BIDU Beats on Revenue, Earnings and Guidance...

10 years ago I would have looked at BIDU as a perfect short right here, instead I was able to short it nearly $40 higher, but the point is as I said several times today, "I like BIDU, if it's not earnings, it's something else".

Taking a look at the chart alone from a textbook technical Analysis perspective, BIDU is a high probability short (today before earnings).

Looking at BIDU from Technical Analysis's perspective, BIDU topped in a large triangle, it's been in a down trend and formed the perfect pattern seen in a downtrend, a descending triangle, which suggests the next leg of the downtrend is starting and it is below the support of that price pattern with a failed test at the white arrow, also large red volume-"IT MUST be Wall Street Selling!", that was the attitude back then.

Instead I see BIDU this way...

BIDU makes a higher high and 3C makes a lower high at an important head fake area, the yellow box is where we actually shorted BIDU for the core short positions. However the technical set up seen above looks a lot like a counter trend bear trap and while price made new lows, 3C is positively divergence making higher lows. I don't want to abandon my core short position, but I do want a taste of any upside action in BIDU, maybe I'll even add to my core short if things work out-you know why I'm not trading around core positions which I'd normally do.

As for the other charts...

 No, the 1 min intraday chart didn't give me a signal that there was a leak in BIDU earnings and really I didn't care if they missed, I was in BIDU long for another reason.

 When in doubt, go to the longer term charts. This 15 min chart leaves a pretty clear impression of a divergence and trend in 3C.

 This 30 min chart shows some sharp accumulation at lows that probably brought  lot of short sellers in quick, allowing smart money to accumulate quickly because of the supply the short sellers offered.

 The same thing on the 60 min chart and that's an important timeframe.

But, why be long and short the same stock? Does it really matter if both positions are in the green? Actually it's not something I prefer to do, but core shorts are remaining in place with hedges for reasons you are aware of, it doesn't mean that I have to hate BIDU, if there's money to be made on the upside, why not take that trade?

As far as where I think BIDU is going in the big picture and how I want to use price strength to my advantage when thinking about the big picture, the daily chart below says it all.

However nothing goes straight up or down in the market, right now BIDU is up 5.5% in after hours.

ES Update

Here's ES for today

 ES going positive at the lows right after the open and going negative at the highs near the close.

 ES walked the lower band or standard deviation of VWAP almost perfectly most of the night and broke through VWAP during regular hours, finding resistance at the upper standard deviation.

Since about 1:45 the CONTEXT ES model has diverged negatively and substantially from ES itself.it almost looks as if the SPX was destined to just make it inside the flag today.

Just made it in to the Flag

There's still a gap above as well, but this was what I thought early today, a move in to the flag...

 SPY 60 min chart, just made it in to the flag.

 The 5 min chart just before the close

Here's the gap still open, I was actually thinking we'd see a more impressive move in to the flag to reallt sway emotions, but then again, I didn't expect it all in one day.

VXX / UVXY Charts

 UVXY 3 min going positive intraday

 VXX 5 min starting to lead positive

VXX 15 min also starting to lead positive-this is what I was waiting for.

 UVXY leading positive on 30 min


leading positive 60 min...

Adding a SMALL UVXY Call position

A couple of charts are now going positive in UVXY, the 3, 5 the 15, 30 and 60 also looking pretty good, so I'll be looking for a speculative (as with all longs) position in August Calls, around $7-8.

BIDU Update

I'm getting a lot of emails on BIDU as they report after the bell, BIDU looks like the market for the most part or the Tech charts I put up on the intraday timeframes, it's the longer timeframes that I like that may have nothing to do with earnings and of course my long term short position.

Since there's not much difference in the shorter timeframes between BIDU and XLK or the market, I'm not positing those short term charts.

 For the long term core position, we went short in the yellow box, I think BIDU has a long downtrend in front of it. I do have the smaller speculative calls for a head fake/ shakeout move or counter trend move up, thi looks like the perfect spot for it.

 The 15 min time frame like XLK/Tech is in leading positive position today, so not too bad overall.

 The 30 min chart went positive at the lows on the 17th and has been in line since.

The same with the 60 min chart, these are the reasons I like BIDU for a move up, maybe it comes in a day, maybe a few, I'm willing to be patient with it for now.

TECH

THE TECH CHARTS FROM 1-5 MINS LOOK VERY SIMILAR TO THE MARKET AVERAGES, SO YOU MIGHT WANT TO TAKE A LOOK TO BETTER UNDERSTAND THE LAST UPDATE.

 Tech 1 min negative intraday

 2 min negative intraday

3 min negative intraday

 5 min leading positive


 There's even a bit of a leading positive divergence on the 15 min chart currently, it seems the lows were accumulated today.

The 30 min chart still shows the longer trend as being in some trouble, but it seems like we may see that move in to the flag as I mentioned earlier.

Market Update

Most all of the short term charts intraday are going negative now, however that may not be the end of the story, they have in many cases built positive divergences out to the 5 min chart which so far are not negative, this would suggest some near term intraday downside, but still a good probability of more upside perhaps late today or tomorrow if the 5 min charts don't start to go negative as well.

AAPL Update

Last time we had a good pop in AAPL we had a strong positive divergence just before earnings, the day before in fact. In addition we had a similar very strong divergence in Tech as a group, that was a nice signal, easy to see. I don't consider AAPL to be a leaky ship and I don't see anything that suggests a leak to me as they report tomorrow I believe, but I will want to take a look at Tech in general as well.

AAPL is a little tough because as I explained some time ago, AAPL seemed to undergo a fairly large accumulation period, thus I didn't expect to see and haven't seen many positive divergences as the accumulated position would just be worked off without adding much more to it, that seems to have been the case and still be the case with AAPL.

 AAPL 1 min intraday is not that different from anything else for instance, Tech is below on a 1 min chart.

 Tech 1 min intraday

 The 2 and 3 min AAPL charts also have a recent intraday negative divergence.

 The 5 min AAPL chart though has still held up pretty well, perhaps the 3 min chart will deteriorate some more and start to chew away at the 5 min chart or perhaps there's some real short term strength here.

 The 15 min trend has been pretty negative as I would expect as accumulated shares are more or less just burned through (sold) in to higher prices.

 The 30 min chart shows the area that I believe was a major accumulation area and therefore we haven't seen any further areas like that as there's been no need. If this is the case, the longer term chart here seems to be showing the position either nearly sold or sold.

The longer term hourly chart shows the primary trend, while AAPL has more or less been in line on the May move higher, it has been from a leading negative position. I know AAPL's track record with earnings and why (they always guide low and come in higher). I don't see anything on AAPL's chart alone that makes me want to go long at this point.

Closing out the last of UVXY Aug $9 Calls

As far as the short term charts go, I want to see positive divergences in to a pullback, right now I'm not seeing anything like that yet so I'd rather just exit the rest of the position at a profit and wait until I have a signal that is telling me this position is high probability.

RISK ASSET UPDATE

I'm looking at a few different timeframes in this update, but most of our trend assumptions seem to have some degree of confirmation here, from the very short intraday to the long term Primary Trend.

 Commodities are holding up better again today than the SPX, we saw this trend last week and recently, its almost as if there's some good news expected out of China, I believe their Flash PMI is due out this week.

 High yield Credit moved down before the gap down and has been moving up in to the drop, this is interesting and suggestive of some more upside.

 High Yield Corporate Credit dropped, but not as much as the SPX and remains supportive or higher prices.

 As for the longer term and the sub-intermediate up trend I have expected, it looks like HY corp. credit remains supportive of a move higher (this is the move higher we talked about after a pullback).

 Yields are very low in the near term, this leaves me wondering if we don't have some more aggressive downside to go, we hit the original expected target in 1 day so I'm wondering if this is signaling more to come.


 Long term Primary Trend, you can see Yields have been very negatively divergence, this would suggest a nasty fall for the long term Primary trend.

 The $AUD also wasn't as bad today as you might expect, it looks like some near term upside is probable.


 Again as to how far a pullback may go, the Euro is still a good distance lower than the SPX, again this makes me wonder exactly how much downside a pullback might see.

 Energy is generally supportive of the SPX

 Financials are starting to show more life

 Tech overall seems to look the best for intraday trade.

Sector rotation vs Friday shows Financials looking pretty good, the safe haven trades are fading while Energy, Industrials, Tech and maybe even Basic Materials are starting to see some rotation.

Market Update-Other Asset Confirmation

This is a look at very different assets, but they all still have a fairly strong correlation with each other and thus provide good confirmation.

 As many of you probably remember, our likely downside target in a pullback was going to be below the flag, just as our eventual upside target will be above the flag, however earlier today I said, if it were me, I'd run  price back up in to the flag, this would likely cause the most confusion and hurt the most traders. Price isn't too far away from re-entering that large flag.

 SPY 5 min chart close up shows the recent negative divergence and the positive divergence on the open as 3C did not move lower to confirm the lower low, but rather stayed in a leading positive position, at least for the near term.

 We would expect to see some strength in the Euro to support the market, here on the 3 min chart (also on the 1 and 2 min) we have a positive leading divergence suggesting the Euro will move higher to support the market very short term. Most charts are negative at 5 mins, so this divergence thus far seems to be for a short term move.

 We would expect to see the opposite in the $USD and her we have  3 min leading negative divergence in the $USD, a slumping $USD would lend strength to the market.

 VXX and UVXY which trade opposite the market (remember I closed 1 Call position Friday and half of the remaining one this morning-looking for a better entry) also have a 3 min negative divergence instead of confirming the upside move, so I'm happy with the decision to take profits on half that position.

TLT is the Treasury ETF, in a down market we would expect to see a flight to safety and TLT is up, yet it has a negative divergence and 3C is not confirming the mov higher, this again suggests a move out of the flight to safety trade and back toward the risk on trade in the market.

ES is also starting to show a half way decent positive divergence on a 1 min chart.