Wednesday, July 25, 2012

Charts 7/25

Was that it for a wave 2 today?  Not even a .382 retrace on this one, it just managed to cross the channel as I have adjusted it now.

In the morning, a 400+ number for claims and a bad Durables report would send us south in wave 3 style.  We could gap down hard at the opening, but we have a small amount of room on the chart for us to pop up a point or two, maybe a last ditch effort to hold us up here.  I really hope we get the latter, for a possible trade on some mayflies -- short-timer puts.

Trying to coin a term here, mayflies are opening a new options position with 3 or fewer days left until expiration.  This is in contrast to Lazarus options, which are calls or puts you bought originally with plenty of time on them, but you were wrong and held them too long underwater, and now, while expiry approaches, you pray for them to rise from the dead.  Only Jesus can save them.

I scalped some weekly 135 calls today, managed to dump them for a small profit while they were still green.  I wanted to have them more for the possibility that we could ramp another 15 handles higher, and I managed to ditch them before they became losers.  I don't want little spec plays like this to crash and burn and end up worthless and just embarrassing, which is so easy to do with mayflies.

Hope the channel is about there now.

Can we actually dive below 1280 this week?

The big nasty


matt_bear said...

there's your pop. wow.

christiangustafson said...

And .. no nasty surprises in Durables or Claims this morning.

Wave 2 still has time and room to handle a pop like this. The .5 and .618 retraces are around 1354 and 1359, respectively.

Or, we get back up in the ending-diagonal triangle again and put in another wiggle up. Higher highs would need some sort of actual policy, I would think, and not just ECB talk.

Pieter vL said...

Henry at SI called the 3 up late yesterday.

PMs popped, but GDX up only a smidgeon (.29%) suggests skepticism on its durability.

This up wave is likely the middle of a C wave off the 1266.

That puts us within a few days of its topping, and the FOMC.

rd said...

Followed u on TF - good stuff

Here is something I saw on Slope of Hope

Pieter vL said...

Dailies have us at R, and a countertrend move today.
No hints though of any neg. divergences. So we ought to clear R soon.

Weeklies still on buy the (IT) dip.

So I'll give the edge to the weeklies, suggesting we clear R, and head up into mid Aug.

Ven said...

Hi CG, long time no see. I too was banned by that TF nutcase. He obviously has some serious mental health problems. Anyway, I think if you look back you will see strong similarities between this past week in Spain and the week of Sept. 15 2008 here in the U.S. Crash first half of the week, then short covering bans and rip your face off rally the second half of the week.

In other words, we are a couple weeks away from things completely falling apart in Europe. My work shows a 15-20% decline here in the U.S. before the end of August, and much worse coming in the Fall ...