MKTstate

Monday, June 14, 2010

BRITISH POUND Futures - Searching for Resistance

Technically the MKT has produced a major positive signal into the upper extreme and will need to hold structure if it is going to avoid a drop back into a digestive trade.

Key off the 15035 Inflection Pivot as the potental exhaustive high point for any new interest today.

On the SELL side FADE signals are valid but REVERSAL strategies are a better option at 14916 and 15035. Have resting limit orders off support inflections and use aggressive position management to lock in any unrealized gains on any REVERSAL trade. BREAKOUT strategies at 14801 and 14686 are aggressive but do have the potential to profit from a quick negative move out of the extreme. Use tight position management for these strategies as any unrealized profits can be erased quickly by the underlying positive momentum.

On the BUY side accept FADE strategies off the 14686 support pivot after confirmation. The MKT is extended and may search for stops before it resumes its Bull move. REVERSAL strategies are a better option. The sharper the break, the better for an entry with the expectations that the MKT is going to revisit the recent move high. BUY BREAKOUT strategies above 14801 and 14916 may need to be "worked" as the MKT is extended and has the potential to produce some starts and stops, with 15035 the high point for any positive push. Only above here does the rally extend.

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Saturday, June 12, 2010

STRATEGY BASED TRADING TOOLS WEBINAR EVENT JUNE 22, 2010

Webinar Event – Market Structure vs. Market Madness

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Thursday, June 10, 2010

BUND Futures -CORRECTIVE

Technically the MKT is in a NEUTRAL CORRECTIVE state producing a negative signal against a positive trend. Opportunity exists on both sides of the MKT however a held trade above the 12812 Inflection Pivot will keep the underlying tone positive. Only below this support does sentiment turn sour.

On the SELL side avoid FADE strategies until after the previous session low point or major support level has been broken to confirm a negative shift in momentum. Until then a better opportunity will be a REVERSAL strategy but only off the 1st major resistance level at 12880. This is a one shot trade using a low risk big profit target criteria. The idea is that if the MKT is going to follow through on its negative signal any stength is just a "head fake " before it follows through. SELL BREAKOUT strategies below 12812 can be profitable but they are aggressive and should look to take profits and potentially REVERSE long at support targets. The trade is corrective and the underlying positive tone must be respected.

On the BUY side accept BREAKOUT, FADE and REVERSAL strategies off major inflection points with the expectation that the positive momentum is going to resume. REVERSAL strategies are recommended over a FADE strategies, which should have at least 1 if not 2 challenges to the support integrity before executing a long off 12812. BREAKOUT strategies above 12880 can risk a little more if current events and other MKTs of confluence confirm a positive posture with the expectation that the Bull Trend is going to resume. If not a better approach would be to FADE a negative "squeeze" reaction after a positve breakout signal at 12846 as the neutral technical position can keep the trend sideways.

Note: The MKT is in a corrective position with the potential to move in either direction. Keep your opinions to themselves and focus on what the MKT is telling you it wants to do. Don't fight it, roll with it.

EURUSD - POSITIVE TRANSITION

Technically the MKT is in NEUTRAL TRANSITION and has produced a positive signal which should infleunce the MKT today if the signal is valid. If the integrity of the prior session's high remains intact it is less liekly to do so with the MKT returning to a sideways trade. Roll with any new strength and leverage up if good risk parameters present themselves. The potential to get in at the beginning of a new move higher is real.

The 12086 Inflection Pivot is the hurdle the MKT must hold above to confirm a sentiment shift.

On the SELL side REVERSAL strategies can be executed off of major resistance levels at or near the previous session high point. Avoid this strategy on higher levels as any new strength has the potential to be the beginning of a move. If the integrity of the previous session high remains intact FADE strategies can be accepted at or near this inflection point on the initial test with tight profit target objectives. If the MKT has already had a reaction off this resistance area avoid this strategy. Use a BREAKOUT strategy as a signal to FADE a positive pull-back after a confirm break in the momentum. Only take this trade if the previous session high point remains intact. Otherwise this will be a BUY REVERSAL opportunity.

On the BUY side be more aggressive after the previous session high has been taken out. Not that this is a pre-condition but should be noted as a confirmation of strength. BREAKOUT strategies should just "go" so keep risk parameters tight. FADE into any negative reaction off an unsuccessful upside BREAKOUT after a support level is confirmed. Use a REVERSAL strategy to leverage up after the MKT gets back above the original breakout point. If the integrity of the previous session high remains intact, avoid REVERSAL strategies as any break momentum is a negative signal that the MKT is going to return to its neutral posture. FADE strategies are recommended early in the session or near the end. The positive signal will either play out from the get go or will make its move in the latter stages of the trading session.

Note: This is a dangerous emotional trading environment. MKT reactions to go a little further that you expect in either direction so anticipate this in your position and risk management.

Tuesday, June 8, 2010

5yr T-NOTE Futures - TRYING TO MAKE A DIFFERENCE

Technically the MKT is in a DIGESTIVE BULL TREND and is flirting with a shift into a more aggressive positive position. Look for excuses to get long but respect the digestive nature and avoid pressing any position.

Key off the 117-0225 Inflection Pivot for an indication of the session tone. This is the base for the underlying positive momentum and will maintain its integrity if the 5yr is in for higher prices.

On the SELL side avoid FADE strategies and use a REVERSAL instead against the 117-152 resistance pivot. The MKT is excited but has yet to confirm any new advance. Expectations are that any false positive breakout signal will be met with a sharp negative reaction. BREAKOUT strategies below 117-022 are a lower probability but are valid and in line with a reversal scenario. If the MKT has already produced a false positive signal and is holding negative reversal structure, this strategy has potential. Expectations are that any negative BREAKOUT should just go and with the MKT staying under pressure into the close and expanding the digestive range. Anticipate a positive turn and consider reversing off lower support structure.

On the BUY side accept FADE, BREAKOUT and REVERSAL strategies. BREAKOUT strategies above 117-152 have the potential to run. If so, they will just "go" and not look back. Any stop and go action and any profits should be realized as it is more likely the MKT will be setting up a re-test of support to FADE before it can extend higher. FADE and REVERSAL strategies should work off the 117-022 support inflection pivot and only provide one opportunity. Repeated tests or base building and it is more likely the MKT is going to search for its lower digestive extreme rather than resume a positive course.

Note: The MKT has produced a positive signal but is not confirmed. Be ready for it but if it does not materialize, beware of a negative reaction. Don't get caught fading a break that continues to hold structure as the MKT may be defining its lower digestive extreme and will most likely find it after it hits your last sell stop.

Monday, June 7, 2010

SP500 Futures- VULNERABLE BELOW 1070

Technically the MKT is in a BEAR TREND ACCELERATION position and is vulnerable to the offer with all trading below the 1070 Inflection Pivot. Any positive corrective action is expected to be short lived below here with only one upside "stop squeeze" if the negative moemtnum is going to play out. Any held strength and repeated probe higher is a sign that the trade will turn digestive. This does not take away from the negative bias but does limit the profit potential for any new sales in the session.

On the SELL side accept FADE, REVERSAL and BREAKOUT strategies below the previous sessions high point. BREAKOUT strategies under 1045 should just "go", so do not risk much. FADE strategies against 1070 are recommended over REVERSAL strategies as the MKT is expected to hold lower structure and any momentum shift should be considered a potential positive corrective turn.

On the BUY side avoid REVERSAL strategies off the 1045 support pivot as these signals are more likely short squeeze rallies and opportunities to SELL into and FADE against 1057.50. BREAKOUT strategies above 1070, so risk less and go for more. Any BUY FADE off 1045 should have confirmation and are not recommended if the integrity of the previous session high is intact. After a break in the negative structure confirmed support levels can be used for short term reactions using aggressive position management.

Note: The MKT is in an aggressive sell posture. If the previous session high is intact its just a matter of time before the sellers try to overwhelm the MKT. Look for excuses to get short. If the previous session high is breached opportunity will be on both sides of the MKT, however the bias still rests with the Bears.

Saturday, June 5, 2010

XAL - Airline Sector Index : CORRECTIVE SIGNAL

Technically the MKT is in a NEUTRAL CORRECTIVE state producing a big negative signal against a positive trend. If the negative signal is going to follow through it should do so from the get go and not look back. Any break in the negative structure is a signal that the positive trend will try to reassert itself.

Key off the 3644 Inflection Pivot. If the underlying positive momentum is going to resume the MKT will build a base above here.

On the SELL side FADE strategies should work on the initial test and immediately turn the market lower. Repeated tests is a sign that the market will try to probe higher. REVERSAL strategies should be avoided as any positive signal is more likely an indication that the underlying trend is going to resume. SELL BREAKOUT strategies can be profitable but they are after a major negative signal and have the potential to be stop and go. The trade has the potential to be the beginning of a major sentiment shift if it turns sour.

On the BUY side accept BREAKOUT, FADE and REVERSAL strategies off major inflection points with the expectation that the positive momentum is going to resume. REVERSAL strategies are recommended over a FADE strategies, which should have at least 1 if not 2 challenges to the support integrity before executing a long off it. BREAKOUT strategies can risk a little more if current events and other MKTs of confluence confirm a positive posture. If not a better approach would be to FADE a negative "squeeze" reaction after a positive breakout signal as the neutral technical position can keep the trend sideways.

Note: The MKT has produced a big technical signal against the current trend. Be aware that the negative action may be a 1-day event with the positive trend quickly re-establishing itself. If the MKT is really going to turn it should remain hard pressed and provide little or no relief. Don't fight any sustained weakness as the potential for a sentiment shift is real.