Friday, March 22, 2013

AAPL Closing the week at resistance

It's put up or shut up for AAPL next week. If it can't hold these levels another move lower is in the cards.

Tuesday, March 19, 2013

Covered short position 1537.50/Long 150% @ 1537.50

After reviewing market info after the bell, I believe there is a good chance we could a move towards /es 1553-1560 in the next 2-3 days. I will not necessarily hold this position for that long. If we break down tonight I will be stopped out and might have to re-short at lower prices. For now, it looks like a chance to take some profits and make a little $$$ overnight.

*This is only for the very short term. I still believe the intermediate term risk is heavily skewed to the downside*

Friday, March 15, 2013

cover and roll

covered /es at 1560 and rolled into the June contract. 200% short /es 1555.25

Thursday, March 14, 2013

Where the rubber meets the road

As the market inches higher day after day, hitting new highs, there is now evidence that the Johnny come lately investors are diving into the markets feet first. First of all, this week is options expiration. March expiration week has had a tendency to close higher over the past 2 decades. However, this particular opex is quadruple witching. These particular opex's are traditionally more volatile than others. Having said all of that, so far this week, volatility is trading lower and is slightly below the support I outlined on Monday. When you add all of this with the fact that the S&P 500 and Dow are both trading around 4% above 75+ year old resistance, you get a recipe for a nasty pullback. The market charts displayed below clearly show both markets piercing the broken channel resistance that has held since the tops in 2010, 2011 and 2012. With volatility at 6 yr lows and proven, formidable resistance pushing against the markets, I see only one likely outcome. I believe the markets will probably close relatively flat tomorrow. Probably no upside but no real downside either. Volatility should tick up and close the week above support. However, next week the beginning of a 4-6% move lower is HIGHLY probable. March 31 marks the end of the quarter. The lifetime charts display price in quarterly candles. That means the move has approx. 2 weeks to complete. In conclusion, look for the SPX and Dow to close the month of March around 1500 and 13,900, respectively. It will be interesting to see how it all shakes out.

BAC is now ripe for the taking...

BAC is trading up after hours.  Announcing a 5 billion dollar stock buyback along with a requested dividend increase, has the stock trading at $12.67 in extended trading. Assuming it opens at this level or higher, those who are willing to sell it short will have a chance to ride it to $10 in the next couple of months, in my opinion. The lifetime underbelly of the broken channel should completely overwhelm the late buyers of BAC.

Monday, March 11, 2013

Volatility is at alternative support level

The VIX traded below the intermediate support last Thursday and Friday, continuing it's fall even further today. However, wrong as I was believing volatility had bottomed last week, it is now near the maximum alternative support level and should close the week much higher than today. The weekly and hourly charts of the VIX and VXN show the support levels that volatility is trading at. While it is possible that volatility begins to rise from these levels and the markets don't fall, that is not a bet I would make.  Market distortions and imbalances are building upon an already shaky foundation. Investors and traders who have been riding the market higher the past couple weeks are putting themselves in a precarious position by holding long positions overnight. Financial market conditions are almost identical to April 2010 and July 2011. Both instances led to months worth of gains vanishing in a few days/weeks. Remember, markets ride an escalator up and take the elevator down.

Thursday, March 7, 2013

HLF-Bill Ackman will have the last laugh

 Throughout the media and financial blogs, Bill Ackman has been on the receiving end of some harsh criticism. Carl Icahn on the other hand has been on somewhat of a roll. With his huge gains in NFLX and as of now, HLF, most seem to think he is going to torch Bill and leave the remains for the vultures. However, the charts say something very different and when the dust settles I expect Ackman will have the last laugh when it comes to HLF.
Disclosure-I have no position in HLF

Wednesday, March 6, 2013

Ready for launch - The VIX is going to 30+ in the coming weeks

The Volatility Index (VIX) has spent the last several weeks testing a very important lower channel. After the explosion higher on 2/25/13 the VIX has now come back down and closed the day at 13.53. This is an important level because the previous intermediate term swing low (eod) was 13.45 back on 8/13/12. With an equity p/c ratio of just .54 and the VIX holding major support all week, we should see a gap lower tomorrow in equity prices that ultimately takes the SPX to 1440 sometime in March-early April.

Significant declines about to occur for these stocks...

These financial media darlings are at their apex. While slightly higher highs could happen in the coming months, the bull market in these stocks is at it's end.

200% Short es 1539.50

Tuesday, March 5, 2013

TBTF, BAC is about to get creamed 10%+

Something Wicked This Way Comes...

The markets are setting up for declines that are reminiscent of 2010 and 2011. The highly important trend lines that are providing resistance ensure a scary sell off is almost upon us. Buyers beware.