Sit and Watch

The bull run that skeptics hesitate with continued to market tops of 10,392 in morning trading. The market moved as lows as 10,206 in hesitancy at another market top.

Each move up that holds decreases the amount of consolidation, based on the count of the market. The bias stays clearly at near 5 to the call, and there is always an upside.
Profits are possible on both of our open signals, for fast day traders; otherwise, the market is hard to trade for index options, and actually hard to day trade in general.

An appropriate email from subscriber Dave

"Good Morning, Floyd.

Hope you are well. Been a little while since I wrote you with any questions J. I have been studying the market and alerts for months… I don’t even paper trade – I just sit and watch the market (OEX, DOW, and YM Futures) every day possible, all day when I do. I have learned a great deal by doing this and have come to understand your approach to the market much much more than I ever have before. Much appreciated are your teachings by me. Though I feel I have learned a tremendous amount, and am still learning and I have a couple questions… Stuff that is basic but that I am curious about…

As you begin to calculate up or down on the 21 day cycle… Either the 500 – 600 current market swings or 21 days, whichever comes first fulfills that particular cycle right? Then we see the 2 way trading more apparent and whipsaw as the market sorts itself out to establish the direction of the next cyclical move (whichever direction)?

Day-Trading the options that swing in ranges, to me, appears to be much more reliable than using the pivots. Just like trading channels. I’ve come to not like the pivots as far as trading them but I do see their value in establishing S/R because you can clearly see when one of them is honored vs those that are not. Just matching up the option swings with the market swings (syncing them) among other things stacks the odds in ones favor.


Anyhow, Thanks again, Floyd. All your teachings are very much appreciated."

Floyd's rule of thumb and answers: Sitting and watching the market for months is how many of my best students have gotten rich. They learn patience, and truly following the market, with fear or greed.
Right now the 21 day cycle is closer to 30 days, but each consolidation, even in stages, has averaged 586 points down. I'm actually watching this with all of you now, as it does not appear the market would consolidate deeply with the higher higher we've seen, and our Dow projections so reflect this.

There are many stocks we are recommending in our Blue Chip Options service (www.bluechipoptions.com), however, and there is more upside potentially over the next 6 weeks.