COT: 12-03-10
Hi Traders,
Well, I don't know what it's like in the rest of the civilized world, but it sure is cold here in Tampa Bay. Believe it or not, I actually wore socks on both Friday AND Saturday night. And, today, while I'm not wearing 'em, I probably should be. But, I'm loving the weather... it's apropos for the Season: Kind of "merry", which is putting me in the holiday mood.
About this week's COT:
Interesting, but no surprises. The US Dollar has gained strength as the specs have been buying it, especially against the euro and pound. And, I say "no surprises" because we saw the turn setting-up on the charts as the commercials and specs were recently 180-degrees out from each other. Personally, I'm glad, as who really wants to see their home currency get the tar kicked out of it? Of course, fundamentally, dollar strength makes little sense, but I'm following the charts:
They never lie.
The New Zealand kiwi, aussie and swissy are being sold but the specs, currently, which, again was foreshadowed by the COT charts, while the Canadian dollar is in a gray area. Still, I'd expect the dollar to gain strength against it, too. Are these long term moves? I don't believe they are. Remember, fundamentally, US Dollar strength makes little sense when compared to the commodity currencies, such as New Zealand, Australia and Canada, whose countries actually produce and export something.
Gold and silver are at all-time highs, but I have to keep asking, with all the attention they're getting, is a top (even if just in the shorter term) coming? Remember, markets top on enthusiasm and there's certainly a lot of that for both of these shiny metals. I say, keep an eye on momentum, which looks to be waning.
Go here to see this week's charts:
https://tradesight.com/wp-content/uploads/2010/12/COT-12-3-10
That's my take on the COT for 12-03-10, until next time...
Be very well,
Clay
Stock Calls Recap 12/3/10
With each stock’s recap, we will include a (with market support) or (without market support) tag, designating whether the trade triggered with or without market directional support at the time. Anything in the first five minutes will be considered WITHOUT market support because market direction cannot be determined that early.
From the report, the top pick in GNTX triggered long (with market support) and worked beyond great:
TTWO triggered long (with market support) and worked:
ISIL triggered long (with market support) and worked:
LIFE triggered long (with market support) and worked:
VPRT triggered long (with market support) and worked:
LLEN triggered long (with market support) and worked great too:
CENX triggered long (with market support) and didn't do anything at all, but didn't go against either:
In the Messenger, AAPL triggered long (with market support) and worked:
Rich's NFLX triggered short (without market support) and worked great:
That brings us a total of 8 triggers with market support, 7 worked great and 1 barely moved. Just a great session.
Stock Calls Recap 12/2/10
With each stock’s recap, we will include a (with market support) or (without market support) tag, designating whether the trade triggered with or without market directional support at the time. Anything in the first five minutes will be considered WITHOUT market support because market direction cannot be determined that early.
Off the report, SNDK triggered (no market support due to opening 5 minutes) and didn't work, but it triggered later (with market support) and worked:
In the Messenger, Rich's NYX triggered long (no market support due to opening 5 minutes) and worked great:
AXP triggered long (with market support) and worked:
AMZN triggered short (without market support) and didn't work the first time, worked the second:
PWER triggered long (with market support) and worked great:
CMC triggered long (with market support) and worked:
Rich's RIMM triggered short (without market support) and worked enough for a partial only:
AMZN triggered long (with market support) and worked:
FSLR triggered long (with market support) and worked great:
All told, that's 5 triggers with market support, and all five worked, some of them very nice. Huge day.
USDJPY Value Area Play Discussion
Last night, I pointed out the Value Area on the USDJPY. Let's be clear on one of the Value Area concepts. If you open below or above the Value Area in a session, then if you break into the Value Area, you typically move across. On our charts, the Value Area is represented by two light blue lines. The top one is the Value Area High (VAH) and the bottom one is the Value Area Low (VAL). Last night, the USDJPY opened above the VAH line. So a pure Value Area play would be to short under VAH and expect the market to head toward VAL.
However, there are additional support and resistance tools that you can use to improve your entries and chance of success. In the case of today's action, we had the Pivot (dark blue line) just under the VAH. The Pivot is almost ALWAYS a key level that the market doesn't just break through. So, instead of looking to short under VAH, we let the market break the Pivot, and it gives us a higher percentage chance. Let's see what it looked like:
So the USDJPY bounced off of the Pivot, just inside the Value Area, and A and B perfect, then broke many hours later in the US session at C. That's the short you want to take. It went 40 pips down to the dark blue S1 level, although it didn't quite make it to the VAL, but close enough, and definitely enough to make some money. Meanwhile, note that the dashed red line represents our Average Daily Range expectation boundary, and that stopped it also.
Either way, a profitable trade that behaved very technically.
We look forward to seeing many of you at the first of our 5-day Stocks and Futures course this weekend, which has been redesigned from the ground up. A Limited Trial of our services is always available by clicking here. For the latest news and information and market education from Tradesight, follow us on Twitter.
Tradesight November 2010 Forex Results
Before we get to November's numbers, here is a short reminder of the results from September. The full report can be found here.
Tradesight Pip Results for October 2010
Number of trades: 38
Number of losers: 18
Winning percentage: 52.6%
Worst losing streak: 3 in a row (Oct 6-8)
Net pips: +218
Reminder: Here are the rules.
1) Calls made in the calendar month count. In other words, a call made on August 31 that triggered the morning of September 1 is not part of September. Calls made on Thursday, September 30 that triggered between then and the morning of October 1 ARE part of September.
2) Trades that triggered before 8 pm EST / 5 pm PST (i.e. pre Asia) and NEVER gave you a chance to re-enter are NOT counted. Everything else is counted equally.
3) All trades are broken into two pieces, with the assumption that one half is sold at the first target and one half is sold at the final exit. These are then averaged. So if we made 40 pips on one half and 60 on the second, that’s a 50-pip winner. If we made 40 pips on one half, never adjusted our stop, and the second half stopped for the 25 pip loser, then that’s a 7 pip winner (15 divided by 2 is 7.5, and I rounded down).
4) Pure losers (trades that just stop out) are considered 25 pip losers. In some cases, this can be a few more or a few less, but it should average right in there, so instead of making it complicated, I count them as 25 pips.
5) Trade re-entries are valid if a trade stops except between 3 am EST and 9 am EST (when I’m sleeping). So in other words, even if you are awake in those hours and you could have re-entered, I’m only counting things that I would have done. This is important because otherwise the implication is that you need to be awake 24/6. Triggers that occur right on the Big Three news announcements each month don’t count as you shouldn’t have orders in that close at that time.
You can go through the reports and compare the breakdown that I give as each trade is reviewed.
This month, we had a "worst losing streak" once again of only 3 trades, which isn't really a streak at all. Here's the breakdown:
Tradesight Pip Results for November 2010
Number of trades: 30
Number of losers: 9
Winning percentage: 70.0%
Worst losing streak: 3 in a row (Nov 8-9)
Net pips: +512
Just a great month overall. Huge win rate, no real losing streak, and a few carryovers that really added to the total. Not much else to say except that the system clearly works. Average daily ranges actually dropped a little between October and November, but that is a little deceiving because we had the Veteran's Day bank Holiday and Thanksgiving (which affects three days, really). Overall, ranges were quite good, and that's when we do our best. When you have three or four months a year like this, everything is good.
Forex Calls Recap for 12/01/10
Closed out the month with another winner. I will be writing up the November summary in the next day or two and post to the site's Blog. Will note in the Messenger when that happens, but November was a great month any way you slice it.
New calls and Chat tonight as we head into NFP on Friday.
EURUSD:
Triggered long at A, hit first target at B, raised stop in the morning and stopped final piece at C:
USDJPY:
Perfect Value Area move:
GBPUSD:
The call for strength in the USD was a short under Pivot, which hit (but didn't break to trigger) at A exactly to the pip:
USDCAD:
Nice use of VWAP:
Tradesight Market Outlook for 12/1/10
Tuesday was a typical month end mess. Gap down, then recover and the ultimately lots of white noise and nothing much to show for it. The market is bending but not yet breaking. The daily candle was both a downside CPS and also a camouflage buy signal which means that neither side has full control. The 50dma remains the key nearby technical level. Note the key neckline (aqua) that has been added to the chart.
Naz was much weaker than the broad market losing 28 on the day. Key support remains at the static trend line and 50dma.
Multi sector daily chart:
The XAU was the only sector green on the day, up 1%:
The XBD broker-dealer index is 9 days down and finding support at the 200dma. Look to this sector for upside continuation opportunities if the market starts higher again.
The OSX continues with the handle like price action.
The BKX remains in the recent range, nothing new until this area is exited.
The BTK is leaking and close to the low of the recent range.
The SOX is finding support at the 10ema. The April highs remain the level to take.
Gold was higher on the day by about $20 which is the high of the left shoulder.
Oil diverged from the OSX and was much lower on the day. Keep in mind that at this stage in the cycle, the underlying stocks should lead crude futures not the other way around.
Tradesight Market Outlook for 11/30/10
First touch—Monday was the first interaction with the 50dma (red) since the first trading day in September. This will be an important area of interest for days to come. The 50 should provide support when it’s first tested and would be a strong confirmation of a change in trend if lost. There are a couple of ways to look at the recent trading action. The bull case is that price is consolidating in the area of the prior high (April) possibly making a handle to breakout. The bear case is that the “look see” above the April high was a failure and the price pattern is making a head and shoulders supported by the MACD sell condition. Time will tell but for now the 50dma is the big man on campus.
Naz closed the gap from last week and was unchanged on the day. Note that there is still one open gap open just under the 2100 level.
The NYSE cumulative A/D line took a pretty good whack last week. The current area of interest is the breakout level at about 1525. This is key support and the loss of 1525 would indicate a failure.
The 10-day Trin remains oversold at 1.36 which implies that the market has available energy for upside movement.
Multi sector daily chart:
The OSX was the top sector on the day. The pattern still has cup and handle potential so set an alarm for a break over 230.
The BKX was stronger than the market, finding support near the old lows. Price has been boxed up for about 4 days so a breakout of the pattern could be strong.
The SOX was slightly higher on the day gearing up to challenge the old high. Note the maturity of the current SEEKER countdown at day 10.
Oil was very strong and will surely breakout if the OSX makes new highs:
Gold continues to hover perhaps tracing out a head and shoulders. The first clue will be the loss of the 50dma.
Forex Recap for 11/29/10
EURUSD made a bigger move than the GBPUSD, but we still had a winner with nice use of the Levels and more. See GBPUSD below. Very technical use of the Levels in general.
New Levels will be out after 5 pm EST.
EURUSD with Levels, exceeded average daily range (dashed lines represent average daily range or ADR):
GBPUSD:
Very nice the way that it came up and hit the long trigger (which was over the Pivot) exactly at A without breaking through, then triggered short at B, never stopped quite at C (note the use of VWAP, but stop was over 1.5599); INSERT INTO `wp_posts` (`ID`, `post_author`, `post_date`, `post_date_gmt`, `post_content`, `post_title`, `post_category`, `post_excerpt`, `post_status`, `comment_status`, `ping_status`, `post_password`, `post_name`, `to_ping`, `pinged`, `post_modified`, `post_modified_gmt`, `post_content_filtered`, `post_parent`, `guid`, `menu_order`, `post_type`, `post_mime_type`, `comment_count`) VALUES hit first target finally at D, and still holding with stop over LBreak:
USDCAD, classic Value Area move from one light blue line to the next:
Stock Recap 11/23/10
With each stock’s recap, we will include a (with market support) or (without market support) tag, designating whether the trade triggered with or without market directional support at the time. Anything in the first five minutes will be considered WITHOUT market support because market direction cannot be determined that early.
PDCO triggered long (with market support) and went enough for a partial on a spike, but that was it:
REGN triggered long (without market support) and worked great:
OPEN triggered long (without market support) and didn't work the first time, worked great later:
In the Messenger, NFLX triggered long (with market support) and worked:
BIIB triggered short (with market support) and worked:
AMZN triggered short (with market support) and worked:
Rich's AAPL triggered short (with market support) and worked enough for an easy partial:
In total, five for five with market support.