Back To Serious Trading - September 7, 2011

[Billy]

Forum Clusters 110907.xlsx

If Tuesday was really the first day back to work after holidays for large and professional players, this was a most bullish day to say the least. After opening at the low for the day near daily S3, well above the pre-market lows, and after some initial hesitant hiccups, IWM crossed above the day’s VWAP at 11:15 AM and seldom looked back till the close. Cumulative TICK crossed its half-day average soon after noon, its full-day average soon after 1:00 pm and closed the day above the 10-hour moving average and the very strategic QS3 (68.17) level.

I believe that we must forget about August chaotic trading characteristics and focus immediately on what the pros and their algorithms are doing right now. We can also expect the floor levels to become major guidelines again, just like it happened last year after Labor Day. Large players were also on a buying mode all day long with a relatively strong accumulation pattern that switched the 20 DMF back to neutral.

If the large players strategy is really to accumulate for the long term from these oversold summer levels, we will know soon enough in the coming days. The IWM robot still produces good edges for shorting but at much higher levels. The short entry price (70.81) is waiting 3.72% above yesterday’s close so the best is to patiently let the optimal shorting trade setup execution opportunity come to us. If it happens tomorrow or later, the robot might have changed its analysis overnight and we’ll reevaluate the new setup and signal accordingly.



GDX stalled as expected at the confluence of MR1 (66.64) and WR1 (66.45) and seems to be following perfectly the support from the (65,5) volatility stop. The GDX robot could raise once again the trailing stop (59.69) 0.73% above the initial entry price (58.96). This trade is now basically a risk-free trade and a hold for initial buyers. New entries at 63.25 have very neutral edges and could only be triggered after a deeper pullback below the volatility stop (64.31). A new consolidation around SR1 and QR1 (62.12) might follow before the next upleg.
Billy

[jgt2004]

Hi Billy,

do you manually draw the support clustors? or is there a way to upload them into freestockcharts?

Thanks

Joseph

[Billy]

Hi Billy,

do you manually draw the support clustors? or is there a way to upload them into freestockcharts?

Thanks

Joseph

Yes, Joseph, it's all manually done. Because I also have many confidential robot proprietary annotations on my charts (that I hide for publishing here), I am sorry to be unable to share them online.
Note that once you have duplicated one of my charts, it is very easy to keep them and the clusters updated with the daily "Forum Cluster " files that I attach to my morning robot commentary.
Billy