Intraday Breakouts
- Thread starter Harry
- Start date
The market's been very disjointed lately. Very random. NASDAQ Composite March 28th, April 1, April 2 10 min bars illustrates it. Wierd. No direction, seems like just a lot of waffling and indecisiveness to me. Seven major gaps in the last month. I think we're in some sort of a consolidation period.
Add to that ,Compx weekly looks like a downturn here to me, why not?, earnings won't be anything and accounting probs have many dominos to fall. Funds aren't going to start buying till they sense bottom is in, and it doesn't look like it yet so were left with traders trying to pick each others pockets. Not enough force anywhere to find direction.
Another interesting phenomenon that has almost always been present in the stock indicies has alot to do with the mechanics of the rollover...I do not know how many times I have seen the roll from one contract month to another turn into some form of "squeeze" in the days prior to the rollover...This makes sense when you consider that longer term position traders have a limited life span in any specific front month contract...Hence, traders who were short the NAS futures in the MARCH contract were squeezed out during the first few weeks of March and then rolled into the June contract at which time the NAS has dropped like a rock...
In addition, the first quarter has ended and the pressure to keep the indicies in the uptrend has ended...Rather than simply trash the market down to the February lows it appears that the market just hits a dead zone and alot of covering takes place very quickly at which point the shorts just resume their selling...
The real problem most people are having does relate to the intra-day breakouts and it is interesting that so many people have picked up on it recently...From my perspective, the market has basically eliminated the "obvious" entries and, therefore, the non-thinking traders(especially in the index futures markets)...During the bull market, many traders could be very "sloppy" on the entries and rely on the residual momentum to "take them out" for at least a small profit...THe difference was that there was a great deal of committment to both sides of the market...Now, markets can make seemingly "clean" breaks and then stop on a dime and reverse to the days highs or lows...Many, many people have been getting hit with these new market tactics...I just believe that there is no commitment on either side of the market and that the market, as a whole, has become "reactionary" at all levels, with the majority reacting in a major game of "chicken"...
In addition, the first quarter has ended and the pressure to keep the indicies in the uptrend has ended...Rather than simply trash the market down to the February lows it appears that the market just hits a dead zone and alot of covering takes place very quickly at which point the shorts just resume their selling...
The real problem most people are having does relate to the intra-day breakouts and it is interesting that so many people have picked up on it recently...From my perspective, the market has basically eliminated the "obvious" entries and, therefore, the non-thinking traders(especially in the index futures markets)...During the bull market, many traders could be very "sloppy" on the entries and rely on the residual momentum to "take them out" for at least a small profit...THe difference was that there was a great deal of committment to both sides of the market...Now, markets can make seemingly "clean" breaks and then stop on a dime and reverse to the days highs or lows...Many, many people have been getting hit with these new market tactics...I just believe that there is no commitment on either side of the market and that the market, as a whole, has become "reactionary" at all levels, with the majority reacting in a major game of "chicken"...