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IWM Stopped Out For Less than 1% Loss + Market Update

IWM has exceeded the very tight suggested stop of 121.65 for a negligible loss of 0.96% (less than 1%) as I continue to prefer unusually tight stops on any counter-trend official trade ideas lately. With the trend indicators flipping back to bullish & none of the major index (SPY, QQQ or IWM) trading below the aforementioned supports yet, I decided against officially extending the suggested stop on this trade but am certainly giving my position some more room, awaiting the same trio of sell signals on QQQ, SPY & IWM before adding & waiting at least until early next week or until the current bearish posture of the 60-minute & daily charts dissipates. IWM/TZA will be moved to the Completed Trades category. I will also add that IWM will likely be added back as an official trade idea very soon, should I see enough evidence in the charts to do so.

IWM 60-minute Aug 5th

IWM 60-minute Aug 5th

Negative divergences continue to build on this morning's marginal new high on the SPY. Still awaiting a solid break below 215.30 along with confirmation on the QQQ 60 minute chart, as QQQ has been the leading index recently, still yet to trigger any of the 3 sell signals: break below 114.12 support, MACD 9-ema bearish cross & 13/33 ema bearish cross although I still highly favor a trigger of all of the aforementioned sell signals on all three indices any day now.

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Aug 5, 2016 10:22am|Categories: Completed Trades - Short, Equity Market Analysis|Tags: , |4 Comments

4 Comments

  1. alshaw August 5, 2016 10:40 am at 10:40 am

    yes i am staying short the crash is close i have seen this pic before i am shorting more oil xle xop oil is ready to turn down and blow apart back to 26

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  2. roguetraderone August 6, 2016 9:26 am at 9:26 am

    Reposting these S&P daily charts which shows a similarity with 2007 peak, megaphone pattern preceeded by a bearish rising wedge, then a rising wedge inside the megaphone pattern. However, the similarities are certainly becoming less and less. Particularly if we break through the upper trendline. Given yesterday’s action, I can’t see how that trendline will hold, that candle is highly likely to be followed up. I’m still confused by elliot wave analysis but, one can easily see the 5 wave structure in the 2007 but, it’s clearly not there this time around as that second wave up is now higher than the first wave down after the rising wedge peaked inside the megaphone. Worth noting the BB is pinching, big move one way or another. I’m short spy, etc. but losing my resolve. I hope alshaw is right.

    2007 Pattern

    http://stockcharts.com/h-sc/ui?s=%24SPX&p=D&st=2007-04-01&en=2008-04-01&id=p02315091485&listNum=1&a=467654800

    Now

    http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=7&dy=0&id=p23318647058&a=466601921&listNum=1

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    • rsotc August 8, 2016 12:35 pm at 12:35 pm

      rt1- Nice charts, certainly a possibility worth monitoring. One thing that I noted on your current $SPX chart is that you questioned whether or not the negative divergence on the MACD is still valid. You need to extend the starting point for that divergence a little further back to the reaction high in March, just as with the divergence on your CMF. Doing so clearly shows that there is still some large & clear negative divergences in place at this time. Thanks for sharing.

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      • roguetraderone August 8, 2016 4:14 pm at 4:14 pm

        Thanks Randy. I see that now. Although I wasn’t sure I could extend that line on the price as it would be broken. Inadvertently did it on the CMF. In any case, I am surprised that there was no follow through on the price today. That was a strong candle on Friday. I guess the current megaphone pattern gets to live another day.

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