So what will send this rally over the cliff?

Discussion in 'Trading' started by etfarb, May 14, 2013.

  1. Josef K

    Josef K

    This is the one that stuck out for me:

    3/9/09 ISEE reading of 220. This was the day that SPX closed at 676.53, which was the bottom (measured by SPX closing value) of the past bear market. That reading of 220 was the highest since 12/20/2005 and it was not surpassed again until 12/10/2010.
     
    #61     May 16, 2013
  2. I hope we go down soon. I only shorted a few contracts in the last week of april but am down over 25% on my account.:( I am lucky i didnt go all in, this rally is indeed disgusting.:mad:
     
    #62     May 16, 2013
  3. Maverick74

    Maverick74

    Yeah at market extremes you can get extreme readings on both sides. I can deduct why we most likely had a high reading there at the bottom having lived through that day. When the market was in freefall at that point, it was obvious that bottom was near and at the same time nobody was going to try to catch it. Just being off by one trading day could cost you 100 handles in the spoos. I think as we got near that level, people were bottom picking with calls instead of the underlying. I remember that March vividly. It was a news driven market where every rumor shot the spoos up and down 100 handles on nothing. Exchange margins would going vertical. The only way to play was with call options. That would be my best explanation as to why you saw that reading on that day such as it was. Just one man's opinion.
     
    #63     May 16, 2013
  4. etfarb

    etfarb

    ISEE on fire today bud
     
    #64     May 17, 2013
  5. Josef K

    Josef K

    It's interesting that the equities readings are very high but the indices and ETF readings are very low.

    09:50 Equities: 343, Indices & ETFs: 28
    10:10 Equities: 293, Indices & ETFs: 20

    EDIT: Come to think of it, this could just be due to hedging.
     
    #65     May 17, 2013
  6. Maverick74

    Maverick74

    Yeah the ETF and index only reading is usually below 100 and is predominantly used for hedging. That's why I like to focus on the equity only. A side note, there are now a LOT of people trading weekly options and expiration day options so I can't honestly say how much of that today on the equity only is due to expiration day gambling.
     
    #66     May 17, 2013
  7. Maverick74

    Maverick74

    [​IMG]

    Look at that squeeze into the close for the DAX. Brutal.
     
    #67     May 17, 2013
  8. Maverick74

    Maverick74

    ISEE went out near the lows, pretty bullish sign. Put buyers in full force all day long. Mantra continues to be, get long, buy puts, sit on hands.
     
    #68     May 17, 2013
  9. clacy

    clacy

    Holy crap that is brutal although anyone short right now deserves to have their money taken
     
    #69     May 17, 2013
  10. Maverick74

    Maverick74

    #70     May 17, 2013