TRADITION PAYS 11/19/12

BOT TRADING SYSTEM

THE Monday before Thanksgiving has a track record that favors the bull.  Today did not disappoint.  After an early short  the market flash a long at the SB.  The alert was issued, day done, so to speak.

alert: longs 68.75 and shorts 66.25 for PA BO opportunity.

The long buyers were likely to get +10-12, which in this case took us to the BO-10 area.  Sideways action and a new HL buy for the next BO move for the bulls.  The final exit was the PM high.

THE WORKING CHART

a 50CB at B2 was the next controlling point from the AM long.  At the 50CB, I like to watch for a test of the horizontal ( a FBO tends to continue the prior trend, resist, where a BO tends to be a great reversal) and watch the 45 degree (bull or bear).  Today, PA followed that 45TL until we had a PA correction to the .382 from the high.  Same point for the new buy signal that gave the new push to to BO 15 and the bulls exit.

WEEKLY LOOK

At the lower channel TL, hit the daily 50CB target around 1340 and seeing a buy signal, similar to the HL buy that continued the bull bias.  Time to celebrate!  But...

My gut feeling is that we will see a new low test before the actual bull rebound.  Friday and Monday were aided by temporary news.  Let congress and the President stall on the "cliff" and we push down again as new fears of a recession appear.  This fear is needed.  A substantial bull (or a bottom different view) is developed when there is wide spread fear.  By the time the general population catches on, the pros are well entrenched  at better prices.

ANOTHER LOOK

THIS view, we see the buy again at the bear channel low and a BO to run to test a key resistance level.  This is likely to push back into the channel and deplete the "news" buyers and allow the pros a better entry point.  A double low shake out, doom and gloom, makes for an interesting point to build the next bull leg,

WEEK ENDING 11/16/12

BOT TRADING SYSTEM

This is the first post since October.  November has been a personal trying month, and the markets have been fantastic.  Both causing the need for time to reflect, repair. and look forward.


Friday 11/16


Overnight trading had settled in a range.  Earlier we (assumes chat crowd followed) took shorts in the 49 zone.  As the Euro zone developed. PA would test highs around 52 and back to 45 lows.  By early morning US we were at highs again and saw a reversal run the range to establish new lows.  We eventually got the discussed  daily 50CB around 1340.  This was a support level on the daily chart.

Buys there led to a range run back to the BO 5 level from the pre-open.  A 50% retrace back to the triple bar 50CB area created a HL which again offered a nice return for bull longs.

A small wedge, followed by a larger wedge,


DAILY

We still have a gap from current PA to the last 50CB  bearish TL.  The TL is roughly a 45 degree TL (bull or bear) from the 50CB point.

This has bulls struggling against heavy resistance at the prior august 3rd 50CB, and the more recent one of  November 7th..  Upper resistance is at 1365, 1370, and the TL 1375.

Given the current economic and political climate, the market is likely to reverse the Friday positives to put in a double bottom test of the 1340.  Whether up or down, we are in a zone that likely will see continued testing- lateral PA in a narrow range-  before it can break out.