all of you weekly upside call buyers get completely wiped out tomorrow
99% of option traders lose money because they let FEAR and EMOTION creep into their trading. I am guilty of this hundreds if not thousands of times over the past 7 years of my trading. For instance,Friday's price action should have scared me out of my shorts and put me back into cash or maybe even into SPY calls going into the weekend. but that's not what my inicators are telling me. did you notice that MAX PAIN for last week put/calls was SPY 205.5? SPY closed at 205.49. this is not random. so far we've seen a 5 wave move down followed by a 61.8% retrace. then we saw another 5 wave move down followed by a 50% fib retrace. so that leaves us where we are now. does this head and shouders fail? I don't have a crystal ball. but I will trust my momentum indicators, and they tell me to hold my shorts.
bulls have lost momentum. two patterns in play here. we have a breakdown and backtest of a symmetrical triangle. we also have a head and shoulders top. price is getting comfortable below the 10, 20, and 50 day moving averages. the 100 day is below the 200 day. we need a 38.2% fib retracement, at least. that is near SPY 199, which is also in the area of the 100 and 200 day avgs. the macd (12,26,9) signal line is about to move below zero. we're looking for a very large red candlestick next week. price weakness probably gets started pre-market Monday, with weak European economic data
holding 5/27 207 puts
s_t I am not familiar with the coppock curve. what is it telling you? I specialize in using the 3 different MACD settings of 12,26,9 5,9,2 and 65,90,12. in addition to the slow stochastic.
this pattern that I flagged several weeks ago has played out. an elevator move down is coming
bulls have lost momentum. SPY 210 level will soon be confirmed as a major top. check out some different MACD timeframes
the (5,9,2) settings, used by many advanced traders, now sporting triple bearish divergence. signal line has already gone below zero, and macd is about to turn back down below signal line. this will result in a large red candlestick.
longer term Pring settings of (65,90,12) about to get a bearish histogram tick, or a bearish macd crossover. this gave the long term buy signal on feb 26th but is now about to switch to a bear signal.
slow stochastics making lower highs and lower lows, about to get comfortable below 20 soon. It appears that the selling will accelerate last couple hours of trading day today, and into tomorrow. if SPY 204 breaks, the robot trades could really get interesting. could be a trap door down to 198
MACD signal line about to cross below zero, VIX ready to breakout to the upside. a 38.2% fib retrace is needed. don't ignore this head and shoulders pattern. 20 day moving average now acting as resistance. price needs to go lower over next several days. market will probably throw a tantrum before the Fed statement tomorrow
I was also able to spot the bottom in IBM and FTK, accumulated call options in both the day they bottomed. loaded TWTR call options yesterday. LONG TWTR, from $14.05
don't try to short here. she's gonna pop another 2% tomorrow, and make a run at the 38.2% fib, just north of $100 in the coming trading days. just get out of the way and let it happen. I would sell upside calls when AAPL tests 100 level, but I anticipate the selloff from there will only establish a higher low.
since the beginning of this year, AAPL has entered a new bull market. the bear market was about a 30% drop over 39 weeks. now we have the characteristics of a bull, stairs up elevator down. we're finding support just above the 200 week moving average. that is where we found support in 2013. congrats to those who are buyers here. in the next few years, this is headed to $170
shorts will cover now
cover shorts at SPY 204 because the right shoulder will form, confusing most traders with the whipsaw action. we are a few weeks away from a missive decline
time to give some back here. volume is increasing on the down candlesticks. this is the start of a large pullback.
gorgeous inverse head and shoulders pattern here. the measured move is just north of Oct. 14th gap fill. more than 11% of the float is short. that is more than 30 million shares. The shorts have certainly been correct for a long time, and have made a lot of money. But, they are on the wrong side of this now. expect buyers to overwhelm sellers for a few days here as long as STX still has a $30 handle
Long stock and call options
IBB broke out of the triangle yesterday