Nice Opportunity to Go Short U.S. Bonds Long-term

What the heading says. Go short bonds or long interest rate futures if you can - over the next few days.

Out of AAPL

Don't like price action.

It was following, not leading the market.

Going down to 240?

Awesome Post by Carl Futia

http://carlfutia.blogspot.com/2010/05/breakout-or-shakeout.html

It addresses:

1. How long do bull markets last after advancing issues peak?

2. What can be expected when there is a breakout from an area of congestion -- a place where the market has spent a long time.

Thursday and the Future

Went long AAPL at 250 and change today. Went long more SLV.

1. Market's going up.

2. Divergences in NASD up down issues and up down volume; Gold etc. SLV will rise by Friday.

3. NYHL and NYMO are at levels indicating bottoms. 9 DMA of NYTV is similar.

4. We should get at least a bounce. Then we'll have to decide if it's just a bounce or a new up trend.

5. But TICK indicates that we may get a lower low tomorrow before a bounce. Possible 1148 on the SPX?

6. Also no climactic volume today indicates no bottom yet. Finally H&S resolution is 1140 ES.

7. Then, in my opinion, NDX is going to 2000, and possibly to 2050.

8. So, on the SPX, in order 1175, 1148, 1200?

Gold miners are doing great. Indicating Gold will jump.

Keep checking TNX. Important support.

Will sell SLV calls and some AAPL tomorrow (Thursday).

After this rise, start looking at LT Puts.

Lessons from this Mini Crash

1. Look at the NYA. That is the most important index. Trust it.

2. Trust what you see in the other indices. Europe, China, Brazil and India.

3. Silver is very weak in down trends.

4. The middle of a down trend is just the right time to buy Puts or sell Calls for protection. No, it is NOT too late.

Wednesday Plan

1. Short GS at 152.5

2. Short SPY until AAPL closes 250 gap.

3. Long AAPL at 250.

Why Short the Indices?

When you can short weak stocks (or weak foreign indices)?

Don't struggle to anticipate a trend. There are lots of confirmed trends all over the world. Just find them. Use the 5 MA system or your other systems.

If you're not very sure about a direction for U.S. Indices, buying SPX puts may be riskier than other options.

Short AUDUSD spike on Interest Rate decision?

Just an idea.

Think about it.

Feels Like a Wave 4

The choppiness here, feels like a Wave 4. It may just be Wave 4 of the entire ascent from March 9, with Wave 5 to come.

Plan for Next Week

1. The U.S. indices are broken. I will look for a retrace to short with SPY Puts. Look at the big red candles on the daily. We could go down to 1110 or so in 2 weeks. First stop would be the 50 Day SMA at 165 or so. Look at the Copper chart for one. NYA down volume is indicating a correction. BSE (Bombay) is lining up for a classic 5 DMA short. BVSP (Brazil) is badly broken and so is Shanghai.

Basically, I am looking for 1-3 days of consolidation in the indices, with a range of 1175 to 1200, and then a fall apart. PC ratio spiked on Friday and 5 DMA of TRIN is also indicating a bounce. However, at this point (as indicated earlier), I think the bounce should be shorted. Silver and Gold should do what they can in the next week, after which it may be too late. I don't see Gold going much over 1225 (previous high) on this move.

2. Will hold Silver on a tight leash and expect to sell it within the next 2-4 days. Ideally, indices would go mildly higher in the next 2-3 days and Silver would rocket to 19.5 or so. If U.S. indices collapse to 1110, Silver cannot hold out. Fall/late summer may be the next time to buy PMs.

3. AUDUSD bull flag failure indicates that it may fall to long-term lower trend line. Holding a small long for now, but divided on this. Long-term, I am an AUDUSD bull. Short-term (2-3 days) I'm not sure. May cut it loose. Will update over the weekend.

4. EURUSD: looking for at least 1.3380 to short. The USD chart looks like it could be setting up for a nice, swing long, perhaps as a sell the news reaction when the Greek bailout news comes out.