The Study Continues

The market showed flat futures, and varied news data prior to opening. Gold was already rising. And, from a futures of 12+ the market opened to highs of 9945.73, or almost 10,000 on the theoretical Dow.
Retail sales data was reassuring, and the market opened strongly bullish. The sadness in the country in the lack of true investigative reporting ,and the finding that over half of the derivatives being traded don't even show accurately on the exchanges, showing Wall Street still in charge. For some reason, this frightening news was not even understood, and the market just forged ahead.

We remain concerned that 10,000 will not hold and that another consolidation, led by the USD shifting, oil dropping, and made a buy to an Out of the Money Put, for a fast downside we see. The amount of massive moves in the market, up 177 points for example by 10.30 a.m. makes it difficult to trade. But to see the day hold and run up over 10,000 and hold....we'll see. More data reports out today that "excite" the market, and right now in such an emotional way it's hard to read. We seem to be repeating the same cycle, part of what some would see as a head and shoulders pattern that is ominous.

Our Dow projections are right to target, just hard to figure which way first.


More on Trader Bill's study on the count:
His premises:
How do the parts of the count stack up to correlation of movement.

I'm still trying to figure this question out.

ie. When I developed my spreadsheet, I broke down the 5 parts to the count.

Part 1 compares the current day price action
Part 2 compares the last 3 days
Part 3 the last 2 days


I recently asked our Blue Chip traders the question "why do you trade?" The answers were astounding, and showed me as person all the different reasons people are trying to make money trading options.

So, my hard question to you as a trader for a Friday is this: would you prefer smaller, steady profits, or larger pools of money invested in simple signals?
Neither answer is wrong, but your answer to this question is key.

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How can we as a nation manage to take simple subjects, with simple solutions, and make them undefinable, filled with graft public or private, and inept.
Simple problems. Simple solutions.
Like, where is Osama Bin Laden. L.A.?

That is not a statement to annihilate Bin Laden, but come on, how hard is it to figure out where he is?

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Trader MR gives an update on his BCO and OEX trading:

> Closed out last MKDAC today for 60% gains. I'll look to re-enter at lower price point, as MCD hit P/F resistance today.
Floyd: McDonalds has done us well, and he's right....we'll soon have a new entry on this.
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> I made out on those GLD calls from last week. Finals positions were 80% gains.
Floyd: Gold remains a buy. CEF is an excellent long term investment, and we'll soon have new Gold calls/puts listed. There may be a correction,but Gold is headed to $2000 or more an oz.
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> Bought AAPL dec OTM calls yesterday. Up 22% today, I'll hold for greater return.
Floyd: Smart. He's learning on his own. Apple we've played for years, and I'm soon ready to recommend a position before the January numbers come out.
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> Now for the bad news. My index option trading has been horrendous. I can't get a good read on the market, and/or I am making bad choices. I have messed up enough OEX trades to cancel out those fantastic trades and my trading account total value is still flat lining. It's sort of comical.
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> I feel like I am "missing something" like there is a key data point, or indicator I am not looking at. Maybe it's my mind's eye that's not focused. I think I should take a couple days to "go fishing."
Floyd: Although this is for OEX traders, it's a very honest piece of information. The indices right now (SPX, DIA and OEX) are all difficult to trade because of the amount of whipsaw in the market. When traders experience situations like this, just don't trade. This is what I call my "fishing time."

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> I can ETF trade fairly well. My conservative portfolio (my wife's IRA account) is up 10% in 6 weeks, and its 75% cash at the moment. I may be starting to find my own style in trading. buying "longer term" or "trading the swings" seems to work for me, and I have been fairly accurate in the trades I've made.
Floyd: This is the purpose of learning to trade with me. Develop your own style, and learn what NOT to learn.
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> The study continues...
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> MR