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Friday, February 19, 2010

E-minis [Update 2:45PM EST]

[Update 2:45 PM: I think the transports show best the recent sideways wave iv action.  It makes a nice contracting triangle.  That means we are near the peak of this run-up. Its already occurred or one more squiggle up. Anyways, the i - v looks very nice structure]
[Update 2:03PM: Another variation on the squiggles using the RUT.]
[Update 1:50PM  Playing around with squiggle counts for the past 3 days worth of slop]

[Update 1:13PM: The RUT is the first index to reach the underneath portion of the upper previous range.  It is pretty well extended to say the least.  I am dying to see how it handles any sideways consolidation...]

[Update: 12:37 PM  I stole this ascending triangle target concept from Cobra. I suggested he was being too generous but I was wrong. Sorry Cobra!  

I suspect we are nearing some kind of blow off peak because I have been considering not only a recount of P2 but the entire bear market back and indeed the entire run-up from....1780.   Maybe the peak comes Monday or today. I think the market wants to close above its 50DMA today obviously.  

As I stated last night the Wilshire actually has an average retrace for Minute [ii]'s during P1 above 70%.  We are at 68%.  So yeah, I am barely hanging in there. Obviously I hate to throw in the towel when we haven't even seen how the market will handle any consolidation/pullback once this bull drive is over....

I'm a hopeless bear. At least BIDU ain't north of $500....yet..

It really does come down to shaking out overbearishness. We had dropped too low too fast and although I was willing to overlook it a bit, I was wrong to do so.  Things never change and the way the market trades doesn't much either.  Question is, if bearishness is lower than at a comparable stage on the last run up, then will we see some indexes make new high? Too early to tell, we'll have to review it all over the weekend.  The only way to shake out over-bearishness on a wave two is via higher prices.  And we certainly got that going.

But like I said, once this initial thrust peters out (and it will peter out!), I need to see how it handles a consolidation.   My primary count is that it will be unable too and that yes this is still a wave two up.

In general, I was cautious last night because I feared there were too many people on the bearish trade thinking the market will drop.  I still think it will, but only when we think it won't. So maybe a day or 2 delay. This is the contrarian rally for the day but I think reality sinks in next week. Particularly since its OPEX Friday.

I'm thinking maybe they need to sell something back come Monday....]

Reversal bar up on volume. Now lets see if it can follow-through.  Europe dropped on its opening, and then promptly skewered higher to make a new recovery high. Should be an interesting day and opening.

Remember they'll deem the news either good or bad until after the fact and they usually get it wrong. A market that drops on the opening will sometimes have a headline screaming "All is Lost" or to some effect only to have the markets change direction and gain 1% before they can even change the headline. It makes me want to vomit.  Its all such a game in a way. The entire freaking thing.

Unfilled gap downs are always a target, particularly the big ones.  So in that sense as a bear I hate to see them.  Yet having them filled is of course, painful and sometimes a very bullish development .  So it all sucks.
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