Saint Paddy isn’t the only one seeing a little green.
The bulls are seeing red… so the charge is still a stampede.
“The graveyard of wall street is littered with the bones of investors who were right too soon” is a paraphrasing an old adage I mentioned the other day.
E: funny how the boyz know how to kill puts last 8 to ten days of op ex then dump #seendat game b4 gap 34.25 /32 poss support zone #EMWS $ES_F
It is even more appropriate near Options expiration.
@Jeffrey Lin: @eminiwizard mind writing more about this and what you’ve seen before on the blog?
Jeffrey at MarketHEIST asked me to elaborate, so here is my two cents.
(Gangsta rap music playing in the background….)
The longs are a bit toothy in time and price since the June 2012 Gold rush, and presumably they are hedged with put options. They have had no serious run against their positions since the pay check came from the second defense at 1438, then again at 1482.
The financial engineering worked last year, why not again?
Gap up and go the first days of the year and never look back, squeezing anyone who thought it would be fair to close any of the south side gaps.
Fast forward, The March contract is expiring, and we are up 280 points since the shakeout after the November elections.
Time value of the next cycle of puts (and calls) is the greatest immediately after expiration. Simply stated, the Boyz have the most time to adjust their positions if they blow out shorts/puts and then adjust early into the next cycle, when the time value component of options is at its greatest magnitude.
Premiums kept through time decay is a nice way to earn a living, don’t you think?
My two cents for what it’s worth. Timing of the plunge makes me wonder if this is not a manipulated market… Nah.
I am not an options expert as a disclaimer.
Did I mention that Friday we had a two point sweeper move that knocked out aggressive shorts pre market?
Having read the criminal handbook, the 34/32 zone I believe is natural support ahead of the 29.5 daily chart.
All the stops were hit from the past eight days, so weak hands gone, and now big fish need to decide if they want to re buy at this level and timing.
They did; retail didn’t.
Commissions generated in this business occur on turn over. Think like a real estate agent who loves clients who flip houses. Action, more action, more profits.
RT @matterhornbob: …EMOTION,I have always found it is difficult to match: CAUTION with higher prices and COURAGE with lower prices. #EMWS
Overnight, very few players participated and some traders see no hope of a bounce.
The slingshot was already in progress as posted.
Washout lows that trigger stop runs, then reset near our idea of support offer fertile opportunity for re entry by longs in the new contract. Retail prefers to short discount openings, thinking its like shooting fish in a barrel.
The barrel was turned upside down, and the NQ was a great read alog with the ES.
Picture perfect target was 51.5 when the overnight high got taken out.Lunch contra was an opportunity with day trade longs flush with profits or shorts who missed the morning plays.
Dips are opportunities in this “dangerous market”.
One day they won’t be… but not yet.
Knives bought today at the fork in the road…
Bring the paddy wagon for all the shorts who now have a nervous twitch after today’s behavior.
Cyprus is a blip, a non-event.
Criminals have an equal opportunity employer. “I am from the government, and I am here to help you.”
The slingshot move is alive and well, and we thought the whole key was can the overnight high hold or not. Once broken, 41 became our aggressive support key.
Trading has become very challenging lately. Un-auctioned territory long side has become magnetic, with a squeeze thrown in boosting the trade to higher levels than we (me) can imagine.
Be conservative and determine bigger swings to avoid being trampled by the momo crowd.
Use stop losses and try to see the idea of fading our emotions as one of the keys in trading.
FOMC this week, so I think squeezes vs distribution are part of current Psychology.
RT @Glems111: I like @eminiwizard cause he post great stuff and proven record, and no I am not a subscriber of his postings / thank u #EMWS
We thought the 48/50 zone would be tough to crack; wrong about that one. Jump back to the next level, can’t be stubborn, but need a few tries if we have a notion profits needed to be taken. Re-entry second tries often will work, but we need to be careful about averaging in. Easier to take stop outs and try again.
Once the momo trade traps traders, Kaiser Soze is stubborn in relinquishing newly conquered territory.
As real as it gets…
Finally the Profit taking sequence