DaddySawbucks

DJI Rolling over- Textbook Rejection

Short
CBOT_MINI:YM1!   E-mini Dow Jones ($5) Futures
Refer to J Murphy, Technical Analysis of the Financial Markets: Fig 4-10a; rejection, return to TL; rejection confirmed:

https://cdn.preterhuman.net/texts/unsort...

See p. 72; and discussion of reversal patterns with diminishing volume pp 103, 107/8; Fig 6.8c with discussion of wedges as reversal pattern, and volume on pp 147-150.

All this is THEORY. Trade at your own Risk; GLTA!

NB: DJI is STRONG SELL on multiple indicators, see investing.com:

https://www.investing.com/indices/us-30-...

IMO we could get a wee lift if you look back week of 19-23 October, a weak lift before the deep dump... will Santa save DJI?!




Comment: Aye, wee lift from the bipartisan relief bill proposal, going to a vote later on. Short entry IMO
Comment: Sitting in cash waiting on clear signal; manic rally possible on stimulus, might be soon
Comment: Stim deal in the works, see how markets react before you throw money in this grinder!
Comment: Would not touch this yet. WAIT for the DEAL. Might be Friday; might be next week. Santa will come!
Trade active: Fourth trip to the TL. Rejection now will be fatal IMO; entering shorts in SDOW and some bear spreads
Comment: Rejecting; heading lower in New Year IMO
Comment: Closed bear spreads on the dip; holding SDOW
Trade active: Reloaded bear spreads on 12/23; in the Jan 302P, short Xmas 297P; just 4 contracts. Another improbable bear flag grinds higher all day after what appears to be an exhaustion gap; expect short-covering visit from Santa Thursday!
Trade active: Played Fade Gap; waiting on Tuesday's price action, holding inverse ETFs, rolled short calls to pay for drawdown. So many gaps to fill...
Comment: Unless it closes lower EOD FTG did not work for SPX/DJI today (12/28); NQ did fade back down to near closing price, and RUT closed it. These prices are very effing high but can certainly climb higher! IMO the rally will end soon... correction, then another stupid rally LOL
Comment: Looks like it topped at 30500 on 12/29; look to the weekly candles for confirmation!
Trade active: Shorting in box 30600-30800
Order cancelled: It's a blowoff top expect a parabolic
Trade active: In SDOW at $12 and DIA 310P, bear spread

Comments

32k is coming.
Reply
We are very close to the short term top. Volatility increasing. A lot of divergences now. SPY & Nasdaq may go a little higher. Divergences only getting bigger though. Normally we get many 10% corrections during a melt up. It looks like we are close to one of them here. More melt up to come after this though, we have not seen the all time highs yet. Too much FED and stimulus yet to come after this correction. Should be good trading over the next couple months, then jump in and ride it up some more.
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@bkidd7, Right on IMO
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LOL. I doubt those Politicians (many that are senile) will ever agree on a bill.
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It's going to get volatile very soon. Get ready to trade!!!!
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@bkidd7, do not short this now fgs!
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@bkidd7, VIX rising on price rise; shorting it here
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Nosniv DaddySawbucks
@DaddySawbucks, what bearish positions do you suggest taking?
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bkidd7 Nosniv
@Nosniv, All different ways to play this. I bought VXX calls last week, still holding those. I'll probably buy QQQ puts soon, just waiting a bit longer. I'll probably buy IWM puts also.

It's just me. I'm not telling you what to buy though. Bottom line, It looks like a correction very soon, with increasing volatility. How big, who knows. I'd guess at least 10% correction over next month. Could be bigger and last longer. It all depends on virus, Georgia Senate race, and any other crazy thing that come out of left field. The FED could lose control, even pumping in Trillions more.
+1 Reply
bkidd7 DaddySawbucks
@DaddySawbucks, Agree. Increasing volatility over the next several weeks. A decent correction should get going soon. How big, only the new mutant virus knows that.
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