Short 3005-3026

15 באוק׳ 2019

Those that have followed me into green october I think that run is about to come to an end. I suspected yesterday we'll take another stab at 3000 and here we are. The index almost ALWAYS paints a virtual double top as part of its wave 2 down, so I wouldn't get too eager about entering the short trade. Wait for bearish divergence at the very least on the hourly chart.

• The red curved arrow at the top is top of the fib spiral that I've been posting in recent updates. I'll add it again as I think that is the line in the sand for the long term direction of the market
  
• At best I think we are in a continuation triangle and we're in wave D right now. At worst, this is wave 2/B and another leg down is about to begin.
  
• At my entry, I think we'll at the very least get a .382 retrace to the 13WMA (orange dotted line) at around 2955. Most likely I think we'll get an ABC down to the 2920 range.
  
• Also waiting patiently for a sub-13 VIX as well as some kind of news to sell here, with trade being the obvious catalyst.
  
• Running a tight stop on this trade (basically playing the bearish gartley shown). Hourly close above 3022 and I'm out.
  
• If this thing DOES break the purple TL, it has the potential to get pretty ugly. Think 24+ VIX, GOLD 1600+
  

15 באוק׳ 2019

הערה

As mentioned above look where we are in the fib spiral... Can see clearly why I believe that curved red line is the do-or-die line for the market.

16 באוק׳ 2019

הערה

Software dumped again today... As per my IGV CC vs. SPY chart, this has typically been an ominous sign for the broader market.

21 באוק׳ 2019

הערה

Initiating put position here for Nov 15 on thesis that this is a wave 2 virtual double top as proposed above. Good chance that it isn't, but will add at 3020+... however gotta get some skin in the game here.

23 באוק׳ 2019

הערה

Fifth time's a charm...

Every wave of this rally has petered out on the 5th peak w/ bearish divergence on the RSI on the 4hr chart seen here. I expect this time to be no different. Using Fib spiral, the ATH and the 4th peak as guides, 3012 -> 3026 should be shorted with impunity.

25 באוק׳ 2019

הערה

As expected we got a whole 2 minutes to short it at 3012+ at the 5th peak during cash open today. What's funny is that it wouldn't surprise me at all for this scam to still paint a higher high despite AMZN's massive miss. All the signs of a reversal are there though:

1) AAII Investor sentiment at 36% today. Last 2 times it was 35%+? Aug 1 and Sep 19.
2) Software continues to underperform
3) Clear RSI bearish divergence on 4hr chart

That said, unless 3000 breaks the pumpers will likely take this trash back up to ATHs to unload unto poor Joe Retail. Timeframe-wise I'm expecting 2950 within 2 weeks.

25 באוק׳ 2019

הערה

VIX crushed at sub 13 as desired... Possible wave 5 of 5 of C is in... If you're thinking about shorting now's the time to do so.

26 באוק׳ 2019

הערה

Breaking down what should be wave 5 here of the impulse or ABC up. Can see clearly a running flat and descending triangle for waves 2 and 4 respectively. The index LOVES expanded flats at the top of the pattern to shake loose the bears so I'm expecting that as wave (iv) of 5. A break below 3006 would confirm that wave 5 is done and we are now headed downwards. Moving my stop to 3044 which is the 2.0 extension of the bearish crab shown. Either way I don't think this thing's gonna continue upwards after FOMC on wednesday.

26 באוק׳ 2019

הערה

Here's one example of why I believe one more high is in store... this week looks like a microcosm of the end of Aug / early Sep reversal.

Fundamentals-wise there are ALOT of potential catalysts this upcoming wk:

1) Consumer confidence, GDP, payroll, PMIs, China PMIs, EU CPI numbers all due Tues-Fri. Most will likely disappoint.
2) FOMC on Wednesday. Goldman expects Fed end mid-cycle adjustment... I tend to agree. Fed meetings have marked tops for the past 2 months.
3) China holds its 4th Plenum starting Oct 28th for 3 days. It's arguably one of the most important meeting in the Chinese government. essentially a performance review for Xi. At heart he is a US hawk, but I believe the recent lovey-dovey trade attitudes are to appease Xi's opponents in the central government. Once the plenum is concluded, I expect a more hawkish trade tone from China as well as some action on the HK front.

28 באוק׳ 2019

הערה

Definitely seeing some signs of exhaustion here. Maybe one more pump to 3050 to hit the TL from the '18 tops. I think we're currently painting wave (iii) of an ending diagonal C to what is a D wave in an expanding triangle. I expect wave (v) of C to conclude w/ the signing of the phase one deal... at which point we start E, which isn't gonna be pretty.

30 באוק׳ 2019

הערה

Looking ready to start wave (v) of 1. Expecting a massive short covering rally post FOMC (as always) to draw wave 2.

30 באוק׳ 2019

הערה

Remember in July when reports of anti-trust actions against FANGS came out and they closed the day in the green? SSDD. Fed says no more easy money and the market rallies... LOL. I dumped some positions in the mornign but not nearly enough... I shoulda known something was up when the VIX started getting crushed after the morning selloff.

Anyhow take a look at where the VIX is right now. If you'd shorted every time it touched that line you'd be a rich man. So hey why not? Divergences are still evident on all hourly TFs. My guess is this intermediate high is tagged tomorrow afternoon.

31 באוק׳ 2019

הערה

So my dumbass actually decided to hold and accumulate more puts on yesterday's post-FOMC spike, it wasn't out of brilliance, just pure stubbornness. It panned out and I got lucky. So what I thought was the wave 1 down is starting to look like wave C of 4 which is an expanded flat. I say this because yesterday's leg up looks very much like an ABC to me. If it dives again tomorrow, look to 3010-3014 as crucial support for one more leg up to 3050+. That said, it looks so obvious as support that the algos will probably just bust right through it and trip all the stops. Does trading suck or what? :)

Alternate structure if tomorrow is bullish and rallies to 3050, wave 4 was an expanding triangle where today completed the ABCDE. Either way I'm waiting until 3050-3060 to initiate more short positions.