I guess we all saw this one coming – after all the script has been the very same for the past two years. First you whipsaw the crap out of everyone ahead of a holiday, then you kill the bears right at the open the day after:
Now the ZL signal was pretty flat throughout the day which means that participation here is pretty minimal. Even that last big spike up only registered at 0.6 on the ZL Richter scale which is nothing but a hiccup. Which leads me to believe that this thing can melt higher, yes – but I don’t think that we’re at the onset of a protracted short squeeze. I’m looking forward to see the spoos paint new highs because the way [...]
For the noobs, COT is a report on the commitment of traders (CFTC futures reported data). I keep track of the number of speculators long – short (aka net long). If you see wording like Net Spec as a % of OI, that means the number of net speculators (long- short) relative to the total number of contracts outstanding.
All the definitions aside, here are a bunch of charts to look over.
NQ: This just shows that there is still much money “crowded” in NQ futures. Some money has come out, but we are far from levels that say the market is panicking. Some of you may wonder why I dont have the ES on here, well, the answer is simple. The ES is full of day [...]
Well, I probably should point out that the tape over on the EUR/USD was quite exciting. There was one really nice long trade setup on the ZeroFX – go check it out (it’s still free).
I see four good setups here – one (blue arrow) dropped but not far enough and probably would have gotten stopped out. The trick here is really in being patient and waiting for a long juicy spike – then you set a stop nearby and simply forget about it. Finding a target is a bit more tricky – at this point I am playing with the one standard deviation away (i.e. two lines away) from where the entry was triggered.
On to the snooze session:
I [...]
The first hour of today’s session session was a bit trippy – and it was served with the obligatory bear trap which I hope all of you subs avoided:
The key entry today was a bit subtle but it was there. When the spoos looked like they’re about to drop off the edge Zero Lite was completely unimpressed and painted a divergence. Those setups are never a guarantee of course but if you see them go in there and simply set a stop a few ticks from the prior low.
Geronimo wasn’t missing out on the fun today and nailed a nice long scalp.
Cheers,
Mole