Inflection Point

Alright, things are getting a wee bit out of control here, especially on the equities side. I’m all for letting winning positions run but the odds for a temporary pullback now seem nearly insurmountable. Given the lack of context on our daily or long term charts the hourly panel speaks the loudest right now.

2014-09-03_spoos_hourly_briefing

What we have here is a very ordered advance which climbed the 25-hour for a few weeks, with rare and only obligatory touches of the 100-hour. In the past week velocity decreased and volatility increased a bit. Note that each ‘poke’ outside the 100-hour BB lead to at least a touch of the 25-hour. We are now at a make-or-break point – meaning the BBs/SMAs are pointing almost sideways – which again means that a breach outside this range will require a violation of the recently established ‘play book’ if you will.

In plain English I’m saying that we either pull back here – most likely touching 2000 or perhaps even 19990 – or we bust higher and leave any top callers in the dust. Which scenario will transpire I do not know but that does not keep me from properly managing my positions, given the new evidence:

2014-09-03_NQ_update

As you may recall I have been enjoying a fine ride here and until now have let my stop trail at a wide berth. But after 5R in the bag it was time to take partial profits earlier this morning. I am leaving the remainder (50%) in play with a top at the 5R mark. If we drop below that then I’m certain we’ll find new entry opportunities next week.

2014-09-03_DX_update

Quite frankly the DX trade has gone out of control – nearly 8R at this point and the chart above shows you some of the steps along the way. Again it was time to take partial profits but I’m leaving a few lottery tickets in play for a possible pop  into 83.5 – wouldn’t that be nice…

2014-09-03_spoos_briefing

Most likely this chart isn’t valid anymore by the time you read this but if you manage to catch the spoos near 2010 then it’s time to tell Hal to grab a short position.

2014-09-03_hal

Damnit Hal – I told you SELL SELL SELL!!! &@^!%!

Alright, we’ve got some very juicy short term setups to attend to – please meet me in the lair:

2014-09-03_soybeans_briefing

Soybeans have been whipsawing around lately but I do like the current configuration as it’s facing triple resistance above. Worth 1/2R with a stop right above the resistance cluster (~ 1028.4).

2014-09-03_EURCAD_briefing

EUR/CAD – we can’t be sure but this thing may just break through that upper 100-hour BB. Very nice BB compression and if it manages to defy gravity I think we may have a short term runner. Watch that daily NLBL near 1.444 however.

2014-09-03_GBPJPY_briefing

GBP/JPY – there’s a lot to like about this setup, on the daily and hourly front. I’m long here with a stop below 172.7 – sometimes you simply see a setup and realize that it’s a go. Stop below the recent ST lows – and you’re good to go.

Have fun!


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Cheers,

Juicy Setups Galore

Alright – I threw my back out at the gym and am now operating on a mix of illegal pain killers, icepacks, and purified adrenalin soaked adamancy. It’s only Wednesday and it’s been a fun week already. While the hapless schmucks on the other side of our trades are busy applying vaseline we are banking coin and having fun. This tape is literally plastered with excellent setups and the Market Mole will not be denied. So let’s get on with it – but snappy as the drugs may wear off any moment:

I told you that ES 1910 will most likely be a bounce zone and thus far the tape is playing along. There are good reasons for it as well as we got the 100-day SMA, a weekly NLSL, plus a 25-week SNA all looming a few ticks away. However, at least as of this writing price remains lackluster and if that doesn’t change near the EOS we may just fall off the plate this week.

The GBP/JPY correlation is still pointing down – as you can imagine I’m keeping a close eye on that one and so should you. Now this may be all a last attempt to reel in some late hobby bears. Possible yes – but a drop below ES 1900 puts us into the next participation range:

As you can see the volume hole is rather pronounced right at 1900. If the bulls let this level slip it’ll be one hot late summer to be sure. Fair chance we would see some panic selling into 1850 and perhaps even lower. But as of right now let’s assume we are holding 1910 today. In which case we may be long tomorrow on a breach of today’s highs. Stop below – you guessed it – 1900.

Quick update on a gold campaign I threw to the wolves yesterday. I got stopped out once and then entered again as today’s hourly NLSL was breached. So far so good – but it gets better. This thing either falls apart today by pushing below the NLBL or it heads higher and probably starts a squeeze. Which means I’m advancing my stop to b/e and then wait for further instructions. This could turn into a fun one.

Talking about juicy setups – here’s another one – cotton. It’s been a long way into hell and it has been weeks since it even looked at a NLBL. It touched 65.25 today and I just went short with a stop above it. IF it breaches then I will try a long with a stop below yesterday’s lows (or whatever floats your boat).

But we’re just getting warmed up – wait until I see the goodies I have in store for my intrepid subs. I’m all over this like a fat kid in a Mars bar:


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So, did I promise too much? Didn’t think so – now go out and play but don’t talk to strangers or people with strong opinions.

Cheers,

Time To Wield The Iron

I’ll be quick as we may be dealing with a small window of opportunity here. The S&P E-Mini has painted new all time highs and that means we’re pressing our noses against that volume abyss I haven’t tired pointing out to you guys for the past few weeks. Given the various Soylent scenarios Scott and I have been pimping over the past few days this leaves us with a prime entry opportunity:

Let me paint the picture. A bit over an hour ago I pointed out a glaring bearish signal divergence on the Zero Lite (right panel) to all my subs. Some of you are already short and it was a good entry – however given the fact that price has not responded at all, despite rapidly diminishing participation (i.e. flatline signal on the Zero) we will have to follow price and price only!

However if nothing else today’s ramp & camp candle thus far suggests that we are kissing an important inflection point, which obviously lines up with the upper limit of the current trading range.

Let me throw this one into the soup as well – our GBP/JPY carry trade correlation which has kept us out of a lot of traps over the past few months. Now for anyone long this should be quite concerning, nevertheless given where we are and the increasing possibility of a short squeeze I’m going to propose to distinct setups – one with a high probability good return ratio and one with a low probability but high return ratio.

It’s quite elementary Holmes – we are short right here with a stop at 1982 which is a number I basically pulled out of my rectum. Well to be honest there is that sideways 100-hour BB that’s blocking the way and I felt that it’s as good a line in the sand as any.

Now one of two things are going to happen – we drop from here and I smile all the way to the next turning point which is probably an R or two away. OR I will get stopped out in which case I’m already set up to be long with a stop very nearby below 1979 (where we pretty much are right now, plus minus a few ticks).

Caveat – do NOT play this setup on the Spiders or any other equities based ETF – that includes SPX/SPY options and any of the 2x and 3x symbols you like to trade. You will only and I repeat ONLY take this setup on the ES futures as this will require you to monitor  and manage the situation rather closely. If we get a big spike (or drop) overnight then you don’t want to find yourself 10-15 handles in the minus because you had to wait until the NYSE opening bell.

Also, don’t get overexposed – use our futures risk calculator if in doubt and only attribute between 1/2R – 1R to this campaign. Actually 1/2 ought to suffice on the long side as it’ll probably take off like gangbusters if we reach the inflection point of no return (which we hope is 1982 and above).

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,





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