01/27/2014 Live Update

[RedKite]

A few missing bottom indicators suggest to me the down isn't over yet, most notably TICK 20ema which should be down near 70 and is currently around 185. So I have today as point A in a down ABC. In terms of cycle timing I feel final bottom (C) is not due until around mid Feb. No technical clues when B will arrive to start the next leg down, but FOMC has to be a good candidate.

[L_T]

I’ve posted this before, not sure if you saw it
McClellan explains “why” XIV outperforms:
http://www.mcoscillator.com/learning_ce ... investors/
“…many traders have figured out that they can use XIV as a leveraged proxy for the SP500…”
“Since January 2011, the daily percentage changes in the SP500 and XIV have a correlation coefficient of +0.82, and a "beta" (leverage factor) of 3.19. In other words, if the SP500 were to move up or down by 1%, then the expectation would be that XIV would move by 3.19% in that same direction. It does not always work out perfectly that way every day, but on average that is their relationship.
And unlike VXX, which gets hurt by the roll to later contract months, XIV gets the benefit of that roll by shorting VIX futures at a higher price, and then harvesting the benefit of the decay as each contract's price moves back closer to the level of the spot VIX Index. It is for that reason that XIV has a positive bias relative to what the actual VIX does.
XIV does move inversely to the VIX in the short run, and the magnitude of those movements can be quite violent. But the longer term trend is decidedly upward, owing to the profit factor from harvesting the contango by shorting VIX futures contracts at higher prices further into the future.”

Thanks for posting that. Here is a weekly of XIV. From $6 to $36 in 2 years......not bad!

[Al_Dente]

.........Thank you, Al ; No, I hadn't seen that, but I did some research on Investopedia on options, and pretty much came up with the same conclusion, then I did some historical and relative performance charts and my eyes just about popped! I'll read that article because anything with the name McClellan on it is certainly worth the read, thanks

Cool
I used to borrowsteal good stuff from you last year
So… just returning the favor

[Cobra]

members only update at 3:45 pm
http://www.cobrasmarketview.com/2014/01 ... ay-update/

[rhight]

Along a similar vein, I once had the bright idea of trading VXX on a bear swing instead of my usual SDS, and whereas SDS made money on that swing, VXX lost ; that was one of those WTF moments when I realized I didn't know what I was doing! One rule I read and now follow is, if you don't know why you're in a trade, get out ; so even though it was painful I got out of that trade, figured out why it didn't work, and now advise anyone to give VXX a pass

[Al_Dente]

..........Thanks for posting that. Here is a weekly of XIV. From $6 to $36 in 2 years......not bad!

hi boss
run a percentage comparison between XIV and SPY over the same period or longer...
just make sure u r sitting down.............

[Cobra]

well, guess that's it for today. mixed tomorrow as Tuesday has been known as turnaround Tuesday which is bull friendly recently, however it's FOMC which is a little little bit bear friendly recently. Whatever, a red close today would favor bears a little bit in the short-term, not necessarily tomorrow though which if indeed, I'll explain why to members. thank you guys, I'll see you tomorrow.

before the close, please take a little time to vote for me, thanks. https://stockcharts.com/public/1684859/tenpp

[Al_Dente]

Along a similar vein, I once had the bright idea of trading VXX on a bear swing instead of my usual SDS, and whereas SDS made money on that swing, VXX lost ; that was one of those WTF moments when I realized I didn't know what I was doing! One rule I read and now follow is, if you don't know why you're in a trade, get out ; so even though it was painful I got out of that trade, figured out why it didn't work, and now advise anyone to give VXX a pass

[edit: I “borrowsteal good stuff” = specifically your volume studies…..plus other good stuff]
"""""now advise anyone to give VXX a pass""""
I like VXX when the VIX futures go into backwardation. I think Friday the front month went into backwardation; RARE in the last year…

[Al_Dente]

gotta run
could someone please post AAPL earnings here, and its trading in the after hour mkt
thanks

[MrMiyagi]

Couldn't hold it Mr Market.... you jellyfish you.....

[KeiZai]

gotta run
could someone please post AAPL earnings here, and its trading in the after hour mkt
thanks

Hey doctor here you go

miss

pasta anyone?

[Al_Dente]

Hey doctor here you go

Apple-ER.png

pasta anyone?

pasta.png

Hey thanks panda boss
Here’s one 4 u:
Luby offers “a retrospective look at the year in VIX and Volatility”:
http://vixandmore.blogspot.com/2014/01/ ... -2013.html

[BullBear52x]

gotta run
could someone please post AAPL earnings here, and its trading in the after hour mkt
thanks

Hey doctor here you go

Apple-ER.png

pasta anyone?

pasta.png

First it was just a dip buying,
Then it was just a shake out the weak hand,
Then it become involunteer investing.

[xfradnex]

Where is Waldo? Long term differences in trends (SPY vs S&P) make a difference

[xfradnex]

Based upon my S&P chart, there is very good support at 1755: three line intersection on tomorrows date:
1) Line based upon the low of the last two trading days.
2) Line based upon 12-18 low and 11-20 low
3) Line based upon 9-19 high and 10-18 and 10-17 gap GLTA

Upper resistance has 3 lines intersecting 1796
1) Todays high
2) previous Thursday and Friday high line
3) Line based upon 12-26, 1-2, 1-6, and 1-13 lows and 12-24 high.

[TWT]

$SPX: Follow up of the s/t count

[TWT]

$SPX: 60 min momentum oversold but absence of positive divergence

[TWT]

$EURUSD: Current corrective decline suggests more upside ahead

[DellGriffith]

I did a study of SPY bollinger band breaches a while back.

When you get a true breach of the upper band, 1 of 3 events always occur in the next 2-3 months:

1. SPY retraces to its 50 DMA
2. If it gets past that, it WILL retrace to its 200 DMA.
3. If it gets past both, it WILL turn into a crash.

Its uncanny how a lot of these stop almost PRECISELY on the 50 dma.

Recent history:

1. SPY had a breach on October 18th, which I shorted.
2. Instead of a decline, SPY had ANOTHER breach on November 15th, about 1 month later.
3. On December 18th, exactly 2 months after the first breach, SPY posted a huge white candle. The bottom part came as close as you can come without touching the 50 DMA, which I'd score as a hit. I consider that as fulfilling both upper breaches.
4. A NEW breach on December 23rd.

That breach on 12/23/13 warns that SPY will do a retracement. That seems to be underway now. SPY has fallen below its 50 DMA. History tells us the next target IS the 200 DMA.

True breaches are somewhat rare. There have only been 12 in the past 6 years. The breakdown:

6 bounced off the 50 dma
3 bounced of the 200 dma
2 were crashes
1 is current and the outcome is still unknown.

We've already past the garden-variety 50 dma corrections.

The 3 that bounced off the 200 dma are:

May and June 2009. We had two breaches close together. The 200 dma was close by at the time and price found a low in early July 2009 against the 200 dma. Price dragged along the 200 dma for a bit.
March 2012. This one is most applicable to our current situation. Price fell for 2.5 months, culminating in clanging off the 200 dma on June 1st 2012. That was the exact low.

The 2 breaches that led to crashes are:

July 2011. The 50 and 200 dmas were close together and price smashed through both very quickly and entered a waterfall event.
January 1st, 2009. The 50 dma was under the 200 dma to begin with and so once price fell under the 50 dma there was no support.

These breaches can often lead to multimonth corrections. The 200 dma is far away and is the next target. A target of 1710 on the S&P 500 must be considered.