Why the whipsaw yesterday?

Thursday's huge turnaround in the major U.S. indexes was not driven by a bullish outlook for risk assets, or a contrarian bullish outlook on the part of investors relative to the CPI.

It was driven by factors that we refer to as "tacticals" — factors like player positioning, algorithmic trade executions, market maker activity, options-related buying and selling, and other aspects of market plumbing that are magnified in low-liquidity market conditions.

Justice Clark Litle
Chief Research Officer, TradeSmith 

In his Tradesmith Decoder comments today

Looking pretty overcast to me,  timebandit!  Thanks for the education. 

Thanks, Matt!  

Thanks, Steve. We were talking about the possibility of a B wave and then up in C. Is that a moot point now?  Do we have a target or just level to level , expecting more downside pressure?  

Matt, does that suggest end of B wave and Up on C?

Thanks for your thoughts, Fred. Sounds reasonable.

MATT,  3650 bounce  Wave 2 complete now?

Sell hedges immediately or wait for a bounce back this am?  Opened 2.2% down. 

Sell hedges immediately or wait for a bounce back this am?  Opened 2.2% down. 

I totally agree. I would love for it to bounce so I can buy some more shorts.

Night, night.  Sweet dreams..

No problem, Matt. Thanks for continuing to improve the service!

Alternative view, could be retesting the break of the channel line. 

Thanks, Matt

MATT, FDX is double topping. Are you out or waiting for another bounce (MACD pattern). Thanks.

Helpful reminder. Thanks. I’m not sure what to do with the seasonal pattern that suggests upward bias for 2 weeks then lower by end of October.  Swing both sides?

Yes!  STEVE, are you implying a 3-5 flat suspected?

They don’t do stop losses. They have first, second, and third entires ( occasionally) and they buy twice as much at second entry, 3x on third entry. Their system is very effective if you take all of the trades, not so much if you just take the ones you want. Hope that helps. 

If I remember correctly, the short version is If $VVIX CLOSES above 110, it usually leads to a decline in the market. Someone correct me if I am wrong. 

Third assault on the neckline. Does that favor the ice cracking this time?