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:


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Cheers,

Setup Bonanza!

Interesting turn of events this morning – although my growing cautiousness concerning the equities (long) side has thus far paid off I’m not yet convinced that we’re heading into another correction. Be this as it may, I did get positioned nicely courtesy of the TF this morning and I intend to hold this position for now or until stopped out at break/even:

Although there was a quick fake out toward the NLBL my stop was well placed and thus far I’ve racked up almost two R. Which is nice but not really what I’m interested in – I’m turning this into a lottery ticket to the downside given what I’m seeing on the short term momo side:

VIX:VXO (which I showed to the subs yesterday) continues to point downward. Again, it could be a fluke or a bear trap but I already earned my entry and I’m sitting pretty right now.

Out of fairness I should however show you guys the Zero Lite which is rather flat today. So not much participation on the downside here and I give this 40% chance to continue lower. I don’t see a long entry here right now either unfortunately – once I do I’ll let you guys know.

Update on the Dollar entry which I hope some of you guys grabbed yesterday. The right panel shows us at the 2R threshold and that means we are either moving our stop up if we close above it or close our position if we close below it. That is via the CrazyIvan campaign rules. If I would employ Heisenberg then I would have taken partial profits a bit above 1R and moved my stop to b/e. So I leave this in your capable hands – it’s possible that the Dollar is going to enjoy a run higher. But heck – it’s the Dollar right? So I’ll stick with CI rules on this one ;-)

So many awesome setups today – here’s crude gracing us with a very interesting configuration I tried to explain on the chart. Could swing either way and we are near the $100 mark – will definitely take whatever trigger this throws at me.

And I cannot believe I’m actually giving this one away for free as it’s my favorite. I have already gone long via this morning’s short term entry near 104. My stop is at today’s lows and all that ties very nicely into the IP and RTV-L that any of you leeches may grab later tonight. Absolutely love this setup and I think it’s coiled up and ready to snap.

More goodies below the fold – it’s a veritable futures bonanza today – seems Hoss is getting all excited. Please grab your secret decoder rings and join me in my freshly painted spring lair:


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,

The Outer Limits

So where are back from whence we came and I hope you enjoyed the ride. I know – who am I kidding – it’s been a rough month and let’s hope that April will not only bring us better weather but also put us into a less devious market phase. So let’s see where we’re at on the equities side:

It’s getting interesting as we now have reached the outer limits of the current whipsaw zone. No, there is nothing wrong with your television set. Do not attempt to adjust the picture. We are controlling transmission. If we wish to make it louder, we will bring up the volume. If we wish to make it softer, we will tune it to a whisper. We will control the horizontal. We will control the vertical.

Literally that is – I’m not sure there is much left on the vertical but that was a nice jump in four days. If we push above 1880 then the momentum may again propel us higher in the stair step fashion we have have seen lately. Also don’t forget that SPX 1880 will switch our P&F back into bullish mode.

Also rather compelling right now is that the VIX is starting to drop below a pretty pronounced support line. And that may herald a new low volatility period that gets us back to the 12 mark or below. OR it may be that we are dropping from here. Unfortunately I don’t see a price pattern to get us into a position right now. At least on the equities side.

But that doesn’t mean we can’t have any fun, does it? Here’s crude which I very much liked this morning and happily pimped to my subscribers. I got filled short near 101 and it’s been one wild ride ever since. Have taken partial profits but will keep 50% in the running for a touch of daily support near 99.1. And if you weren’t a sub – well then you probably missed out ;-)

On a totally different note – you recall my write up on market phases the other day. Here’s a chart that should do two things for you – demonstrate two very distinct market periods for one. And then also drive home the point that mean reversion does not always happen, especially on the Forex and futures side. So if you trade expecting platykurtotic markets you will get burned, just a matter of time. Always know which market phase you are in and that also means looking at volatility. I and Scott have written about this rather exhaustively, go hunt it down – the search box is your friend.

We have a lot of setups tonight – here’s a freebie: Bond futures – the 10-year is at NLSL support but is also painting an RTV-S. I want to be short here with the trend if the NLSL triggers tomorrow.

Quite a bit more waiting below the fold – please join me in the lair:


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,





    Zero Indicator
  1. recent misdeeds

    1. Drop The Baseline
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    3. Back In The Thick Of It
    4. The Squeeze Is On!
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    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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