Troubling Tape

I am loving this market volatility. As long as you are short realty/housing and long oil, get ready to retire.

I am swamped with projects, hence the lack of substance today. When the market swings are wild, I am normally glued to my screen.

PS- Remember AHM from two months ago? I bring it up only because the stock is a lot closer to zero after today. Percentage wise, that is the greatest trade ever recommended on this blog (applause). This stock has nearly lost 100% of it's value when we talked about shorting it at $22. Whatever you do, don't ask me if you should take profits now.

Recommendation: Quote of the day: "Technical analysis is an excellent approach towards becoming homeless." - The Fly

Long: Oil

Short: Owning a house... or two.

I am going to have Randy Watson ring the closing bell... give him a round of applause...

What a day! It seems that I am in everything except housing/realty and oil.
Calls moving down, puts moving up...I hate these days.
At least my exits are in place!

I'm as speechless as Eddie Murphy!

Hey Tim, I have a wireless router question can you email me at, if you have a minute?



Brett, agree with your AMAG comment, owned it since June 12. Have August expiration. would like to see it move down the 6 points sooner rather than later

Wow, what is happening with POT. Most of my virtual profits for the day are gone. Housing and Oil unfortunately not in my account.

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I take it this 300 point reversal has you feeling down in the dumps?

No one has to tell us the $VIX is back up! This market has changed .. One surely has to be more patient and wise as these swings happen ....

Now let's see .. am I correct ... Dow was low 155 at close .. and this AM was up $120? 275 point variation in one day?

Yes .. this is a different market now!

We just have to work harder and be smarter .... My $.02!

Anonymous must not have had any PUTS ... Jeff! :)

Now, now, now, Anonymous, let's use our big words!

i echo anonynous,,,,man this market is hard the past few weeks,,,i am short real estate, banks, home builder, and spy,,long tech and oil and i still lost money today,,,s@#$%&*@t
time to do some homework

Glad I kept my BWLD puts through earnings tonight...


Today's action SHOULD be an exit right? RIGHT???


Wow! I'm glad I bought some puts on strength this morning.

Already own XHB put against realty as a whole. But I'd have loved to have been in AHM. Congrats to all that are in it!

Oil...that's another matter. The only place oil is going is towards Dan's new Ridgeline.


Looks like Chipotle has done it again. Up about $6 after market, let's hope the conference call goes well.

MCK played nice with my entry today, though I would have liked to see a harder drop toward the end of the day. Started to look a little relatively strong there. I'm still in as it's still below 58.

Yes, Jodi, I will email you.

Brett .... THANK YOU for the suggestion of DIA yesterday as insurance .. I'm not experienced enough to figure that out (and I am in the insurance business - go figure!) .. But it sunk in and paid big time today in this fluxuating market ... When the market rose .. it's wasn't proportional to the rise .. When it dropped like a lead balloon at close ... the DIA went with it...

WHAT EXCELLENT advice! I appreciate it. You're good at this sir and a true asset to this community!

I am only in 2 positions at this point...LEN and CROX. I am going to sit on the sidelines and observe for a few days.

Brett, could you please pronounce
motherklasdfl;ashdf0[awehrug['aijg'aklsjdfg'aewrft for us??


Well, that was interesting!
I left this morning and the Dow was up about 100 or so. Came home 20 minutes before the close and got to watch it fall from -70 on down. Tried to throw in some orders at the last few minutes to no avail. Unfortunately I did jump into GME early this morning which needless to say cost me. Oh well at least it was a small position.

Kim, good for you to buy those puts this morning!

I came home about 10 til close and couldn't get Options Express to move fast enough to take some of my profits. Anybody else have trouble with Options Express moving slooooooow? Oh, well. I did have stops in place, so I got stopped out of AAPL today, thank God. What a tanker. CMG, I took a small stock play on the chance it would move up.


On your DIA puts, did you go OTM? There are so many choices, how'd you decide which to play?

SO much for GS. This has to be illegal the way the market acts in the last hr.


Nothing changes, right? Support, resistance, diversify. This is easy..


The charts are telling you everything you need to know.

Don't imagine lines where they are not. Don't chase trades.

Now may be a good time to sit and wait, let the dust settle...if you are not sure...

As I am now in the building industry I have tough time shorting it but I need to get with the program. I have not found an oil plays that fit my rules. Pam got NOV on a paper trade that has done great but no entry since then.

Ok, I jumped into BPHX again at support and soon as I did what did it do... But I did get into AMGN and a one contract wonder on CMG so I am still smiling. On a day like this to close a bit positive is good for me.

Man, I am off my game. I've done fairly decently despite the market craziness but today (at least for my portfolio) kinda sucked.

In the year I've been trading, the only spreads I've done were on paper. But today, Grant and I did our first ever "real" credit spread. I've never been very excited about them but, I guess we'll see.

I also haven't had much to contribute lately so hopefully that will change in the next week.

I do love reading everything from everybody especially all the comments that make me laugh.

liz (and grant)

GS - we'd been waiting for a break below 190. Looks like it finally made it.
What a buff & rumpy day!!!

:-) Pat

Doji Girl, I'll give you my play. Yesterday I bought @ the money 4@ 133puts Aug, Sold 2 @ 130puts aug. Bot 2 @ 134puts Aug. Today @ 3:30 I bought 4 more Aug. @ 133puts Aug. We'll see how the Mkt. opens for my next move & make a descion after 10:30. Who knows?

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That's the DIA I bought 4 @ 14:39 that's 2:39 EST.

I know that WHY is not the question to ask but I was trying get into AMAG just before close (and someone called me on business, the nerve) so I missed getting filled. Now after hours it is up like $1.30 I was hoping to get in tonight as I have limited time tomorrow. Maybe I was given a "gift."

Well i used yesterday to Enter into CAT and TS.. Cat was a happy move and moved nicely today - TS didnt have so much action. Shame earnings is so close, I was hopeing to see a pop today.

Hope some people are enjoying this volitility :) Makes fun trading


I buy OTM when I hedge with index puts. Since I'm hedging against a crash or a steep decline, i'd rather have a smaller initial investment with the potential for huge upside if necessary. Even when it's a pure technical play like my IWM puts mid-day today, i still go OTM.

My crack market analysis for today:

S&P bounced off support at 145, which was the low from Friday. That's great if it rallies and confirms a double bottom, but that's probably wishful thinking. S&P holding horizontal support, though.

Nasdaq interestingly enough has sold off to its diagonal trendline today. So Nasdaq holding support.

Dow Jones sold off to horizontal support and held today.

Russell 2000 sold off near Friday's low, also horizontal support.

So are we safe? Probably not. The selloff was furious today, particularly late in the day. Which implies that it will continue into tomorrow. If the Stock Trader's Almanac is right, the first trading day in August should be 'atrocious'.

Add to that a Vix that seems like it's on a rocket ride.

We could really tank hard soon. Maybe then we'd have our 10% correction that everyone seems to be looking for. Maybe the bear market has already begun. I'm certainly aware that we could rally hard and fast, but the liklihood is that we're not going to do that anytime soon.


Or maybe you just fell prey to after-hours quotes. My bid/ask on AMAG is $53.69 x $54.95. In short, it's unchanged from today's close ($53.69).

Okay Addicts.

I see Brett has given you his CRACK ANALYSIS.

I only thought i would be fair if I looked into my CRYSTAL BALL and offered MY OPINION on waht the market is going to do.

Okay, looking, looking...(need to get to baseball now damn it), looking..looking

Ah! here it is!

Crystal ball says..HOLY $hi#

You will not belive this....


Raimo and Brett,
You guys, you guys. Two peas in a pod.
Maybe Brett is the phantom.


If VCP heads down from where it is currently, could be forming a head and shoulders.


Looks like I picked the wrong day to stop sniffing glue.

Joel R.

airplane....good one joel


Brett, I think that was it.

I know I have read the idea that the market is made up of individual stocks and should be traded as such. Days like today make me think that there is a little feedback loop in that concept. What I mean is that a given stock might be going up on its own merit but overall market movements brings it down. does anyone have any suggestions how we factor this into our trading.


I heard on CNBC that the drop in AAPL was based on a misunderstanding and that the underlying information was untrue. Could be a buying opportunity? We'll see in the AM.

ummmm, well doji is a good thing you did not get into AMG !!! holy !!!

arty...RIMM 210/220

Was that arty......rimm 210/220 to me for some reason?

If so, I would say; "220 or 221 whatever it takes".

I am a little baffled on this one. Could you elaborate?


sorry arty....i was catching up on the blog and i thought you asked my strike price on the RIMM spread....maybe it was someone else??? this is my first glance at the computer since i left for work this morning...

well i'm off to listen to jeff's price pattern trading room...i need to find some sanity

If you blend the candles of 3 and 4 days ago you've got a beautiful stick sandwich at support. I'm going for a bounce with a tight stop just under 13,200.

Dave B.

I noticed that one of Jeff's watchlist picks SIGM was up 2% after hours. Any significants in this for tomorrow's start?

Wow, WTF (to quote Jeff). The sell off was very crazy.

For what it's worth, I'm mostly sitting this one out. 50% cash, 40% strong stocks with tight stops (none hit today) and a few select options.

Best performance today: AMG put (thanks Brett).

Most lost virtual profit: VDSI, but hey it's still has some virtual profit, at least for now.

Not sure why, maybe I'm a bull at heart, but I see (in my crystal ball) a correction back to 13500 before my Aug options expire.

But what do I know?


I think this market is toast. That contradicts my broker (MSDW) who says their braintrust sees this market hitting 16,000 at year end. It's likely I'll get stopped out of several bullish stock positions tomorrow morning, and happily move to cash while I re-study strategies for making money in a bear market. It's not the end of the world. A strong trend is better than no trend I reckon.

50% cash




You mentioned on the Marketcast that even while the market was positive 20 points at lunch time, you knew the market was going to go down about 80 points. What did you see that told you that ... or did you repair your crystal ball?

Karen F.

Raimo, my friend, my primary nemesis
perhaps you have read the book of Genesis?

It speaks about the dawn of creation
and the evils of masterbation,

so wash your hands, take of the latex
its time to trade, and not the forex,

the trades we speak of are directional
so hopefully your release for the correctional,

facility that is that encourages recreation
and, Raimo, it does not include self-flaggelation,

so give it a break and you will find
your vision improves, you won't go blind,

and then you will see trade patterns explode
like the noise you make upon the commode,

after the burritos you and Brett do consume
the aftermath which quickly clears the room,

and when the party is understandably fading
you both are discussing the benefits of trading,

even though you are surrounded by a green fog
you take time to assist those on the blog,

so although I enjoy pulling your chain
I do respectfully remain,

and admirer of both of your pursuits
to keep this group in kahoots,

with support bounces and patterns that may be trending
and that we can rhyme without offending,

each other because we understand
that although Raimo has just one free hand,

he writes from his heart, we all know it
as he secretly longs for the Phantom Poet.

Editor's note:(please excuse the visual that you have all just experienced!)


okay, so as i am reviewing my piece of crap trade (AMG) i am seeing a totally different picture...yes there is a long term diagonal trend line, and price "was" bouncing....BUT why in the heck did i not see the 125 support break and then the retest !!! if i could reach i would kick myself in the A$$ !!!

So another leg lower today. I think we have a little further to go in the indexes over the next day or two before we get a strong bounce or some sideways action.

I have pulled back and gotten into spread trading almost my whole portfolio to manage some of the volatility and direction. Here are a few going my way:

BCS - short AUG 130/135 calls
CFC - short AUG 30/32.5 calls
ROG - sold my puts when I was all nervous about gaps going against me last week. Shouldn't have done that. But I kept the short AUG 40/45 call spread.

Go some WAY out of the money iron condors on GRMN & RIMM. GRMN announces earnings tomorrow so I sold into the crazy high implied volatility. The play is that it will stay within $75 & $95 at AUG expiration. I am a little nervous it will break the $95 mark but we'll see. Have you ever traded iron condors (ICs)? Nice profit range but limits both risk and returns a bit... it's all about time decay. I have positive 30 theta right now on my combine portfolio.

Anybody seeing anything good?
I have been watching Jeff K's set up in MCK. H&S break the other day with a retest
right at resistance today. I may buy a put or two in the next day or two as long as it stays below $57-58 range.

Thanks to everyone's humor and support over the past week or so. Who says trading is solitary?

Tonya, I know exactly what you mean. Pam and I reviewed a trade this morning and found we totally missed resistance! So after the CAST I reviewed every trade I have with the IT coach and found AGAIN a bad entry and that missed resistance. Chris can I borrow Catherine's hammers, on second thought I just bought a nice new one that we can use...

Looks to be a bumpy ride again tomorrow so stops are set and will strap in tomorrow am. Look at those futures!

I can’t keep up anymore! Uncle! I will do my best to do a quick once over each evening. Work, completing the final touches to sell our home, trying to pick the amenities of our new home… and sleep too. Uncle!

I haven’t been able to watch intra day lately. Probably a good thing. A though thing though without mechanical stops. It has worked fine so far though.

I knew there was a reason I stayed in my only contract in BSC. After all, it was an October option and I didn’t expect it to go up too far.

I see lots of bulls at or near support. I am really liking how CAM, DRYS, FCX, GMCR, PCZ, VSEA and GRMN are holding up. There seem to be too many to list. Besides, a lot of you are looking at these all day long and mentioning them. A bounce before they break would be nice, if not, there are plenty of bears. BRY is poised to drop. Consolidating COG, CNX, EIX, EGN, ESS…….. on and on and on… People mentioning all the great bull and bear setups over and over again is what gets them on all our watchlists. Thank you!

I may set stops at borderline bullish plays in the AM. We will see.

Mike from Seattle, I will try the brewery in Stevenson if I ever make it there.

As Raimo says so eloquently,

Nothing changes, right? Support, resistance, diversify. This is easy..


The charts are telling you everything you need to know.

Don't imagine lines where they are not. Don't chase trades.”

Thank you!

Oh, nice video clip. My kids stared in disbelief.

GRMN profit rises and premarket up 8.5%. THANK YOU GOD!! I needed this. I am holding a OCT75 Call with a protective PUT in case it went badly.


AAPL, Boy does that sound like market maniuplation or what?
I'll bet the buying is wild today.


You guys can call me nuts, but keep your eye on BSC today. If it somehow closes UP today, the correction is over. BSC is a proxy for all this sub-prime mess. After last night's news, it dropped big in the after hours and is now coming back this morning.

I still expect further downside, but watch the financials for clues to further movement.

Lately I feel like I need to install a seatbelt to my office chair! Buckle UP!

Hello addicts,

I don't know if I am glad I held AAPL through the "misunderstanding" yesterday or not. It was a heck of a drop/profit taking day.

Yay for GRMN though. I pared my contracts down from 13 to 3 yesterday just in case. I don't feel bad about it. Better safe than sorry with earnings for me.

I came home for lunch yesterday with almost all my losses from the previous week recovered on paper. I had a surprising urge to sell everything and sit on it (like that would ever happen). By the time I drove back to work, checked in with my secretary, and booted my computer up -$8k swing. Ugly. These trying times.

I guess we all do the "What if I had just ...?" The good news is that I did manage to buy a put and take profits on a couple stocks before I left to go back to the office. So, I have learned a little here and there. (I had a couple stocks still over 100% and GRMN with earnings today)

I took enough CROX contracts off the table to where I'm just playing with the house's money now.

James H.

I think we can find out today if we are really reading charts and trusting our read or if we are going to let the 'market of stocks' overwhelm our emotions ...

I'm looking at possible adjustments in my portfolio and saying ..."patience .. recheck charts and trust your judgment" .... and I remain 50% cash .... and will TFN ...

If one is going to buy puts to cover a stock for earnings, is it correct to buy the same number of puts that cover the shares or more? Like if I have 100 shares, is one OTM put going to do it or is more better?

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Didn't you say you bought a small position of CMG before earnings? It sure looks good today! Great for all that have it.

Debbie L.

(picture mel gibson in braveheart screaming...)



Hey, I am in CMG and AMGN thanks to all of you! The IT Coach told me to hold CMG for at least the first 30 minutes today to let bid/ask filter out a bit. But with the market moving down I am having trouble waiting. AMGN is sweet thanks for putting that on the radar.

Remember me? The AAPL to $100 guy?

Here it is: AAPL to $200.

There it is, folks. Flame away.

Hey guys. Don't know if you knew this already, but if you use TOS and go to prophet charts inside TOS and type in the symbol USD/JPY you can get the currency pair that the FXY is based on. It moves inverse to the FXY so if it goes up, it's good for stocks.

Anyway, the nice thing is that it trades 24 hours so you can see what currencies have done overnight.

So far, it has held it's ground. I'm NOT saying that means we're bullish, just wanted to point it out cause I'm watching it like a hawk nowadays.

Thank you for AMGN! In looking at the chart and trying to figure out a target, I went back to the 2 year chart and drew a diagonal on the support going back to Oct '05. Oddly enough, the line hit EXACTLy on today's (so far) low at about 50. Do you have a traget for this and if so, what?


It's smaller than the 'measured' target from the sym triangle breakdown, but i see $40 support as a reasonable area to shoot for.

For those of you thinking about holding over earnings, let me share a lesson with you.

SPW is a well diversified international company (doing very good business in China right now)- 2 days ago it broke above resistance to a new 52 week high on strong volume (close to 200%). Yesterday it successfully re-tested that old support. This morning they reported earnings and beat estimates. They even revised their year end outlook upward. They are currently trading down over 8%. I don't have that large of a position so it doesn't hurt the account too bad.

The point is that holding over earnings is nothing but gambling because you cannot anticipate how the market will react.



By the way, I have CMG. I bought it on 7/12 with the intention of holding over earnings. it took a huge tumble over the following weeks, but I held on. Interestingly, volatility has shot up so much lately that my call option gained some value even when the price was lower than I bought it. Today was great, but with the volatility crush, and the fact that my option was a Sept. 95, it didn't gain huge, but I think it's still got some room to move between now and Sept if the market doesn't plummet to the depths. We shall see.

Scoot, you are right that holding over earnings is a gamble. But honestly, every trade is a gamble. Nobody knows what the martket will do in the future. It's just a matter of risk, reward and probabilities. The reward to risk can be very high on earnings plays which means, by nature, the probability will be lower.

I don't think it's any more or less appropriate than any other play we do as long as we position size appropriately.

Yes, Debbie,
I bought CMG where I saw support around 81. I bought a small stock position. I watched it and saw it move up before earnings. Sometimes it works out.
I think AAPL will hold the 130 support and head up. I got stopped out yesterday, which I'm okay with, and bought some stock today. I'll watch it and hold it for a few months. I think it will do well. I also bought a bunch of puts this morning on bearish plays.
Who knows what today will bring.


I see a head and shoulders forming on CME. Just my 2 cents' worth.



Let's just keep that to yourself, alright?

Just kidding. I see more of a triangle and support area here holding. Also, the volume doesn't support a reversal.

Brett, You're too funny. AMGN, good play. It's too late to enter, but great for those in it.

Bear plays:
Watching VSE.


So now with AMGN, As it moves in your direction other then it hitting your target is there any other place along the way or any other price action that would prompt you to take profits?

It is precisely at this point that I am getting stuck. Also do you ever take profits intra day?


WILL $26.30 STOP THE VIX?????

NO H & S on CME.......Stop that..


I like how you think in terms of probabilities and risk/reward as I do the same. My views on reward to risk during earnings are different from yours, though. The one thing that is known about earnings is that it is going to generate news specific to a particular stock that will quite possibly cause it to make a large move. What this means to me is that both the risk and the potential reward increase.

For clarity, this was not a trade for me but rather an investment in my IRA for long term. I had done my homework and I expected them to both beat and raise their outook which they did. If this were a trade, I would not have held unless I was willing to lose the whole position.


The bottom just fell out of the homebuilders - BZH -35%.



This is the decision that makes you as a trader.

I can't tell you where to take profits. I could tell you to let your winners run, but then you'll get burned that way. I could tell you to sell at your target, but then you'll leave profits on the table.

What you need to do is pick a point at which you're happy with the move and sell there. Whether it's a point on a chart, a measured target, or a designated pullback level.

I told you my AMGN target. It's very possible that I sell before then. Then again, It's very possible that it falls to $35. Who knows, right?

This post was designed to be unhelpful. In short, you need to develop your own feel for selling.

If you are not making money the past week or so,you need to revisit how you manage your portfolio, check you rposition sizes, and look at how you diversify. ANd remember, never be afraid to take profits...sell off part of you rpositions and take some of the profits, let the rest run as a two cents worth..


at a support level, I just sold half....

Actually what you wrote as has been the case many times is very helpful. My training is in medicine so I tend to be more concrete in my analysis and rules. I was looking for the perfect answer and what I am learning from our interaction is that trading is an art. After you learn the basic rules you have to play the game and find out your own feel for it. I know I may have asked the same question in many different forms but every time you answer it sinks in a little deeper. Thanks By reinforcing that I have to develop my own feel for the taking of profits I start focusing on what I am seeing and stop looking for external rules.

I really mean it Brett. I owe you a lot.


I just sold CMG as I called the IT Coach to walk through it. Yes, it hit my target, yes it was just an earning play for me and I have an AUG option (IV bleeding). Bought for $4.20 and sold this morning for $8.50 so over 100% in one day. I think this is a first for me and yes I know (the coach made this point too) this was a gamble that just happened to work out. As I am in AMGN too I feel like I am finally participating in some of the winners that many of you have when I have been on the sidelines.

Chris I am not yet to those 200-300% returns you have but watch out as now that I have broke my first 100% it is too the moon!

Thanks to all of you!!!

I gotta get away from the computer. I am itching to buy a put on CME 'cause I see a head and shoulders. Maybe I'm mad because I got stopped out of my call on the big move up (laughter.)


P.S. Any predictions on how the market will end up today? I would like to see who gets it right.

Bob (and Pam),
I am so glad you got a winner. It feels nice. I have stock in CMG, so I'll put a stop on it and watch it. If I had a call, I'd do just what you did (probably).


Hey Scoot,

Yeah, I see where you are coming from. I was thinking of the "hold over earnings" from a trade perspective where you go in knowing that is your plan. In such cases, you can often buy inexpensive OTM options which limit your risk to a very small level, with the potential for great reward if the stock makes a big move (and of course, a low probability of being successful).

If you have long stock then, yes, your risk and reward are both high, but your probabilities of success are better because you don't have to move a certain amount before you are successful, like you would with an OTM option or a strangle or something like that.

Wow, that dip in homebuilders was uncanny. Look at the rebound.

How do you measure the target for a H&S?



CME...?? a put??

Can you please share your analysis?

My prediction -- CMG closes up by at least one penny.

If it closes down today, it's the formation of a H&S. Too early to enter, but definitely something to watch for.


Hey Bob, congrats on CMG! Interestingly, CMG was my first homerun ever back at the last earnings call. I also happen to be in love with their soft tacos so that makes it all the better.

Homebuilders - it looks like they took a hit on speculation that Beazer Homes will go bankrupt. I also saw where Australia's Macquarie Bank says investors in two of its funds may lose up to 25% do to subprime fallout. Crikey!


Brett, should we let the bulls out now?

My crystal ball says its time





I just don't see the H&S on CME. Could you let me know where you have your lines drawn? It could be because I have a bunch of other lines drawn all over the place and I can't see it.




Where is it that an H & S forms?


There is none (CME)


I am letting the bulls out now....

Move over and let The Rogue takeover.

So many suckers, so little time to take your money.

How do I know? I'm on the other side of your trade. That's bad news for you.


I have had enough of the bears for a while. Getting out my Ruger Super Alaskan .457 Casul and gonna do some bear damage now....



Not mine buddy...


That's funny, Raimo. I don't shoot too well but I'm with you on sentiment. :-)


6/12, 7/13, 7/31 (CME)


You're welcome to keep taking my money. I'm way ahead and if it means giving you some of it, then bring it on.

Keep 'em coming Raimo....I hear them in the distance....getting closer!

Debbie L.

But seriously, folks.
Aussie Pete... if you like this market I suspect you were a kangaroo rodeo rider in a previous life. Personally I'm getting a little sea sick.

Joel R. Thanks for a blast from the past with the Airplane quote. I, too, picked a bad week to give up sniffing glue.

Rambo: Selling half my contracts to lock in shares always seemed a bit like kissing my sister (if I had one.) Only wimps and nerds did it because they couldn't get the real thing. I'm starting to change my mind, though (but not about the sister thing.) AMGN has taken such a leap today that I'm tempted to take half off the table. Must think about this. What does your sister look like?

Bob (and Pam) Congrats!!! WAHOOO!! and various other expletives. I bought PCU and SGR yesterday just to prove to myself that Catherine must keep the hammers handy. Both are down astronomical amounts in the day and a half that I've owned them, yet neither have broken support. Does this tell you something about entries? Should I have waited? Do little kids have snotty noses?

I guess this is one of those weeks that proves I'm an addict. I promised Catherine I was going to sit in mostly cash for a while and check out the market. I've had to redefine "mostly" as anything over 35%. More of a guideline than a rule anyway.




H&S needs to be at the top of an uptrend....

I would argue that CME has been sideways to down since last year.

CME broke out of a traingle in July and retested it.

The H&S does not fit, it does not make sense, and it has not confirmed.

Also, on the left shoulder taht you are looking at, there was no increasing volume as the price drooped. There was incresing volume as the "head" was formed. As the right shoulder ws formed headin up, there was HUGE volume, and that was a retest of the triangle breakout in july. The one down day (yesterday) was not on any significant volume.

So for me, this H7s you see (yes I see it to) does not make sense to me. It does not fit.

But we all see different we should trade what we are comfortable with.

I went long CME...and remain bullish on it, until the chart tells me differently.

Hope this analysis helps everyone, regardless of how differently we may see things.


Ooops, Rambo... I meant locking in "profits", not "shares." How do you lock in shares?


lock in shares I guess by owning them.??


DO NOT give a PENNY to this ROGUE trader...he gets none of mine...

I will JOIN forces with my nemisis
the Phantom Poet if I must to bring down ROGUE, LOL...

Bring it on Rougemeister

I had not looked at volume (which is part of the whole H&S pattern) as I'm not trading it right now. Just an observation. I hope that (since you are trading it) it continues upward. But I do have it on my watch list. You are right, it has not confirmed. Just something to be aware of. Thanks for the anlaysis. It is always helpful to see analysis of other traders.


One thing I do disagree with on your analysis is -- it has been in an uptrend recently.


Did you warn me about TAP because of overhead resistance at 93 or earnings or both?


Seriously, Brett,
How do you measure a head and shoulder? One of my put plays (not CME) is a H&S and I was trying to measure a target price.


You measure from the neckline to the top of the head, and hope the head's not bald. A little extra hair on top could be worth an extra 10%

Thanks, Chris. Too Funny.
Gotta go do housework now. Hope the market doesn't get freaky in the next hour or so.


WM - Washington Mutual is breaking through long term support. Looks like a triple top on the 5 yr. You could probably call the recent activity a bear flag. Bottom line, they're going down. They don't usually get mentioned in sub-prime circles, but they have purchased a lot of subprime paper from Ameriquest and Freemont over the last few years. Could come back to haunt them ...

Rogue, I owe you dinner for selling me all those put contracts on Homebuilders - KBH, CTX, LEN, BZH, etc. and the lenders too, NEW, IMB, AHM, etc., oh yeah and the financials BSC, LEH, MER.

Joel R.

Keep your eyes on FTO.


Breakout on DWA to new 52 week high. Keep watch for a better entry.


COF 5 year chart at support.

Debbie L

I also see a cup and handle on DWA.

Debbie L

New Thread!

Clean Cups!

Joel R.


The whole pattern needs to be at the top of the trend for me to have an H & S pattern. I do not count the move up the shoulder as the trend...the trend prior to what you see as the beginning of the H&S pattern was downtrending. The price fell from nearly 600 to 500.

As for TAP...did I warn you, I don't know, did I?? What was the warning..??

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  • I'm Option Addict
  • From Saratoga Springs, Utah, United States
  • I am a professional trader and an instructor for Investools. I've had relations with the markets for 9 years. Born in Concord, CA, but reside in Saratoga Springs, Utah. Father of THREE, Husband of one.
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