursday, October 9, 2008 10:42:00 AM EDT
------------------------

Easy, you need to study and watch the markets for minimum 11 years , 15 hours a day, 5 days a week, 56 weeks a year... have no life, stay married to the mrs market, in a monopole relationship

however i do not think no human being can sustain this for a whole life... so my retirement is getting closer everyday... especially after what i got in the last few weeks

AJ said...

Atilla

traders like you that succeed have passion and love the market, hope you will stick around

thanks

PCP said...

They are setting up the last line of defense here around 970 on /ES.

How long before they scream "retreat".

Atilla M. Demiray said...

it will undercut 970 like a hot knife through a butter

angus said...

Atilla, please throw a quick note on THIS thread to let us know when you make the switch to long

Thanks!!!

P.S. let us know when you'll publish your memoirs when in retirement:)

bubb said...

Lol the 1 min candle looks like a hot knife for sure :)

ko said...

Ok, this is just nuts.
Where you hiding your time machine at dude?

Atilla M. Demiray said...

in bushes behind nyse in downtown loll

Really Lost said...

I knew it! You're THE DOCTOR! You have a TARDIS!

angus said...

Atilla, out of curiosity has your profitability being this good from the beginning? at which point in your career you achieved consistency?

kam said...

Atilla, you cannot retire unless you check with me first!

saahil said...

Attilla where is Bottom on USO? it keeps dropping..thanks!

sahmtrader said...

Dared and went long, made 1.5k extra in 2 minutes and now back short. Thanks, Atilla.

Atilla M. Demiray said...

Atilla, out of curiosity has your profitability being this good from the beginning? at which point in your career you achieved consistency?

Thursday, October 9, 2008 11:13:00 AM EDT

--------------------
since mid 2003, i became consistent.


since August 2007, I am off the charts

apconcen said...

Atilla,

Probability of spx 957 being all we get ? Any chance we dont get into the 940's

tamas said...

was that the bottom?

angus said...

Thanks Atilla! you are inspiration man!

Atilla M. Demiray said...

Blogger saahil said...

Attilla where is Bottom on USO? it keeps dropping..thanks!

Thursday, October 9, 2008 11:17:00 AM EDT

---
why you looking for a bottom, look for a top until $35

too many suckers dreaming about the days of $200 crude

utopia

Atilla M. Demiray said...

bottom will come from sub 950

there will not be a bottom before i cover and go long


until then, short any little pop

angus said...
This comment has been removed by the author.
student4life said...

Me think Atilla found the secret sauce after being in the kitchen for 11 yrs. He's not going to sell the formula even if Coke asks for it.

anabolic said...

Atilla, will we be able to know some of your secrets if we join your hedge fund? =)

PCP said...

Hey Atilla, you should look into buying one of these next year.

http://gizmodo.com/5060812/terrafugia-transition-flying-car-unbelievably-close-to-reality-going-on-sale-next-year

Oil has ways to go before it finds a bottom that is sustainable and proportional to world economic demand and growth.

apconcen said...

Thanks man... for the first time in a while I saw a free fall from 970...since my mind is clear and my profits are protected its so much easier to be in sync with the tape...I think :)

I think a 25spx drop in 1 min should nail the bottom ? What do you think ? Barely enough time to cover.

Do you look for stuff like that Atilla ?

apconcen said...

Calls for direct equity purchases by the FED on CNBC

buylo said...

I don't think Atila has a lot of secrets to share. I think he was trying to say earlier, if you live and breathe the market for 10+ years, you begin to get a "feel" for it. The 'feel' and some TA and maybe a secret or two might someday give you the "touch". But, it might not, no guarantees, imho. Am i on the right path, Atila?

Atilla M. Demiray said...

Ok I admit, I found the holy grail, i have the time machine and i am not going to give anyone

folks i really dont know why you consistently think i have a secret oscillator or technical indicator

its getting funny.. i told you those things dont work. it is the trained eye that makes the decision easy. there are millions of conditions / configurations and only a trained mindset can recognize which one is which

Anthony said...

Stop being like 2 year olds and overwhelming Aitilla with questions. Can you sheep think on your own? The man is providing you his thoughts and actions. From that if you can not learn and decipher you will never make money consistently in the markets anyway.. Bottom line is stop pestering him with question after question for that is the quickest way to chase him away.. Enjoy his thoughts and actions!

Atilla M. Demiray said...

Blogger buylo said...
Am i on the right path, Atila?

Thursday, October 9, 2008 11:33:00 AM EDT

------------

Couldn't have said better.

Atilla M. Demiray said...

Anthony said...

Stop being like 2 year olds and overwhelming Aitilla with questions. Can you sheep think on your own? The man is providing you his thoughts and actions. From that if you can not learn and decipher you will never make money consistently in the markets anyway.. Bottom line is stop pestering him with question after question for that is the quickest way to chase him away.. Enjoy his thoughts and actions!

Thursday, October 9, 2008 11:33:00 AM EDT
-------------------

that is ok, i have plent of time till ES 930

I enjoy it, but my point is, there is no formula to this

it is a process of training over 10+ years

ARAK said...

whoa ... target is now 930?

Atilla M. Demiray said...

maybe 830? why worry about it, market will tell us when time comes

angus said...

Oscillators can be misleading. There was a lot of talk about the S&P oscillator, which is always predicting tops and bottoms and so on. I got some data from S&P and backtested them, it is inconsistent, it takes days for the market to pop or drop after the oscillator reaches a climax, and the number of days even varies.

There is no holy grail and all static systems are subject to failure.

PCP said...

I still like the 600ish target you gave back in your TT days. I think this entire bull market run will get erased and then some.

Atilla M. Demiray said...

That is a long term target , 2010/11 probably

Tony said...

Any thoughts with regards to OpEx?

Will 'the market' care where the index is [enough to move the prices]?

Atilla M. Demiray said...

I dont think it is a big factor

angus said...

The more they buy the dips, bounce then making lower lows, the lower we go in little steps. Day trader's paradise.

Atilla M. Demiray said...

es 991-992 will be another intraday maxima

we test 950 from there

KC said...

Today is a mirror image of yesterday. If it plays out should bottom about 12:30-13:00 EST at Atilla's target.

I have known of Atilla for years but just recently came to this site. I love it. He makes his forecast but trades what he sees. Quite the inspiration.

Wiseowl from Texas said...

Do you have a peace and quiet feeling like zen feeling, if you are looking at charts.?

Do charts start communicationg with you?

Atilla M. Demiray said...

we should bottom around 2:30 - 3 pm

we will get the strongest rally of the year from there


like 200 ES points in two days

Atilla M. Demiray said...

Wiseowl from Texas said...

Do you have a peace and quiet feeling like zen feeling, if you are looking at charts.?

Do charts start communicationg with you?

Thursday, October 9, 2008 11:49:00 AM EDT

------------------

loll

Shawn said...

Atilla, I hope I did not burden you with this question again.

Are you predicting today's bottom is an IT multi-month bottom, or at least 1 month bottom?

Thanks!

Atilla M. Demiray said...

yes

Atilla M. Demiray said...

multimonth bottom

PCP said...

I think 915-930 is where this thing will bottom. Too much buying on the dips for 950 to hold.

Atilla M. Demiray said...

I think there will be a surprise on the downside

i cant wait

Lawrence Chiu said...

I just saw a head and shoulders pattern on the SPY 1-day chart, with minute bars. Did I get this right?

http://lcmarket.blogspot.com/2008/10/s-daily-chart-with-1-minute-bars-head.html

angus said...

Man you nailed that previous top at 992 in absolute perfection!

buylo said...

Atila re surprise - I hope you mean a big flush down today which everybody wants but nobody expects, at least not today.

Atilla M. Demiray said...

next local maxima 985

zigzag said...

Atilla, what are the smallest time frames that you look at?

J

angus said...

H&S in such a short-time frame is irrelevant, look for this technical pattern on the daily chart or at worst 60-min chart

5min, 2min look for trending, failure to reach a higher peak or failure to make a lower low, use expenential moving averages, and fixed support/resistance levels

Atilla M. Demiray said...

all time frames i follow

but i mostly trade swing waves like 3-5 days

my core positions last a few weeks

Lawrence Chiu said...

Thanks angus.

apconcen said...

Atilla,

You really think we can 'surprise' at 830 today ?

That is a crash by any definition

I have limit orders setup at DOW 8899 with a 222 stop. What do you think ?

Atilla M. Demiray said...

its gonna get hectic, i love this !!!!

sahmtrader said...

Goodness. It IT happens, DOW can be either at 8700 or at 7850 FIB 50% retracement.

SPX 850 or if not, 800?

apconcen said...

so what do you think of my order ?

mulli said...

Attilla,

Would you consider playing the IWM or stick with the Nasdaq?

Lawrence Chiu said...

NEW POST

angus said...

Thanks lawrence I would have missed it!

sahmtrader said...

Every time a post goes on the blog my post list on Tristana view window gets pushed down so I have to manually move the cursor up to see the latest post. Any ideas folks?

Thanks.

PCap said...

I covered all but my TLT and JAN2010 puts at SPX 960.

No need to fight for the last few drops.

anabolic said...

I think the crash will kickoff at 1:15.

anabolic said...

Atilla,

a super crash and a super rally in around 2 hours??

anabolic said...

starting starting!!!!!

anabolic said...

Atilla do you know what is the limit down for ES?

PCap said...

Anabolic

http://en.wikipedia.org/wiki/Trading_curb

and

http://www.sec.gov/answers/circuit.htm

anabolic said...

Maybe it will selloff into the close, and gap up on opening??

retracementmaster said...

anyone expecting a crash to 800, like shown here?

http://retracementlevels.blogspot.com/2008/10/spx-daily-to-go-long-emergency-crash.html

target bottom price in the second chart was fixed at 940 for this impulse down, equivalent to odds 100% for a long reversal.

I think the next level, 800, may be more likely as a IT bottom.

Any thoughts about this?

student4life said...

Amazing call and timing, Atilla! Awe and respect from me. I am sure you will have many clients for your new fund. Please let us know more details about it once available. Thanks again for sharing.