The ACD Method

I'm having a A down on the ES, a first in a very long time.

Any ideas ? could be gone in a few hours when Bernanke opens it's toybox, but, it's still a valid first A down.
 
Quote from traderslair:

I'm having a A down on the ES, a first in a very long time.

Any ideas ? could be gone in a few hours when Bernanke opens it's toybox, but, it's still a valid first A down.
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OK, I will walk you through the logic "I" use to create trade ideas. Let's say I was "looking" for a short or wanted to "express" that point of view. Knowing that the ES has a confirmed number line I would avoid it and instead draw my attention to bonds which are confirmed on the number line and tend to rally when stocks go down. Well, we had a perfect failed A down in the bonds to the A up. Trade done. It accomplishes what I wanted to accomplish based on the view I had of the overall market. This is how to make ACD work for you. This is the kind of thought process I use everyday.
 
CL confirming QTR A down into end of month (for me 97ish level)

also had the late in the month A down and this week a failed weekly Aup into the month A dn area

looks interesting to the down for the rest of the Qtr...anyone have any addl thoughts?
 
Quote from boze_man:

CL confirming QTR A down into end of month (for me 97ish level)

also had the late in the month A down and this week a failed weekly Aup into the month A dn area

looks interesting to the down for the rest of the Qtr...anyone have any addl thoughts?
More...

That's good analysis. So the optimal setups will be:

Selling into failed weekly A ups and possible a failed monthly A up in Nov.

Being that the market is really overbought at these levels, fading crude seems like a good high probability bet.
 
I'm shocked that no one on here is mentioning some of the massive moves in FX today. Please refer back to your notes about what I've said about big moves in currencies....:)
 
Quote from Maverick74:

I'm shocked that no one on here is mentioning some of the massive moves in FX today. Please refer back to your notes about what I've said about big moves in currencies....:)
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Not saying all of them but for EURUSD it was a down move in the face of a strong number line. I attributed it to one of those post-FOMC quirks; indices, bonds, precious metals, FX all moved to the downside, supposedly because the statement was not dovish enough.

None of my indicators pointed to this so I can't say I'm delighted.
 
Quote from justrading:

Not saying all of them but for EURUSD it was a down move in the face of a strong number line. I attributed it to one of those post-FOMC quirks; indices, bonds, precious metals, FX all moved to the downside, supposedly because the statement was not dovish enough.

None of my indicators pointed to this so I can't say I'm delighted.
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My number line has re-set on the Euro and has lost all it's strength. But the real sell signal was the failed QTR A up. As I've said many times before, just something I have noticed time and time again, long term trends "tend" to end at QTR levels.
 

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Quote from justrading:

Not saying all of them but for EURUSD it was a down move in the face of a strong number line. I attributed it to one of those post-FOMC quirks; indices, bonds, precious metals, FX all moved to the downside, supposedly because the statement was not dovish enough.

None of my indicators pointed to this so I can't say I'm delighted.
More...

To make this even simpler, let's remove the directional aspect of this. With regards to FX, when FX "volatility" increases, regardless of direction, something is going on there. It takes a lot of money to move currencies. These aren't small cap stocks with small floats that are heavily shorted or futures contracts going into expiration where traders are forced to roll or close out. There is literally an unlimited supply of currency in the world (because it can be printed) so when you see massive moves or sharp increases in volatility, that's telling you something and often provides good tells for risk assets.

Combine this with the yield curve flattening and investor sentiment at near all time highs and margin leverage approaching 1999 levels, well, you've got yourself an interesting situation here.
 
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