11/30/2011 Intraday Watering

[TWT]

SPX:

-Potential Count ABC or ABCXABC
-Extension target range = 1240-1268

[Mr. BachNut]

So, this morning in the pre-market I re-established my pilot short position after the Chinese reserve announcement. I got my target price and I figured the announcement would fade after awhile. Then came the one two punch of coordinated intervention and payroll numbers. Position is trapped and dangerously close to stopping out for a loss. Argh!

I also have profits in treasuries and long $ that have been gutted like fish. A lot of stops are in range for me. This is ending a good month on a bad note.

Eyeballing the opening levels, they seem to be at levels perfect for crushing shorts that were established a few weeks ago when things started to break down. A true housecleaning.
Given that the market dynamic here is policy driven, it makes technical decision making a challenge. I'll be letting the protfolio run with stops and plan on doing more watching than doing for awhile.

[hiram]

Once we clear 1260 and markets are sitting positive for the year many will still be calling for correction but it wont happen....once market closes for the year then correction will happen. THE GAME IS RIGGED. I will sell into the euro-PHORIA.

Hiram

[Me XMan]

Got this from Zerohedge site. Rocking and crashing after intervention.
http://www.zerohedge.com/news/here-what ... tervention

[soku]

damn i think i should relocate to asia. i missed this one

[Al_Dente]

PAGING UEMPEL
Thank u for your kind words yesterday, I appreciated that more than u know
Internals: http://stockcharts.com/h-sc/ui?s=SPY&p= ... =249244776

As you are aware: The DATA is pure
My interpretation only = green lines and arrows indicate bull spy.
Reds indicates bear spy
Pink arrows indicate “Hmmmmm”…..Blue arrows indicate “WTF”... and sometimes the pink and blue arrows are interchangeable.
PS: I miss yr yellow-filled elliptical charts, I watch for them carefully. Did u replace them all with the blue-filled ellipses??

http://www.youtube.com/watch?v=2U-rBZRE ... re=related

[Me XMan]

Agreed.

Once we clear 1260 and markets are sitting positive for the year many will still be calling for correction but it wont happen....once market closes for the year then correction will happen. THE GAME IS RIGGED. I will sell into the euro-PHORIA.

Hiram

[cougar]

COUGAR..Are you still holding to 1262 your projection.

Yes, but not for today. This would be for the week...
Before that, however I found some resisatnce at 1252, on a 130 min chart.
Chart soon.

[KENA]

Right or wrong I took all profits on my longs.Not going to be greedy.To good to pass up a this point.

[99er]

Quick honey...grab your bikini.

SPX http://99ercharts.blogspot.com/2011/11/spx_8814.html

Surf's up.

[Cobra]

target $124.96, 80% chances, the same setup failed just recently, so very rare it fail again. Let's see.

[jarbo456]

nothing against ZH per se, but i have definitely cut way down on how much i read his articles. i still follow him on my twitter feed, but i realized he was really getting into my head in terms of viewing the market so bearishly all the time.

the fact remains that the structure of the financial industry is to buy, buy, buy. as a result, surprises will almost always come to the upside. i'm looking for a time to close out my longs for a profit, and sit in cash and wait for my next entry.

this isn't bragging at all, but this is a few of my positions since i stopped being so bearish the market.

[soku]

A newbie's question: if I hold a future contract, e.g. ES, over the expire date, what will happen? Thanks, I have never got chance to do that yet

the answer is it depends. if you r holding es, which is cash settle, then at close of last day of trading, your open positions will be settled in cash to the S&P 500 Index. i think es is still using open price, but they changed spx options to close price of that day. remember opening price will frequently go out of range, usually i will not hold to the end. instead, you can do a roll forward to next expiration, since i know u r an enthusiastic bull.

[KENA]

COUGAR..Are you still holding to 1262 your projection.

Yes, but not for today. This would be for the week...
Before that, however I found some resisatnce at 1252, on a 130 min chart.
Chart soon.

Thanks..I took profits and will see what happens.May buy in with less longs later.I can't see the mkt going much more then your projections.

[jarbo456]

A newbie's question: if I hold a future contract, e.g. ES, over the expire date, what will happen? Thanks, I have never got chance to do that yet

the answer is it depends. if you r holding es, which is cash settle, then at close of last day of trading, your open positions will be settled in cash to the S&P 500 Index. i think es is still using open price, but they changed spx options to close price of that day. remember opening price will frequently go out of range, usually i will not hold to the end. instead, you can do a roll forward to next expiration, since i know u r an enthusiastic bull.

some good facts you should know:

Quick Facts about Rollover Day

The following applies to many (if not most) futures contracts especially those from the Chicago Mercantile Exchange (CME) and Chicago Board of Trade (CBOT).

Rollover is 8 days before expiration.
Expiration is the third Friday of each quarter month (March, June, September, December)
The contract letter associated with each month is: March=H June=M September=U December=Z
Rollover is on a Thursday.
Rollover is usually on the second Thursday of the month but will be on the first Thursday if the first day of the month falls on a Friday
Volume shifts to the new contract at market open (09:30 EST) on Rollover day
New day trading or swing trading positions opened on rollover day should use the new contract month irrespective of when you plan to close it.
New swing positions might be better opened using the new contract if opened within a few days of rollover day.
Market myths abound at rollover and expiration. Check the source and confirm the probabilities before believing anything
http://clicks.aweber.com/z/ct/?AJp76SfBGBFdsG2FkJTNxw

Rollover day is when we switch from trading the contract that will expire this quarter to the contract that will expire the following quarter.

The futures contract that we focus on (the e-mini S&P500 or ES) expires on the third Friday of the months of March (H), June (M), September (U) and December (Z). The rollover days, however, are 8 days before expiration on the second Thursday of each of these months. These months have the letter designations H, M, U, and Z. Depending on the charting and trading platform that you're using you would usually have to switch your reference to the following month by letting the software know the contract and expiry month/year. On eSignal "ES H5" refers to the e-mini S&P contract that expires on the third Friday March 2005. Using eSignal and the #F designation it will switch to the new contract on the rollover day for you.

I have bit more to explain about how eSignal uses the #F designation to make rollover day easier for you. On Globex, the trading day starts at 16:30 EST the evening before the "day" and ends at 16:15 EST on the "day." So, for example, Thursday's trading session starts at 16:30 EST on Wednesday and ends at 16:15 EST on Thursday. If you have a chart that is plotting the symbol ES #F, then this chart will switch the symbol that is being plotted at the start of the Rollover Day which in this case is actually 16:30 EST before the "day" which in our case is the second Thursday in each quarter. So the symbol swap happens at 16:30 EST on the Wednesday before that Thursday.

Why is this useful? If you have 15 charts that plot several E-mini contracts on several timeframes then you have to manually edit each chart and change the symbol from the current to the next quarter. If you've specified #F then this will happen automatically for you and save you from forgetting or missing a chart - especially if you have multiple pages/layouts of charts that you load.

When and why you should switch from trading one contract to the next?

Liquidity switches from the current contract to the next contract at 09:30 EST on rollover day. This can be seen by comparing the volume (number of contracts traded) in the old and new contracts in the charts below. [Note that the scale on the volume part of the charts is different for the near and far expiry months because of the rollover effect and traders switching to the far contract.]

If you are opening a new position in the ES before 09:30 that you plan to close during the day or perhaps before 09:30 you could use the near contract but you must remember that the spread will start widening as traders start switching out of this contract and you will struggle to get as favorable a price as you would with the next contract.

The general rule here is that you want to get into the next contract as liquidity moves from one to the other. At this point in time (09:30 EST on rollover day) the spreads will be tightest and you will lose the least amount on the spread as you switch contracts. This is especially important for swing and longer term traders that may want to carry their positions past the expiry date.

If you are opening a new position that you intend to carry for more than an hour and it's 09:00 EST on rollover day then you are better off trading the next (new) contract.

What else happens on rollover day?

You may hear plenty of myths and "truths" about rollover and expiry days. Don't believe any of it until you have seen it several times or have back tested this and verified it. I have heard many traders say: "They always mark it up on rollover day" or "stay away from rollover day because it is choppy and impossible to trade."

First of all do your own back testing and investigations before you believe any of this. Start off by looking at the charts on this page and see if any of them (all from rollover days) match what you have heard. Then get some data from previous rollover days and see what happen on those days. Even daily data will allow you to compute the change from open to close or from previous close to rollover day close.

There is no reason for the market to act any differently on rollover days. Scalpers, day traders, swing traders and longer term investors balance each other out. Traders trading large size contracts know that they risk moving the market if they are rolling from one contract to the other and so they break their positions up into more manageable sizes and move their contracts in partials in order to get the best execution prices. Traders are not focusing on the rollover process but instead on strategies that will make them money. They want to move to the next contract at the best possible prices and lowest possible costs. The rollover process is merely a mechanical necessity of the market.

There are (allegedly) pit traders that just specialize in the days around rollover. They only trade these days (I have no idea what they do for the other 10 weeks in between rollovers but this is what I've been told) and they trade the widening spread in the expiring contracts. For whatever reason there are longer term traders that don't close out and roll their contracts at the optimum time. These rollover "specialists" will make a market (at a wider than normal spread) in the expiring contract and (apparently) make a very good living out of the rollover process.

[rola]

The fact is that THEY do it because there is really a lot of shit. Italy 10 year bond is still 7,2 % yield, there are still violent strikes in England, this is just a sharade.

[ActiveTrader]

damn i think i should relocate to asia. i missed this one

Obviously, the "real" trading hours are during trading in Asia and early morning in Europe. The U.S. trading has become a robot chop fest.

[jiufeite]

target $124.96, 80% chances, the same setup failed just recently, so very rare it fail again. Let's see.

124.23 is the 23.6% Fibonacci Retracement from Oct. Could be a resistance

[Mongoose]

I appreciate the comments from Polar Bear and would like to add that the FED did the same action just prior to the Lehman collapse in 2008, so this is a step in the right direction, but it doesnt solve the fundamental problem - just buy some time -- which, without coming out and directly saying it, the Central Banks are acknowledging the inevitable collapse of the EU. (If the EU crisis was manageable, then they wouldnt have needed the coordinated efforts from so many Central Banks. Obviously the crisis is too large for the ECB to handle it alone.)

further, this move barely made a dent in eu sovereign debt yields which are still high.

Its not fun at the moment, but I am still short.

This is dedicated to the 2 million marching in London:
http://www.youtube.com/watch?v=SHhrZgojY1Q

And this is for Maria Fekter and Wolfgang Schauble and all the other dithering EU finance ministers who have been ignoring the Euro Crisis for the past 3 years and now have a choice to make --
Either this:
http://www.youtube.com/watch?v=EzgGTTtR0kc
Or this:
http://www.youtube.com/watch?v=-b7qaSxuZUg

[barbaragull]

A newbie's question: if I hold a future contract, e.g. ES, over the expire date, what will happen? Thanks, I have never got chance to do that yet

the answer is it depends. if you r holding es, which is cash settle, then at close of last day of trading, your open positions will be settled in cash to the S&P 500 Index. i think es is still using open price, but they changed spx options to close price of that day. remember opening price will frequently go out of range, usually i will not hold to the end. instead, you can do a roll forward to next expiration, since i know u r an enthusiastic bull.

Thanks, soku. Actually I am not really a bull or bear. I just like to stick to a losing position, keep adding adding until not able to any more, then waiting and hoping -- a pathetic trading habit. I will change -- until my current positions go out (most of my YM were sold this morning at 116xx level )