Monthly Support

I posted a long term E-Mini chart in the comment section this morning after I realized that we had tested a monthly Net-Line Sell Level during today’s lows (on ESH5). That’s a pretty serious inflection point and as there’s very little other context it’s where I believe it’s worthwhile considering a few long positions:

2014-12-16_spoos_update_LT

As you can see we breached a monthly NLSl only once in October, followed by what clearly was the reversal of the year. But as you can see there is an increasing amount of interaction with support and whether it’s this time or in a few months from now – we will see a big sell off sometime in 2015. The past two years have been nothing but manna from heaven for the bulls but we are slowly running out of buyers up here. HOWEVER, that said – all that stuff is happening at a glacier pace and LT tops take a lot more time then you think.

2014-12-16_spoos_update

Look at the hourly – I know – quite a jump from the monthly but it’s the best context right now: Apparently a second test of the 100-hour SMA has failed quite miserably and things are now again hanging in the balance. Nobody really wants to be long or short here. However given the monthly context and the fact that we are again trading below ES 1990 means I’m going to start accumulating a small amount of long positions down here with a stop below today’s lows.

2014-12-16_SPX_pnf

Let me however be clear that this is an experimental position. The P&F on the SPX is pointing at 1970 and we only have dropped to SPX 1976.

By the way, if ESH5 1955 gives again then we are most likely visiting ES 1900 or below, P&F target be damned. The bulls are well advised to hold this monthly support level. Alright, I’m going to look for more entries – give me about 30 minutes.

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An Impending Trend Shift?

With the exception of equities we have been seeing a pronounced shift in market behavior across the futures as well as in Forex. Once again it drives home the point that one’s approach has to constantly be gauged and if necessary modified in response to shifting market phases. Or in other words - none of your trading strategies/approaches work all the time – the trick is to apply the proper market strategy to each discrete market phase.

2014-11-19_gold_pnf

Gold for instance has been stuck in a pretty uneventful sideways churn for most of the year. Hunting for an trend trades on the precious metals side would have been a total waste of time which is why we barely touched it all year. Just look at the P&F chart above – note that the part covering 2014 is a quarter of the size of that of 2013. Reason being – P&F charts do not track time – they only focus on price, which is why I appreciate them. If there’s no movement then no boxes are added to the chart.

That may however soon change. Gold just painted a low pole reversal warning and that means the bears are officially on notice. And as coincidence would have it we do have a promising setup on the roster today:

2014-11-19_gold_setup

We have a nice hammer formation there on the daily panel – right underneath the 25-day SMA. I would take a breach of today’s highs with a stop below yesterday’s lows (today’s a bit low for my taste). Pretty simple setup but be aware that it’ll most likely try to shake you off. When it comes to precious metals every campaign has to be earned.

2014-11-19_FXE_pnf

The EUR has been among the trending charts this quarter – but until August it had barely painted any boxes on our P&F chart. Then Draghi announced a whole new battalion of printing presses in response to lackluster GDP growth in the EU and the rest is history. I have been enjoying the sell off quite a bit as you can imagine but the downside ride may be over soon as we are but a bagel throw away from producing a low pole reversal as well.

Are We Due For A Trend Shift?

Now if both the EUR and gold turn then it may also mean that equities are due for a much needed correction. Seasonally however that would be an incredibly inopportune time for the bears. Not that the Santa Rally is chiseled in stone but it’s rare to see any significant corrections this late in the season. Not to second guess what may happen next (which is usually out of touch with reality at any rate) I have decided to simply keep my trailing stops where they are and let the chips fall where they may.

That’s all I have for today folks – nothing exciting to report on the setup front. And quite frankly – given the recent gyrations across board I am a bit cautious and when my Spidey sense tingles it’s usually good medicine to remain extra selective when picking entries. See you guys tomorrow.

It’s not too late – learn how to consistently bank coin without news, drama, and all the misinformation. If you are interested in becoming a subscriber then don’t waste time and sign up here. The Zero indicator service also offers access to all Gold posts, so you actually get double the bang for your buck.

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It Keeps Going And Going…

This is getting ridiculous. Apparently my long campaign is fueled by nuclear fusion based Energizer cells from the 24th century. It just keeps going and going and going…. Hey, I’m not complaining obviously - this innocuous morning entry on October 20th quickly turned into one of the most profitable campaigns of the year.

Now for the record: I did rattle everyone’s cage for FREE that morning. And quite frankly I ‘m a bit puzzled by the fact that none of you guys jumped onto that one – even at the time it seemed like a complete non-brainer to me (i.e. the potential gain far outweighed the risk). Consistency folks is what makes all the difference in the end – meaning showing up here for work every single day.

I see many of you guys show up here jumping up and down during corrections but the same people are surreptitiously MIA once the tape starts ramping higher. I’m not one to jump to conclusions but this reeks of directional bias, and I thought we got this out of our system years ago? Please take this criticism in a productive fashion – which means I recommend you meditate on the type of stimuli which motivate your trading and the ones that seem to deter it. This is something I unfortunately can only point toward - in the end it is you who must make the journey.

2014-11-03_spoos_update

I for one am determined to milk this bad boy for all it’s worth. And how far out may this be?

2014-11-03_SPX

Yes, I know – this really seems ridiculous – a preliminary bullish price objective of 2415? Gulp… One almost feels sorry for the bears… almost. Now this candle begs for a correction obviously, but I’m trailing this campaign via 25% MFE or the last spike low (whichever is higher) – and both are a mile away.

2014-11-03_gold_setup

Another symbol that’s been trending is gold – downward that is. These days I’m a lot more skeptical about inside periods unless I see context nearby. However after this drop outside both daily BBs I’m willing to throw 1/2R into this one. Lousy odds but if she snaps back (or drops into hell) it’ll be worth it.

More goodies below the fold – please step into my lair:


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