The Other Shoe Just Dropped

Yesterday I mused that the onus was now on the bulls to push the spoos above 1997 and that an inability to do so may lead to grave consequences sometime next week. It seems like my concerns were justified but the situation escalated a bit earlier than anticipated:

2014-09-12_ES_hourly

Don’t get confused if 1997 is suddenly a mile away – we just rolled over into the December futures contract and thus fair value is at its most extreme. Basically 1990 is now roughly yesterday’s 1997. And that’s almost exactly where the bulls fumbled today and the rest is history as they saying goes. There seems to be a support line on the hourly which now points toward ES 1970. I would not entertain any long positions unless that one gets touched.

2014-09-12_ES_profile

Because of the roll over our profile volume chart is not exactly spot on right now – it’ll take a few days for things to settle properly. But adjusted to the new contract it seems that 1970 represents a volume peak and it’s smack middle in our recent congestion zone. Oh joy… haven’t we suffered enough? ;-)

2014-09-12_VIX_update

Just a few days ago I wasn’t too concerned about a correction beyond a touch of the 25-day SMA. But things have shifted a bit – more specifically the VIX is now building a diagonal support line which is slowly pushing volatility higher in a systematic fashion. That may look innocuous at first but it’s a lot more dangerous actually than a fast emotional spike higher.

2014-09-12_SPX

So unless we see a very quick and violent reversal – preferably today – it’s very much possible that this one will touch the 100-day SMA mark on the SPX which now awaits near 1940. As you can see we are at the 25-day and that’s basically ‘containment territory’ – a drop below it will trigger a bit of panic selling.

2014-09-12_EURUSD_update

Not much to report on the campaign front today. The EUR/USD has triggered a long now but I’m not sure it’ll get out of the gate. Which is surprising given how compressed the hourly Bollingers are. Something’s got to give here soon. Well, I’m long with a stop below yesterday’s lows – system is a system.

2014-09-12_ZN_update

The 10-year bond campaign however is progressing very nicely and it’s time to take 50% off the table as we’re approaching the 3R mark. I’ll shift my stop to the 2R mark in hopes that we’ll touch my target zone at 123’3.

And that’s all I have for this week. Be advised that I’ll be absent Monday through Tuesday morning. But no worries – Scott graciously volunteered to be on point and if needed defend the fort from invading hordes of bear-barians. I will probably put up a quick post Tuesday near the close – see you all then!

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.

Cheers,

The Long Con

As you can imagine I wanted to wait out Draghi’s announcement before putting up a post but that didn’t leave me with much time before the bell. So here we go in no particular order:

2014-09-11_spoos_update

Equities still in whipsaw mode but I’m actually starting to give the bears more credence here. Neither side has been able to make much of a dent but let’s not forget that 1) the onus is on the bulls to continue the trend and 2) there are really no bears left. In a late bull trend downside corrections are usually generated by a lack of bulls as opposed to being caused by strong selling pressure. Which is why we have seen the tape plot extended tops followed by a quick fall to the next support zone.

Bottom line: The bulls need to push this turd back above 1997 – if we close the week below it tomorrow then there may be a price to be paid next week.

2014-09-11_ZN_update

Bonds are on the way now – my new target area is 123’295ish. Glad I flipped that initial long to a short after being stopped out. A lack of directional bias does have its rewards ;-)

2014-09-11_cotton_update

Cotton is accelerating higher and I’m moving my stop to the 2R mark. Very happy camper because I think we may have a runner here. Current target near 76 – if we touch that I may just be able to afford a turkey for Christmas!

2014-09-11_cocoa_update

The cocoa campaign also back on track and we may have another runner here as well. Target – well, who cares – there’s nothing but air below. I have to say – the fun has been in futures lately!

2014-09-11_coffee_update

Coffee is looking great today – inside day candle right on top of a very tested 100-day SMA. I’m taking either breach it’ll throw my way tomorrow/tonight.

2014-09-11_EURUSD_update

EUR/USD – may attempt a bottom here (much to my chagrin of course) – time to hedge, triggers on the chart.

2014-09-11_dollar_update

And I promise I won’t boast about my DX campaign (snicker) – but for the rest of you guys here may be a chance to play a shake out. Double inside day – usually decent odds on that as velocity seems to be slowing up here. A breach in either direction is a good play. I’ll put my stop at today’s lows – if stopped out I’ll be short with a stop near yesterday’s highs.  If we get a double whammy (stop out both ways) I’ll continue higher with my current position size.

FWIW - the long con across various futures contracts seems to be the play of the year. This is easy money folks with beautiful prime rib entries and strongly trending tape. If you keep staring at equities all day you may not just go blind but also miss out on a lot of fun. And that – my dear steel rats – would be unforgivable. So get with the program!

 

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.

Cheers,

Sitting Pretty

I’m glad I stayed out of that equities campaign as it continues to test everyone’s patience. If you’re short since yesterday then you may be wondering if this is merely one last stab higher before the big drop. Well, maybe – I don’t have a dog in this fight which affords me a reasonable sense of objectivity. And the way it’s looking right now this beast could swing either way. But as I pointed out yesterday, terrible conditions with limited downside potential. But hey if you must dabble – be my guest – here are a few pertinent perspectives:

2014-09-10_spoos_profile

Rather interestingly we saw a bounce right at the end of a tiny volume hole. Another tick or two below and the bears would have enjoyed a much needed injection of participation. But for some reason the spoos touched 1980 and jumped right back into the dreaded whipsaw zone. Seemed utterly avoidable given the recent lack of participation, thus it begs the question as to whether this may be a bull trap. IF it really is then we need to turn back lower sharply before the end of the session – the more time we spend up here the worse for the much battered grizzlies.

2014-09-10_SPX_hourly

The hourly SPX shows us a touch of the lower 100-hour Bollinger. And boy – is that one compressed to the max right now – we’re talking less than 20 handles top to bottom. So something’s got to give here soon and most likely it will. Now, if our Sorgenkind indeed resolves lower then we may actually drop all the way to that 100-day SMA near 1940.

Here are a few short term momo charts – subs only. The free portion of this post continues further below:


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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Alright – I’ve done my duty to your equities addicts – now to the interesting part ;-)

2014-09-10_EURCAD_update

Update on our EUR/CAD campaign – well, it dropped back to whence it came. Fortunately we enjoyed a very fortunate early entry and thus can afford to sit out a possible retest of the 100-week SMA. Nothing to do here right now.

2014-09-10_cotton_update

Cotton however has fared rather well and we almost touched 3R today. Which means we’re moving our stop to the 2R mark. This may actually work out fine as it gives us a bit room for a possible shake out day or two. IF this one manages to breach the upper 25-day BB it may just turn into a runner. So I personally will only use 50% of my stop at the 2R mark – the remainder goes to the 1R mark.  The long term potential here justifies a bit of campaign management discretion. This approach has served us well over the past few weeks.

2014-09-10_cocoa_update

Cocoa – and it’s off to the races! Well, we hope…. excellent entry with minimal risk yesterday. This is why I love those last kiss goodbye entries. So sweet when they actually trigger. Nothing to do here either – it’s do or die time – we have done our part.

Cheers,




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