The One That Got Away

You may think that I’m referring to my short positions in the spoos but you would be horribly wrong. Saw that one coming a few miles out and exited at break/even as previously planned.

2015-05-14_spoos_update

And also as previously planned – I am long since 2112 with a stop below 2105. Let’s see if we finally get some directional tape, but who knows. I’ve managed to traverse this sideways mess this far without getting my ass kicked but something tells me to better not test my luck. There are limits to Ms. Market’s patience – even for the mighty trading Mole.

2015-05-13_gold_briefing

Now what I was referring to in my title is … gold. You may remember this one from two days ago. I saw a potential break out chart and was waiting for a teeny weeny dip to the downside to grab some longs. Only problem is – it never happened and I didn’t get my fill.

2015-05-14_gold_update

If there is one thing that absolutely truly annoys me is when I read the market right and for some reason don’t get a seat on the bus. I know – I should listen to my own advice – better wishing to be in a trade than wishing to be out of one. Rub it in! Instead I choose to console myself with the campaigns that are running as planned.

2015-05-14_natgas_update

Natgas – very sweet entry that same day actually and it’s off to the races. We’re now touching the 25-week SMA and as you can see the 100-day BB is narrow as hell. I say we have ourselves a runner here and I suggest you let this sucker run all the way.

2015-05-14_CHFJPY_update

CHF/JPY – equally perfect entry and it already bounced against a NLBL – thus far it’s unable to muster enough mojo for continuation higher. I’m moving stop near 129.80 – let’s see if she can bounce from the daily lows.

2015-05-14_AUDUSD_update

AUD/USD – excellent progress so far although the past day or so is looking mixed. Again I’m trailing here – this time I’m using a daily NLBL, expecting support nearby.

2015-05-14_EURGBP_update

EUR/GBP – it’s been ‘meh’ but it’s holding thus far. My stop is now at break/even – only giving this one 30% chance to resolve successfully.

Speaking of the Euro – I have put together some long term EUR/USD perspectives for the subs. Please meet me in the lair:


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Cheers,

Breaking The Big Bad Bull’s Back

Every once in a while it’s a good idea to detach yourself from your daily trading activities and take stock of the big picture. Although I do not trade weekly or monthly charts they do however serve one very important purpose – which is as a measure of strength given the prevailing trend. So let’s forget about playing the daily bounces for a moment and let’s simply revisit at the tape of the past six months:

2015-05-07_equities_weekly

I don’t know about you but to me this looks pretty ugly. Since late December of last year we have suffered through two massive high volatility sideways periods, only interrupted once by a nice straight run higher during February. The rest hasn’t been fun, to say the least, and I’m sure it has blown up retail accounts left and right. However hitherto the bears remain unable to break the big bad bull’s back. Nevertheless the price action clearly tells us that the ongoing trend is weakening. This is not the same bull market we have come to enjoy (or to hate at particular trading blog which shall remain unnamed) and the implication for us, as traders, is that we need to respond in kind and adjust our trading activities.

Now what I am not suggesting is that we immediately start to look to the downside. Long term tops take quite a long time to form (clearly) and shorting the market without confirmation is a pretty bad idea. Bear in mind that we have yet to break any long term bearish inflection points – be this the 25-week SMA, the 100-week SMA, the 100-month SMA for that matter. So boy – do we have a lot of time to change our minds about this market – more time than most of us would care for. Going forward however what we do need to adjust are our expectations. The long straight runs to the upside are most likely over.

2015-05-07_VIX

Although we are stuck in sideways mode we are seeing the VIX bounce around between 13 and 16. Which I consider a very casual risk pricing model at best – and most likely rabid complacency after six years of effervescent bull market exuberance. What happens from this low base will most likely not been six months of the same – I really don’t think we are going to see the VIX drop to 10 or lower and paint a range there. If that happens after all I won’t be caught with my pants down however as I’m not shorting the market here. What I am however doing is to adjust my trading to accommodate the possibility of:

  • Fake out breaches – like the one we recently saw near the top.
  • A sudden rise in volatility if one of the major support levels give way.
  • In general more and prolonged sideways corrections going forward.

I think these three points really summarize some very realistic assumptions going forward. Perhaps we’ll be positively surprised  as I wouldn’t mind another extended run higher. But until I see a major breach to the upside, and even then probably, I’ll be extra picky with my setups, take profits a bit earlier, especially on the equities side, take smaller position sizes and wider stops. The overall goal for the coming quarter is survival and to keep one’s powder dry.

Campaign updates and new setups below – secret decoder ring required:


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Cheers,

We’ve Got Movement

Despite yesterday’s lottery tickets the odds supported continuation lower and that’s exactly what we got. Early in the morning near the open there was a moment when I thought the bulls still had a chance – yesterday’s lows had held up overnight and we were slowly crawling higher. However shortly after the bell that low was crushed and it’s been a sea of read since. Let’s see where we are and where we may be heading:

2015-05-06_spoos_update

The E-Mini is now touching its 100-day SMA and the easy part of the journey is over. That doesn’t mean it’s the end of the line for the bears. We are most likely going to close below the daily NLSL at 2070.25 and despite a bounce we could easily continue lower afterward. As I’m typing this our current line of defense is the weekly NLSL at 2064 and if that one doesn’t hold we have a stack terminating near 2030. Below that the bulls are quite frankly screwed.

2015-05-06_SPX_PNF

Yesterday I showed you guys this P&F chart and pointed at 2080 as a level to keep your eye on. Well, if we close below that – and the odds are high we do then we’ll finalize a double bottom break down on our SPX P&F chart. The current temporary target is 2020 – my money says we may drop lower. Again, if we bounce right here this may change again. A run back to 2095 would trigger a low pole reversal warning.

Oh – you didn’t see that chart? Probably because you’re not a sub – an unfortunate situation you should remedy! ;-)

2015-05-06_crude_update

Our crude campaign is proceeding according to our nefarious plan. What can I say – we got a perfect entry there and I’m holding this all the way. My trailing stop now advances to 56.07.

2015-05-06_ZB_update

We’re not in this one but bonds have literally fallen off the plate over the past few days. I’m seeing very very soft support here but would not dare taking entries until price confirms that a low may be in place. Anyway, keep an eye on this one. If you’re short – don’t bloody touch it and let your trailing stop take care of you.

2015-05-06_PA_setup

Very very nice setups tonight – I’ll throw one out for free the rest is for the subs only. Palladium – long above 796.80 – my stop goes below today’s lows.

Quite a few more waiting below the fold:


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!

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Did I promise too much? Now let’s go and get that money!

Cheers,




    Zero Indicator


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