Bearish! High numbers are bearish. It's calls over puts. It was an extreme bullish reading which translates into a very bearish signal. Just as anything under 75 which is bearish is actually bullish. It's a contrarian sentiment reading.
Whoa, that I never knew. The definition I saw said high numbers above 100 mean market sentiment was bullish, because more long calls were purchased than long puts, and this excludes MMs. I had no idea we should use it as a contrarian indicator.
I had skipped over the ISEE stuff when I read the thread but will go back to it once I get a better grip on ACD. So I had nothing to add about that. Bonds had reset for me but now close to confirming again. In currencies USD/MXN has confirmed on the downside for me! The Aussie had reset but has confirmed positive again, now making a second test of the monthly A down. Probably have to wait til next month on that one since you don't want to fade the second touch.
Just a review here of ISEE. ISEE basically measures dumb money. It's open only transactions, no firm orders, no spreads, only buys. So it's measuring the guy who simply buys calls. When this activity reaches an extreme and exuberance is at it's highest, it often signals caution. When this same guy is buying every put in sight in sheer panic, the downside move is usually over. The key is not to track every tick of this thing but look for extreme readings at the end of prolonged moves in the market.
I owe 70% of what I know that works for me to this thread and Maverick. So thank you. The only reason I signed up on this forum is to be involved with the discussions in this thread and learn more. I can relate to the ACD I learnt here very well on all time frames and it suits me. I have just completed developing my own trading philosophy, largely based on what I learnt here. I monitor only 4 markets (futures) using ACD and I will start trading them next week onward on a simulated account. I use the Intraday, Weekly, Monthly and Quarterly sessions to define "paths" that price might travel on. I do not use number lines or time for confirmation. I could not relate to those (actually, I never got around to developing my number lines and I still might work on that before ruling them out completely). I developed my own confirmation based on price action and volume analysis at the areas I am interested in for entries. I use the same tool at the "price path milestones" (as I call them) for exits. My "milestones" are A up/down areas and the OR. Price generally travels from/to these milestones and that's what I look forward to capitalizing on. I do not have too much capital to have multiple open positions at the same time so my trade durations will be short and probably have only 1 open position at a time. I am hoping to share what I see through my "ACD lens" here on this thread going forward and keep learning more as I develop as a trader. Today's observations: ES/NQ: I look at them together and am more interested if they are aligned and agree with each other. Yesterday, after the close, they failed at my WAdn and are on their path towards the WAup. Both have confirmed an Intraday A up now and NQ just tagged its WAup. CL: CL confirmed a MAdn earlier in the month and then later confirmed QADn. 2 days ago it found support and confirmed above the WAdn then above the QAdn and now is struggling against the MADn. Intraday its a failed ADn. ZS: Yesterday, beans bounced back below my MADn after confirming it earlier in the month and have found support at the QAdn now. Intraday its a failed ADn.
GBP/USD has reset for me, so confirmation is negated. USD/JPY dangerously close to a reset. For indices, RUT despite it's weakness it's number line is holding up, currently a +7. That is promising, but it has confirmed a monthly A down and it's 5 day hit -6 last week. So mixed signals there. Nasdaq is strongest at +12 but failed the monthly A up last week and I have Spooz at +9. So to sum up, Naz and Spooz still look bullish but momentum has faded for the time being, and R2k is sending mixed signals. My ACD analysis isn't screaming at me to look for entries in indices right now. I'm new to QTR levels so don't know how accurate or useful mine are, or if using them will only confuse me as an ACD beginner. But having said that, I have Nasdaq making a QTR A up and RUT and Spooz both failing the QTR levels so far.
For the last few days I have been getting distinctly mixed signals from the Indices. Not quite sure what to make of it. Mav, insights?