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View Full Version : The Nowhere Market, Back To Basics – October 10, 2011



Billy
10-10-2011, 04:49 AM
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My weekend work feels like a big waste of time. After spending hours trying to accomplish deep research in all fields ( stages, correlation, sentiment, breadth, price/volume, leadership, macro views,…) and reading tons of expert commentaries on the same topics, I can only conclude that this market went nowhere in the last two months while behaving like a cocktail shaker in between. And the more you dig and read, the more confused you become about how long will it last and how to detect if this market can go anywhere soon with some reliable probability.

Fortunately, the robot didn’t need to waste his precious leisure time like I did. As early as Saturday’s breakfast time, it was telling us exactly all we needed to know for Monday’s trading. The 20 DMF is in a buy mode, the IWM robot is holding its long winning position with a trailing stop at 61.89, it will avoid entering a new position today with neutral settings and the expected 3-day gain is only + 0.3% with a weak win ratio of 57.5%. Nothing exciting, but basic, practical and actionable facts.

Looking at the multi-pivots outlook, I notice that the new weekly pivot (last week’s floor equilibrium price = 64.40) matches exactly the yearly S1 (last year’s first floor support price = 64.40). The coincidence is too striking just following a potential major bottom and hints that this is currently the most important reference in all floor traders programs. I feel confident that buy programs will trigger rather quickly if that level is tested this week. It is slightly below the initial buy entry price of the robot (64.78) and far above the trailing stop (61.89). Remember to be patient with a winning trade! Don’t change the rules after committing to the full robot trade setup.

I still see the declining 50-day moving average (69.08), bordering the second floor resistance cluster as the major source of potential selling pressure. It is also at the reversal area from 9/27/11 that launched a 5-day selling wave.

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The GDX robot stays in cash once again. The multi-pivots outlook is rather bearish down to the 10/4/11 lows with the weekly pivot (54.06) as the lone potential brake area in-between.
Billy

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