Death Warmed Over

by Larry Levin

With a title "Death Warmed Over" one might think I was about to write about my singing career. Oooff, that's bad! No sir, I will write about the state of the recent stock market, which is death warmed over indeed.

We expected a large move Thursday and the market delivered - kind of. Almost as quickly as the sell-off began, it stopped. Yesterday I said that its overall Market Profile distribution suggested a lower market followed by a rally. OK, great; the market delivered again. The "death" and "warmed over" parts, however, are everything in between!

For example, Thursday the 12th through Monday the 16th the market traded almost entirely within a 7 point range. Friday's range was slightly lower than the prior two days but still traded within the aforementioned band. To be sure, the total range between the highs and lows were greater, but approximately 80-90% of the traded there.

Were the subsequent days better because the overall daily gains or losses were much larger? No, not by a long shot! In fact, one could make an argument that it got worse. Tuesday the 17th, for example, opened much higher, but died on the vine. The first eighty agonizing minutes of the day traded in an approximate 2.50-point range. A little later, at a higher level, the market traded within a 2.00-point range for TWO HOURS. A short time later the market was once again stuck in a narrow band of just (mostly) 2.25-points for an additional 105-minutes. Amazing!

I could go on and on as this is now a daily occurrence, but I won't. I'll wrap it up with Friday's late "death warmed over" period, which occurred as the market traded into the close. For nearly 90-minutes the ES traded within a small range of just 2.50-points. Dead, indeed!

Since long periods have been Lilliputian-like for so long, trading has been difficult. Draw downs are a part of trading and the VTR is not immune. During this period the VTR went through a 6-day draw down that was been recovered over a 3-day period.

Hopefully the coming week will liven up a bit...nay, a lot!




Previous Day's Trading Room Results:

Trade Date: 8/20/10

E-Mini S&P Trades*
(before fees and commissions):


1) No "Secrets" trades filled today.

2) Algorithm positions (12)

3) “Reading the Tape” positions (7)combined Secret’s, Algo, & “Reading the Tape” total… +4.00



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