Tuesday, September 21, 2010

Technical Picture - Markets Mixed



Lackluster trade until the FOMC statement was released at 2:15. As expected rates are unchanged and, current economic conditions dictate exceptionally low rates for an extended period. FED is also prepared to provide additional accommodation if required. How did the market react? Stocks, gold, and treasuries rose and the dollar sank. All but stocks managed to hold those moves into the close.

TLT has regained its broken trendline, UUP looks really ugly, GLD notched new closing high and the S&P looks somewhat bearish intraday, but it has a lot of support from the BO base. If it forms a right shoulder intraday, the technical picture will become clearer.



Doji flags are bearish. GS rips to resistance zone, carves out a doji flag on the 15 min. timeframe above, and sets up a reversal. Short as depicted on the lower timeframe below.

Post FOMC, short the trendline break.

Gold rips post FOMC. Using ABX as a proxy for gold, wait for retracement of initial spike, and go long.


5 comments:

Andy said...

Jamie -

Avid reader of your site. I have been wondering: now after all these years of trading and blogging, how often do you make a bad trade now-a-days?

It seems to me like you're batting 9/10 or 10/10. I'd be surprised if you had a losing day all month. No?

Jamie said...

Andy,

Thanks for your loyalty to the blog. Reducing the number of losing trades is a priority for the P&L and eliminating boredom trades has helped the win:loss ratio.

The blog is not a trading diary, just a summary of my thoughts on the markets and some of my favorite trades.

This month has been really good. The markets have been strong.

joshua said...

how come those last two charts are marked up strange?

Jamie said...

Joshua,

On the lower timeframe I'm using Esignal formulas for RSI price bars so that I can easily spot positive/negative divergences at intraday bottoms/tops. When the bars are printing red, we have bullish momentum, blue is neutral and green rips to the downside. I find it very useful in my trading.

joshua said...

gotcha.