MARKET MECHANIC BIG PICTURE REPORT, BROUGHT TO YOU BY ODYSSEY TRADING GROUP FOR 12/19/ 2012

Welcome to theMarket Mechanic daily blog

TODAYS TALLY: $1350.00 +       

TODAYS ACTION : In yesterdays AFTER THE CLOSE we stated there was a great deal of price divergence and that this meant a market selloff. We got the selloff. The market did open higher but by 8:50 AM the DTI’s on the 10 and 20 minute charts had gone negative, setting the stage for the day’s selloff. The software and system generated 2 profitable sell signals to start the day. The market went into an oversold condition and we did get a profitable buy signal as the market had a slight rally. After 11:00 AM the market slide resumed and did not let up for the balance of the day. Our system and software went on to generate 6 profitable sell signals.

The tally is determined is by taking the trade at the closing price of the 5 minute bar when the software and system generates a trading signal. We will trade 3 contracts per signal with the profit goal of 4 ticks or 1 point per trade. This profit goal is a minimum.  The system will employ a 4 point disaster stop or a loss can be booked when the software and system generates a trade that would reverse our outstanding position. There will be times when the software and system generates what can best be called overlapping trading signals, in this case there will be only one trade booked.

TODAYS SIGNALS:

8:50 AM sell signal emini S&P price 1441.25. The set up; on the 20 minute chart with the cross of the TI agg above and close above its 70 line, the trigger: the cross of the TI agg back below and closes below its 70 line and there is a negative reading on the 10 minute DTI, indicating the market coming out of an overbought area, a sell signal is generated. Subsequent low: 1437.00.       

8:55 AM sell signal emini S&P price 1440.25. The set up; on the 10 minute chart the DTI and the TI agg both have negative readings, the trigger; when the 5 minute MACD, 5 minute DTI,  5 minute RSI and the 5 minute Chaikin Oscillator all align negative, a sell signal is issued. Subsequent low: 1437.00.

9:40 AM buy signal emini S&P price 1440.25. On the 10 minute chart, the set up, with positive readings on the 10 and 20 minute DTI’s and with positive readings on 2 out of 3 of the following, the 20 minute TI agg, the 10 minute RSI with a reading above 50 and or the 10 minute DMI with a positive reading, the trigger; the 10 minute TI agg crosses and closes below its 30 line and then crosses above and closes above its 30 line, a buy signal is generated. Subsequent high: 1442.00.

11:00 AM sell signal emini S&P price 1440.00. The set up; on the 10 minute chart the DTI and the TI agg both have negative readings, the trigger; when the 5 minute MACD, 5 minute DTI,  5 minute RSI and the 5 minute Chaikin Oscillator all align negative, a sell signal is issued. Subsequent low: 1431.00.

11:05 AM sell signal emini S&P price 1439.00. On the 5 minute chart; the set up, with the 5,10 and 20 minute DTI’s all reading negative and a negative 5 minute MACD, the trigger; on the 5 minute chart a yellow neutral bar or a green bar is followed with are bearish red bar, a sell signal is generated.  Subsequent low: 1431.00.

12:20 PM sell signal emini S&P price 1439.00. The set up, with the 5, 10 and 20 DTI’s with negative readings, the trigger; on the 10 minute chart with the cross and close of the 10 minute DMI from positive to negative a sell signal is generated. Subsequent low: 1431.00.

1:05 PM sell signal emini S&P price 1437.50. The set up; on the 10 minute chart the DTI and the TI agg both have negative readings, the trigger; when the 5 minute MACD, 5 minute DTI,  5 minute RSI and the 5 minute Chaikin Oscillator all align negative, a sell signal is issued. Subsequent low:  1431.00.

2:50 PM sell signal emini S&P price 1432.50. The set up; with  below 50 reading on the TI agg on the 20 minute chart and a negative reading on the 5 minute DTI, the trigger; with the cross of the DMI on the 5 minute chart, from positive to negative a sell signal is generated. Subsequent low: 1431.00.

2:55 PM sell signal emini S&P price 1432.50. The set up; on the 10 minute chart the DTI and the TI agg both have negative readings, the trigger; when the 5 minute MACD, 5 minute DTI,  5 minute RSI and the 5 minute Chaikin Oscillator all align negative, a sell signal is issued. Subsequent low: 1431.00.

AFTER THE CLOSE : The near term 5, 10 and 15 minute TIndexes finished negative, all others positive. The DTI’s on the 5 minute through the 60 minute all finished negative. With all the DTI’s negative and the near term TIndexes gone negative the market looks to be trading lower. Keeping in mind that we are in a news event driven market and the news can turn the market with no notice and turn it hard.

TODAYS CHART:

ABOUT THE MARKET MECHANIC:

The Market Mechanic has developed 3 proprietary indexes and oscillators: the Trend Index Aggressive (TI agg), the Delta Trend Index (DTI) and the Trend Index (TIndex).  These 3 proprietary indicators combined with the Directional Movement Index (DMI), the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) give us over thirty, high probability set ups that are used to day trade the emini S&P market. These indexes and oscillators are applied on time frames from 5 minutes to 60 minutes (5, 10, 15, 20, 30, 45 and 60) and these set ups are traded on all time frames. The final product of the combination of these proprietary and non proprietary oscillators and indexes is a mechanical system and methodology for identifying entry points into the market that completely sidelines emotion and allows its user to concentrate on the money management part of the trading equation.

The philosophy of the Market Mechanic is not to predict the market but to anticipate likely market scenarios that the market will produce on a daily basis and the best way to exploit these opportunities. These set ups are designed to profitably and consistently exploit these market scenarios.

Markets are opportunity generating machines; our software and methodology strive to take advantage of these opportunities as they arise and provide its users a consistent and reliable profit making trading set ups.