Seeking Alpha

aarc's  Instablog

aarc
Send Message
  • Catch Me If You Can 0 comments
    May 7, 2014 8:26 AM

    Since April 24, SnP500 has been whipping around using an intraday Inverted Head and Shoulders similar to what Compq did then made an attempted rally:

    >> Compq Head and Shoulders on Daily: img10.imagefra.me/i457/jquint84/141u_012...

    >> Compq InvHnS: img10.imagefra.me/i657/jquint84/141u_f31...

    >> SnP500 InvHns Intraday: img15.imagefra.me/i657/jquint84/141u_af3...

    >> SnP500 Cont Inv HnS on Daily: img15.imagefra.me/i257/jquint84/141u_e58...

    There are many ways to skin a cat for TA Traders.

    For the bears it is obvious their Divergence Sell Signal for Compq worked quite well and many profited by it by covering some positions as Compq tested it's major 200ema Support.

    Likewise, early bird bulls were able to take advantage of the Daily 200ema support, right off the bat, in April 15. And presumably have already taken some profits off the first or second red bar that appeared in April 23/24.

    For intraday traders it is obvious there are far more patterns that the bulls and bears have been playing. Those intraday patterns are also very useful for Daytraders for precision entries/exits.

    That's just the name of the game. Seasoned traders are usually not perma-bulls nor perma-bears. They know how to play the game and the bulls will give the ball to the bears when the probability of the market to go down becomes imminent. Likewise, bears know their limitations thus it is almost always a safe play to take partial of full profits off the Daily 200ma Support (Tech traders favored the ema in this particular case).

    >> Compq 30min Chart Bull Flag: img15.imagefra.me/i457/jquint84/141u_beb...

    Right now, Compq is 'Good to Go' for the very short-term trend traders with a mini Bull Flag on the intraday chart.

    Trading Strategies:

    I was trying to post this Instablog before the open (or before the e-minis rally). But right now ES, YM, and NQ are rallying before I can post. Thus higher probability the cash markets will open with a minor gap up on the 15min to 30min charts UNLESS some bad news appears at 8:30 a.m.

    Thus, for those who would like to chase this rally off the April 15 bottom for Compq; SnP500 and/or Dow Jones; buy strategy is usually during a gap up in the cash markets such as for SPY, DIA, and or QQQ. Most of the time the gap becomes the support. Stop loss is of course yesterday's low. Avoid Russell2000 as it is the one being heavily shorted.

    ------------

    This is a heads up for those who were not able to buy in April 14/15 and/or in April 28 as Compq formed an Inverted Head and Shoulders as illustrated in my Comment of that date.

    As the title says: Catch Me If You Can. A mini-Bull Flag on the 240min chart is perhaps the last buy on mini-pullback down. After that, those who would like to chase the rally will more likely end up buying on breakouts.

    For me: I was not able to sell some YM positions in April 24 as DJ and SnP500 suddenly went down with a potential truncated v-th wave on intraday charts. Instead I sold some on intraday a-b-c up in April 29. For now, I bought the YM back yesterday after the close with very tight stop loss. Sold some SSO in April 24 but decided not to buy it back.

    10:30 am Update:

    TNA, together with QQQ, went into a mini-flash crash right after the open. DIA and SPY and SnP500 tried to hold on to their gap up but later went down in symphaty to TNA and QQQ.

    This trade is another one of the 35% Bull Flag Failure Rate. At least for Intraday Trend Traders. For Daytraders who bought the April 15 bottom; the trade remains viable until proven otherwise.

    - SPY is now a potential 'bigger' Bull Flag on the 30min chart as it re-tested the Daily 50ma Support with minor penetration. Those who might still want to use the bigger Bull Flag for SPY may do so. If a strong bounce happens on the 5min chart happens; then a slow-grinding a-b-c down would be the ideal buy strategy. Preferably if SPY forms an Inverted Head and Shoulders on the 5min chart = to minimize potential loss just-in-case Yellen's testimony becomes bearish harbinger to many traders.

    - The 5 to 7 days rally off April 15 is being consolidated for 9 to 11 days now. 7 days rally for EWA with truncated v-th wave on intraday, 5 days for TA traders. Thus, SnP500 should be rallying sooner rather than later. A prolonged consolidation range can make it extra heavy and many trend traders might just abandon the trade for lack of action.

    - Note that if SnP500 and/or Dow Jones kept re-testing their daily 50ma supports without going into a strong rally; more likely those supports are going to fail. Thus, protective stops are necessary. For now, Daytraders are still in the go-no-go situation as SnP500 and Dow Jones whipped around.

    Compq is definitely not a good buy right now together with Russell2000 - at least on the intraday charts. Unless they show considerable strenght.

    For me: The YM I bought yesterday's after hours proved to be a failed trade as the trailing stops triggered with tiny profits. I bought it back as Dow Jones made a minor false breakdown on the 15min chart AND as ES made a touch down to it's 120min 24-hr Bull Flag Support. Now using trailing stops in order not to incur losses.

    >> Dow Jones Intraday NOW: img15.imagefra.me/i457/jquint84/141u_140...

    >> ES Intraday Bull Flag: img15.imagefra.me/i457/jquint84/141u_bf3...

    Definitely not an easy trade trying to catch this rally 'while I can'. At least for the YM Buyback Trade.

Back To aarc's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers

StockTalks

More »

Latest Comments


Most Commented
  1. The Acid Tests (3 Comments)
  2. Sticks And Stones Part III (3 Comments)
  3. Back to Sept 2008 (2 Comments)
  4. Global Outlook (2 Comments)
  5. To 5th or Not To 5th? (2 Comments)
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.