Tuesday, March 2, 2010

Frustrations are high everywhere

It seems no matter what blog I am visiting now - everyone seems frustrated or in revenge mode. Seeing statements "I am not going to let them get me", "I am all in and not closing out" - just goes to show what traders are feeling of this market.

Thus far we had one of the tamest overnight session on ES in a while, but we have a few more hours to screw both sides bulls and bears. A market like we have now is almost impossible to get positioned in. Big moves happen either overnight or in very short time frames during cash hours around news events. By the time cash hours hit 11:30 all major moves have been made and traders get the shaft. Unless you pick a side, gamble and assume a wide loss you are not getting a piece - and even then you will get shaken out the majority of the time. Some are able to make some profits in this difficult markets but I dare to say those traders can be counted with one hand.

For me its quite simple, stay small, with tight stops around positions, and get out as soon as I see the market not moving in my direction. I have not made any money in February and it feels like a victory - just because I did not loose anything either besides some commissions - is this my new market relationship?

From a directional perspective, I have to admit, this is looking very bullish, double bottom at the EURUSD (tripple bottom now). Even if EURUSD remains sideways for the next 4-8 weeks it means higher prices in SPX. The FX to SPX relationship works in the markets favor when dollar is weak, but detaches when dollar is strong - amazing hands in this market to be honest. I am not talking about manipulation, just the fact that we see strong divergences on the currency side that generally has some type of effect on the markets - but not in these times it seems.

Regardless of where we will be, I had mentioned a few weeks ago it would not surprise me to remain in this range bound uneventful state until summer. Now the one thing we have to keep in mind, the market is working off long term overbought conditions (weekly and monthly) by trending rather sideways - if this is to continue a few more weeks and months we could be ready for another stage of upside.

I am not really saying anything about direction here - just general statements about sentiment and what I am seeing in the blog world.

1 comment:

  1. well here I am again with a 5 pt profit and not sure what to do. I got to start making some money at one point - lol.

    Keeping stops at break even and taking the risk of holding position overnight. 5 pt buffer is not enough for me to be really comfortable though as most overnight ranges have been well above 5 pts.