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FTD

🟥 NEW LOW on IWC - Market Commentary⬇️ IWC NEW LOW The microcap ETF (IWC) has made a new low. This is not good at all. On the good side we did close up on the day - so we can call this a Rally Day and wait for a Follow Through Day (FTD). ↗️ WAITING FOR FTD SPX is sitting on the 200D Moving Average and Nasdaq s on day 6 of its Rally Day (marketd as RD on the chart). We are waiting for those FTDs in order to get into the action on the long side. 😰 FEAR NEEDS TO PICK UP The VIX like I said in my previous note, to print a picture perfect bottoming action, would need to double its low of 16, meaning a shakeout with VIX jumping to 24 would be a positive sign. 👨‍👨‍👧‍👦 SENTIMENT Sentiment is horribly bad - which is so negative it could be showing a market bottom. The chart below shows the % of stocks above the 50D (pane1), 200D (pane2) and the VIX (pane3). Only 32% of the stocks are above 200D which is v. bearish. Why we look at this? Because any real bull market would require participation from more than 7 mega cap stocks in order to be a) strong and b) lasting. Otherwise it is a very thin market - which is not healthy. 🚽 FLUSH POSSIBILTY I am cautious also that because the last couple of days we are seeing dislocations in relationships that are actually correlated *historically*. I am refering to interest, forex, utilities, bonds, commodities and so on. E.g. Oil broke down and the interest rates and the dollar went up. When this has happened historically there are a higher chance of a flush occuring. The probability is stacking but it would be a black swan. For the newbies a flush is a mini-crash. 📅 STAY ALERT REMEMBER We are always 4-5 days away to a new Bull Market. This is the time to keep your eye on the market. Know what the leading RS names are. Also we are about to enter earning season. Be cautious. My strategy is to never go into an earnings event unless I have enough profit to justify the implied volatility.
TVC:VIX
by TintinTrading
🟨Successful FollowThroughD - BlueprintSince 1971 we have had 6 "major" Bear Markets. Average Characteristics of Bear Market 👉 Avg Length: 536d 👉 Avg Depth: -39% Current Characteristics of Bear Market 👉 Length: 282d 👉 Avg Depth: -28% But as I have shared before around the web - the Length and Depth depend wether we have a recession or not. FULL ANALYSIS HERE (this part starts +17:00 in): www.tradingview.com How do Successful FTDs look like: 👉 Avg Gain in first 4 weeks: +6.46% 👉 Avg Gain in first 13 weeks: +12.07% 👉 Max Drawdown in first 13 weeks: -4.65% Last FTD statistics: 🟥 Gain in first 4 weeks: +5.4% 🟨 Gain in first 13 weeks: +9.3% (so far we have more time to achieve average threshold) 🟥 Max Drawdown in first 13 weeks: -5.4%
SP:SPX
by TintinTrading
Failed Follow Through Days and 2022The the S&P 500 bear market statistics for the past 50+ years show that the average number of Failed Follow Through Days (FTDs) is 5. However, in the stagflation market of 1973-74, characterised by rising inflation and declining economic growth, there were a shocking 9 failed FTDs! If we exclude the two short bear markets of 1982 (only 53 days) and 2020 (V shape), then the average Failed FTDs is just a bit over 6. This might indicatate a historical precedent case for a stronger rally here Note, a distribution day, within the first five trading sessions after the market has a FTD, has led to a failure of the FTD 70% of the time. Also note, undercutting the rally day from the FTD implies a 95% failure rate
SP:SPX
by TintinTrading
1
Probability of Rally Failure is 90% There is an important study, that estimates the success of a Follow Through Days depending on how close a Distribution Day is observed. Look at the annotated chart on SPX. In essence if we observe Distribution Days close to the FTD then the probability of Failure is high. (Failure is defined by undercut of the Day 1 Rally Day ). Study is courtesy of IBD Research. I have annotated the zones in Red, Yellow and Purple below. 🟥 Red Zone - Distribution Day 1-2 days after FTD: 95% Failure Rate 🟨 Yellow Zone - Distribution Day 3 days after FTD: 90% Failure Rate 🟪 Purple Zone - Distribution Day 4-5 days after FTD: 30% Failure Rate We observed first Distribution on Day 3 and another one yesterday on Day 4 (white bars on chart) - this is why I have labeled all my trades as High Risk - since, I wanted to see how we are to perform first week after FTD.
SP:SPXShort
by TintinTrading
4
All of the FTD's ever reported since January $AMCFailure to deliver (FTD)~ When a trader of a security can not meet all of the obligations of the trade at the time of the sale. How FTD's are effecting AMC is done by Big money traders trading these FTD's between each other which continues to impose selling pressure. When a single stock is a FTD (NOT THE TICKER/COMPANY), there is a owner of that Security. When the ftd is being sold to the next big money trader, There is a new share that is resulted in that trade between traders. At the end of this transaction between the seller of the FTD and the buyer 2 shares have been imposed on the market. Owner of the FTD --> Selling the FTD to the next --> Sell it again to the next and you now have 3 shares sprouting from 1 with the pressure on the market of 3 shares! 1 Share at this point Rather than that one share being given, a synthetic share was made (the same pressure is imposed as if a second share was bought on its own through a lit exchange) You can see how this turns into a shit show when these FTD's are constantly hopping around imposing new pressure at different points. 3.5 Million on the top but how many shares could that actually be? I figured this chart would be great to watch. Updating this every month with reliable information pulled from the Sec. Follow to keep up Happy trading everyone and remember, Scared money don't make no money.
NYSE:AMCLong
by GreenDayTrade
PROG - FTD's vs T+2 vs Delta Hedging Calls ITM are more than likely already bought. The calls when exercised are a transfer of shares and not always a new purchase of shares. IMO the buying pressure on Monday led to MM hedging their position on PROG on Tuesday. With added buying pressure it sent PROG up to north of $6. This level hasn't been seen since Feb 21. Support was found and investors rallied, causing maybe some more hedging. Bagholders from then, day traders, and profit takers got out. This selling pressure caused, again, a MM hedging, this time they sold shares they previously bought. This is extreme resistance, MM know this. Support was found and bulls rallied to cause (perhaps) some more MM hedging. The large swings in price caused extra buying/selling pressure but bulls in control Higher lows can be set above $4.00 Just because there were a high volume of ITM that expired on 11/19/21 we cannot assume that all/most of these were either naked calls. MM go out and hedge when the price is running up by buying shares. They can also sell those shares if the option falls OTM. If the itm calls are exercised on then is more likely than not those shares are already owned and priced into the stocks price. It is unwise IMO to assume the idea behind T+2 and more shares being hedged for after expiry. That said, if the shares cannot be located then that's when it becomes an FTD and could take 30+ days to settle.
PLong
by OccamsPhazer