These signs indicate the next big move is down

For the fifth session out of past six, emini markets went absolutely nowhere yesterday. Other than last Tuesday's sweet rally and the one-hour stretch from 2:00pm thru 3:00pm EST on Wednesday, stock index markets have traded inside choppy little micro-range coils. That will not last much longer. Price action is poised to break, and probably big. Whether that lasts one - two days or couple of weeks remains unknown. We do know for an absolute fact that a directional break is imminent.

When the price break ensues, please do not fade or fight its direction. Go with the flow and you'll make money. Fight the breakout trend with reversal mentality, and you will likely get hammered. Simple as that.

Lastly, Chris Curran reported yesterday that the COT (Commitment Of Traders) report shows large commercial traders holding a 3-year extreme net short position. That is the stuff market turns are made of... in favor of the big boys. Large commercial traders ARE the stock market. If they are selling into the latest rise, guess who becomes their liquidity on the massive exit? You got it... retail traders buying every dip like Google is still a $150 stock.

Summation
Short-term, markets are due to make a sharp directional break that will plow thru layers of reversal traders in its wake. Long-term, the biggest players in our professional appear to be building net-short positions in obverse extremes to new market highs. What does that suggest to you? It suggests to me that the next 100+ point S&P move is likely to be lower.

Hopefully we'll have directional markets to report for Wednesday morning!

Trade To Win
Austin P
www.CoiledMarkets.com
(Online video clip tutorials... open access)

Austin Passamonte is a full-time professional trader who specializes in E-mini stock index futures, equity options and commodity markets.
Mr. Passamonte's trading approach uses proprietary chart patterns found on an intraday basis. Austin trades privately in the Finger Lakes region of New York.