A mixture of everything tonight.
Interactive Brokers: I want to stress that my complaint was more about:
- The failure of IB to execute a stop order and
- The attitude of IB’s customer service that all was well in their world.
The fact is, it is not – at least not from my experience. The failure to execute a stop is a cardinal sin. And a refusal to accept that the system has a problem, despite evidence to the contrary, is a danger waiting to explode.
I cannot lodge a complaint because I suffered no loss. Two students did – but they failed to follow my advice to snag their orders and fills, so it would come down to their word against IBs.
I repeat here the advice I give all my mentor students: snag your order before you place; snagit after you place it and snagit after your fill. This way in the event of a dispute, you have some evidence to support your claim.
S&P: My view on this one was wrong. Yesterday you saw one reason why I won’t trade against the trend – the surprises are in favour of the trend. The rally on Tuesday did not catch me by surprise; the Monday low triggered a warning – in Market Profile terms, there was no trade facilitation below 1270.
The magnitude of Tuesday’s rally did surprise me (notwithstanding the stimulus of more stoking by Bernanke and Company). With the strength of that rally in mind, I felt we’d pull back to the 50% level, 1319.75 basis ES M8, develop and then have another push up. But once the market accepted below 1319.75, the preferred scenario had to give way.
So now, how? (As my Singaporean friends would say).
I see a range developing between the 80-minute Primary Buy Zone (1268 to 1258) and the Primary Sell Zone (1340 to 1329). I’ll wait until after March 31st (window dressing over) before I develop any scenarios.
This plan will change if we see acceptance below 1270 and preferably below 1258 (basis March).
GOLD: Figure 1 shows that despite the ‘top’, the 18-d uptrend is alive and well. The minimum target basis the perpetual contract is 925.30. Gold has an affinity for the 50% level so that may end up being the ultimate corrective low. One thing is certain, the correction will take time to unwind.
The lines are MIDAS support zones – see Nature of Trends and the free section of my site. (You can download the original articles).
Note that the present strong downmoves are characteristic of corrections following parabolic directional moves.
FIGURE 1 Gold
Crude Oil: Crude is not as clear as Gold. Gold’s strong correction is ‘normal’ in the light of the parabolic uptrend. But, the two strong days down in Crude (as shown in Figure 2) was not in keepieng with the overall profile. Crude Oil had just broken up and there was nothing to suggest the very strong down days were to come.
Crude Oil, for me, has all the hallmarks of a 13-w or 12-m correction which means the we’ll probably see an 18-d change in trend pattern. Let’s see what develops.
FIGURE 2 Crude Oil