Over the past few weeks several readers proclaimed that they were heading on a little vacation and I decided to follow suit. For one May is really the last month before Spain is being invaded by wave after wave of sun deprived Nordic barbarians, thus travel becomes all but impossible and of course more expensive throughout the Mediterranean. Besides if you want to enjoy Europe in relative tranquility but without the occasional surprise spring snow storm then May is a great time.
Secondly I’ve been working my butt off over the past few months, not only printing coin in rather challenging tape but also producing one high quality post after the other. The little free time that remained I spent on immersing myself deeper into python and quantopian, which I confess has been a steep learning curve despite 30 years plus of programming experience. But it will play off going forward in that I will be able to offer advanced quant related insights and pertinent services to my readers, which is you. It’s been a lot of work and I need a bit of a break.
So I am heading to Austria later this afternoon to visit family who I have not seen since Depeche Mode and Billy Idol dominated the airwaves (yup that would be the mid 80s). As you can imagine I’m rather excited to once again experience the place of my early youth. And most importantly to fill up on all the culinary delicacies I have been deprived of over the past few decades. Suffice to say that I’ll be hitting the gym rather aggressively upon my return. Which by the way is next Monday, so I’ll only be gone only one week.
During My Absence
First up, try not to panic. As usual all subscriber services (the Zero and the systems) will continue as always. If you have a technical problem then just email me at admin@ but allow 24 hours for a response as I may be traveling or not have access to reliable Internet. Scott actually offered to fill in a bit during my absence but I refused as he’s on his honeymoon in beautiful Tuscany, Italy. So instead what I’ll be doing is to repost some popular educational classics from the Evil Speculator archives. Come on – most of you could benefit from a refresher. Even I catch up on some of my older posts here and there.
Special Quant Treat
Over the past few weeks I have been comparing notes with a self professed quant geek who happens to be a professional trader working for a major firm (which shall remain unnamed). He volunteered to put together a post and if you behave yourselves and don’t ask stupid questions then he may just do a second one this week or some time in the near future. Your treat is already waiting in the drafts folder and I will post it tomorrow assuming my plane doesn’t crash into the Austrian alps today.
Meeting The Convict
But wait, Mole is in Austria while Scott the Convict is in Italy? Wouldn’t that be an awesome opportunity for a meetup? Absolutely, which is why I’m heading down to Italy on Friday to see him and his newly acquired super hot Asian trophy wife. Of course I won’t miss the opportunity to console the poor girl and convey the benefits of Western divorce laws. Whatever time remains will most likely be spent causing mayhem across the Tuscan countryside.
Let’s Talk Business
Obviously I won’t be trading until next Tuesday but let’s look at a few interesting charts and then cover our ongoing campaigns:
The EUR/USD woke up with a morning boner today and it seems like it’s making a b-line toward the 1.11 mark where I see some long term resistance as shown on the monthly chart above. From there we’ll either see it crash and burn again or a breach higher which could propel us into a completely new market phase. So the 1.11 range is going to be interesting to watch – hopefully it’ll happen once I’m back at the lair.
Speaking of long term charts – here are the weekly and monthly panels of gold. The weekly formation in particular is looking rather bullish which is great because we’re already long (see below). If gold can breach > its 1300 mark then we may just see a trend change over the summer which could result in a bit of fireworks in the final two quarters of the year.
Let’s start with gold then. It’s still earl in the game here but it’s looking like it may be ready to make a run for it. I’ll hold as is with my ISL intact.
The E-Mini campaign has survived the weekend and once again it’s still too premature to advance our stop. We do have a lot of short term support context which hopefully will keep us out of trouble.
Copper is looking very good here but needs to make a run for it now. Nothing to do here either.
Bonds also looking like it’s ready to head higher. The daily also looking good with the 100-day BB tightly pinched – everything is pointing at a big move here.
Soybean Oil was a great entry last Friday. I’m tempted to move my stop but want to wait one more session to gauge the momentum. This could turn into a massive runner and I really don’t want to get caught by a last minute stop run. BTW this is a subject we should revisit when I’m back – how realized volatility cycles should affect your stop logic.
Soybean Meal is starting to resemble a heart rate monitor – I’m not really jazzed about this campaign but refuse to be affected by a lack of patience. There is no evidence that invalidates my original assessment and if I wasn’t in this one already I may actually be tempted to grab positions now. So why should I exit prematurely? Exactly.
And I’m off as I need to finish packing and then head out of the door. Have fun during my absence but keep it frosty!