Reset Switch

Sometimes I post ideas and sometimes I don't. The reason being is that I want to be relatively sure of the market's direction, then I know which trades I want to look for. Friday's Quadruple Witching options expiration has thrown everything into the Bermuda Triangle again. I'm seeing a mixture of short term negative and positive divergences, in that case when I do not have majority confirmation I do not post any anticipated direction, it would be dishonest to act like I know where the market is going in the short run when I do not. Options expiration created so much volatility as they pinned the heaviest volume calls at $112. To make money you'd need price above $112 plus whatever premium you paid for the options. It seems to me that they fought it with a lot of volatility to keep it pinned and make all those calls or many of them expire worthless.

 I can come up with opinions of what that might mean, but there are so many strategies in options that you can never draw any accurate conclusions from them. We do have several reversal signals the last few days, it looks to me to be about time for a pullback, in that pullback we will have the information of whether we make a higher low or not which will tell us a lot. Should the market just peel off north then we have a different scenario altogether and our plan will be to sell bear ETFs a little at a time and replace them with bull ETFs and continue hedging in this manner until we get a reversal.

The charts now show what to me seems to be a clear path down, the question is when and how? The new Wall Street maneuver is volatile breakouts followed by failures, but we have yet to see a real failure.

Monday will begin the re-set. If we get higher prices, that is not out of the norm and it does not mean we are entering a bull phase, if Tuesday we got confirmation with a higher high and volume, then we have reason to start the hedging process. If Tuesday we see a failure to confirm as we have seen the last week, then we are on track.

The market is very much like professional poker. there are times to press, times to fold and times to sit and wait out the game. Right now it is time to sit and wait out the game.

I would post some short term trades that I see, (and I have in the last week, many limit order trades too which should be watched carefully for an opening), but I will not post those trades tonight based solely on the intraday volatility, the market seems to be heading in the desired direction and in the last hour it makes up all the ground it gained or lost during the day. Talking with floor traders, even the most adept that do this every day are getting massacred and when they move into cash to wait for clarity, who am I to say otherwise? I would not hesitate to say otherwise with clear direction from 3C, but it is not there in the short term (1-5 minute charts) which depict the daily movement and movement over several days and reversals. The longer timeframes are solidly negative, but as I said, getting from here to there can cost a lot of money if we do not have a strong edge. Many of you are here because of 3C's ability to give us that strong edge, when it's not there, I tell you.

I do not make market calls based largely on my experience and opinion, I make them on clear objective and overwhelming evidence. So I know it is frustrating to sit still, but for me to offer anything otherwise at this time would be gambling, a partly educated guess. You are not paying for a partly educated guess, you can do that yourself or get it froma thousand sources. You are here for the strength this system shows and when it shows that strength I will give you enough trades to keep you very busy as I often do. It's not there tonight.

Check back around 10:30-11 a.m. tomorrow. What I see now appears to be some sort of early strength, how long it goes on will be better determined tomorrow morning to the early afternoon.

Agin, if you have specific questions, and I answered several today with several page explanations, send them to me. In the meantime I will help all I can in whatever manner you desire.

Don't get too caught up in the early indications if they are very bullish. We just had an extraordinary round of bad jobless data an things are heating up in the middle east-the market hates uncertainty and will quickly mark prices down, thus the saying "When the missiles fly, it's time to by". the market would rather the certainty of war then the uncertainty of whether or not there will be a war.