Rhody Trader

Until GE came out with their much worse than anticipated Q1 results this morning, today looked like it was going to be another one locked within the general 1353-1367 value area carved out over the last two days. Thankfully, though, the GE announcement blew that away, so we had a much more interesting session.

With the day’s open down a bit below 1350, the first upside level of meaning was Wednesday’s/Thursday’s lows at 1352. On the downside the point of control from March 26 at 1342 was close to the 1340 area lows from last Tuesday, so that was a meaningful reference area. Below that was a cascade of points of control from the days following March 26, including 1336 and 1329, which are marked on the chart.

 

In hindsight, a sell at 1352 would have been optimal. One had plenty of reasons to take that trade, but I failed to do so myself in concern about stop placement. I did get in later, though. The real question in mid-day was whether or not the market would get cleary of the 1342-45area. In my daily work I watch a list of what you could call high beta stocks. It was the fact that those stocks were continuing to worsen when the market was holding steady that convinced me we had more downside left.

That’s it. I’m putting limit trade close orders in all the time now!

Again today I wasn’t paying attention at some key points and missed out realizing the potential the day offered. The key levels to have in mind for today’s trading were 1360, which was that pivot point I talked about as being important earlier. Below the market was yesterdays’ lows, while above the market was a combination of the rejection area above 1366 from yesterday and the 1368 point of control from Tuesday.

 

Selling the first approach to 1360 near the open was the easy first call. It might have been a bit more of a challenge to go long at 1352, or thereabouts, but the set-up was there. When the rally stalled out below 1370 it offered a couple of chances to get short for a pull-back toward 1360. In other words, today could have produced quite a few points to the attentive trader. 

I really need to be paying more attention! I missed another great entry this morning because I wasn’t watching and didn’t have a standing order in.

Today I took the same starting view as yesterday. The market needs to trade outside the 1360-79 band to give a good directional indication. Since the open was right in the middle of that again, it was back to a primarily range oriented strategy to start the day.

As you can see, the short I missed was the initial period rally up toward yesterday’s highs and that 1373 level. Too bad. That could have been a good one. I did buy on the initial move down toward 1360, but after a couple of points I bailed because it was looking pretty pathetic. I later shorted when the market hit 1356 on a go-with trade, but that didn’t really amount to anything.

 

Not too surprisingly given the way the market fade Monday, today’s open was set to be lower. I picked out 1360 and 1379 as the key levels representing the primary range the market’s in. The former will be obviously, but I’m guessing the latter might be a bit confusing. It is, as you can see, Monday’s point of control, as well as matching up with a value peak from Friday. Going further back, though, it’s really the point above which the market has failed to gain any kind of sustained hold.

You’ll see that I’ve drawn in a line at 1373, Friday’s point of control. The approach of that point was my short entry point in expectation of a move toward that 1360 level. Unfortunately, I was distracted and didn’t get the order in, so I missed a good little trade. Aside from that, it was a dull day.

Today looked like it was going to be balanced around the 1385 level, which was both where it was trading in the pre-open time and a point of control from late in February. Above the market was 1392 where prices were rejected back in that same February time period. Below the market was Friday’s 1373 point of control.

It ended up being a rather challenging day to trade. I would have bought 1374, but the market didn’t get there early enough in the day to make it worthwhile. I would have sold at 1390+, but the market never got there. So, I just sat back and watched – and fought with my computer.

 Today didn’t end up providing any really great trade set-ups. The main reference points going in were the 1379/80 area and the 1360 level. The former was the topping out area from Wednesday and Thursday. The latter was Tuesday’s point of control from which prices bounced a couple of times Thursday.

The only really worth while play that developed today was one based on the intraday action. When the market broke through to a new high in D period there was a brief opportunity to make a long play, but you would have had to have been very nimble to get in and our for single digit profits. All in all, it was a disappointing day.

Sorry for the delay posting this. I was just too fried yesterday afternoon. I needed to get away from the screen.

With the Payrolls report coming Friday and the Bear Stearns testimony running all day, Thursday was bound to be a rather nothing day in terms of direction. The main levels of interest were Tuesday’s point of control at 1360 and Thursday’s point of control at 1373.

I left Wednesday thinking that the way the market had rejected lower levels probably mean that higher prices, albeit only somewhat, were likely. There was weakness in the premarket thanks to the unemployment claims data, though, which created a lower open.  That ended up just being a head fake, though, providing a good long entry near that 1360 level.

A couple of things had me thinking that selling would be the play of the day today. That being the case, I biased myself that way.

As you can see at the top of the chart there is a reference point above where the market opened. The chart shows 1382, but that’s from the June S&P contract going back to a date when it was thinly traded. Using the mini contract we can see that it was actually 1381, the point of control from February 28th. Below the market, the only really meaningful level was until yesterday’s point of control at 1360.

 My play was a sale at 1379, which was provided during C period (it show up for F period too, but 1379 wasn’t acutally quite hit then.) I sold with a stop at 1384, which obviously never got challenged. Then it was just a question of being patient. The 1366 area became a decen take profit point when the market traded back down there to what had been the day’s lows from A/B period. There was a rejected extension lower, but that 1360 level never really got approached.

Today was one of those days that can drive you completely nuts. I knew which way the bias was, but never got in because the market didn’t give me an entry point. The initial key reference levels were the 1342 point of control from last Wednesday and the 1336 point of control from last Thursday (not drawn).

The market too right off from the get-go this morning and never looked back. I didn’t get a chance to buy and just watched it run away. It blew through all kinds of meaningful levels, only pausing for a little while around 1360, where things had stalled out this time last week.

For me there is nothing worse than having it right and not being in on the action – especially when that action is like 40 points!

Note to self – have a go with strategy for days like this.

Today ended up being pretty straighforward. The reference points were clear – Friday’s point of control at 1329, and the 1314 low from Friday, which was also the point of control from March 20th

 

So the best results would have been to buy at 1314 shortly after the open and sell 1329 later in the day. In fact, one could have played the general range a couple of times..