CL setup reverses

Taking off from the previous post; the long entry never materialized and price broke down further.  A lesson in not being married to a bias.  The long setup was taking place, the trigger never materialized and price rolled over and traded in the other direction, which could have been just as profitable.

The fast line was trying to hold the slow line (read: momentum as price tested marginally lower, 3d criteria setup).  The price pattern showing a descending channel.  The further, steeper down tick in the 3/10macd fast line (daily chart) coincided with the breakdown bar through the descending channel.

Wed. 05_01

Got a bit chopped up for the ISM.  Frustrating being how textbook of a stop run that was within the first hour.
Also got a but chopped up in mid-afternoon.  I gave up on the trade setup because of "Fed Day" excuse which is stupid to make excuses like that.  I failed to include the down arrow on the 5-min 3/10macd to indicate the last trade into the close.

Breadth - Compare the Adv./Decl. (top) to that of SPY 5min (above, right).

Vol. Profile coming into today - Opened right under previous day's value area and traded through the second, smaller, distribution area.  Eventually traded back to NVPOC from Friday.

ES with globex - trended lower since 7am

Higher t/f split - Price coming into decent support

Tue. 03_19

today's trade:

A key for the above chart to define the horizontal lines and dots.  For further explanation, see this link:  

Still considering this a 2c-2d criteria pullback on the higher (daily) time frame.  As such I would be looking to buy a 3d on the faster time frame (65min), or some pullback combination like 3a-3b-1a.

Thu. 02_28

today's trade

3-point drop in the last minute of trading.  Looks as though March may have an interesting start tomorrow.
Unfortunately didn't take the short into the end of day.....so dumb

Looking like a lower high, followed by a double-top at resistance.  Today amounted to a faded breakout.
Higher time frame (65m) still showing a bearish favored trend, the 3/10macd slow/fast line is crossed and I'd like to see an XYZ wave on the faster (15m) time frame to short but I would still suspect a higher low to be defended.  $150.80 = 50% retrace of this past move.

Gold lower

Not looking good for Gold.  I had hope for it a few weeks ago, but sell stops were unwound.
My premise a while ago was that it could be forming a cup w/ handle pattern, but since that posting, the handle (channel) broke down further.

The daily (above, right) looks a bit oversold at this point, so I can see a pullback higher to try and regain the weekly (above, left) lower channel.  If buyers are attracted then I can see a buy divergence on the weekly playing out, but the ball is obviously in the bear court.

Looking at the monthly (below, left) I can imagine that if 1529 gives then I think it can get messy.

Just for kicks, below is the weekly cycle count, since it has been consolidating for 77-weeks (I believe).  Previously, it spent 100-weeks in a bullish frenzy after a consolidative breakout.  So, it seems about right that it is consolidating as much as it has been in order to give symmetry to the previous bullish momentum.
The red line represents the price and time target based on the previous Inverted Cycle.  The fuchsia line is the cyclic trend line (CTL in the Stevenson PTT concept) which is the trendline needed to be broken in order to consider the current Regular Cycle ended and the next inverted cycle to begin.

Overnight ES

Just a quick look at the ES overnight pre-holiday edition.  Whatever it does likely will not include the higher time frame "big money", but it is what it is.  A split view of the 15-min (left) and 5-min (on the right).  The 15-min is showing the 2c-2d criteria (pullback following bullish momentum while showing a reverse divergence) while the faster time frame is setting up the 3d criteria at support.  Looking for price to break the overhead trend line (on the 5-min chart) and the fast line turn green.

Well, it had a rough go of it, but was able to test higher without breaking down from support.

Worth Watching

Going into this next week or two I'll be watching for AMZN long entries.
The higher time frames have a strong trend in place, with trend line support.  The recent downside momentum was the largest ever, which could be an omen for things to come.  However, this shows itself as a reverse divergence on the higher (monthly) time frame which often leads to snap-back rallies (which may or may not form its first lower high).
Monthly:  Trend intact, reverse divergence (2c criteria).

Weekly:  Trend line holding on a small divergence

Daily & intra-day charts:
The daily has an inverse H&S pattern on diverging momentum (setting up a possible 3d setup).  Certainly wouldn't want to see it give up $170 below (actually wouldn't want to see it fail the 50% Fib retracement of the Head to right shoulder).  The first hurdle above will likely come from the $182.76 level.
Primary target $199, secondary $216.  Essentially I'd like to see a break of the overhead trend line on a strong momentum bar.

Higher Time Frame

If you have read understood much of what I post on this blog, I use this confounded "code" (3d, 2c, 1a, etc.) simply as a means to describe (in shorthand) the criteria of the 3/10macd which in turn highlights a structure occurring within price.  With that said, here is what is happening with the higher time frame S&P 500:
Here is a split window of the monthly (left) and weekly (right) price action.
Things of note;
2c set up on the monthly - which is really just a reverse divergence.  When looking to trade a "2c" setup I look for a few things on the faster time frame which include a "3d" setup, 3-pushes to a low, and/or an inverse Head & Shoulders or strong seed wave, which is exactly what we see on the weekly chart (trigger to enter was 5-weeks ago on 12/16).

The only concern I would have with the above setup is the bearish tone to the trend on the monthly chart (50-period MA trending down while the 20-MA corrects into it) which can turn into a Head & Shoulders pattern (2b setup) or a climactic top (say at 1400).  Essentially price is going to have to break out of this 1300 overhead resistance with some serious momentum (say greater or equal to the previous 10-month long upward momentum) which in turn could start a new cycle of higher highs.  If momentum fizzles price can still go higher but price would give clues to signs of weakness.

thurs 1_12

Another good example of the A/D zero-line acting as support today.   First the initial bounce in the first half-hour of trade.  Price support ended up corresponding with a -200 reading (mildly bearish).  A/D line bounced at zero 3 times later in the afternoon as extreme negative TICKs on higher lows indicated a bullish divergence.

Some trades:
BTU - 2c setup.  Later in the day there was the chance of a continued test higher, but ended up scratching at b/e

GS - continued to show strength (or squeeze).

Really disappointed in missing this as I was watching for it yesterday.  A channel/flag break in NFLX

Also disappointed for not taking this short in the SPY this morning (2d-to-4c continuation, or simply, a bear flag).  Notice that the 15-min 3/10macd (top indicator) showed a lower low while price made a higher low/double-bottom, which gives us a buy divergence, while the 5-minute 3/10macd formed an inverse H&S (as did price).

Wed 1_11

Some decent setups today.
First was GS early in the morning and later in the afternoon (2c setup)

FSLR- I have two up-arrows on the 5-min 3/10macd.  The first shows a valid long entry trigger, but I didn't take it as price felt extended.  I did enter on the second up arrow though.

GLD- into the close with a 2c setup

Thought I would include this chart of the SPY with the TICK and Advance/Decline.  I mentioned in a past post about watching the A/D line and its interplay with the zero-line.  Here was a good example of how sellers were hitting resistance points, but once the A/D line recovered zero the buyers seemed to be in control.  Also worth noting, price held the 50% retrace from Monday's gap up.

tues 1_10

I'm really not good on days like today; the big gap up day (or down for that matter).  The momentum should tell you not to aggressively fade and what I would consider overhead resistance makes me hesitant to put on long entries.  Not to mention a momentum indicator is rendered useless (until later in the afternoon when it catches up to price).  What I end up doing to combat such a dilemma is use a "gap-less" indicator, one in which the gap is muted so that it doesn't exaggerate the move.  As I mentioned, the indicator does catch up to price later in the day, so I just use this indicator for the first 3-hours of the day.
So, in the chart below I've done two things;
1) I'm using a gap-less 3/10macd indicator
2) I'm using a 5-minute chart, however, the first 3/10macd has settings that reflect the 15-minute time frame, while the second 3/10macd has default settings for a 5-min chart (also the moving averages have settings to reflect a 15-minute time frame). 
So I have just combined two charts into one essentially.  The two down arrows reflect short entries (first exit was at $129 support while the second exit was $129.2 after the double bottom).  The up arrow was a long entry (half taken off at $129.3 other half for break-even).

and here is what it looks like using a regular 3/10macd.  The gapless indicator made it easier to see a more bearish tone to the price action.

All-in-all not a fun day to be messing with the broad indices.  However, there were issues that had a nice trend to them.

I missed the better entry in FSLR (first up arrow) but did get in before it broke higher (second up arrow)

NFLX illustrates a good example of when to take momentum divergences.  It has had a strong trend these past few days and pulled back into support on higher momentum.  Exits taken around $96 resistance zone.

monday 1_9

2c setup in AAPL today didn't quite work out for me. Original stop was $0.80 which would not have gotten hit until the $425-test failure. However, I took a 10-cent loss on the position as I was looking for more of a squeeze move higher from my entry.

NFLX just continues to squeeze. If there is one pattern combination of Moving Averages and 3/10macd this is it.  Exited 10-min before the close.

more 2c

Took GS long giving consideration to the 2c condition on the 30-min chart while the 15-min chart showing a stark reverse divergence.  The faster time frame showing the inverse H&S pattern and 3d criteria.  First target at the intra-day supply point (coinciding with the Open price).  Second half taken off on failure to follow through.  Not a great trade, but it worked out.

Here is another example of the 2c setup occurring in Crude Oil.  The 50% target was hit without a hitch, but the 100% projection was hit only at the end of the session.

new year same setups

2c setup - entering a pullback in a bull trend
Momentum shows a reverse divergence while the faster time frame shows 3-pushes to a low or inverse H&S pattern (3d criteria).
SPY

GLD

2c

Examples of the 2c setup. 
Being that the pre-market is so active these days it has offered some good technical setups of which the Opening sequence is just a follow-through.
Here, the SPY opening move was a drive off of this trend line break (2c setup, reverse divergence)

Here is one which I traded but feel I got "lucky".  In hindsight this market was an inside day and didn't offer that reverse divergence to act off of

2c setups

In GLD

and AMZN

SPY

Moves to the A/D zero-line while fading resistance worked well today.  As the previous day was an extreme advancing day the 124.45 area was a previous day break-out level. 

2c AMZN

Here was a 2c setup gone wrong.  At least I THOUGHT it was a 2c setup, but the "trend" was certainly not decided at this point.  As the breakout failed (stopped out) I turned short quickly as the setup morphed into 2c-2d-4c continuation short setup...essentially sloppy and not worth the trade.  $195 overhead looks to be a significant level for AMZN...keeping an eye on it.

2c

AAPL ....adding this for the sake of having it on here.  2c long entry.  Price pulling back  in a bullish trend.  Price forms somewhat of an inverted Head & Shoulders,  or three-pushes to a low sequence.

 Also, something which stood out for me was the symmetrical cycles which formed, wherein I harken back to the 'ol Stevenson PTT concept.  Red lines are targets based off of the previous cycle and the purple line was the CTL which triggers a long entry.  I actually traded this for a tiny gain as I covered almost to the tick before it rocketed higher....very frustrating