Timing Market Turns
- Thread starter W. B. Busin
- Start date
we are scalping this with long YMZ5.
a-b-c-d- with a very flat 'e' from the 10:50 a.m. low today
a-b-c-d- with a very flat 'e' from the 10:50 a.m. low today
out
+22
+22
testing for lost post
Timing Market Turns - 11/10/2005
âThey have freed millions with the simple courage found in the kid next door. My words are brief but are filled with complete gratitude. I am free today because of the millions of American men and women, throughout American history, who served their people, their country and the world by putting themselves in harms way for others. Is it any wonder God has so blessed this land?â Thank you, American veteran; and, thanks to your families. Happy Birthday to you Leathernecks!
Market Timing for
Option trading- still 100% long
Index futures trading- still 100% long
Stock investors- still 100% long
We have no hedges on at this time. We have no significant daily time loci for the coming 3 trading days. Next Wednesday is on the rise to significance though if todayâs Dow intraday high stands as a swing high till then. The locus point on Wednesday was a puzzle to us. The solution to the puzzle may have been found today in the breakout above the recent trading range.
We say "may have been found" because a good follow through in the next few days above the October 3rd high of SPX 1233 would add solid credibility to today's Dow 30 close above its October 3rd high of 10608. It could be the beginning of a true breakout above this multi month trading range.
Many good short-term indicators are peeking into overbought planes for both the Dow and the SPX. Overbought status was the way the February 2005 and the May 2005 rallies began. We welcome the overbought nature. It shows strength if the rally continues.
From a counterpoint view, we expect to monitor any pullback closely to see how quickly the weak hands in the bullish arena head for showers. This rally is still just a rally in a trading range until the Dow and S & P 500 breakout above <u>and hold above</u> each of their 2005 highs.
As option expiration week approaches, the volatility indexes are making lower lows â perhaps even trending down. These declines are more good signs for the rally. As we monitor reactions to news events, investors and traders are quickly shrugging off the reactions to âbadâ news. With sentiment turning neutral from a strong negative in recent days, we expect corrections to fall into the âshort and sweetâ category.
In summary, small and short pullbacks allow the indexes to maintain their 45-degree angle of ascent, which both the Dow and the S&P 500 hit again today. Patience is still a blessing during expiration week.
For an interesting look at what shape the current rally might be taking (my current view), find a daily chart of Citicorp (C) and look at the August low forward. If this form is followed, I would place the indexes near the September peaks. The downward correction into Wednesday before the American Thanksgiving holiday might resemble the downward move of C to its mid-October low.
Good Trading and God bless America.
W. B. Busin
âThey have freed millions with the simple courage found in the kid next door. My words are brief but are filled with complete gratitude. I am free today because of the millions of American men and women, throughout American history, who served their people, their country and the world by putting themselves in harms way for others. Is it any wonder God has so blessed this land?â Thank you, American veteran; and, thanks to your families. Happy Birthday to you Leathernecks!
Market Timing for
Option trading- still 100% long
Index futures trading- still 100% long
Stock investors- still 100% long
We have no hedges on at this time. We have no significant daily time loci for the coming 3 trading days. Next Wednesday is on the rise to significance though if todayâs Dow intraday high stands as a swing high till then. The locus point on Wednesday was a puzzle to us. The solution to the puzzle may have been found today in the breakout above the recent trading range.
We say "may have been found" because a good follow through in the next few days above the October 3rd high of SPX 1233 would add solid credibility to today's Dow 30 close above its October 3rd high of 10608. It could be the beginning of a true breakout above this multi month trading range.
Many good short-term indicators are peeking into overbought planes for both the Dow and the SPX. Overbought status was the way the February 2005 and the May 2005 rallies began. We welcome the overbought nature. It shows strength if the rally continues.
From a counterpoint view, we expect to monitor any pullback closely to see how quickly the weak hands in the bullish arena head for showers. This rally is still just a rally in a trading range until the Dow and S & P 500 breakout above <u>and hold above</u> each of their 2005 highs.
As option expiration week approaches, the volatility indexes are making lower lows â perhaps even trending down. These declines are more good signs for the rally. As we monitor reactions to news events, investors and traders are quickly shrugging off the reactions to âbadâ news. With sentiment turning neutral from a strong negative in recent days, we expect corrections to fall into the âshort and sweetâ category.
In summary, small and short pullbacks allow the indexes to maintain their 45-degree angle of ascent, which both the Dow and the S&P 500 hit again today. Patience is still a blessing during expiration week.
For an interesting look at what shape the current rally might be taking (my current view), find a daily chart of Citicorp (C) and look at the August low forward. If this form is followed, I would place the indexes near the September peaks. The downward correction into Wednesday before the American Thanksgiving holiday might resemble the downward move of C to its mid-October low.
Good Trading and God bless America.
W. B. Busin
Quote from Hook N. Sinker:
Hi Hook
I responded to you earlier this afternoon and had also posted an update. Both posts vanished into cyberwonderville. I am sorry I hadn't seen your post earlier.
I would have responded with what would have sounded like shoulders shrugging, as in "I'm wondering too about a decline."
Waiting for the indexes to do something can make a day of waiting seem like a year. That is certainly the reason I preach to myself when I'm trading: "PATIENCE ! PATIENCE!"
By SPX not falling to 1205 level (small gap under 1200), the market indexes are left with only two alternatives: go upward, or, continue sideways. It seems that it chose the former. Uh, so far!
Good trading and God bless.
W. B. Busin
edit: for clarity, Hook, to me and for my purposes, the word "extreme" reflects a boundary that would present the farthest normal excursion from existing trend allowed, without bringing into question my whole macro view. Macro, as in rally or correction; bull or bear market. Below that level, there is another that would conclusively assert that I am wrong in that view, and that something quite different is going on. These levels fluctuate with price and volume swings.
A non-market example might be the price of the latest trendy branded sneaker. Markdowns of 10 to 25 % are common in the life cycle. But we all can intuitively see that the shoe is fading from its peak of popularity when 50% or more markdowns are becoming the normally expected price level for the shoe. When that price fails to "move" the inventory, for days or weeks, prepare to observe that product's death, or clearance sale.
hi W.B. - i have enjoyed reading through your posts in this thread - i have a couple of questions:
1. the long trade off the October lows has been an excellent trade, the timing was very precise too.
2. the timing for the scalp trade (from your post below) worked very well too - can you please shed a bit more light as to how you derive these intraday turnaround points - i am not asking for the details of your methodology, i understand you use a proprietary algorithm etc etc - i am just looking for a bit more intuition behind your process, i.e. what is the logic.
3. when i click on the link to your blog website, the webpage starts loading but then crashes my Internet Explorer - i use IE daily and it's the only site that has caused a crash in some months... not sure why.
4. i understand you are still 100% long in index futures - what is your general exit methodology, i.e. do you scale out partial position, do you use targets, do you wait until you see selling?
thanks for sharing your work and all the best.
1. the long trade off the October lows has been an excellent trade, the timing was very precise too.
2. the timing for the scalp trade (from your post below) worked very well too - can you please shed a bit more light as to how you derive these intraday turnaround points - i am not asking for the details of your methodology, i understand you use a proprietary algorithm etc etc - i am just looking for a bit more intuition behind your process, i.e. what is the logic.
3. when i click on the link to your blog website, the webpage starts loading but then crashes my Internet Explorer - i use IE daily and it's the only site that has caused a crash in some months... not sure why.
4. i understand you are still 100% long in index futures - what is your general exit methodology, i.e. do you scale out partial position, do you use targets, do you wait until you see selling?
thanks for sharing your work and all the best.
Hi fader,
The October 21/24 projected low was rather easy to find by numerous methods, I am told - Fibonacci, Elliott Wave, cycles and other esoteric means. It gained a significance in April and neither wavered nor did we doubt its significance. It did not make a mass appeal type launch though.
We were wrong about that. It appears to be regaining its 45 degree angle trajectory/path. That may not last long though. We suggest a drop into Thanksgiving Holiday, and if such, the steeper climb might start there and continue into January 2006. But, that is too many caveats to trade on. It does work for a position though.
You mentioned the scalp trade. The timing locus was locked in the previous two days. We essentially know how the time loci are derived, but remain dumbfounded by its accuracy. We have numerous theories about 'why' it works, but none are worth our time to pursue. In our lines of research, we are required to know what and when about the behavior of people; not why!
) Why do people buy the same things their whole lives (coffee) while switching to every 'new' product (cosmetics) in another different category? We don't know, even though we do it ourselves! The scalp trade- From the morning low at 11 a.m., the sideways grudgingly etched an excruciating track to nowhere for hours. Volume indicators led price indicators throughout the last unit of correction, from the high on October 3rd.
Again, I thought about what the market indexes and futures <b>weren't</b> doing was more significant than how tedious it was.
The accumulation that began at the morning low accelerated at the minor upward move into the lunch hour. For the next 3 and a half hours, the accumulation persisted without any decisive price direction or break. That state of affairs was where my mind was, awaiting the 3:35 time locus.
I try to avoid using or thinking or writing in Elliott Wave terms. But I will here as a shorthand for the structure that ended.
The ABC down from the previous day's high had taken most of the "required" percentage of an Elliott Wave correction by 11 a. m. I thought that it would possibly go a few ticks lower but it didn't. The indexes just completed the 'b c d e' from the 11 a. m. low of 'a'. That's what I was seeing and thinking and watching.
I held the scalp much longer than I expected. There just wasn't a sell or exit signal on the 1 minute bars of any significance till 3:50.
The blog website has done the same to me. I don't know why either. I have told the good people there about it, and they have attempted recreating the same effect unsuccessfully. I will pass your comment on to them and hope it can be solved.
I post here in more detail and depth than there. I have been on that guy's site for years - good people and interesting family type issues and products. Joel Comm is the owner and is one of the original online game writers from the last millennia!
Relative to the core position entry/exit item you asked about - Yes, we are still long ETF's, ETF options and futures. The core position being ETF's with options for leverage.
Entry and exit are normally mirror images at respective time loci. Assume all conditions on volume parameters are directionally harmonious, we simply enter the orders in full and many times "all or none" limit orders coupled with conditional stop loss orders on entry. So we're all in or all out for each particular transaction.
As you've read, we have a error bracket around each time locus of plus or minus 1 time bar. So we don't hold positions or trades till the very last moment. We know that it can be devastating to a profitable trade to try and squeeze the last tick out of a trade. As the saying goes, greed kills, eh?
Monday morning will be clarifying for higher or lower toward Wednesday's minor time locus. For example, if we perceive a potential drop into Thanksgiving Holiday beginning, we would cover the December calls and futures. Then we would await confirmation of a downward move to put on an appropriate quantity of short futures contracts, basis December or perhaps March 2006.
I hope that answers your questions.
Good Trading and God bless.
W. B. Busin
W.B. - thanks for the detailed answers - your point about people doing things consistently at a certain time makes sense, it is very interesting how you have been able to reach a high degree of precision in identifying these points on an up to the minute basis.
i look forward to following your journal - all the best.
i look forward to following your journal - all the best.