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Wednesday, July 20, 2011

I'm short the IWM

Short 84/85 VERTICAL Call: AUG11 IWM

We now have 5 waves down on the subminuette chart.  This plus the other patterns over the last couple of days gives me confidence in the contracting triangle (b) wave pattern on the minuette chart that I've discussed in prior posts.  I've decided to play this by going short a vertical call spread on the IWM russell 2000 ETF.  I love trading this instrument, as it normally has a much higher beta than the SPY.
I'll get a credit selling the call spread and the time decay as the market goes sideways to down over the next couple weeks will work in my favor.
Posted by Waverunner (FractalTrader) at 11:43 AM

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Notation


Wave DegreeMotiveCorrective
Grand Supercycle((I)) ((II)) ((III)) ((IV)) ((V))((a)) ((b)) ((c))
Supercycle(I) (II) (III) (IV) (V)(a) (b) (c)
CycleI II III IV Va b c
Primary((1)) ((2)) ((3)) ((4)) ((5))((A)) ((B)) ((C))
Intermediate(1) (2) (3) (4) (5)(A) (B) (C)
Minor1 2 3 4 5A B C
Minute((i)) ((ii)) ((iii)) ((iv)) ((v))((a)) ((b)) ((c))
Minuette(i) (ii) (iii) (iv) (v)(a) (b) (c)
Subminuettei ii iii iv va b c
Micro((1)) ((2)) ((3)) ((4)) ((5))((A)) ((B)) ((C))