October 5, 2011- Bear Traps :) Enjoy Bullish Folks!

The bears had too much fun already with the markets.  We got oversold levels, and short covering lead the rally last night.

The bears have gone all in, and now they’re trapped and killed by bulls.  Enjoy while it lasts.  Rally!

Short Term Bullish Reversals, Relief Rallies & Trading Levels: 

Looks like the bearish sea monster has taken a brief sigh of relief before it extends its market decline.  Take advantage of this bear trap rally (Bear trap definition:  The bulls will be trapping all those bearish shorts.)

For those who are stuck with their stocks, or looking to trade some bullish reversals.  Read up on some interesting trading levels.  Today will be an exciting day.


SPX Wrap Up (Via  Fallond’s Picks)  For complete market commentary, view his post here.

The day started with a small gap down. This was followed by further losses before rebounding back to yesterday’s close. Then markets took a second spin lower, before a late day surge took indices into (or above) yesterday’s candlesticks.

S&P was hardest hit by early morning selling, but had done enough by the close to see a bullish piercing pattern, with higher volume accumulation and a ‘buy’ trigger in on-balance-volume. There was also a significant shift in relative strength against the S&P towards the Russell 2000; a bullish development.

Tomorrow will be about consolidating today’s gains and not giving back what was strongly fought for in afternoon trading. Most of the indices will be looking to confirm or create (i.e. Russell 2000) ‘bear traps’.  For bulls, today’s lows mark a new line in the sand to defend.

Click the chart to view.






Philippine Trading Levels : 

1.) Philippine Composite has retested the 3800 level.  Look for that 3700 level to hold in the short term.

2.) Trading Levels for Volatile and Active Stocks: 

Trading Stance – Buy Nearest to Support.  Sell Near Resistances. 

LC – 1.10-1.28, LCB – 1.13 – 1.34

AGI – 8-9.50

MBT – 60-67

ALI – 13.50-14.50/15

PX- 18-22

SCC – 150-190

MA/MAB – 4.2- 5.00 (in centavos)

Note: I limited the stocks, but I’m sure there are several that will manage a bounce.  Just trade your favorite stories.  

Happy Fishing!  Hopefully we all catch some good rallies 😀

Also, PGOLD starts trading today!  Good for them that we have an oversold rally bounce to trade from 😀

– Faceless Trader


About Abc

This entry was posted in A Little Common Cents Corner, Sharpening the Mind. Bookmark the permalink.

18 Responses to October 5, 2011- Bear Traps :) Enjoy Bullish Folks!

  1. I don’t understand how IPO subscribers can sell what they bought on listing day. I guess most buyers are short term traders hoping for IPO magic on the first day. PGOLD down 11% as of writing.

    Strong start today, hope you were able to gain some.
    I feel more mature as a trader. Happy that I’ve been able to put to use some concepts I’ve learned about trading this year. 😉


  2. Paul says:

    Good read again. I always like your posts because it guides any trader.. newbie or expert alike.

    TA rules once again! 🙂


    • Well.. AUDUSD is off from its lows. I went long at 0.9500, Its currently hovering at 0.9558. Also, my favorite trading stocks are also off their lows. I don’t really need the PSEI to register 100 points to make me bullish. A consolidating setup is actually good enough 😀 I understand its a huge probability game, and I’m willing to take the risk, since I’ve got some evidence that a short term bounce is likely 😀 – FT


  3. Mon says:

    There was no rally today. Game theory in action. Everyone waiting to sell on rallies. So who’s going to buy. In the end, lower close. One for the case books. Great post still!


    • Haha. The weight of evidence is not always merely in the Philippine stock composite. That’s what fools most of the public. They need a 100 point rally in order to be bullish. I witnessed stocks registering off their lows (perhaps because I just fairly am biased trading LCs etc. Also, my longs in Aussie at 0.9500 is now in the money by about 50 pips. Currently at 0.9555. With the overall global picture going higher, and 90% correlation of the Philippine markets with global sentiment, we shall see in the next few days 😀 It’s a probability game that I’m willing to bet my money upon. 😀 Cheers- FT


  4. XYZ says:

    I don’t understand why IPO subscribers sell at a loss on listing day too. I just don’t. Sad that today’s rally ended in the red. Maybe green tomorrow? Nah.


  5. mac says:

    …LC heavy foreign buying at 1.20 level today, what your take on this and F.Yap bought a lot on 1.11-1.14 levels around 80++millions shares…is LC ready for the next wave run?


    • i’d write a post about the many possible scenarios. Of course, if you truly have a process, you’d know that taking profits while everyone’s bullish (selling 1/3, 1/2 on 5% profits) is prudent, while riding the other 2/3s or 1/2 of your position to the maximum possible point in this trading range. Enjoy. It’s a boxing match between bears and the bulls. 3700-4100 range. I sincerely hope you made money, as well as most of my readers too. 😀


      • should i say “slight edges”? hehehe ^^
        A little but not much but more importantly I think I’m learning and getting better at this ^^
        I sincerely hope you made money as well FT.


  6. tmac says:

    LC (10/7/11) – not a good looking candlestick today. 😦


  7. h0tm0ney says:

    great blog faceless

    particulary enjoyed article about manila mining, what software/data vendor do you use for philippines trades?


    risk on/risk off my current mantra 🙂


    • hello hotmoney,

      I’m just using the free softwares available online. I use COL’s free charts. Bigcharts.com for HK charts, Metatrader 5 for currencies and index futures, and yahoo finance, google finance, stockcharts.com in checking US quotes. – FT


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