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Murrica's Outlook: Nasdaq & Russell E-mini's
- Thread starter murrica
- Start date
Anything can happen. Noone really knows what the US stock markets will do next. There is no sure thing in this game.
Thus, I could be wrong and we might go up from here for months and years on end (and neke will make millions with his bubble exploitation algorithms). That's why we use risk management as traders. Unless you have a crystal ball, or are connected to the flying spaghetti monster, or are an alien with sufficiently advanced technology and randomness doesn't exist at a quantum level, then you never bet the house. Always stay in the game.
Now, this is just my interpretation. I look at this graph and ask myself, "Self, would I go long here?" Yes, it might not be the top, now (10/20/2013). We could have a blow-off, or worse for the stubborn bears, start bubbling; you never do really know about these things. But when I ask myself that question, the answer is most certainly a screaming, "NO FRELLING WAY!" Show me some strong upside *beyond* this obvious confluence of resistance on various indexes, then we can talk about a bubble. Until then, in my mind, this is a low risk (meaning tightly defined) area to consider exiting longs, reducing exposure, preparing your short ammo, or what have you.
Stay safe bears, your time will come sooner or later. We just don't know when, exactly. It's just that, these days, I am watching things like a hawk, watching sentiment grow more fearlessly bullish by the day.
Good trading to all.
<img src="http://i.imgur.com/DCPtGuh.png"/>
<a href="http://i.imgur.com/F8JE10I.png">Bigger Version Of Multi-Decade SPY Graph</a>
Thus, I could be wrong and we might go up from here for months and years on end (and neke will make millions with his bubble exploitation algorithms). That's why we use risk management as traders. Unless you have a crystal ball, or are connected to the flying spaghetti monster, or are an alien with sufficiently advanced technology and randomness doesn't exist at a quantum level, then you never bet the house. Always stay in the game.
Now, this is just my interpretation. I look at this graph and ask myself, "Self, would I go long here?" Yes, it might not be the top, now (10/20/2013). We could have a blow-off, or worse for the stubborn bears, start bubbling; you never do really know about these things. But when I ask myself that question, the answer is most certainly a screaming, "NO FRELLING WAY!" Show me some strong upside *beyond* this obvious confluence of resistance on various indexes, then we can talk about a bubble. Until then, in my mind, this is a low risk (meaning tightly defined) area to consider exiting longs, reducing exposure, preparing your short ammo, or what have you.
Stay safe bears, your time will come sooner or later. We just don't know when, exactly. It's just that, these days, I am watching things like a hawk, watching sentiment grow more fearlessly bullish by the day.
Good trading to all.
<img src="http://i.imgur.com/DCPtGuh.png"/>
<a href="http://i.imgur.com/F8JE10I.png">Bigger Version Of Multi-Decade SPY Graph</a>
<img src="http://i.imgur.com/QvMDF0P.png">
Would not be surprised to see Russell and S&P500 mini futures break these 'support' lines made up out of thin air.. see the NYSE index hit 10,200+ and shake the tree before finally swinging down. Picking turns in advance or at the 'inflection point' has not proven to be wise on this advance in particular... channel trading worked well this year but this last one was nasty and I think others saw it coming, had a hunch myself but wanted to stick to my guns/system. Bad idea thus far.
That's why you are best listening to the wisdom of other traders who take a practical approach: trade with the trend, try longs until they don't work anymore. This keeps you out of trouble and has a better probability due to inclination towards trend continuation. You are better off listening to these folks instead of reading my contrary ideas (which can get you into trouble if you do not have a solid plan for defining risk, amongst other issues such as goalposts moving against you over time, etc., etc.).
This is not to say that my system discounts the short swing idea -- just cautiously stalking a better entry, and stalking an area of idea invalidation (cat and mouse game).
Good trading to all.
Would not be surprised to see Russell and S&P500 mini futures break these 'support' lines made up out of thin air.. see the NYSE index hit 10,200+ and shake the tree before finally swinging down. Picking turns in advance or at the 'inflection point' has not proven to be wise on this advance in particular... channel trading worked well this year but this last one was nasty and I think others saw it coming, had a hunch myself but wanted to stick to my guns/system. Bad idea thus far.
That's why you are best listening to the wisdom of other traders who take a practical approach: trade with the trend, try longs until they don't work anymore. This keeps you out of trouble and has a better probability due to inclination towards trend continuation. You are better off listening to these folks instead of reading my contrary ideas (which can get you into trouble if you do not have a solid plan for defining risk, amongst other issues such as goalposts moving against you over time, etc., etc.).
This is not to say that my system discounts the short swing idea -- just cautiously stalking a better entry, and stalking an area of idea invalidation (cat and mouse game).
Good trading to all.
Quote from murrica:
- Dow 30 index multi-decade resistance: ~16000 - 16250.
Fine tuning here to 16,125 - 16,150, still be on alert for 16,250 for possible blow-off (confirmed as blow-off top by a huge dump back below 16,100 and 16,000 if we do blow off above 16,150).
Quote from murrica:
- Nasdaq 100 index multi-year resistance: ~3300 - 3375.
Busted, Nasdaq showing strength. Useless.
Quote from murrica:
- Russell 2000 index multi-decade resistance: ~1150.
Looks like we are on target for the Russell to possibly hit 1,150 mostly on the nose if we get a final push here in the coming days/week.
Overall, looking for interactions between the multi-decade resistances for the Dow and Russell as possible confluence at the above levels, which might confirm a possible clean long term reversal.
Someone asked in another thread how can I know that the market will respect my trendlines (admittedly a very simple and old-school analysis technique)? I have no clue whether they will do so. They are simply tools to manage risk.
The game is more about me respecting what the market does (which cannot be reliably predicted), not the other way around. This was the hardest lesson I've had to learn about trading, but learning it has kept me in the game. Now I'm just fine tuning my system, constantly learning, and holding out for a big position trade. If I have to keep banging at it for another 6-12 months before scaling into a huge winner, so be it. Goal is to manage risk in the meantime.
These contrarian ideas are inherently lower probability (on an individual basis) due in part to the current conditions of a one-sided market, but catching the big turn (if it turns out to be a big turn) will allow for larger size with tightly-defined range of risk. The goal (in terms of position management) is to enter and hold one big winner that far outsizes any small losses incurred along the way. Such a trading style is very tough, mentally, due to the patience required and stomaching draw-downs. But, even a broken clock is right twice a day, so by sheer luck alone, eventually such an approach (managed correctly) will pay off.
Please manage your risk and have a happy Thanksgiving.