The ACD Method

Quote from kinggyppo:

equity correlation to me, I wonder what the percentage move down vs es was, like Mav says its like one trade due to the high correlation.....my .02.:)
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Does this just look like correlation?
 

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Quote from Shanb:

Does anybody see any news on the Crude drop today? I don't see anything, this is a big move and many times a move happens and no one can tell you why its usually a sign that the move can have some legs.

I posted before on my bullishness on crude, well it broke out and failed through the weekly and 105. When something breaks out and doesn't hold near the highs that is a sign of weakness, no trade. I took a shot and it didn't workout...hands off since then. This is a HUGE move, we have the quarterly move right below us. We will most likely test it on monday...that could either be a GREAT buy or this could be a good place to have a very good short.

So what does everyone think?
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Not sure what happened that caused Thursday and Friday melt down. Beauty of days like Thursday and Friday is that BIG MONEY intentions are very clear. They can not hide. I use 1 minute Volume bars to identify trade location. 2 charts from Friday are attached. Both shorts were when intentions of BIG MONEY became clear.
 

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Headed into next week I see relative strength in my number line for NG. Other than that, the line values are getting crushed. You know it's an issue when some of your strongest values are +3s...

I'm still making use of that multi-week line and liking what I'm seeing so far, (so keep in mind this is not the typical 5 day line). What I'm encouraged by is that coming into this week I was seeing strength in XLP, (the only sector that didn't make a weekly A down and tried on multiple days to confirm the weekly A up) and the XLV which gave you a great failed weekly A down trade on Tuesday all the way to the weekly A up where it failed as well.

Weakness was in the XLK/QQQ for me where you got a nice failed weekly A up on Tuesday, (where I took some puts). Unfortunately I covered too soon, (into the last hour Tuesday - when I started seeing some bouncing at the weekly OR). Had I stayed short I would not only have seen the weekly A down Wednesday morning, but the blow through confirmation later in the week. Ah well...
 
Quote from mfbreakout:

Not sure what happened that caused Thursday and Friday melt down. Beauty of days like Thursday and Friday is that BIG MONEY intentions are very clear. They can not hide. I use 1 minute Volume bars to identify trade location. 2 charts from Friday are attached. Both shorts were when intentions of BIG MONEY became clear.
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All you had to do was look at that monthly A down. We bounced off it to the tick on Thursday and held it for the night session before taking it out over night. Crude has not had a clean monthly A down since last August. As I've mentioned on here before, the more rare something is, the greater the importance. The break of that 102.35 level was huge. Once we took it out, we went into meltdown.

One could even make the argument that once we took out the weekly A down at 103.05 that was trouble being that we confirmed a weekly A up.

But to me the more important tell was the action on Crude to the ES. Spoos were trading sideways when Crude took out the weekly A down. I knew that was trouble. Again, price action.

We now have a solid confirmed monthly A down. Crude has the potential to really crack here "if" the overall market rolls over. If the ES stabilizes here, "maybe" the QTR A will hold at around 96.00. Last August when we took out the QTR A down at 91, we traded all the way down to 75.
 
In other markets, both Gold and Silver seem to be putting in a base around their monthly A downs.

Soybeans bounced off their monthly A down as well on a wick.

Bonds approaching their monthly A up at 144'18.

USD/JPY also seems to be breaking down as it took out it's QTR A down at 80.17.

Also, NQ's making a monthly A down. This market looks very vulnerable here.
 
Quote from Quon:

Headed into next week I see relative strength in my number line for NG. Other than that, the line values are getting crushed. You know it's an issue when some of your strongest values are +3s...

I'm still making use of that multi-week line and liking what I'm seeing so far, (so keep in mind this is not the typical 5 day line). What I'm encouraged by is that coming into this week I was seeing strength in XLP, (the only sector that didn't make a weekly A down and tried on multiple days to confirm the weekly A up) and the XLV which gave you a great failed weekly A down trade on Tuesday all the way to the weekly A up where it failed as well.

Weakness was in the XLK/QQQ for me where you got a nice failed weekly A up on Tuesday, (where I took some puts). Unfortunately I covered too soon, (into the last hour Tuesday - when I started seeing some bouncing at the weekly OR). Had I stayed short I would not only have seen the weekly A down Wednesday morning, but the blow through confirmation later in the week. Ah well...
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Nat Gas looks very strong. The only headwind it has now is CNBC is talking about it nonstop and everyone appears to be bullish. That is going to make this trade very choppy. But the nat gas curve is getting very steep which usually is very bullish.

The ACD levels look great. That 2.38 level in my opinion is going to get blown out. There is no such thing as a triple top. Markets test levels they are about to break. Having said that, nat gas is not AAPL and it does not trade like a stock. This product will be choppy. Much better and safer to buy the dips then the breakouts. Look for failed weekly A downs and intra-day A downs to get long.
 
Here is an hourly chart of ZB, bonds rallied hard overnight starting at 2:00
am tuesday night, gives you an idea of who you are competing against.
 

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