What a week this is. The stock indexes have gone up, down, up, down and closed last night almost at last Friday's close in the S&P ~ a doji day and a doji week so far for stocks. Gold and silver have rolled over and broken trendline support and most of the FX vs USD pairs are also now making lower highs and lower lows. In fact the only market still making higher highs and higher lows are stock indexes.
Greg Harmon has a really good post showing that the Gold market rolling over is leading this move and pulling the dollar and in turn pulling equities down with it. What is interesting is that (aside from the ridiculous extreme bullish sentiment) what seems to have triggered the sell off in Gold is China tightening earlier this week and if thats the case it looks likely there is more tightening to come, so more gold selling and more dollar rally. Stocks are being dragged down, not leading the charge so are not the best risk-off trade but shiny metals and bonds look like epic shorts.
This week there were/are Pomo days on Monday / Wednesday / Friday. The market went up on those days and sold off on Tuesday and Thursday. While this is not an exact science it is reasonable to exercise caution if you are trading the short side today in the NY session and perhaps take some profits and wait for the weekly candles to close. What else goes up on Pomo days (apart from everything)? Shiny metals like gold always go up on Pomo days ... which is good because I would like a pullback to sell again.
Even Goldman are telling clients to frontrun the Fed and buy Pomo days
And then there is the G20 this weekend where they have currencies on the agenda ...
New positions London open - I may close these before US open:
CRUDE short 81.30 stop 81.60 - 50%fib retrace - addition
AUDUSD short 0.9830 stop 0.9860 - addition
SILVER short 23.20 stop 23.40 PT 22.50
Closing everything for Pomo, even Goldman tells its clients to buy on Pomo days:
Crude closed all positions @81.00 (+1R) (+1.5R) (+1.6R)
AUDUSD closed all positions @ 0.98 (+1R) (+1R) (+0.9R)
SILVER short 23.20 stop 23.40 PT 22.50
Closing everything for Pomo, even Goldman tells its clients to buy on Pomo days:
Crude closed all positions @81.00 (+1R) (+1.5R) (+1.6R)
AUDUSD closed all positions @ 0.98 (+1R) (+1R) (+0.9R)
USDCAD closed 1.0250 (+1R)
Posts
great post, nic.. altho it might give you pause that you summarized my thots so perfectly : )
ReplyDeletei've been told to tell you to ignore all that pomo stuff [they used another word with s] see the usual prop place for all the rude words why :)
ReplyDeletePOMO has not done much for the market today, I think that Goldman note yesterday killed the effect.
ReplyDeleteDo you ever look at DeMark indicators Nic? We have sell signals across the risk complex.
ReplyDeleteI know so many really good traders who swear by DeMark but I don't use them.
ReplyDeleteI am a bit tied up doing an options course at the moment but I might look at them when I am done.
Yeah the Goldman note has killed pomo, although now that Europe has closed the US markets might rally.
ReplyDeleteFor DeMark I recommend Jason Perl's book published by Bloomberg - "DeMark Indicators".
ReplyDeleteCould anyone recommend any good trading chat channels?
I follow some good DeMark guys on twitter, they swear by a chatroom on Bloomberg that Mr DeMark frequents. I dont know of any others. I go to some skype ones for harmonics.
ReplyDeleteoo i recently looked at options too. the rewards are less but so is the risk. they can be good if you have a bias. IG have both daily and quaterly. for 30pts risk you can get some quite good ones.
ReplyDeletewhat kind of course?
Actually I am doing US stocks, just at the US open. Lot of fun ;)
ReplyDeleteWhile waiting for the ministers to finish eating their dog meat in Korea, keep your eyes on the Ten Year; there may be an upside surprise in store. Have a great weekend!
ReplyDeletehttp://99ercharts.blogspot.com/2010/10/ten-year.html
Hi Sinan, I use or try to use TD and used to be in the BBG chatroom before they started charging for it.
ReplyDeleteWe could start trading TD ideas and share our experience to increase our learning curve.
Anyone else who is keen on TD could drop me a mail at evilelmo500@gmail.com
Nic, would appreciate it if you could share with us the Demark twitters you follow.
happy trading everyone!
DeMark traders I follow are @wallstwes @TommyThornton @kevindepew @20characters
ReplyDeleteWallstwes is very chatty / helpful, so is 20characters. TommyThornton is very smart.
There is a DeMark blog I read too:
ReplyDeletehttp://trading-to-win.blogspot.com/
that blog is of much win win strategies really good one in fact.
ReplyDelete