08/31/2011 Intraday Watering

[shumushu]

Fyi, today is the last day of AUG. we are in one of the worst aug performance ever! Where are we gonna close today?
SPX targets: 1257.50, 1220, 1187. These are previously month's high/low or closes.

[Mongoose]

Cobra, I was reviewing yesterdays Intraday Watering and had some questions, which as a student of your forum would like your help -- You mentioned at one point in the day you didnt think there was going to be a breakout, based on the data. Then about an hour later you wrote the breakout occurred as you expected. This seems contradictory.
Then there was the comment about the Cup & Handle pattern forming which you thought it would continue into today. At the close of yesterday, based on the data, it suggested there could be a pullback as the market appears to be overbought. This also seems contradictory.
It seems as if the data is suggesting "the market is going to go up, unless it goes down", or "the market is going to go down, unless it goes up".
If you wouldnt mind taking a minute or two and helping me to understand these contradictions. Thanks.

I think I said I didn't expect it to breakout immediately which implies a breakout, but it just need a consolidation and indeed, after a few bars consolidation, it broke out.

The C&H was short of the target and ended when the day ended because the pullback was below the breakout point. Even it can continue today, it doesn't contradict the pullback call because it could go higher than fall back.

Anything have time frame. I cannot mention time frame every time. so forgive me if I didn't make it clear.

So not expecting a breakout implies a breakout, but not immediately. And expecting not to breakout implies not a breakout, but not immediately.

[hemlock21]

The EWI Guys are looking foe 1228-1229 area as the next turn point.

[keesa]

cup&handle completed. What next? Chicago PMI is super good. Obama is going to release new mortgage-refi plan....all good news are priced in I guess.

[Cobra]

Global ES is touching trend line again, clearly a Rising Wedge.

[KENA]

PMI bad but not as bad as projected.So mkt goes up.Well thats the hype right now.I still have no positions but thinking SPY short.Wait and see.

[keesa]

Global ES is touching trend line again, clearly a Rising Wedge.

Cobra: you mean acceleration might be ahead?

[Anaconda]

50% retrace of Aug.9 low. We're close to a top, if not there already, most likely.

[soku]

chicago pmi very strong. in fact before open rumors are there. i think it is priced in high 1220 could be a strong res

[kenwind]

Despite an abrupt drop in prices at Tuesday's cash close for the ESU1 contract from yesterday's daily high (1218.50), prices have rebounded in the overnight session and have stabilized above 1215.00. The short-term price pattern remains constructive with an upside price target at 1232.00 but intermediate resistance at 1220.00. The pre-open Globex session experienced a point of acceleration as it rebounded above 1210.00 which should continue to provide support through today's regular trading hours session. Today's session marks the end of the month which should provide some interesting rebalance flows targeted for the cash close. The significant divergence between equity and bond performance over the month suggest the potential for asset allocation into equities and out of bonds. There has been evidence for those types of flows since the August low but its worth noting that as funds build their equity exposure via index futures throughout the month, they will often sell futures at month end and replace the equity exposure with cash equities creating temporary divergence at the cash close between the cash index and the index futures.

Hmm, are you the same person shorted heavily the day before yesterday? Just a question, I'm curious as you two have exactly the same ID.

Yes, I am. I am not worried. It will come down to my target sooner or later.

[silkway]

Global ES is touching trend line again, clearly a Rising Wedge.

going down soon (next week)? Thanks.

[keesa]

chicago pmi very strong. in fact before open rumors are there. i think it is priced in high 1220 could be a strong res

now the strong res is moved to 1250 area. free to run now if not retest 1220 area

[Cobra]

Global ES is touching trend line again, clearly a Rising Wedge.

going down soon (next week)? Thanks.

no evidences yet.

[KENA]

cup&handle completed. What next? Chicago PMI is super good. Obama is going to release new mortgage-refi plan....all good news are priced in I guess.

I got the PMI was bad but not as bad as projected. Am I wrong????

[uempel]

Mid of red Andrews as support:

[Cobra]

Despite an abrupt drop in prices at Tuesday's cash close for the ESU1 contract from yesterday's daily high (1218.50), prices have rebounded in the overnight session and have stabilized above 1215.00. The short-term price pattern remains constructive with an upside price target at 1232.00 but intermediate resistance at 1220.00. The pre-open Globex session experienced a point of acceleration as it rebounded above 1210.00 which should continue to provide support through today's regular trading hours session. Today's session marks the end of the month which should provide some interesting rebalance flows targeted for the cash close. The significant divergence between equity and bond performance over the month suggest the potential for asset allocation into equities and out of bonds. There has been evidence for those types of flows since the August low but its worth noting that as funds build their equity exposure via index futures throughout the month, they will often sell futures at month end and replace the equity exposure with cash equities creating temporary divergence at the cash close between the cash index and the index futures.

Hmm, are you the same person shorted heavily the day before yesterday? Just a question, I'm curious as you two have exactly the same ID.

Yes, I am. I am not worried. It will come down to my target sooner or later.

Got you, thanks.

[Michelle]

Uempel, what was the moving average you were watching a few weeks ago........377? Was it on the daily?

[Anaconda]

Can you see what I see?

[kenwind]

Passive equity portfolio managers who rebalance back to benchmark weights monthly will be active today. The August return pattern ,with notable losses in Europe (DAX -20%, CAC -13% and FTSE -9%), and more minor losses from the rest of the world (S&P -6%, TSX -2%, SPI -3%), should result in buying of EUR and GBP and selling of CAD, USD and AUD; with the Asian currency impact more muted.

[Cobra]

overshot, volume surge, biggest bar after a series of bull bars, so could be an exhaustion bar here. let's see.