I'll start it off.
My opinion is that 31-35 level for thes ES, posted on the 1st Jan., is even more worth attention given the structure of the correction, especially potential 3Ds into this area.

ABCD to lower 80s comes together with some longer term lines.

was looking at the same thing Marcin

1820.66 – 2093.55 = .382 at 1989.31
1972.56 – 2093.55 = .786 at 1986.35

Great minds think alike, rat.

Nice charts, crew.

You know what my anecdotal observation of the day is? Has anyone noticed that, except for me, every last person I am hearing is just calling the bottom here non-stop. I'm not seeing anyone reading the pops looking for shorts. I'm looking at every pop as a short, and possible bounce spots from a management perspective, and for very short-term countertrend, and then get back to thinking about hammering the short side. And it seems all everyone else is saying is 'okay, time for this to get moving on up again'. It reminds me of the big bear. Everyone I watched called the bottom like a hundred and fifty times, and finally admitted it was going to zero around late February early March of '09. Until I see a change of character, which can literally happen in seconds, I have and will continue to see nothing but down. Just my two cents.

For me it's very hard to accept that the ES is so weak, that it doesn't need any significant correction. Pullback is the most you can expect right now.

Here's the kind of thing I am always looking for, observant of, but most miss things like this (because they aren't looking at various possibilities). This applies not just to this exact situation, but pops, drops, various moves, length of time for sideways moves, depth of retracements, and on and on. So, did anyone notice the drop today was within two ticks of the drop from yesterday?

I'll post a quote that I have posted in here before, from the Kung Fu TV series. Remember, Master Po is blind.


Master Po: Close your eyes. What do you hear?

Young Caine: I hear the water, I hear the birds.

Po: Do you hear your own heartbeat?

Caine: No.

Po: Do you hear the grasshopper which is at your feet?

Caine: Old man, how is it that you hear these things?

Po: Young man, how is it that you do not?

One thing I have learned in my life is just how hard it is for us to see ourselves clearly. I have done a lot of work on videotape (doing documentaries, if you will), so I have gotten to see how I act, how I look, how I talk, my mannerisms. They are not at all what I perceived myself to be at the time. It taught me a lot. One thing I have heard others say to various people is 'You should hear yourself'. In a sense this is the same type of idea. People generally can't hear what they say, how it sounds.

Now, without picking on Marcin here at all, let me apply this kind of principle. Look at the ES from the recent low on the 16th, on its strong move up. Now look at the ES on its recent move down. To me, the one on the way up looks even a bit stronger, less corrected. Now go back to the previous month's low on the Dec 15th. Look at that move up. Very uncorrected. Look again at this sell. Go back to the July/August sell (look at the U2014 contract). Look at the 7/31-8/1 leg. Over 60 points straight down (and there is a characteristic that my new students should see that lines up, in a fractal way, with the entire sell off the top, although it differs from the 'typical' we look for), no real corrections to speak of. Now, look at the move off the low. And so on and so on. We are seeing this kind of behavior over and over, yet it still surprises people.

Given all this, could someone (not Marcin specifically, I'm just saying, generically someone listening to this argument, who fell into this category) say 'Well, what I meant was I just didn't think the ES would go down, be weak, I didn't necessarily mean that it would be so uncorrected, just that I wasn't looking for the short side to any extent.' Sure, that's another issue. This 'bull' is one of the longest running ever. In all previous cases like this the aftermath was vicious. The fundamentals are the worst in recorded history right now (because of deep, severe systemic issues that are irresolvable without a total reset and then some). And people are the most bullish ever recorded, as shown by many of the sentiment gauges. And everyone everywhere is talking about only one thing: higher prices and more new all-time highs.

Look, I get it. I studied operant conditioning. But our job is to be professionals, so we have to study ourselves, study the masses, and get beyond that. When I see everyone on one side of the boat, I have to weigh that in with the trend, momentum, and a host of factors and make an informed decision about the possibilities. But the second I say it will do this or that because it always has, I'm done as a professional, time to hang up the spurs, because now I'm conditioned just like the masses. Just my two cents.

Originally posted by MarcinO

For me it's very hard to accept that the ES is so weak, that it doesn't need any significant correction. Pullback is the most you can expect right now.

I'll finish today with one more comment. I have heard many times that, in sports and such, it's 90% mental, give or take, and I've heard the same said with trading. I not only agree, I might go so far as to say it's 95%, or even 99% mental. The thing is, that is sometimes misconstrued by people, taken to mean if your head is in the game properly, you need not have many actual trading skills, since all that really matters is your head. My interpretation is more like: you need monster trading skills, mad skills, exceptional skills. Then you need to have a head that is like 20x as 'skilled' as that. Think you've worked hard on your trading skills? Plan to smoke that level of work compared to working your head.

Sure, some are naturally gifted at that, they have to do almost no work to just perform, and they think what I'm saying is nonsense, since they don't have any issues. They just perform at optimal levels with no work being done on their head. I am truly happy for them. It's like being born a billionaire (into a billionaire family). Well, certain things are just yours 'for free'. Me, I was born to a poor sharecropper family (it's from the Steve Martin movie 'The Jerk'). So, as far as my head, I've had to work for everything I got. Most, perhaps all, of the people I have worked with are in that same boat. They wind up quitting not only because of how much work it is, but to an extent, because that work is very uncomfortable work on their head. They wanted to bang trades out, not do therapy. Well, good luck on that one. Many athletes, I think especially ones who are in individual sports like say golf, have head coaches. How do you think Dr. Brett Steenbarger earns a living? Yes, roofer does this naturally and probably hasn't had a head issue, as far as trading, in his life. I suspect (but don't know) that rat doesn't struggle in this area very much. But, that is the exception. So, as I used to say in my website commentary: "Fix your head".

Oops, I didn't actually make the more general point I wanted to with that last post. I have tired of the endless technical posts. I can post the levels over and over, then comment on how they were used again just like I said (no claims, but go back and see for yourself how many times this has happened). To what end? I've done over twenty-seven thousand posts in here, the most of anyone ever at MyPivots. I'm tired. So, if I can contribute some trading philosophy, some other tips and thoughts, well, then I will. Hence, the shift, at times, in my posting.

Closed on the low tick for the move, a drop of 13.50 points. Not bad.