Drop The Baseline

Having been on the road until Tuesday I just realized that we’re heading into a long weekend. I suspect most of you are already on the way out or won’t catch this before Sunday night. So let’s dive right in:

The VIX Buy signal we triggered on Tuesday seems to be proceeding nicely. Worth noting is the fact that we have rapidly descended back toward a baseline near VIX 13.5 which only recently was breached. That’s quite a volatility squeeze and if you were caught with puts (and even calls) near the bottom and didn’t get out then your premiums aren’t worth jack at this point.

On the spoos we are heading toward a NLBL which represents our first technical hurdle. Nothing else to see here…

Our GBP/JPY correlation seems to be supportive – it’s served us well again this week.

My YM entry this morning has paid off very handsomely and I’m taking it off the table now as we’re touching a NLBL on the daily panel. Good chance for a little shake out here.

I know it’s a long weekend and all but I actually ran into some very nice setups. Please join me in the lair:


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Per today’s theme I’m kicking off your Easter weekend in style by dropping a real bassline:

And another one – as it’s a three day weekend – wohoo!

Make sure no pets or younglings are nearby then grab a cold one and crank these suckers up. Wishing you all a fabulous weekend – see you guys next Monday!

Cheers,

Lazy Thursday Morning Briefing

Welcome to our morning briefing. Here we are reviewing short term setups ahead of the NYSE opening bell. If you are a scalper or swing trader then these setups may be of interest to you. As usual keep in mind that these are short term setups although they could be used as early entries for more longer term positions.

Not too much going on this morning. Equity futures have been pushing sideways overnight and we’re starting to see a bit of short term Bollinger compression. Interesting but I don’t see a good setup on the spoos right now.

The Dow futures however may be worth a play – we have a teeny bit more context here courtesy of a NLSL which is lining up with the 25-hour SMA. I’m long with a stop below the lower BB – if it breaches I would consider a short if it’s not the result of a quick event swing.

GBP/CAD is looking pretty juicy here as it’s pinned between the 25-hour and a NLBL right above it. However there’s this:

This will probably be good for a bit of whipsaw, so it’s probably wise to stay out of this one until after 8:30am EDT. The NLBL will have expired by then but I think trading the SMA higher is a good play if it holds.

Alright, see you guys later this afternoon – have fun but keep it frosty.

 

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Cheers,

Back In The Thick Of It

Things are starting to look more positive as we are accumulating bullish context. As you recall the VIX triggered a bonafide buy signal (relative to equities) and thus far things are proceeding in the right direction. That of course doesn’t mean we won’t see an attempt to shake out some of the stragglers.

On our volume profile chart we are back in the thick of it – anything can happen around here and it has in recent past. But if nothing else the bears once again were unable to drag things beyond the point of no return, one which may have heralded a medium term trend change. So no cookies for the teddies and the bulls have another lease at life – at least for now.

The GBP/JPY correlation continues to provide important clues and thus far it seems to be leading higher.

Short term (left panel) we are holding the 25-hour SMA and may just breach that NLBL just below ES 1850. Not much context on the daily chart, so for now let’s stick with the hourly. As long as the 25-h is leading higher we are in squeeze mode. Won’t last forever though and various strategies for a shake out are probably already being hatched. If you are long from Monday then there’s not much for you to do – don’t over think this – hold your position and move your stop up with each 1R increment. It’s important that you let your winners run.

Thanks again to Scott for providing valuable guidance during my days off. It was short and sweet and very much to the point. That’s how I like it. Complicated charts and pages of rationalizations are for traders with too much time on their hands.

More below the fold for my intrepid subs:


More charts and commentary below for anyone donning a secret decoder ring. If you are interested in becoming a Gold member then don't waste time and sign up here. And if you are a Zero subscriber you get free access to all Gold posts, which gives you double the bang for your buck!

Please login or subscribe here to see the remainder of this post.

Cheers,





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    1. Drop The Baseline
    2. Lazy Thursday Morning Briefing
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