Wednesday, April 16, 2014

Beating the Algos at Their Game, Part 2

– Posted in: Tutorials

Mounting evidence that algo traders are horning in on “our” highs and lows requires aggressive countermeasures. During this lesson we looked at some more trading tactics that do NOT require camouflage. Chief among them is the timed buy-stop, which allows us to test the water nearly risklessly when we aren’t entirely confident that a trade will work. Also on display here is a way to profitably exploit ABC patterns when they look likely to stop out early birds via a second point C. The workaround is a more aggressive and pro-active approach than we have considered before.

A Gambit in May Silver

– Posted in: Free Rick's Picks

One might as well flip a coin to determine where stocks will head tomorrow, since they appear to be in the throes of delerium. Somewhat less difficult to predict is May Silver, however. If you trade this vehicle, especially at night, be sure to check out the update to my tout, since the chart includes a precise price where one might attempt bottom-fishing with the tightest of stops.  Don't subscribe? Click here for a free peek -- no credit card necessary.

GCM14 – June Gold (Last:1302.40)

– Posted in: Current Touts Rick's Picks

I disseminated a nasty, 1265.60 target intraday based on the pattern shown. Although it will be in play until such time as C=1331.40 is exceeded to the upside, it is encouraging that the bounce from Tuesday's lows exceeded the pattern's midpoint pivot at 1298.50. The pivot looked like an enticing short the first time it was hit on the way up, but subsequent price action looks more like a bullish consolidation than distribution. Even so, to 'actualize' the bullish potential of this picture, buyers will need to achieve 1312.40 today. That would exceed a very small 'external' peak made on the way down yesterday at around 6:00 a.m. ET. The peak is barely visible on the chart displayed, but it is significant because any rally that get's past it will be bullishly impulsive.

ESM14 – June E-Mini S&P (Last:1843.00)

– Posted in: Current Touts Free Rick's Picks

It was just coincidence that yesterday's edition of Rick's Picks led with a headline about schizophrenia, since a market-watcher could not have asked for a better demonstration of it.  At the opening, the futures head-faked the equivalent of 100 DJIA points; then they plummeted the equivalent of 250. Just when things looked darkest, short-covering by bears too stupid and frightened to know when to sit tight drove the futures into a spasm that recouped earlier losses and then some. By day's end the futures were up 18 points, bears were cowering, Wall Street was jubilant and all was right with the world. I won't hazard a guess as to where this freak show will head tomorrow, but I should warn bulls nonetheless that the night session is unlikely to deliver much more upside than the 1845.50 target shown.  Above it, perhaps after Wednesday's opening bell, an 1851.75 target will be in play. However, if you plan on intercepting it with a short offer, you had best do so only if you've caughta piece of the rally.