Tuesday, November 29, 2011

Monday, November 28, 2011

Market update

I have a VST buy signal from overnight. Will enter SPY long as soon as premarket trading opens at 8 AM ET with a 2% stop.

I still have 10% of the short TNA swing position. Stop for this is at the open position 43.4$. For those ST swing traders, I cautioned you to take 50% off the table on friday. That post came in after hours, but was good enough for you to close half of your position as it was SPY. However, none of my systems signaled a buy on Friday or reversal of the signals.

The reason for my post asking to take profits on TNA and also swing SPY short is to ensure that you lock the profits, regardless of the market direction the next day. I have taken short TNA position at 43.4$. At friday's close of 33.67$, we were looking at a 22.5% gain in 4 sessions. In stock markets, bulls win, bears win and greedy pigs get slaughtered. I don't want to be a greedy pig. Hence, I took 90% of the position off in 2 stages. We had 7 days down before today, and to expect another day would only be greedy.

The ST/ swing sell signal is still intact. /ES is up by 2.8% in today's premarket. I believe it will hold up to gains in real time trading on SPX. That will not change my swing sell signal though. We will still be in a swing sell signal even if we close 2.8% higher today which only means that the downside objective is not fulfilled yet. I believe that this down leg is not over yet. We got our swing sell signal at 122.25$. We took a 5% gain on half of the position at Friday's close of 116.34$. Our stop for the other 50% is at 1% above 122.25$. Or close the swing position when we get a cash signal. Even that way, your gains for the swing position will be 4%, only because we took 50% off the table.

For any system that you follow, I told you that asset allocation and market discipline is very important. Without these 2, you will have any net gains over the long time.

Friday, November 25, 2011

Swing trading update

Swing traders, take 50% of the short position off at SPY 116.2$. We had the signal at 122.15$. TNA short position is reduced to a mere 10% now. I will make a detailed post later in the weekend.

Sunday, November 20, 2011


AMZN is in a downtrend. I expect it to continue and hit the lower trendline of the megaphone pattern. I see a bounce there and then I expect AMZN to go down, and down. 10 cents EPS/ qtr and > 200 PPS? You got to be kidding me. Sure, billions of $ in revenue, great traffic yada yada. It all comes down to earnings per share! Wall street is not short of pumper analysts and greedy hedge funds - so take it from me. A buy of AMZN even at this level doesn't make any sense. Sell all rallies!

Panera Bread is in a sector which is very hot right now - Speciality eatery. While I say the rally is not sustainable, I am not looking for any long term downtrend atleast at this time. Time is not ripe for a super decline for this ticker. Not yet. Right now, I am looking for a gap fill as marked. We had a down gap on the previous earnings release. The ticker jumped straight above the gap on earnings release this time. We have the 100 day EMA below the double gap and I expect it to fill it.

Thursday, November 17, 2011

ST signal

My swing/ ST system entered short sell signal today. Sell short SPY at 122.1$ ie., today's close with a 5% stop. VST is already on sell signal, I missed the VST signal yesterday because of the chop that preceded for 2 days. Never mind!

Wednesday, November 16, 2011

Cash is King!

Summary of the market:

  1. The market did not break out above /ES 1260 as expected. Rule # 1: There is no gift horse in the stock market.
  2. I had mixed signals throughout the day, from buy to sell to buy to sell...that for a period of 1 full day makes me suspect if the market goes up or down tomorrow. I had not gotten such type of day with mixed signals for a long long time. Till there is clarity, move to cash. I was stopped out today at the end of the day. Down but like I mentioned in my previous posts, I am able to afford it.
  3. In the chart below, look at the highlighted triangle. If SPY falls below, I see a big air pocket below the break down. Target can be anywhere but lower at ~ 110. SPY could breakout above as well but that is to be determined. When there is big TBD, I am moving both VST and ST models to cash.

4. I could not get this post on time because of rapid move during the last hour. What does this tell you? Nobody but you will be able to close positions when needed. You should be able to organize stops for your portfolio. If you can't do that, stay out of the stock market.

ES update

A picture speaks thousand words. Over the weekend, I decided to ignore the news that is coming out of our media. I have always followed my proprietary signal but going by the psychology, news will take a toll on our brains. Hence, this decision to not open any news websites. My charts will dictate my path and I will follow the charts with adequate allocation and discipline to get stopped out. There are always going to be challenges and if any traders/ investors thinks it is a cakewalk to win continuously in stock market, they are lying to themselves. Having said, it is our aim to maximize the returns of our hard work and I must say I have been quite successful in doing that. 

Another point I would like to make is I am catering to a specific set of audience. I managed funds from my families, relatives and friends. I used to explain my decisions to them using emails. I had to learn how to blog because it was getting hard to post my views only in emails. I could keep this blog open only to them but when I am doing the hard work, it is fair to say that I would like my views to reach outside that group. It is no harm to open my blog to everyone on the www. However, unless you tell me what your needs are, it is hard for me to understand what issues I have to address. For example, I have an ongoing conversation with AH on one of the blog posts. His capital is less than 25k, it is not unusual to have a capital of less than 25k $ invested in the market especially in the wake of problem scenarios like MF Global.    If day trading is not what you do or you are restricted to only less than 3 round trip day trades, unfortunately I must say that you need to stick to swing trading. I will do my best to include my swing trading signal in my blog posts as I am already looking at the charts from all time frames.

I am looking at /ES hourly chart above and what a mess it has been overnight. I was getting mixed signals overnight, as of now the signal is on buy. Like I said above, the food doesn't come to your mouth so easily. I decided to look outside my signals, I found something interesting and reliable. RSI is not my signal but I look at different patterns every single day to find any clues. On Tuesday, RSI formed a positive divergence with the /ES price on the hourly. I have marked it on my chart above. RSI formed a double bottom while the price posted a lower low. Since then, RSI has been in a higher low pattern which is encouraging on the long side. I remain on alert, open to both long and short possibilities to change positions as needed. I am long at this time, having taken 65% off the table yesterday. I have nothing to lose after a great run in the last week but I adhere to my stops and suggest everyone to follow adequate market discipline as always.

A close above 1260 on the daily time frame and I will add more money on the longside with adequate stops.

Tuesday, November 15, 2011

Waiting for a US Dollar index breakout

Fakeout = 57%, Pullback = 49%

Market is inversely related to the Dollar index but I will post any signals as and when they come. Stay tuned!
The last triangle that I posted last week got filled to the target.

What is happening in the 'Euro' land?

I have no idea. I didn't even read the news, I am not going to. I opened my Euro chart and I see the chart below:

Eur/ USD chart on the daily and hourly timeframe. If you zoom the hourly chart, it is still inside the trendline.

Yesterday we had a sell signal before close. /ES is down 1.3% from the close which is roughly ~ 1% from our signal. When I get a VST signal, I am honestly not looking beyond 1%. If I get lucky I will take it. Otherwise, 75% of my position will be out on a 1% move. The signal has a success rate of over 95%, but yes I have had failures like the 2.5% overnight gap up 3 weeks back against my signal. Prudent as it would seem to me with my VST signals as they are signals in the terminal phase of the move, I would take as much profit as I can off the table and make sure we score a win again. Use premarket trading too, that is why we play SPY. Don't stare at the screen when you see the profits. ST signal is still on a buy. Adios!

Sunday, November 13, 2011

Don't lose sight of the forest

I am sure many of you have not heard the word "bull market" for a while. Our air has been filled with bearish sentiments, bearish rants for a while. Even though there are few bulls around, I haven't seen anyone say for sure that we are still in a bull market with a valid reason. We have permishbulls who make bull market calls everyday without rhyme or reason, I ignore such professionals for the same reason that I ignore permabears who are maniacly depressed every day. I wanted to examine the market's long term trend from a technically valid point of view. You should not lose sight of the forest for the sake of the trees. I don't hold fundamental or political views to be of much importance and significant enough to bear weight on my trading. I do have my moments of political rants but that has no affect on my trading. I trade short term and very short term, because I can say for sure that nobody has any grip over the long term view. We must hold long term view but to have complete control of your capital, short term trading is still better. You have to work hard for every penny while you are trading short term but like I said, your odds of winning are better in the short term. You can always set aside 10% of it on your long term view and rest for Intermediate term, short term and very short term.

I am both a bull and a bear, I am flexible to skin the game on both sides.

The full analyst side and blogger sites are fully drunk with comparisons of 2008 with the current period for at least the last 5 months. If it happens, congratulations to everyone but me. While it may still happen, I don't see that at this point of time.  I myself see that we have deviated from the 2008 comparison. I would say they may have been right till the 1st week of October. October's market rally completely changed the game in bull's favor. The Bears may still have a chance, but you need to look at the current trend (and not dream of the future trend) to tell what market you are in. We have been in a Primary Bull market since March 2009, we continue to be in the same. It looked like we may sink into a bear market, but we did not. The market gyrations in the last 5 months have definitely caused enough damage, so non-stop rally case to > 1400 within 2 months can be put to rest because we first need some consolidation here for the bull's case.

Bull case: The best scenario for the bulls is to consolidate in this 1200 - 1300/1350 range for a while like atleast 2 months, gather lost momentum and zoom upward breaking previous high of 1370. The presidential cycles, seasonal cycles rhyme with the bull's case as well.
Bear case: The best case of bears is go lower from here but October's rally has delayed the bear case for atleast 2 months. The October rally that followed is nothing short of a miracle as it changed the game completely.  In the next 2 months bears have to show strong conviction, otherwise bear case is dead. When everyone on the street and wall street are uber bearish, the options house will have to push the market higher and that is exactly what they did. The house never goes broke, please remember that. The options house definitely made enough from this wild swinging while investors and traders from all terms bet their money on put options and lost.

Neutral case: I predict lower than 1100 but higher than 1000 by March 2012 because the chart below points to a cycle low in March 2012. Cycle low doesn't mean we have to go down from here. The cycle low could be higher from here which simply means for the next cycle, the bottom is in. My best guess is we may visit 1150 in March 2012 before going higher towards next year's presidential elections. Before 1150, I think we will see 1325 - 1350 though. Predicting long term cycles to the T is very tough but we can use long term charts to say general statements like "we are still in a bull market....", "we are in a bear market....", "we avoided bear market.." and so forth but not to say we will see bull market for the next 12 months. That is not possible to predict. It is completely futile trying to predict targets except for fun.

As of now, evidence points to the continuation of the Primary bull market that began in March 2009. When the charts change, I will make it a point to visit this topic for sure. I will take time to post it on this blog.

  1. CCI moving back above 0 indicates resumption of bull market.
  2. TRIX cross over did not occur yet, no confirmation of bear market. TRIX is lagging but the last cross over happened in May 2008. This cross over is not even close and will not happen in the next 2 months, unless major damage occurs before that. But, notice that TRIX is trailing in its momentum compared to the previous 2 bull markets, atleast at this point. Further down the road if the bull market continues, TRIX may rise to the 2007 bull market level but that is to be validated later, can't predict now.
  3. Ultimate oscillator had the first kiss of 30 line indicating bearish trend in 2007, so far we had none. Even if it may not touch 30 (like in 2000), I would like to see this spend sometime below 50 for me to say this is a bear market.
  4. Rate of Change had a small tick below 0 but nothing major of a bear market  here. The previous bull market had multiple touches (or close) to the 0 line before resuming upwards.
  5. MFI is still in bull mode and did not even come close to 50. Strong evidence of the money flow.
  6. Slow stochs indicate neutral stance now and are pointing upwards. The chart doesn't have full stochs, but that shows the same thing. Fast stochs show that they have crossed above 50 after being below for 4 months pointing upwards.
  7. Cycles point for a low in March 2012 but that low could be indicating a bottom for the next cycle which means it could be higher from here and not lower. I don't have that visibility.
  8. DJI and COMPX pretty much show the same. NDX is very strong and we haven't even come to a bear mode in NDX's case. SPX chart showed some bearish tinges before October but NDX chart didn't even come close. Keep your eyes on AAPL, they will propel AAPL up like a rocket. Let it take time to gather some AAPL bears and bottom for the short term. Then the bears will provide needed momentum to go up.
  9. MACD fast crossed slow line but note the histogram size comparison vs 2008. We are not anywhere like in 2008. SPX rallied for 1 - 1.5 years even after bearish cross in 1998 - 2000.

I am aware of Lakshman's recent ECRI work. We may still enter a recession but that doesn't mean we have to go into super bear market mode. We had minimal impact of recessions on the stock markets from 1982 to 2000.

My long term chart is only to view the big picture. I certainly don't trade the long term charts. I do hold partial positions from the bull market start in 2009 but most of the portfolio I trade is short term, very short term. No patience here to trade long term. I am happy with my short term trading. I certainly don't weigh my entire portfolio on long term views. What if my long term view is wrong, is the question. If my short term view is wrong, no problem. I will get stopped out which will give me another chance. Betting on the long term is like win big or lose big.

None of the 3 cases are guaranteed at this point. While the evidence points upward, we can go into a bear mode albeit it will take time and only if bears show very strong conviction in the immediate future. For the Intermediate term, I vote for neutral case with consolidation. For the long term, I see currently a continuation of the Primary bull market.

I don't have opinions on the super cycles or Grand super cycles or any other such fictionary stuff.  I stay away from Elliot waves. 

For the latter part of this rally, they are pushing commodities upper while holding the tech sector back. They could rotate other sectors later which means they can resume the tech sector up while holding commodities back. When that happens, you will see a real serious violent push in the market with escape velocity. 

Saturday, November 12, 2011

Timeframes and Asset allocation

Am I day trading or swing trading?

I suggest you to first read this post , reread that post, understand it because it will help you understand my trading methodology in the long term if you are following my blog. Read Introduction also before you proceed.

Time frames:

Often my clients are confused, so do I see confusion among blog readers. We need to step back and analyze different time frames first. I am breaking each time frame on the basis of my charts.

  1. Monthly, quarterly, yearly charts. When I use these charts, it is for the very long term/ VLT.
  2. I use weekly charts for the Long term. Long term/ LT
  3. I use daily charts for the Intermediate term. Intermediate Term/ IT
  4. I use 4 hourly or hourly charts for the short term and very short term. ST/ VST.
  5. ST/ VST positions are often closed on good profits, not waiting for the reverse signal. For IT/ LT, I use scaling in and scaling out technique. I do not trade VLT positions, as they are only traded based on signals.
  6. Regardless of the timeframe, follow risk/ reward and market discipline. More on that below...
Asset allocation:

On any timeframe, if you are trading an individual stock, use 5000$ as position size if your capital is 100,000$ which will be 5%. Often times, there are small investors whose capital is only 5,000$. Should your position size be 5%? Unfortunately, if your position size is 5% of 5,000$, I must say that will not yield any good results on an individual item. You have to trade atleast 5,000$ on an individual issue to make any profit. 

If you are using SPY (as an example), I can recommend using 100% of your capital provided you follow rules. I use SPY mostly, so most of my rules are centered around that. 
  1.  Follow your instinct. If you are not comfortable, step aside, think and then come back.
  2. If you want to follow someone's advice, fine but take your time to think. Follow rule # 1 in this case also.
  3. If you are trading SPY, use 2% as stop for the short term. Use 5% as stop for the Intermediate term and long term. If SPY gaps  more than 2% or 5% (which are not common) against your position, close the position. Reassess and then enter again.  Both of them are not common, but comparing both, I would say 2% gap downs are more than 2% gap ups. 5% gap downs are rarity, 5% gap up? Good luck searching for that. No 2nd discussion on stops, it will help you in the long run even if you miss 1 or 2 opportunities.
  4. If you are on a vacation or in a place where you are not able to monitor your position, avoid trading. If you have to invest, you must still follow rule # 3.
  5. I already covered Leveraged ETFs in the link above.
  6. Options: I trade them at my own risk. I don't recommend options. If I trade options and you admire or follow that, it is your own risk as well.
  7. Using 100% of your capital may make your nervous. I developed my proprietary systems, on all terms in such a way that you will not lose money in the long run. Whipsaws, stops and loss trades may occur but if you follow my system for more than 3 months, you will be in a profit. You can papertrade (without using real money) for 2 months to see if I am correct or wrong on VST trades. On ST trades, you can evaluate for 6 months. I can post my backtest results, but since you are skeptical, it will not help in anyway. Following the system for sometime will be the only thing that comes close to truth.
  8. Entry: For very short term, I post my entries and stops. If you are late by 0.5% on the very short term trade, your chances of profiting may reduce by 50%. Nevertheless, you may still profit. On a short term basis, entering more than 1 day late or 2% above my buy/sell may reduce your chances of profiting. I trade SPY based on /ES which means I often enter or exit in after hours trading. Read the link above for after hours trading.
  9. Exits: This is the most important part. I enter positions based on my signal. If a signal reverses, I follow the signal or 2% stop whichever comes first. In case of profits, I scale out of the position. I am advocating using 100% of your capital as entry, if your trading vehicle is SPY. For VST trades, closing 25%-50% of your capital size on a 1% profit will ensure that will keep your profits intact.  For the remaining position, you can use your open price or 0.5% below (in case of long position) or 0.5% above (in case of short position) that price as your stop. If SPY gaps more than that, close that position. You can take profits all along the way if SPY continues above. In recent history, the longest time my VST system was on a buy signal was from 10/5 - 10/17 during which time SPX went from 1125 to 1206. To maximize the gains in that period, you could have taken 1% profit on 1st 25%, then reduced the position size for every 1% profit. You could have had no position at SPX 1200 or above, more on that in the rule 10 below. Even if you closed your entire position for a 1% profit...read rule 10 below For ST trades, you take 25% position size off on a 2% profit. You can then wait for my get out of my long/ short signal or if you hit the 5% stop first, follow it. Lock profits as you see them, taking profits at any point never hurts - don't stare at your screen. You must grind this statement in your brain before you even start trading.
  10. My VST system gives enough signals in a year that your profits can be well above 40% for the year. It is based on very short term trading, repetitive, high probability but terminal signals. Because of the high probability and many signals you get, you can close your entire or partial trade for a 1% profit as you see them. I know you will feel hurt when you take 1% profit and SPX goes from 1122 to 1206, don't feel bad because this system is based on scalping. You cannot foresee your profits or losses, I may say. You may ask how can scalping be a good technique? Because you take profits all along the year. If you invested in year 2000 and you are buy and hold, your returns on SPX are 0%. If you invested in 2010 at the same time, your returns are 0%. You may say, if you invested in March 2009, your profits are now 80%. But, how do you know when to take the profits? You never know. Many people got stopped out during many violent turns of the market as early as within 1 month of March 2009 while some of them are still invested completely. Some out of the latter may not close their positions even if SPX goes back to 666. I don't know. I view trading capital markets as a journey. You must know when to get on the bus and when to get down. If you take the bus at SPX 666 and got down at SPX 750, you may feel bad looking at the market today at SPX 1264. Don't feel bad. You always have the chance to get on the bus at any time and get down. The markets will be open tomorrow, next week, next month and next year. Don't worry about having been left out of the market any time, follow your system and take your profits. Is the VST system for daytrading? Not necessarily true. I have had my VST signal remain on the same signal for anywhere ranging from 1 day to several days. I don't trade on time or price targets. I take it from signal to signal but take profits in between. I let me decide my price profit targets based on my methodology. My ST system gives you enough signals for your profits to be above 20 - 25% annually using nothing but SPY. Usually my ST signals last more than 20 days but there are whipsaws during which you will be stopped out.
  11. If you are not comfortable following the rules, please stay out of my system.
  12. Regardless of whether you follow my rules and system, you can always follow my general market calls and stock recommendations that I post on this blog. You can develop your own risks and methodology following my market calls but you will maximize the returns in the long run if you follow my system. If you follow your own market discipline, make sure you create a good method.
  13. Signals: In my VST system, I have entry signals only. Entry signals are buy (go long) and sell (go short). In VST, I get the signals based on terminal moves and hence, be quick to take profits. Exits are based on the methodology above (profits or stops), and no signals. In my ST system, I have entry and exit signals. Entry signals are buy (go long) or sell (go short). Exits are close out longs, close out short signals. Entry signals are slightly delayed. Exit signals are more sensitive and are quick. In ST system, entry signals are delayed but not terminal. They are in the beginning phase of the move. In both VST and ST systems, there are whipsaws. You must follow my system for certain time to see profits for that exact reason. You should remember that when the ST system is in buy/ sell and VST system gives the opposite signal, you should be quick to take profits on the opposite signal. Right now, on 11/12/2011, the ST system is still on a buy - so any VST system sell signal should be considered as counter trend trade and you should be quick to take profits while leaving some on the table just in case the ST system also turns to sell. On the other hand, if ST system is on a buy, and VST system gives you a buy signal, you can be relaxed a bit - nevertheless stick to the profit/ stop taking methodology.
In this blogpost, I posted about
1, Timeframes
2, Entry, exits, stops, profits
3, My VST and ST systems.

Friday, November 11, 2011

US Dollar update

US Dollar index punched right down through the 50 DMA (green line). Next target is 200 DMA (red line). Euro broke out of the 1.368 line. Next target is 1.3964 obviously. For newbies: US Dollar index is inversely correlated to the market, Euro is directly correlated to the market - that is the correlation for a decade now. It remains so, until it is changes.

I am bullish on the market on all terms. But, keep your portfolio in sight and have your stops adequately set. Don't drink to the tunes of the market. Good luck trading to you!

If you read last night's post, it should be clear to you what my set up was. Market seems to be in a hurry to achieve the target today. Link

Thursday, November 10, 2011

Overnight breakout moves

Let me introduce you to symmetrical triangles first. Go to Bulkowski's site and read the entire page. We will apply the "trading tips" area of the page to my chart below. Link

The chart is /ES hourly with RSI(14) indicator below. Price has been trading in the triangle for the last 2 days. I was scared of the breakout in an opposite direction to my trade, hence I had to get out today. Let us now apply Bulkowski's ideas to this chart. 

Using the measure rule, our trading target (base of the triangle ~ 1245 - 1218 = 27) from 1240 should be 1267 on the /ES, which ~ converts to 1270 on SPX i.e., 200 DMA. Breakout volume is light, obviously this being a nightly move. Throwback rate (failed move) is 37% and pullback (to the point of breakout) is 59%. Beware of these things. I used the RSI(14) EMA for confirmation. Usually RSI is not my buy or sell signal, my system signal is a different one and most of the times it results in a terminal move. I haven't gotten a signal yet but mine is late but with high probability, keep in mind. I reckon RSI(14) is good enough in this context. If you read at the apex of the triangle, it is converging at 3 AM ET which is the opening time of European markets. Humdinger, isn't it?

Respect the channel

Respect the channel, only as long as AAPL is within the channel. Sell outside the channel with a stop. The 200 DMA is at 362$, keep that in mind.

Intermarket correlations

The soaring eagle in the chart is the Italian 10 year bonds that is the talk of the town today. Let it cool down, wait few days and then buy the US market - that is the strategy for the Intermediate term. Meanwhile, you can play ping pong between ranges in the market. I reckon the low for the market in the short term is not in. You should be selling strength, as in today morning, on rallies. The lower line is the German 10 year Bonds. The closer line to SPY is JNK, short for Junk bonds.

Sunday, November 6, 2011

Why am I not invested 100%?

At every point in the market, there is this lingering thought that makes you think why you are not invested 100%. There is a time you have to be in cash, there is a time when you have to be invested 100%.

My market signals are positive, in bull mode in all time frames now. We missed the (short term) bear mode on friday by 5 SPX points in the afternoon. Crude oil, Gold, Silver are in bull mode in the short term. In the long term and intermediate term, crude oil is in bear mode.

Dollar index is in bull mode as well in all time frames. When the Dollar index (risk off trade) is in bull mode, I have to be cautious. In addition to this, I am looking at the credit spreads are being widened. I am not following the political drama in the Uropean continents at all. My focus is simply on my technical analysis. I am still long the market, albeit cautiously. I don't believe in hedging because I want to be certain on the market direction. If I am wrong, I am wrong. If I hedge, I don't think I can make any profits when it matters. I reduce my positions when there are cross currents.

I have a 2% stop for the current position. If SPX clears 1257, I will add another 1/3 with 1250 as the stop. If SPX clears the 200 DMA at 1273, I will add another 1/3 with 5 points lower as stop for that size.

Have a great weekend!

Wednesday, November 2, 2011

Bear flag?

Bear flag with likely resolution downward?

Chart is /ES hourly.

US Dollar update

An real time update of the USD shows that our risk off currency is hanging to its support. If the 50 DMA breaks, then we could see a rally of atleast 2% in the markets till the USD will reach the 200 DMA support. If that support also breaks, then you could put on an Intermediate term market rally. Keep a close eye on the Dollar index

Tuesday, November 1, 2011

Buy on market strength

STMP is talked about as NFLX of 2008. You know the growth story that ensued until the recent collapse. Look at the massive increase in volume. Scale in upwards, is the plan.

I like the chart of LTD.

It is all about the Bucky!

In a post 10 days back, I said the US dollar should get support at the 200 DMA. USD went below the 200 DMA only to reverse back above both the 200 DMA and 50 DMA within 2 days. Will USD stay above these 2 supports? You could use these support/ resistances as a reference to enter the market long or short. USD is inversely correlated to the market, keep that in mind.

I am posting the USD chart in the same format as in 2 weeks back. I see further weakness in USD in near future although USD seems to be firming a bit too much in just 2 days. But, having seen this market move 150 SPX points roundtrip in 5 sessions, I urge you to be cautious if you are long or short. Be nimble, and take small positions unless you are super confident. This market is certainly not for the faint hearted!

USD chart as of close yesterday. Stockcharts updates at the end of day. But, as of today morning, USD is at 77.33 in real time which is way above the 50 DMA as shown in the chart. It would be interesting to see if these supports hold.

p.s: Recently, I started tweeting. My twitter page is this

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