Tuesday report - VISION FINANCIAL MARKETS

You can put it in the books. Another gap higher open started the last week of the year in the green. That makes five days in a row opening with a gap.
This is viewed as expected by some, but at the same time these gains are creating some pause in even the most bullish of traders.
Without a retracement to speak of on this run, the equities are making it difficult to just jump on board.
So as we start this week of the traditional Santa Claus Rally it is sink or swim time in very quiet holiday markets.


In the end the SPH got exactly up to the 50% mark at 1126.00, sold off a little, recovered a little and closed up on the day “a little”. The imbalance showed sell $241mil vs. buy $179mil, traded 1123.50 on the 3:00 cash close and settled at 1123.10 on the futures close. What can we say? The SPH has closed higher 7 days in a row and equity flows are the highest levels in 79 weeks. Do you really want to fight that?


We now have 2 ½ days left in 2009. We see no reason to add to this. For the most part the year is done, cooked. We got our 1130 and “maybe” over the next few days it will exceed 1130. By how much? We don’t know and don’t care. Our call? Remains the same, 1130 and then 1150. The problem with 1150 is it may not happen until next year.

Wednesday Report - VISION FINANCIAL MARKETS

In the end chalk another one up for the BULLs.
With all the buy stops above and the lack of overall trade it seems the path of least resistance is still up.

Wednesday? Have you ever heard the saying “Id rather fight than switch?” Well don’t believe it.
The theme remains the same… the slower it gets the more it will favor the upside. As of today we have 2 trading days left until Christmas, 6 trading days left in the month and 9 days left in the year.

Can you believe it? We can’t speak for you but 2009 goes grown to be one of the longest years we can remember and Dec feels like the longest month of the year.
Looking back it if there is one lesion learned it’s that the markets went up despite many a smart man saying they should go down.
In Asia 11 out of 11 markets closed higher. In Europe 9 of 10 markets are trading higher.
Our call? We have 4 economic release, the EIA numbers and 3 auctions to get past but we still think we are going up

Tuesday report - VISION FINANCIAL MARKETS

In the end the roll over will account for at least part of the current slow down but only a small portion. For get the option expiration its year end. Everyone is “shutting down” for the year.

One thing that we will get out of the roll will be a look at how open interest went out in the S&P. During the last several rolls the open interest dropped from a high of 650k big contracts down to 350k. At the start of this roll open interest was right around 400k. As far as the days overall trade went it was “all spreads” As for the over all tone it seems the slower it gets the higher they go.


Last Monday the SPH closed down 4.40 handles, on Tuesday the SPH closed down 13.70 handles at 1090.00.
But after that Wednesday was up 5.60 handles, Thursday was up 6.40 handle, Friday was up 6 handles and yesterday was up 5.50 handles? The SPH has been crawling its way back over the last 4 trading days and is only a few handles off it contract highs for the year.
Like the market, don’t like the market, it really doesn’t matter at this point.
We have only 11 day until Christmas, 4 trading days until DEC goes off the board and only 12 trading days left on 2009.
That in it should be something to cheer about. Here is where we stand on the markets right now. The slower it gets and the later into the month we go the higher we think the S&Ps will end up.
Do we like that? Not really but in all honesty this should be the time of the year that smart traders cut back.
It doesn’t matter if they are up or down no one wants to see losses at year end.

The way it looks is the SPH is going back up but the narrow rally over the last few days is anything but inspiring. In Europe today the banks led the sell off with concerns about Greece's debts and worries over the financial health of Austria's banks. We could be in for a down day but we don’t think they will stay down for long.

Thursday report - VISION FINANCIAL MARKETS

We have 12 days to Christmas and 15 trading days left in the year.
A local in the S&P pit told me yesterday that he has lost most of the money he was up this year in the last few weeks. All we have to say is CUT BACK.

If you’re down don’t loose any more and if you’re up (like many of the hedge funds) cut back or don’t trade. Another trader asked us if we still thought we could see 1130-1150 by years end.
With 15 trading days left was still think it’s possible but like anything in life there are no guarantees. Shit the SPZ could be up 20-30 handles in one day but who knows. In Asia 6 of 11 markets closed higher.

In Europe 8 out of 10 markets being quoted are trading higher.
We think crude is over sold and that yesterday low near $70.00s could hold for a few days. If this is the case it will only help the S&P move higher. For now the circle jerk continues, the SPZ sells off, finds a spot and holds (we said in Monday 1185 would be critical) and then starts going up again fueled by all the buy stops above. Buy weakness we are looking for the Thursday / Friday low the week before expiration.

THE INDEX REPORT

In the end all we have to say is things didn’t act all that well.
The $100.00 sell off in gold over the last few days and the big drop in the EURO currency and crude are gigantic moves. Many times in the past when you see move like that it’s usually associate with people being caught..
The retail trader sits there and says “well I’m out 20k, gold has to bounce” the unprotected position then turns into an even larger loss. It’s was all fun and games when the GOLD was going up everyday then in come the margin calls and all the people getting forced out. That type of stuff never ends well.


Wednesday? Thursday is roll day, MCH becomes front month.
Most traders do not like the roll because they say it only makes trading the S&P harder. Then next week we have the DEC expiration, none of this will be easy.
In Asia over night 9 out of 10 markets closed lower. In Europe 7 out of 10 markets are trading lower.
This morning we have Wholesale Trade at 9:00 and the API out at 9:30 and the 10yr note auction out at noon.
Our call? Its 6:30 am and the SPZ is up 4.50 handles. We lean to buying weakness, especially if we get down neat yesterdays lows. On the upside we have buy stops above 1098 up to 1103.00. We are still looking for the Thursday / Friday low this week before next week’s expiration.

So what Pit bull says ?

VISION FINANCIAL MARKETS


Out of the last 12 Mondays; 1 was closed, 2 were down and 9 have been up. One of the down days was only off .60 and the other down 10.50.

Total loosing handles over the 10 weeks adds up to -11.1 handles; the 9 winning Mondays account for 97.90 winning handles. We have been asking how long this can go on and even we don’t really understand it.

The Pit Bull says all you got to do is just “buyem on Friday and holdem into Monday”, if only it was that easy.

Its 5:30 am and the SPZ that was up 2 handles is now down 5 handles. The dollar jumped to a five-week high this morning against the euro, crude is down .85 cents and is down $27.00 this morning. We worked in the old GOLD pit and like we said GOLD goes down a lot quicker than it goes up, that’s the history of the commodity. In Asia 6 out of 11 markets closed lower.

In Europe 6 out of 10 markets are trading lower. Our call? The markets are looking at the same stuff they were Friday. We think it’s possible we remain weak for the first part of the day then rally. There is a feeling out there we could dip one more time before going back up later in the week.

Friday report - Bottom line

We have to wait to get a look at the jobs numbers and see if we have “over sized” GLOBEX volumes.

Overall we don’t have a good feeling about the markets right now. They are LONG over due for a pull back which would fit right in to a sell off before going back up during the DEC expiration and month / year end.


VISION FINANCIAL MARKETS


The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. VFM Trading its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction. There is a substantial risk of loss in trading futures and options. Past performance is not indicative of future results.

New !!! Pit tradres are talking from the floor

I am happy to announce of new section in the blog. Traders from the CME floor are going to share there thoughts and beyond that their great massive experience about the stock market.

The floor is the center of information crossroad of the market. Many institutions and hedge funds are placing their orders via the floor and it's well known that the best traders trade from the pit and own seat in the exchange.


VISION FINANCIAL MARKETS - 12.03.2009

The back and fill price action and the slower the markets get all seem to favor the upside.
With a mixed batch of jobs numbers and economic release the SPZ forged into new highs. We said we thought we would see some side ways to down type price action and with the exception of the early spurt up that’s pretty much what we got.

Oil got hit by low demand and the bond market was down, then up, then back down again. We had a lot of people asking about the bond move and all we heard was they trapped a lot of people long into the rally.

Look, we don’t want to see people get chopped up going into the end of the year. The way we see it is if you’re up, stay up. c If your down, don’t use the last 3-4 weeks of the year to get even. Take some common sense advice and cut back. We are now into the DEC roll and in a few weeks it we will be looking at the DEC expiration, a time many traders say makes it even harder to trade.

The less is better. The small ranges and the lack of volume have made it too hard to trade. We still think we will see higher prices but we also think the risk is going up the higher we go. Below is a snap shot of all the economic releases and scheduled speeches for today and tomorrow. After you read that you may agree that cutting back is the way to go. 1120.00-1123.00, 1130.00then 1150.00 are still our upside targets.


Disclaimer :
The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. VFM Trading its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

So are we due to correction?

Thanksgiving has been a very positive for the markets , especially on Fridays. The fact the last Friday ended red has been a poor suprise for seasonality traders and bulls as well.

I consider Friday action as a try to minor the damage for the bulls as relatively they did pretty well.

The overall picture remains positive. Take a look at the new 52 NYSE lows which is running on 10 for several months and this pattern is very typical when bottoming.

Good trading

Houston, Do we have a problem?

The market grinding up as only the expiry week had the ability to temporary halt.

The image below shows the market resistance with the downtrend line stretched from 1550 area.

So what can we do now? The market can start a correction but the uptrend is Not yet violated.

Good trading

Market review

The bears once again have felt the dominance of the uptrend as market recovered from 1035 area to a new year high 1102 area.

While this rally don't have the strong momentum of the last one , it appears that uptrend is still intact.

In the image below, S&P500 weekly cash index. The analysis is very simple. The price should not be below the 65 EMA which represent our benchmark. As long as the price above the 65 EMA , the trend is up.
As you can see over the last years , the outstanding efficacy of this simple indicator.

Updaed performance plus market review

I haven't updated the site for a while and the reason was very poor market conditions.
The risk reward wasn't at our favorable ratio.

Many analysts , especially Elliot wave ones ,expect a down wave C to new lows , below 660.
We encountered a V structure bottom pattern which is very rare. My analysis shows that a new uptrend has begun since 980 area.
As long as 980 is not broken , The uptrend is still intact.

Please take a look at the updated performance page.

Market update

It's been a whiile since the last post and the trend has changed as suggested . So what's now?

Entering a long position here , can cause major loss since conditions are pointing
for a correction.
XLE look weak as well as September is the worst month of the year.

Nevertheless I prefer to short the safe way, where market confirm the down move and then corrects up to lower move.

Position closed

While market was looking as it in a reversal mode ,we shorted 944 area .

A huge rally came to stop us out at 974. 30 points loss. 30-40 points is the maximum loss the Swingit suffers since a change in risk mangament occured a couple of months ago.

As for now,Market is very strong as even change in trend can occur.

Good trading

Position closed

We took a short @ 912 since market conditions suggested a pullback.
Since there is more juice to fall , we let the position ride.

Once there is a profit , we never risk the profit. A profit stop at 898 was placed and today was activated. Position is closed.

Good trading

Market update

Market seems to be vulnerable in the coming weeks for a sharp move.
Recent breadth and other measurements suggest a reversal is near.

In case this analysis proved to be wrong as S&P500 will move north above 970, then most chances that the down trend is done.

Good trading

Twitter

Now you can follow us @ http://twitter.com/indexswing

The updates include not only indices but forex and other commodities (i.e. Gold).

Stay tuned...

Closed position

A short @ 946 was triggered as of 02/06/09 , with a stop at 976.

In order not to let winner into a loser after market was visiting 923 ,the stop was
moved to 944 and today we got stopped out. So trade is +2 points.

Good trading

Market update

As I suspected the market couldn't breakdown 880 and rose above 940 area.

At the moment , things are very shaky.
We are in extreme situation where usually market reverse and start the down move.
On the other hand , this is a bear rally which can lead to a trend change !

I lean on the downside but the current environment is not suitable for trading the both sides , till we get a real clue of where market is headed. That would be for a start a close below 920.

The USD index is very close to reverse and that may help the market to reverse but you can never rely on correlations like this as they can stop "working" at some time.

Good trading

Closed position

I decided to close the short position @ 895 since I suspected there will be
another up leg attempt towards 950 area as I didn't want to undergo more than 5% draw down.

At the moment , it looks like the market topped out.

Good trading

Stopped out

Out stop was activated and we are out. The reason I gave a second chance to this trade was many negative signs that has been collected since 750 area.

While in the first the trade was not going our direction , Thursday and Friday led me think that we are in the right way. The new rescue plan which was published on Monday caused to 7% huge rally and it hasn’t helped the trade.

While I am sure the pullback is very close, there is a chance that market will continue up.
The purpose of stop loss is risk mangment. Swingit has stricted risk managemnt to not risk more than 5% a trade no matter what.

Althogh you think you are right , you can’t win them all.
Not having stop can blow out accounts.

I am confident to have Swingit in new highs over the coming months.

New subscribers site

A new subscribers site has been launched. The new site address -
http://www.index-trade.com/

The main purpose is to have the current status of Swingit clear and shown to all.

I may share there my ideas concerning market conditions that not necessarily linked to Swingit signals.

Good trading

Short closed

We entered a short trade on Monday , at 869.50 E-mini March S&P500 contract.
Right after the fill , the market began all his way down to a low at 806 area within days but then retraced sharply to 831 area on close.

I think this kind of behavior is NOT healthy for markets , to retrace from -2% to light positive area. It reflects that the buyers has no real power to move the index but to only 0.3% advance.

I waited for Friday to be a down day but that wasn't happened(Actually it did after market was closed , the future emini was about 8 points lower).

We closed the position with 39.75 points profit.

Good trading

Another profitable closed trade

Tuseday , we went short at 930 E-mini S&P500 march future ( ESH9).

Since then the market began to undergo a correction. We closed the trade at 897.75 on Friday , leaving us 32.25 points profit to another high record of swingit.

The reason for exiting the position was identifying volatility couldn't handle to rise. Means something is fishy here and we don't want to leave money on the table.

Performance page is now updated.

Good trading