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Tuesday, December 25, 2012

E MINI GOING TO DECLINE?


 


It appears to me we are setup for a decline right here. We had the odd spike the other night on the news story. I heard someone say that was an HFT skit but I doubt that because of when it took place. You don't execute HFT trades when there is light volume because there is not a deep enough market to get in and out of the trades quickly, which is the whole point of them. Again another article by someone who does not trade and therefore does not think through these things like they should. In any event I suppose it could have been an error by an HFT firm, some young clerk, fat fingers etc.., but I doubt it.

In any event I think bars like that need to be ignored and since we held the trend line during the next session conveniently, it still is significant. We have the basic COT sell setup here with a rally accompanied by commercials increasing short positions. Along with that we have some divergence in the accumulation/distribution indicators telling us price underneath is weaker than it appears. As a result we have what appears to be a situation to look for a short.

I have not had a great feel for this market the last week or so admittedly and ironically my ES mechanical system is flashing buy signals for tomorrow. As a result I still have conflicting information. However, strictly from a COT perspective we have a sell setup at hand. It also appears to me that quite a few other markets have COT sell setups, so I have to lean to looking to the short side of things overall right now. However, we are getting some detachment with certain commodity markets and the ES for the first time in a couple of years so let's hope that continues.

I hope everyone had a great Christmas and I am going to begin working on one of my new years resolutions which is to cut down on the editorial comments which probably aggravate half of you anyway.

Good Trading

2 comments:

PD Quig said...

That deep dip on ES Thursday night was to just below the 50% retracement...the obligatory reset / higher low before the continuation up?

Mack Denyal said...

This a nice Post. I think Commodities trading allows you to gain exposure to the price movements of foodstuffs,
resources and other globally traded goods.