Market Speech - September 9, 2011

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Money flow was moderately negative yesterday, showing some selling by large players. Cumulative TICK and VWAP indicate that HFT’s were aggressively selling from lunch time until the close.

The short IWM trade is now in the green. IWM lost the weekly pivot support (70.15) and the next leg down aims at QS3 (68.17). Coincidence or not, this price of 68.17 is precisely 2.02% below yesterday’s close or the 3-day edge indicated with 66% win ratio from today’s ST/LT settings. It is also the price area of the (65,5) volatility stop that could warn of a short term trend reversal to the downside or of an uptrend resumption.

The first resistance cluster is now heavier than yesterday with a huge floor selling pressure strength of 29 and that bodes well for our trade evolution.

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GDX has all the characteristics of a strong uptrend and let’s hope that this trade will end in a climax run to the upside. The second resistance cluster (69.65-70.90) has a good probability of being hit sooner or later. The initial trade is now +13% above the entry price of 58.96 and the trailing stop 61.24) is consistently rising . The daily settings have persistently remained neutral from day one, so it should not discourage you to buy a potential pullback to today’s limit entry of 63.25.
Billy

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