CHART UPDATE: top chart is newer
Today we had a very similar open in relation to last weeks price action, *gap up, then slow gap fill (fade) followed by a push below the opening range. These moves are hard to get involved with in my opinion because the range is so tight, you either have to be super quick and or very risk tolerant because you are either gonna be sorta right, or very wrong. The best trade today was letting off the gas waiting for a clear trend to develop. Though as you can see from the chart above a trend never really showed itself. You can argue the trend is down, but both my shorts and longs were not paying.
It seems for every long there is a seller up at resistance, on shorts there is always a buyer right under support. Makes sense right? well if you ask me it does not make that much sense because the market is up almost every day yet individual stocks are not really moving. This brings me back to the title of this post, “futures painting”. Every night the futures are green on average about 25 points, but what does it mean? nothing..I look at it as further proof our markets are pushed higher night after night by someone buying futures in a thin market BECAUSE the cash market does not follow. Was there any reason why the futures should have been up if the cash market failed to follow? In my eyes no.
CMC is the best stock on the board this am as far as i am concerned, it has a great trend and a clear buyer. AIG is also in play but again she has flattened out due to a lack of volume, my guess is the algo’s will push her down as soon as they sense weakness. Most of these algo’s work by sniffing out smaller orders and running the market against them hoping to get others weak hand to puke up shares. As i am typing this AIG crashed lower on lack of volume combined with algo’s triggering stops. This price action snow balls into prop desk shorting then retail shorting.. Never a good deal if your long. But then again hardly anything in this market intra day is “good”. What do you know, as i type this CMC has fallen off its trend and is now trading 50c off its highs with a clear uptrend break. Looks like a shake out to me, but who the hell knows.. Volume precedes price right? yeah i thought so to, apparently it does not in this market, algo’s precede price.
I am guessing the rest of the day we are gonna see nothing but chop and more chop. If you are green now, take your money and run.