Doji, spinning top, bearish harami…whatever you want to call it, we didn’t go anywhere fast today. As opposed to yesterday’s learning day, today didn’t tell us anything. The consolidation, profittaking, selling or whatever you want to call it was not severe and on lower volume. So we will need to keep watching for the market to say something to all us traders.
The Dow and the Nasdaq were up slightly while the other indexes were down slightly. The Dow chart shows that we are approaching a trendline drawn across recent highs. 
and the S&P is still looking to make a new high or being turned back at the double top.
The key to today was not to lose money. Nothing wrong with just sitting and watching. Cash is a position, especially when the markets are chop chop chopping away. SPPI popped in the morning so I was able to cash out early. CHIP didn’t do much so I’m still holding, but the chart is still showing possibilties.
And on a lighter note: Due to recent bailouts, budget cuts and the cost of electricity, gas and oil, as well as current market conditions and the continued decline of the U.S. economy and its dollar, The Light at the End of the Tunnel has been turned off. heehee
Today was the day to learn which way this market will decide to go. We had a follow-thru of last week’s action to the upside in a very big way. First the indexes were up 2%+, the NYSE Advance/Decline volume was positive 17:1, and volume, although on the lean side, was still greater than last Friday’s volume.
Supposedly the exuse to move up big was that traders cheered G-20 promises of additional fiscal stimulus. Equity markets moved higher first across the Asia/Pacific markets and then in Europe after the central bankers and finance ministers agreed to “continue to provide support for the economy until the recovery is assured.” Who cares about all the unemployed, just keep pumping, or is that printing money until things are better.
My little double bottom I had on the VIX 15 minute chart didn’t materialize and continued down, reducing volatility and showing the markets to the upside. I didn’t trade much today nor twitter much, as I was moderating the Hit & Run Candlesticks trading room. But I did take some half profits on half positions in CHIP and SPPI, which I have been nursing for a week. Here’s hoping that both positions continue to the upside.
The Dow made new highs today::
But the S&P500 did not confirm that:
so either the S&P gets repelled by the double top or confirms a break thru to new highs. We’ll see on Tuesday how that works out. Lookout for “Turnaraound Tuesday” though. 
Futures are really blah tonite and working on a 2 point range. Thought they would be a bit more excited than that, but the night is young. See you on the field tomorrow….good luck. 
Published on
October 8, 2009,
9:08 pm in
Daily and Trading.
Tags: CHIP, DXD, DZZ, ERY, ES, OPXA, SDS, TBT, TZA.
Traders were happy with AA earnings and futures were up all night. Adding in a good jobs report and many stocks gapped up at the open. My spec plays from yesterday were flops. Both CHIP and OPXA floundered around to the down side, but not so much as to stop me out. Most of my trading activities were in the futures before the cash markets opened. I couldn’t sleep last night, so I got up early, like 4AM, and enjoyed some quiet trading. Using 1 car, I traded short 2x and long 2x and walked away with 45 ticks before the open….so it was a good day by morning
The other exceptional play I had was entering some TBT calls before the auction results. TBT is the Ultra short 20+ year Treasury ETF. You would buy this when you think interest rates are going up. After the auction results were announced, the calls popped up 20%…and within another 30 minutes they climbed another 15%, so I cashed out with a 35% gain in about an hour’s time. That was one of those trades where you kick yourself saying, “Why didn’t I buy more?”
The markets have been up every day this week, so I’m thinking traders may be taking profits before the weekend. I also think that Gold may be getting a little ahead of itself. So I’m making a watchlist of several short ETFs, as in: DZZ SDS TZA DXD ERY. I’m also looking at re-entering TBT calls on any pullback. And I’ll probably be shorting ES….unless of course, the bulls come out and chase the bears away.
And for your reading enjoyment:
The Weak-Dollar Threat to Prosperity
