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,

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,

TARDIS Trading Techniques

It has occurred to me that the TARDIS, the spiffy multi-dimensional time machine used by the Doctor (you know Who), may prove to be a rather brilliant tool to acquiring ill-gotten gains in the markets. Why bother analyzing charts or building systems if you can just jump forward a day to see what’s going to happen, right? Of course first I’ll have to steal one and for that there is no better place than Cardiff, Wales:

Once I succeed I will of course quit the blog, get myself a shaved cat and then proceed with setting up the TARDIS Investment Trust Syndicate. Sounds evil enough and I really like the abbreviation.

Of course I’m kidding – but only about hunting down time machines. The Mole will be heading to Cardiff tomorrow morning for a martial arts seminar – definitely not for the weather as it’s butt cold over there. Unless my plane makes a detour across Malaysia I expect to be back next Tuesday – just in time to post an update. Scott (The Convict) Phillips promised to put up a post on Monday, perhaps even tomorrow. So don’t panic – the Mole’s got you covered! ;-)

So let’s talk about equities shall we? Let me start with a chart I shared with my subs this morning. And without rubbing it in may I point out that there are certain privileges to being a member here at Evil Speculator? Because that’s what you have been missing. There was a distinct divergence between the GBP/JPY and the spoos this morning and I recommended to my subs to keep a cautious eye and look for continuation lower. Well, guess what happened then?

Ooooii – that’s gotta hurt. But guess what – our daily campaign was stopped out at 1R and thus we got to lock in our profits. Now I would have loved to catch this move lower but it is what is – besides we have been squeezing an R here and another one there on the way up and the down. All of it adds up over time…

Now let’s keep in mind that we continue to see lower lows and lower highs, especially on the NQ and the NDX. The SPX is a bit more bullish but we are once again descending toward daily and weekly support – 1828 on the former and 1820ish on the latter. Unfortunately we do not have any clues or support levels in between. So if we drop through the Monday lows then we will probably pay those medium term support levels a visit.

More directional move on the NG – boy oh boy! This is turning out to be a profitable campaign! We almost – almost touched the 3R mark – it depends on how you count it. I for one am adding a tick (or pip) to the bottom and top of the previous candle – that makes one R. Given that we should be raising our stop to 4,631 today. Let’s see if she’s going to run higher – I always tell you, Mrs. Natgas is a bit of a crazy broad but once you get her going she can be a lot of fun.

AUD/USD – also not looking so shappy – almost touched the 4R mark today – how do you like them apples? But we dropped back below 3R and that means we’ll probably be closing it out. Unless of course it pushes higher EOD and closes today’s candle above 0.9425’2 – in that case move your stop there and keep it running.

And that’s all I got – obviously I won’t be taking on any further trades before next week. I hope some of you have been trading along – it’s been a wild but profitable week. And next week – next week – boy oh boy, do I have a little surprise in store for you guys. I think you are definitely going to love this one. I don’t want to give too much away but I think what Scott and I have brewed up will be a game changer for some of you system traders. More about that next week – see you all Tuesday!

It’s not too late – learn how to consistently bank coin without news, drama, and all the misinformation. If you are interested in becoming a subscriber then don’t waste time and sign up here. The Zero indicator service also offers access to all Gold posts, so you actually get double the bang for your buck.

Cheers,





    Zero Indicator
  1. recent misdeeds

    1. Drop The Baseline
    2. Lazy Thursday Morning Briefing
    3. Back In The Thick Of It
    4. The Squeeze Is On!
    5. Return Of The Market Mole
    6. We have a potential long setup here, but it sucks
    7. Start of the week
    8. Scott’s market update
    9. TARDIS Trading Techniques
    10. Thursday Morning Briefing
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