Uncharted Territory

The price action in equities today reveals renewed imperviousness to gravity which is a bit surprising given the chasm we are facing on the volume profile panel. I am a bit conflicted up here – there are reasons to be bullish and reasons to be bearish.

As a trend trader there still are no reasons to pull positions. But as a discretionary daily trader I am a bit uncomfortable following the bulls higher as we are heading in uncharted territory – and that at the onset of the vacation season when participation is expected to fall.

Let’s take things from the top. The more medium term SPX P&F panel (by P&F standards) shows us a fulfilled bullish price objective with a lonely spike higher that just begs to be corrected.

The already mentioned ES volume profile chart shows us eleven consecutive higher closes with as it’s heading into a chasm of participation. Do I really want to be long here? Statistically speaking at least one or two down days are very likely.

The weekly ES managed to bust through two Net-Line Buy levels and then closed a few ticks below a third one. Today we’re above it but obviously the week is still young. If we close above it then that would be bullish – but if we close below it then this opportunity would be lost for the bulls as this NLBL expires on Friday. We use that 5-period expiration for a reason as price either rejects or conquers within a statistically valuable time period – IMO price action beyond that is mostly unrelated to Net-Line inflection points. Obviously this is not an exact science.

The regular daily chart has us in the middle of nowhere – what is useful however is the fact that the VolStat indicator shows us falling volatility. And that often is what drives late stage rallies (assuming we fall from above the 1.0 Bollinger). The implication here is that we could see a continued short squeeze fueled by – well, low participation summer tape. Market turns require counter participants, not just lack of continuation.

Bottom Line: I’m pretty comfortable being neutral on the equity side right now. I’ve said this before and I’ll say it again: better wishing you were in a trade than wishing you were out of one.

We have a ton of great setups today so roll up your sleeves, folks. I need to pimp gold again – which is playing hard to get at the 25-day SMA. Once again I will be patient and follow price through sideways churn (i.e. a good reason to play futures and not options here). Short until that SMA is breached.

Many great setups on the FX front again – AUD/USD painting an inside period right on top of a NLSL. Good stuff and that entry will be ripe for the plucking tonight after this session ends.

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Monday Morning Briefing

Welcome to our morning briefing. Here we are reviewing short term setups ahead of the NYSE opening bell. If you are a scalper or swing trader then these setups may be of interest to you. As usual keep in mind that these are short term setups although they could be used as early entries for more longer term positions.

I actually meant to post a weekend update but somehow wound up wiping out my Windows installation, thus condemning me to a weekend of recreating my workstation from scratch. Yes, I do backup religiously but my bootcamp partition wasn’t covered by time machine – fortunately I back up my Windows data separately twice a day. As the old saying goes – only the paranoid survive. Sadly the weather here in Valencia was picture perfect here all weekend and while everyone was out and about until way after midnight the Mole spent it chained to his workstation in his trading lair. You can imagine my mood. Well, as you can see I’m up and running again but it wasn’t fun.

On the the markets – let me get you guys up to speed. The spoos seem are now crossing into Will Robinson territory as prices are currently pushing far below the 100-day SMA mark. There is little on the hourly or daily in terms of possible support. So let’s consult the long term panels.

The weekly is offering the 25-w SMA at 1565 – let’s see if the bulls can stave off the barbarians at the gate.

There was a little volume hole a few handles above but apparently that doesn’t seem to have impressed anyone. Quite a bit of volume below so I expect plenty of participation until near 1530.

Crude is also in a pretty foul mood and I think a play here at the 25-hour SMA could be fun. Which means long above the SMA and short below the 93.04 NLSL.

More fun with futures and a bit of FX waiting below:

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Off To The Races!

So far it’s been a great day as we have lift-off on several of the setups I have been pimping here for the past week. Before we revisit those let’s take a quick look at where we are on the equities side:

The S&P E-Mini is pushing its luck by dipping its toe into the large volume hole which terminates near 1594.75. As I’m typing this it has bounced back a little but and I’m seeing some tepid buying interest. Let’s see if they just tried to scare the children – if you put your stop where I told you then you should be in good shape right now as its currently plotting around 1608.

The NQ will have to push above 2936.5 in order to reverse that weekly NLSL it dropped through today. This candle concludes tomorrow, so let’s see what happens there tomorrow at this time. The implications of a weekly sell signal are obvious but the fat lady hasn’t sung yet.

Alright, let’s take it from the top. I have been pushing this setup all week and I hope you kept your eye on the EUR/USD today as it’s finally taken off. Great entry there at the 100-day SMA (and 100-week SMA) and although we may see a retest of the SMA we now have support below. As you can see the next and final hurdle will be 1.35 – if that one goes then I’ll probably have to either start charging you guys in Euros or raise my subscription fees over the summer. Better lock in those old rates now, folks! 😉

In that context – the Dollar is back at its 100-month SMA and it’s unclear if it’s holding there or if we see a drop back to that lower diagonal. The daily suggests the latter unless we see a pullback here quickly. Damn you Draghi!!

BIDU was another one on our plate this week and I suggested that the 25-day SMA would aid the 100-hour in driving it higher. So far so good – there’s nothing for you guys to do right now. That would be a nice hammer candle on the weekly if it holds.

AAPL – it has let everyone guess for days now and today it decided to drop lower. I admit picking the direction here wasn’t easy but if you follow my work then you know that the breach of the 25-hour today was a give-away. If you missed it – don’t worry, chances are we’re going to see a retest of the new resistance above.

NG – another one on our plate and I did suggest that this Bollinger compression would not last long. Again, tough to pick the right  direction but it did remain below the 25-day SMA for the past two sessions and then fell off the plate. If you got in – take profits!

Crude – it’s been slow going here for a while but I served this one up several times. The 25-hour SMA was our guide in the past two sessions and it finally decided to push above that 100-day SMA and a daily NLBL. That means lift-off and as it seems to be converted into high octane rocket fuel. Let’s see if it holds – again a retest cannot be ruled out but we now have new support waiting below.

If you managed to just grab one or two of the setups provided this week then you should be in great shape. And that’s what we do here at Evil Speculator – every single trading day of the year. Objective market analysis sprinkled with good helping of technical setups – trading without emotions, rumors, headlines, or drama.


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    1. Bonds Bonds Bonds!
    2. Monday Morning Briefing
    3. Fixing The Flaws In Fixed Fractional Position Sizing
    4. Thursday Road Map
    5. Volatility Wave Surfing
    6. Dangling By A Thread
    7. Paying Attention Pays Off
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