Saturday, April 6, 2013

Thoughts on equities for next week

The Friday's NFP action pretty much worked out exactly like Cobramarketview said it would. It opened low and went up high. So when it gapped down big, I bought some ES, and XIV. And both positions worked out nicely by the end of the day. Why did I buy XIV? Refer to this post - where I explained my VIX envelope idea. Look at the VIX chart from yesterday, worked out well huh?

For SPX, Monday's have been bearish recently, so I am not sure how we will close in SPX, but there's some signs that this rally might have a bit further to go. Chart from Cobramarketview:

However, we might be in big trouble on the intermediate term, because Cobra's longer term non-stop trend chart appears to be signaling an end to the uptrend.

Buying climaxes also peaked above 70 this week, which has been bearish for the short to intermediate term. Finally, this chart from cobramarketview indicates "institutional buying and selling action from stocktiming shows now distribution is larger than accumulation the 3rd time since Dec 2012. I believe this time the pullback would be larger than the previous 2"

As far as my thoughts on ES go, I'm 1544 was of some importance on Friday where price struggled a few times to break through, and it will now be support on the downside. 1554 is where I will look to short with tight stops. Its also the 61.8 of this decline. A break above this and I'll try once more with a short at 1560ish which is the 78.6 level and also prior resistance, with a stop at new highs. 

For TF, the 922-923 area seems to be near term resistance which I'm not sure I'll look to fade if it gets there on Sunday night. But if we get there intraday on Monday, should be a decent initial fade area. TF near the 930 area however is a nice swing short level with a 5-6 pt stop.

So I suppose the game plan is to be ready for this rally to go a bit further on Monday, and look for a pullback in ZB/TLT, and then look for sells at the levels mentioned. 

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