Stuff I'm buying...a.k.a. My Critical Mass...

As a Baby Boomer, I have to confess that my buying habits have changed radically over the years. When I was younger and worked as a city planner I had to dress professionally...that meant smart suits, matching shoes and handbags, nice jewelry, nice makeup, nice teeth, nice car...blah...blah...blah. In short, I had to have the "latest everything."

Now that I'm older and work from home on my computer (I can't afford to retire), my priorities have changed. I have a treadmill, a bicycle (for "fun"), and pull-on knee supports to ease my arthritic pain when I'm walking on my treadmill...I take naturopathic supplements to keep me healthy...I get my eyes examined once a year and keep my eyeglasses up-to-date...I have to keep my computer and monitors up-to-date and running at top speed to handle my daytrading activities properly (that also means paying an arm and a leg for top download speed for my internet service)...I use a tooth re-mineralizing product to strengthen and rejuvenate my teeth...I drive a 10-year old car...I wear comfortable shoes, instead of the 3" heals I used to wear...my jeans aren't so tight that I can actually sit down and breathe at the same time...I have a comfortable bed and pillow that give me great support while I sleep...I have to make sure that my health care payments are up-to-date...I have a cat to look after (he's my "child")...I've been visiting a Naturopathic Doctor twice a month for the past 3 years to have my misaligned spine straightened (for pain relief and to help me breathe better -- I'm very happy to say that my spine is almost straight now, I hardly have any pain for the first time in about 35 years, and I can breathe much better). All of these things are critical and life-savers to me (especially the jeans).

Some people will relate to what I'm saying...others will not because they're too young. My point to all of this is my other Baby Boomer friends are not buying the frills and the "latest" and "greatest" stuff that they used to when they were younger...and they're certainly not going to the bank to ask for credit for that kind of stuff. They're busy down-sizing...selling their large family homes for something smaller and having garage sales...taking some time out to concentrate on their health that has been neglected (and abused in some cases) over the years.

The latest U.S. Census Bureau brief on data from the 2010 Census shows Baby Boomers are increasing faster than younger populations. Between 2000 and 2010, the 45 to 64 population grew 31.5% to 81.5 million, and now makes up 26.4% of the total U.S. population. Each year more than 3.5 million Boomers turn 55. Their swelling numbers predict that, by 2012, America's 50 and older population will reach 100 million. And, according to the UN Population Division, 1 in 5 people are expected to be 65 or older by 2035.

So, I really don't care what the latest "gadget" is or who's wearing what. If it really does make me feel better and I really do need it, and if it doesn't break my piggy bank, I'll buy it = My Critical Mass! My favorite store these days is the Dollar Store...I love a bargain! Perhaps Mr. Bernanke should take heed of what the priorities are of the Boomers and stop wondering why people aren't borrowing like they used to and why things are "slowing down"...we're getting older and don't need or want all that stuff anymore!

Anyway, that's my 2 cents' worth on the subject. Now if I can just remember where I left my keys...

Is this "dinosaur" tradable?...

How would you trade this "dinosaur?" This 30 min chart of the TF kind of reminded me of one today...

So what's next?...

"I used to be indecisive...now I'm not sure."

Author--Anonymous

How would you trade this "dinosaur?" Each candle represents a one-month Options Expiry period on the chart of the TF below...the current candle closed today...

I leave you with this "mirror image"...notice any similarities?...kissing cousins?...

Careful you don't get "eaten" by the hungry MM's tossing lines over both sides of the "boat" on a "fishing" expedition! We're at the "mouth" of this nasty creature now!

BTW, for those of you who like statistics, here are a few Pivot Points (potential support and resistance levels) that are in effect for the TF (price closed today at 828.50):
Monday's Daily PP = 826.10
Next week's Weekly PP = 831.50
July's Monthly PP = 814.90
July - August 1-Month OPEX PP = 819.70
July - September 3-Month OPEX PP = 806.20
July - September 3rd-Quarter PP = 821.50
July - December 2nd Half of Year PP = 827.20 (R1 for the 1st 1/2 was 856.80 and hit last week)
January - December Yearly PP = 718.60 (R1 for 2011 is 858.70...this level was hit last week)
*Note the confluence of all but the last one...these are important levels for their respective time periods and worth watching to gauge relative strength and weakness over the coming weeks and months. I would also add that the 1st half of the year's R1 level has been hit, as well as the entire year's R1 level, so, for now, it could be said that this e-mini futures index is in positive territory for 2011...however, the fact that the majority of the PP levels are so close to each other reflects the fact that overall value has not continued to increase during the first half of the year...hence the large consolidation as shown on the second chart above.

In addition, here are a couple of VWAP levels (Volume Weighted Average Price) currently in effect:
Weekly VWAP as it ended today = 831.30
Monthly VWAP as it ended today = 836.30
*This week's VWAP has shown relative weakness compared to the month's VWAP, and the volumes are higher than the first week of July.

Finally, here are a couple of Volume Profile POC levels (Point of Control) currently in effect:
Weekly POC for this week = 832.50
Monthly POC for the month of July = 837.90
*This week's POC has also shown relative weakness compared to the month's POC.

In conclusion and from these stats, I would venture that near-term support lies at 806.00ish and near-term resistance at 838.00ish for the TF. A fall below 806.00, and, subsequently, below 800.00 on increasing and sustained volumes could spell trouble for the bulls.

"They told me I was gullible and I believed them."

Author--Anonymous

This summer...

Hope everyone has a good weekend!

On a different note...

At the risk of repeating myself ad nauseam with respect to what the 4 e-mini futures are doing or where they are within their 2011 large sideways trading range, I'll just mention a couple of things.

First, the large, unwieldy intraday swings of late are beginning to feel like they did before and during the drop in 2008.

Second, I'm posting the following three charts (courtesy of  Barchart.com).

As can be seen, the percentage of stocks trading above their respective 20, 50 and 200-Day moving averages is hovering around 50% or a little above. The 50 and 200-Day moving averages are trending down on the second and third charts, giving a bearish tilt to things. All three charts are a reflection of the range-bound markets in general, and my only comment would be that I'd like to see the percentages either:

1. turn higher and remain above 70% on the second and third charts, in particular, in support of any market breakout of the Daily trading range that may occur at some point to the upside, or
2. turn lower and remain below 40% on the second chart and below 50% on the third chart in support of any breakdown below the Daily trading range.

YM, ES, NQ & TF...and the game of ping pong continues...

The wild swings in the markets since the beginning of this year have created a rather large trading range on the YM, ES, NQ & TF, which I mentioned in my post last night. The last few days has seen an explosion in volatility as evidenced on the 5-min TICK, ADVN/DECN Issues, and UP/DOWN Volume charts below.

Below are four 4-hourly line charts on these e-minis...overlayed on each are 2 regression channels currently in play. I've drawn a horizontal line on each one where both of the channel "means" intersect (broken yellow & broken pink lines). I would venture that these levels will play an important role in the days/weeks to come in setting a potential point from which an eventual trend will emerge that will take these either higher to new levels above the current sideways trading range or lower to new levels below the range. Perhaps we'll get a better clue once Mr. Bernanke has finished speaking tomorrow and after the end of this Options Expiry week. The longer that price remains above the +1 deviation of the shorter downtrending channel (dashed pink line), the better chance it has of reversing this to an uptrend, and it would then be in alignment with the longer uptrending channel...currently in after-hours trading, the YM is trading just below, the ES is trading well below, the NQ is trading just below, and the TF is trading just below.

Some statistics for YM, ES, NQ & TF

Below is a Daily chartgrid of YM, ES, NQ & TF. The charts begin from January 1st of this year. Overlayed on each chart is a Fibonacci retracement starting from the lowest price to the highest price this year. Also showing are Bollinger Bands (BB), a 50sma (red), a 200sma (pink), MACD and Full Stochastics.

Here are a few stats on each e-mini relative to their charts.

YM:

• the high reached this year was 12873 and the low was 11451...the range is 1422 points and has an approximate volatility measurement of 11.05% [(range/high)x100]
• price is currently above the 38.2% retracement level and has formed quite a bit of support below this level and some resistance above this level
• price is currently above the slightly falling 50sma, which has just turned down below the 38.2% Fib level
• price is currently above the mid-point of the BB
• the rising BB mid-point is below the 50sma
• the 50 & 200sma's are beginning to move toward each other...the distance between the two appears to be the largest of the 4 e-minis
• the MACD histogram shows a positive divergence above the zero level from the beginning of the year
• the MACD moving averages are beginning to converge at their overbought level, but have not crossed
• the Full Stochastics shows that %K has crossed over %D and has hooked down

ES:

• the high reached this year was 1373.50 and the low was 1241.25...the range is 132.25 points and has an approximate volatility measurement of 9.63% [(range/high)x100]
• price is currently just above the 50% retracement level and has formed quite a bit of support below and some resistance above this level
• price is currently just above the slightly falling 50sma, which is sitting just above the 50% Fib level
• price is currently above the mid-point of the BB
• the rising BB mid-point is below the 50sma
• the 50 & 200sma's are beginning to move toward each other...the distance between the two appears to be the second largest of the 4 e-minis
• the MACD histogram shows a positive divergence above the zero level from the beginning of the year but was lower in May...however there is a positive divergence once again with this latest ramp up in price
• the MACD moving averages are beginning to converge at their overbought level, but have not crossed
• the Full Stochastics shows that %K has crossed over %D and has hooked down

NQ:

• the high reached this year was 2428 and the low was 2174...the range is 254 points and has an approximate volatility measurement of 10.46% [(range/high)x100]
• price is currently above the 38.2% retracement level and has formed quite a bit of support below this level and some resistance above this level
• price is currently above the slightly falling 50sma, which is above the 50% Fib level
• price is currently above the mid-point of the BB
• the rising BB mid-point is below the 50sma
• the 50 & 200sma's are beginning to move toward each other...the distance between the two appears to be the smallest of the 4 e-minis
• the MACD histogram shows a positive divergence above the zero level from the beginning of the year
• the MACD moving averages are beginning to converge at their overbought level, but have not crossed
• the Full Stochastics shows that %K has crossed over %D and has hooked down

TF:

• the high reached this year was 872.00 and the low was 767.50...the range is 104.5 points and has an approximate volatility measurement of 11.98% [(range/high)x100]
• price is currently just below the 38.2% retracement level and has formed quite a bit of support below and some resistance above this level
• price is currently above the slightly falling 50sma, which is sitting just below the 50% Fib level
• price is currently above the mid-point of the BB
• the rising BB mid-point is precisely at the 50sma now
• the 50 & 200sma's are beginning to move toward each other...the distance between the two appears to be the second smallest of the 4 e-minis
• the MACD histogram shows a positive divergence above the zero level from the beginning of the year but was lower in May...however there is a positive divergence once again with this latest ramp up in price
• the MACD moving averages are beginning to converge at their overbought level, but have not crossed
• the Full Stochastics shows that %K has crossed over %D and has hooked down

Conclusions:  All of the 4 e-minis are above their 50% level of their respective sideways-trending ranges...overall relative strength would place the YM first, followed by the NQ, then the TF, and finally the ES. However, the TF has the highest volatility and may be the first to lead a breakout of this trading range. It's interesting to see this divergence forming amongst these e-minis...and possibly something to watch over the coming days/weeks before a clear breakout occurs either above or below this range. We may see further range trading until the 50 & 200sma's merge (or come much closer) and a new trend established away from that point and beyond the boundaries of the current range (the NQ may give the first signal in this regard). As things stands now, there is a slightly better than 50% chance that all 4 e-minis will remain above the middle of this range, provided that buying volumes and momentum return on this timeframe...otherwise, we may see a drop to either their 200sma's or the bottom of their ranges.

Crossroads for YM, ES, NQ & TF...EUR/USD...

My post last Friday made reference to the 4-Hour charts of YM, ES, NQ & TF:
http://strawberryblondesmarketsummary.blogspot.com/2011/07/weekend-review-for-ym-es-nq-tf.html

Last Wednesday's swing low was broken today on all 4 e-minis on this timeframe, which, in turn, has broken the 4-Hour uptrend. In addition, a new Cummulative TICK low was made today below Wednesday's low TICK.

Below is a 4-Hour (market hours only) chartgrid of YM, ES, NQ & TF. By the end of today, the MACD histogram turned negative, along with MACD crossovers...as well, the Stoch's crossed over to the downside on Friday's gap down. Price is currently above the mid-point of the Bollinger Bands (BB's) on YM, just below the mid-point on the ES, in between the mid-point to lower BB on NQ, and just below the mid-point on TF. Also overlayed on the charts are Fibonacci fan lines taken from the June lows to Thursday's highs...price is currently just above the 38.2% fan line on YM, in between the 38.2 & 50% fan lines on ES, just above the 38.2% fan line on NQ, and at the 38.2% fan line on TF.

In my opinion, today's low is an important confluence level. I'll be looking for continued weakness below today's low on an acceleration of downside momentum with confirming volumes. Failing that, there are a couple of unfilled gaps above last Thursday's close...price may wish to close those gaps at some point and form a range in between today's low and Thursday's high until a breakout (with conviction) occurs on either side.

And, since all eyes are on the Euro these days, I've added my Daily chart of the EUR/USD with the levels identified that I'm watching. A break below today's low and then June's low of 1.39689, could send this Forex pair down to 1.382ish at some point...otherwise, there may be more range trading above. BTW, the 1.33 level that you see on this chart was mentioned in my post on June 23:
http://strawberryblondesmarketsummary.blogspot.com/2011/06/xmas-666.html

And, somewhere in Greece...

The 3 Dows...a look under a microscope...

Today, I'll have a look at the 3 Dows and 6 timeframes on each for possible clues on future direction.

Chart #1

• Each candle represents a One-month OPEX period...the current candle will close this Friday.
• So far, the candles on the Dow & Trans are bullish engulfing candles...while none yet on the Utils, it is still bullish and has the potential to form one.
• All candles are above the current OPEX-period Pivot Point (PP) (short yellow horizontal lines), as well as above all of the previous OPEX-period PP's for this year. [The PP for each candle is created by applying a one-period simple moving average based on the (H+L+C)/3.]
• There is no candle reversal signal yet on this timeframe.
• They are all at or near the top of their (still expanding) upper Bollinger Bands.
• There is no reversal signal yet on the MACD's (in spite of the negative divergence showing on the histogram on the Dow & Trans charts).
• The Stoch's are above their overbought levels...the recent crossover of the Stoch's on the Dow & Trans would need candle confirmation to suggest a reversal is in the making.
• So, while these indices are beginning to look a little toppy here, there is nothing to confirm that the uptrend will reverse yet on this timeframe.

Chart #2

• Each candle represents a One-Month period...the current candle will close at the end of July.
• So far, the candles on the Dow & Utils are bullish engulfing candles...the candle on the Trans is not a true bullish engulfing and a small gap remains unfilled between the close and the open/low of the current candle and the prior one...the candle is, however, bullish.
• All candles are above the current one-month period PP, as well as above all of the previous monthly-period PP's for this year.
• There is no candle reversal signal yet on this timeframe.
• They are approaching the top of their (still expanding) upper Bollinger Bands.
• There is no reversal signal yet on the MACD's (in spite of the negative divergence showing on the histogram on the Dow & Trans charts).
• The Stoch's are above their overbought levels...the recent crossover of the Stoch's on the Dow would need candle confirmation to suggest a reversal is in the making.
• So, while these indices are beginning to look a little toppy here, there is nothing to confirm that the uptrend will reverse yet on this timeframe. However, I wouldn't be surprised to see a retest of the prior month's hammer's low at some point.

Chart #3

• Each candle represents a One-Week period...the last candle closed on Friday.
• This candle has tested the highs of the prior week's large advance...the Dow & Trans closed slightly higher than the prior week...the Utils retested the prior week's high and PP and closed in between and down on the week.
• The Dow & Utils closed above the one-week period PP of this candle, while the Trans closed below...however, the Trans has closed above all the weekly PP's so far this year, while the Dow & Utils have yet to close above their last swing high PP's.
• There is no confirmed candle reversal signal yet on this timeframe...only a pause.
• The Dow & Utils are approaching the top of their (still expanding) upper Bollinger Bands, while the Trans has pierced its (still expanding) BB.
• Both the MACD's & Stoch's are hooking up after turning down with the May-June pullback...the MACD histograms are also rising.
• There is nothing to confirm that the uptrend will reverse yet on this timeframe. However, I wouldn't be surprised to see a retest of the prior week's PP at some point.

Chart #4

• Each candle represents a Daily period...the last candle closed on Friday.
• This candle has tested the lows of the prior candle, but not the highs.
• The Dow & Utils closed above the one-day period PP of this candle, while the Trans closed below...all 3 have closed below the prior day's PP and above Wednesday's PP...Wednesday's PP is likely an important level to watch this coming week.
• There is no confirmed candle reversal signal yet on this timeframe...only a pause.
• All 3 are back below the top of their (still expanding) upper Bollinger Bands after piercing the upper BB (and closing above in the case of the Dow & Utils).
• Both the MACD's & Stoch's are within their overbought levels and the MACD histogram is just beginning to contract to the downside.
• There is nothing to confirm that the uptrend will reverse yet on this timeframe. However, I wouldn't be surprised to see a retest of the prior day's high at some point.

Chart #5

• Each candle represents a Four-Hour period.
• This timeframe simply shows the steep rise that has been made since the June lows.
• There is no confirmed candle reversal signal yet on this timeframe...only a pause.
• The upper Bollinger Bands are still expanding on the Dow & Trans, while the Utils' BB has hooked down slightly.
• Both the MACD's & Stoch's are within their overbought levels and the MACD histogram is contracting to the downside...starting from June 22, there is a negative divergence on the MACD histogram on the Trans.
• There is nothing to confirm that the uptrend will reverse yet on this timeframe. However, I wouldn't be surprised to see a retest of the prior day's high at some point. A candle close and hold below the low of last Wednesday could signal trouble ahead (with Cummulative TICK confirmation as mentioned in my post last Friday)...and a potential reversal, especially if selling enters the market with conviction.

Chart #6

• Each candle represents a One-Hour period.
• This timeframe also shows the steep rise that has been made since the June lows.
• As of the end of Friday, there is no confirmed candle reversal signal yet on this timeframe...however, the Utils did retest Wednesday's low (and rising 50sma) and bounced.
• The upper Bollinger Bands have hooked down slightly.
• The MACD's and histograms are declining with no confirmation of a reversal to the upside.
• The Stoch's have hooked up after falling into oversold territory on Friday.
• Other than declining momentum, there is nothing to confirm that the uptrend will reverse yet on this timeframe. However, I wouldn't be surprised to see a retest of the prior day's high at some point. A candle close and hold below the low of last Wednesday could signal trouble ahead (with Cummulative TICK confirmation as mentioned in my post last Friday)...and a potential reversal, especially if selling enters the market with conviction.

Conclusions:  Unless buying momentum picks up on the One-Hour and Four-Hour timeframes this coming week, we may see some whippy range-trading (in between the upper BB and the rising 50sma (red) on the One-Hour chart and possibly down to the PP of the prior week) until either the uptrend continues, or a pullback begins below last Wednesday's low to some degree. As a daytrader, I would drill down to lower timeframes to look for similar clues and a variety of confirmations, while taking into consideration market internals and events as they unfold throughout the day.

Puns for higher IQ's...

• A boiled egg in the morning is hard to beat.
• Santa's helpers are subordinate clauses.
• Acupuncture is a jab well done.
• You feel stuck with your debt if you can't budge it.
• The man who fell into an upholstery machine is fully recovered.
• Every calendar's days are numbered.
• He had a photographic memory that was never developed.
• A midget fortune-teller who escapes from prison is a small medium at large.
• A lot of money is tainted - it taint yours and it taint mine.
• A chicken crossing the road is poultry in motion.
• Dijonvu - the same mustard as before.
• A man's home is his castle, in a manor of speaking.

US$ on track...

In my post on June 23 I made a passing reference to the US$ at a level of 80.00 before Xmas:
http://strawberryblondesmarketsummary.blogspot.com/2011/06/xmas-666.html

These past few days, the US$ has begun to form a rising channel on the Daily chart. Should the trend continue along this channel, the mid-point would be in line with this projected target. The rise in volumes since the beginning of May this year tells me that interest has been building in the US$. Price closed just above the now rising 50sma (red). A price close and hold above near-term resistance of 76.59 is essential at some point for this scenario to remain in play. We'll see where it goes from here.

P.S. Overlayed on the chart below of the US$ are a couple of regression channels...just above the 76.59 level is a confluence level of intersecting channel lines at approximately 76.70...so this seems to be an important level to watch for a potential reversal of the downtrend that started in June 2010.

Weekend review for YM, ES, NQ & TF

Tonight I'm presenting 3 timeframes on the YM, ES, NQ & TF with comments on their trends within each of those time periods.

The first chartgrid shows a Weekly timeframe. Overlayed on each chart are 2 regression channels...the longest beginning at their 2007 highs and the shortest beginning at their 2009 lows. This week, price closed up and at or near the "mean" of the shorter channel on all of the 4 e-minis...while price closed above the +1 deviation of the longer channel on the YM, ES & TF for a second week and price closed at the +1 deviation of the longer channel on the NQ. The longer that the YM, ES & TF stay above the +1 deviation level, the better chance they have of continuing in their weekly uptrend and the better chance that the YM & ES have of reversing their longer channel's downtrend...in this regard, the NQ will need to "catch up" and begin a series of closes above the +1 deviation level.

The YM & ES will need to make a new Weekly swing high and close above the "mean" of the shorter channel to continue their Weekly uptrend and to validate their last swing low as a higher swing low. However, since the NQ & TF broke their last Weekly swing low, they will need to put in a series of higher swing lows and highs to re-establish their Weekly uptrend once again.

The second chargrid shows a Daily timeframe. Overlayed on each chart are 2 regression channels...the longest beginning at their July 2010 lows and the shortest beginning at their March 2011 lows. On Friday, price closed as follows:

• down and on the +1 deviation of the shorter channel on the YM
• down and just above the +1 deviation of the shorter channel on the ES
• down and just below the +2 deviation of the shorter channel on the NQ
• down and half-way in between the +1 and +2 deviation of the shorter channel on the TF

Price on all 4 e-minis is sitting below the rising "mean" of the longer channel after bouncing up off the -1 deviation level and 200sma's in mid-June.

Price needs to pull back on all 4 e-minis in order to establish a higher swing low and be followed by a higher swing high in order to establish a new Daily uptrend since the prior uptrend was broken by the latest pullback from their June highs.

The third chartgrid shows a 4-Hour timeframe. Overlayed on each chart are 2 regression channels...the longest beginning at their May 2011 highs and the shortest beginning at their June lows. At the end of Friday, price closed up after falling in pre-market trading. Price found support at their Monthly VWAP (blue) and bounced. The YM, ES & TF closed at the intersection of the +2 deviation of the longer channel and the "mean" of the shorter channel...the NQ closed above the +2 deviation of the longer channel and at the "mean" of the shorter channel.

All 4 e-minis will need to make a higher swing high and not break this past Wednesday's swing low in order to remain in its uptrend on this timeframe. One of the things I'll be watching next week is my 5 min Cummulative TICK chart to see whether Wednesday's low TICK of -1164 is broken for a possible clue as to market weakness, or the high TICK made the same day of +1386 to gauge market strength.

A little "eye candy" for today...

Just thought I'd share these photos of Canada's scenery...enjoy your day...

YM, ES, NQ & TF...OPEX Candles & Heikin Ashi Candles

Each candle on the chartgrid below of the YM, ES, NQ & TF represents a 1-month OPEX period.

An approximate 100 point range on this ES consolidation could, at some point, produce an upside breakout to around 1450ish or a downside breakdown to around 1130ish (approximately the 50% retracement level of the big plunge from September 2007 to March 2009). The current OPEX 2011 range on the YM & ES has already penetrated into the last red OPEX candle of May-June 2008 immediately before the next stair-step down and big plunge...whereas, the NQ & TF are well above and poised for new all-time highs. The current OPEX candle on all 4 e-minis is a bullish engulfing one, so far...the NQ is an "outside" bar, so far...the others have higher lows than the last candle, so are not "outside" bars.

The OPEX Heikin Ashi candles on the chartgrid of the YM, ES, NQ & TF show a sideways trend for this timeframe.

Whereas, the Weekly Heikin Ashi candles show a trend reversal to the upside so far, but this would need confirmation on next week's close.

There is no hint of a reversal to the downside yet on today's Daily Heikin Ashi candle...although my RSI levels are running a bit hot.

My guess is that the MMs push these 4 e-minis up as high as they can before OPEX next Friday before we see any kind of a decent retrace...maybe a "pop & drop" formation on the OPEX timeframe.

One last thing...that is that price on my NQ Daily chart is now back up to the rising trendline that used to form the "Pink Diamond" pattern that I've mentioned in previous posts. It already tested the lower one and below, so it may "mirror that action in reverse" and keep going up to the next resistance level of 2441ish.

"The recession has hit everybody...my cousin had an exorcism,

but couldn't afford to pay for it, and they re-possessed her."

Author--Anonymous

The "Triple O" Gang reverts to the "mean"...

I last posted an update on the travels of the "Triple O" gang on June 25:
http://strawberryblondesmarketsummary.blogspot.com/2011/06/catching-up-with-triple-o-gang.html

Since then, the gang did find support and reversed their short-short walk from below the regression channel "mean" on the Weekly line charts of YM, ES, NQ & TF as shown below:

Price has now returned to or very near to the "mean" of the channel once again. As of today, there has not been an usual spike in volumes which could mean either a lack of buying with

conviction from market participants, or that short-sellers have not yet entered in force. It may be that any short-sellers are waiting for new highs to be reached this year and more in line with where price has closed in the past at levels sufficiently high enough above the "mean" to provide a decent downside target to the "mean" of the channel. I would add that this channel is in a strong uptrend and has not yet been broken.

Should such a bullish scenario play out, potential upside targets are in the vicinity of (and shown as green horizontal lines):
YM = 13200 (+600 pts.)
ES = 1420 (+80 pts.)
NQ = 2550 (+150 pts.)
TF = 900 (+55 pts.)

However, should major short-sellers enter the market at current levels, potential downside targets are in the vicinity of, firstly, their recent reversal levels, and secondly, the -1 deviation levels of their regression channels (and shown as blue horizontal lines):
YM = 11200 (-1400 pts.)
ES = 1200 (-140 pts.)
NQ = 2075 (-325 pts.)
TF = 725 (-120 pts.)

There is almost double the reward from current price levels down to the -1 deviation levels with half of the risk. However, we may simply see more stair-stepping on the long side on the 60min timeframe until the above noted upside targets are reached. As a general rule, I'm using the 60 min 50sma as an approximate uptrend line in this respect. This tells me that the bulls are firmly in control until the 50sma is broken and a new downtrend is firmly established (with volume confirmation). As a daytrader, I'll be watching intraday price action, volume and momentum on shorter timeframes, as well as market internals for further clues on short-term direction which would either support such a continued stair-stepping action, or which would signal a possible reversal.