Reflection

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The time has finally come for the big guns to resume trading after the summer holiday. Now is the time of year when the big hedge funds and top traders begin ramping up their position size. What does this mean for you and me or any other traders pushing around less than 100 lots on the ES, more participation, a more technical market, and more follow through. Futures Trader: Tomorrow is rollover meaning the volume for the contract month will shift…

For what was a very big move up today you may notice it was rather “slow.” This is known as a gap and go day where the market gaps up and then moves sideways the rest of the day. This keeps the majority of market participants out of the market. The only way to catch these moves if you have not positioned yourself in the pre-market or overnight sessions is to be long or short stock, option, or overnight futures…

Well that rally was short lived. We were immediately sold into on the open at the daily short level of 1080 on the S&P. The target on this trade is 1053 and there’s no reason we can’t go there tomorrow on the Existing Home Sales report. Regardless, now is a great time to be hedged. If you are flat, then a 70/30 bearish/bullish weight to your positions would set you up nicely to take advantage of a violent down more,…

Look out below! We have now clearly broken trend line support, where land nobody knows. Well, not quite. An inverted head and shoulders could potentially be setting up with the left shoulder trading in June, Head in July, and right shoulder forming in August. Regardless, the VIX has jumped back into the mid 20s and the sense of fear and uncertainty is back in the markets (if it ever left to begin with).

This week is going to get ugly so hang on. If you don’t already have it, grab yourself some downside protection expecting for the worse. As of late good news has lead to down moves in the market and bad news to up moves. Today’s Fed announcement was far from good news. The market is a forward looking instrument.

The FOMC Meeting Announcement tomorrow is likely to cause a whipsaw around 1:15 CST and the time leading up to it. No trading will take place tomorrow from 1:00 PM to 1:30 PM, at least on our end. No sense in getting chopped up or impulse trading any sort of news. It’s never worth it.

A slow week to say the least. Today’s Jobless Claims # added a little volatility to the markets, but overall we continue with the sideways action. We bounced off trend line support today and this candle will be used for the bullish/bearish line in the sand, bullish above, bearish below.