Friday, March 6, 2009

Covered SP and ES below 670

We are putting some sort of bottom here. We will have more clues going forward.

I have covered all banks

covered all financials around ES 671 level,
the index is likely putting an important bottom.

covered GS @ 75

covered BK @ 16

sold FAZ @ 110.2

I am holding the rest as seen on

covered ES @ 675

Aproaching the base...looking good.

After my first MS degree, I landed a job at Airforce as an avionics engineer. I used to watch landing warplanes and listen to the wireless communication between pilots in my spare times. One thing I noticed was the fact that landing was a much harder process than everything else they do.

On December 9, 2008 I said Dow Jones Industrial index would likely test 5000-5500 range in two months. Obviously this call seems to be at least one month early but I think, if the landing system doesn't malfunction or they don't hit the eject button somewhere between 5500-6000, we will get there in late March or early April.

Thursday, March 5, 2009

The last 100-150 SP points of the bear market

As we enter the intense part of the selling climax of this cyclical bear market, it is important to keep the bigger picture in mind when the emotions intensify.

Staying fully short SP / ES and banks.

Wednesday, March 4, 2009

Roundy roundy it goes...

Yesterday I was asking how the market could do the most obvious in the most unobvious way. Did you like the trick?

shorted NQ @ 1111

The day of reckoning

We all know that another example would be made soon. We all know that there will be some sort of crash-like broad plunge in two weeks. What we don't know is how the market can do the most obvious in the most unobvious way - again.

In my opinion, today's gap-up together with underlying sentiment increases the odds for the final episode.

Until then, you know where I stand.

Tuesday, March 3, 2009

Trader Tax

One important issue we all may have to deal soon. I completely agree with Gail.

Just found your site last week and am very impressed - keep up the good work!
I wanted to make you aware of something that you might want to post to your community and other fellow traders.
A Congressman from Oregon has introduced a bill that would impose a transaction tax of 0.25% on sales/purchases of stocks/options/futures. I am enclosing a link to a petition that has been started against this tax, a link to the Congressman's contact info, and a link to info on the bill and other sponsors. The Congressman wants Wall Street fat cats to pay for what they are doing by implementing this tax to help reimburse TARP. He amazingly doesn't realize (or doesn't care) what this would do to the average person who is starting to take control of their portfolio or trying to recoup losses by trading (since this would impact transactions even losses would be taxed not just profits).
Hope you find this info helpful and please pass it along.

No trader tax



Baton Rouge

Catching the bottom again?

This goes to the sword catchers, please quit trying for God's sake! Have some fear for the goodness of the country.

Why most of the retail crowd can not quit picking bottoms in the face of an epic plunge?

Markets closed below the last support

From this point there is nothing to hold S&P500 technically. The selling I was expecting late in the day will probably be resolved with a gigantic gap down or a quick crash tomorrow.
Staying fully short SP / ES and banks.

The intense part of the selling climax is beginning

SPX may be down 20-30 or even 50 points in the next hour or two and I suggest everyone to use extra caution. It is hard to spot a climax bottom before it happens so we will likely know after it is printed or during the event at best.

Monday, March 2, 2009

Some thoughts

Dear all,

JB3 here.

Some thoughts for you... 

....but first, please note: Speaking from experience, these times in the markets is where Atilla's skills stand apart from anything I've seen before. He was made for times like these. So pay even less attention to me than you normally do, OK? I'm serious. 

I haven't done a complete analysis of all my data points yet, but this immediately caught my eye so I thought I'd share it:

In short, that volume doesn't support the idea that we posted 'the' bottom.

Now, onto what I think is the most valuable 'bigger picture' piece of information that Elliott Wave Theory can offer at this juncture. In short it is this: we need at least one more sizeable bounce before we can entertain the notion that a bottom can form.

Why? Because one of the cardinal rules of EW is that impulsive waves must subdivide into five (5) sub-waves (or sometimes nine, and even rarer, thirteen) . At the moment, quite clearly, we only have three (3) sub-waves. Three wave impulses are not possible in EW theory. Three wave moves can only be part of a corrective pattern, and there are very few (if any) plausible corrective patterns that could develop on that wave degree presently. Here's a quick sketch of what EW theory says has a very high probability of developing:

So the bigger picture, from an EW perspective, is quite clear: a bounce should develop soon and last for at least a few days, then one more impulsive drop (at least).

Also, according to EW theory, sub-waves 2 and 4 should never overlap (except for an ending diagonal, which quite unlikely according to the current wave shape). So the bounce should stop well short of 800. 

A finer EW point (not drawn), this bounce has a good chance of taking on the shape of an EW 'flat' or 'contracting triangle'. Something to keep an eye out for. But if it is another zig-zag, like wave 2, then we are likely headed waaaaaayyyy lower.

Finally, in capitulation moves EWaves can often get 'compressed' as the impulse comes to an end, making them tricky to count in times like these. Even more reason to keep an eagle eye on Atilla's calls from here on. 

That's about as detailed as I'll get. As I've already said, Atilla plays these stages with the finesse of a world-class concert pianist, and too much EWaving at this point will just get in the way.



Not happenning

So far market didn't act like it did when it was first breaking below 950 back in October. However, it is extremely likely that there will be lower prices tomorrow.

Still fully short

There could be a sudden drop below 700

I am getting early signals for a 4-sigma move. If the market suddenly slides below 700 , it may drop additional 10 or more points by 4:15 to open below 670 tomorrow. This is somewhat similar situation to October crash. If this is the case, then there will be additional 10% or more percent drop in the morning and we may put a significant bottom right below 600 tomorrow morning.

Test 1 2

Did site collapse? Cant read the blog.

SP500 is about to slide below 700

No 4-sigma move but an orderly breakdown is in order, there may be an attempted rally right below 700 but I doubt it lasts. Selling climax will not stop until no unturned stone left.

A bullish looking chart

for all time frames....