Gone Fishin'

I'll be away on holidays during the month of April but I wish you all great trading. I'll be back on May 3, 2010.

I hope things will have picked up somewhat by the time I get back ;)

I will be holding a small core short position from ES 1169 for the entire month as there is a very high likelihood of a correction, although I don't expect major fireworks. Heck, if I'm wrong then I'll come home to a nice surprise ;)

Take care and see you all soon.

P.S. Here is a hint of where I'm going...

P.S.S. I may update the blog every now and then with some pictures. Stay tuned!

Human Nature Never Changes

I received an e-mail a few moments ago from a fellow named Katzo (some of you may be familiar with him). I've taken the liberty of using his e-mail message as an important lesson in trading.

P.S. This is one of the BEST videos I've ever put together because it contains a real-life example of how the human psyche works.

Hope you enjoy it.

I Hate This Market

I see a lot of people having difficulty with this market (myself included), so I decided to put this video together.

You can find a copy of the PowerPoint presentation HERE.

Latest Views

It's been a while since I've recorded a video so here is my latest...



This week, I expect a correction so look for short trades...

Intraday ES Forecast

Headline Risk

The title of the lead article says it all...bulls getting too giddy?

VERY IMPORTANT BULLISH SIGNAL TRIGGERED TODAY

I want to stress that after today's close I strongly believe (yet, need to confirm) that a brand new Marty Zweig 9-to-1 up day bullish signal has been triggered.

For those of you not familiar with this indicator here is a description:

A "Nine To One Up Day" occurs when this ratio is 90% or higher. According to Martin Zweig, who helped to develop this indicator several decades ago, such a huge imbalance of up volume over down volume "is a significant sign of positive momentum. In other words, when daily up volume leads down volume by a ratio of 9-to-1 or more, that tends to be an important signal for stocks." The quotation comes from Zweig's 1986 book, "Winning on Wall Street."

Also...

How bullish are 9-to-1 up days? Zweig in his book argues that, "Every bull market in history, and many good intermediate advances, have been launched with a buying stamped that included one or more 9-to-1 up days."

Make no mistake people, THIS IS A MASSIVELY BULLISH SIGNAL THAT SHOULD NOT BE IGNORED. PLEASE BE CAREFUL IF YOU ARE SHORT!

Here is the chart that supports the signal....

NYSE Up Volume : NYSE Total Volume

The Reality of The Matter

Let's talk reality for a second by observing and agreeing on the following: the market is built upon a thin layer of hot air.

In fact, the tape we're seeing this week is reminiscent of what we saw at the end of December 2009. That is, a continuous grind higher on DEAD volume which will likely be followed by a significant move down (into late March).

Take a look at the volume distribution on this last piece of the bounce up (note: average daily SPY volume is about 185K)



That's right kids - same 'ol, same 'ol.


That being said, there are a number of very bullish signs in the market such as the GOLD/SILVER ratio, the RUT at new highs and breadth expansion, and until we see these reverse I'm afraid this could continue.

GOLD/SILVER Ratio


Percentage NYSE New 52-Week Highs


Russell 2000


On the bearish front - other than lack of volume - we have the VIX/VXV ratio now sitting at its first level of support and a significantly overbought McClellan Oscillator.

VIX/VXV Ratio



McClellan Oscillator


WEBINAR

For those of you interested in attending my upcoming webinar I'm planning on scheduling it for some time in the next two weeks.

My plan is to hold them at least once every 2-3 weeks, however, I'm going to be away on holidays for the month of April so I may only hold a single webinar in March.

Stay tuned!!

FORECAST

As usual, here is the forecast...


Intraday ES Forecast


Intraday ES Forecast - What If