MARKET MECHANIC for 06/07/2012 BROUGHT TO YOU BY ODYSSEY TRADING GROUP

TODAYS ACTION:
This morning we open higher, at the open Germanys Merkel is speaking and the release of Bernakes opening speech is due out at 9:00 AM. Being a reasonable guy I think to myself, why trade the first half hour? I do not.
After the text of  Bernankes speech is released and he begins his testimony and the market starts its move lower. As we said in AFTER THE CLOSE yesterday , buy the rumor sell the fact. Our system picks up the down move with a couple of profitable sell signals. Benny B finishes his testimony at exactly 10:50 CST, the market makes a sideways move with an upward bias and our system does issue a buy signal, but at the time markets are so thin that the order was not filled. At 1:00 PM we get a sell signal on the 30 minute chart and the market drifts for a while then gets slammed.

TODAYS SIGNALS:

9:10 AM sell signal emini S&P price 1315.50.  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 close below its 70 line and a negative reading on the 10 minute DTI, indicating the market coming out of an overbought area, a sell signal is generated. Subsequent low   1310.25      

9:50 AM sell signal emini S&P price 1311.50.  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    1310.25
   
12:20 PM buy signal emini S&P price 1316.50. The set up; on the 10 minute chart the DTI and the TI agg both have positive readings, the trigger; when the 5 minute MACD, 5 minute RSI, 5 minute DTI and the 5 minute Chaikin Oscillator all align positive, a buy signal is issued. Subsequent high 1318.50   

1:00 PM sell signal emini S&P price 1315.25. The set up; on the 30 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 close below its 70 line and a negative reading on the 30 minute DTI, indicating the market coming out of an overbought area, a sell signal is generated. Subsequent low  1305.25.       

2:05 PM sell signal emini S&P price 1314.50. 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 1305.25   
  
 2:30 PM sell signal emini S&P price 1311.75. The set up; on the 45 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 close below its 70 line and a negative reading on the 20 minute DTI, indicating the market coming out of an overbought area, a sell signal is generated. Subsequent low 1305.25.    

AFTER THE CLOSE:
Well, I think the dust has settled, the Europeans and for the most part Bernanke said what needed to said to stem the market melt down. Now What? Like I said yesterday Buy the rumor sell the fact.  The market loves its old axioms and what happens, a late day sell off. Our proprietary indictor the DTI finished negative on the 5, 10, 15, 20 and 30 minute time frames. The TIndexes finished negative on the 5 and 10 minute chart but positive on all other time frames. To distil all this, it looks like weakness in the near term at least. We will wait and see what kind of legs this short term weakness has.
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 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 several distinct, 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 7 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.