Live: Friday, Feb. 16, 2018

2/16  2:50 p.m. New York time

No trades today, neither into new positions nor out of existing ones.

2/16 – 10:55 a.m. New York time

The broad equities markets continue their counter-trend rise, excluding stocks and their options from trading under my rules. The upward climb has retraced almost exactly 61.8% of the previous downtrend, a Fibonacci level that often sees reversals.

The next step for the broad markets, upon reversal, will be a decline in the direction of the dominant trend. In Elliott wave terms it is a 3rd wave, at the Minuette degree that I trade, so it should have power.

But that’s the future. The chart and the uptrend as measured by the Fisher Transform both argue that I should steer clear of equities and their derivatives today, and so I plan no trades in that area.

FXE, which tracks the EUR/USD exchange rate, saw a reversal today in the form of a significant gap to the downside at the Minuette degree, but it can be argued that at the level one above where I trade, the Minute, FXE has moved into an uptrending impulse wave, the downward gap marks the start of the 2nd wave correction to the downside at the Minuette degree. One that downward correction is complete, I shall have an opportunity to  re-enter FXE as a bull play, ending my bear-play series.

So why not play the decline? Again, in Elliott wave terms, because it’s not the impulse wave, the dominate direction of the market. Corrections tend to be much less predictable in their details, I have found, and so I tend to avoid them at the level I trade. So for now, I shall keep a close watch on FXE but don’t anticipate a trade.

By Tim Bovee, Portland, Oregon, Feb. 16, 2018


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

Creative Commons License

All content on Tim Bovee, Private Trader by Timothy K. Bovee is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

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