Setups Deluxe

Not a very interesting day on the equities side unless you enjoy playing the swings, in which case the sideways range on the E-Mini for instance offered quite some opportunity for jumping in and out. It’s the sort of day when the Zero really shines and not surprisingly it painted a pretty juicy Mole reversal signal during the mid day stab lower – plus note a very distinct signal divergence during the highs:


However what really caught my attention is the repeating pattern that its presenting itself on the hourly Zero panel (the lower panel). It’s starting to look like a heart beat and since it represents participation to the up/down side my conclusion is that buy/sell programs are bouncing the ball back/forth here. I looked around for signs of distribution or divergences on the momo side but still see very little.


My UVOL/DVOL panel seems to support that notion as both lines are almost in perfect sync and are steadily rising – easy as she goes. Again, great day for swing traders, everyone else be nimble and be long near today’s lows and short near the highs (unless we breach above ES 2015 – see charts below).


The E-Mini volume profile shows us a pretty deep volume hole at 2010 which now has been touched 2 1/2 times (the first one missed it by a tick or two). So that should serve as an inflection point moving forward – on the upside we have a ceiling near 2015.


Which also is represented by a NLBL at 2014.75 – a breach above that by a tick or two and we are probably off to the races for another stab higher.


But I promised setups and am happy to deliver as we’ve got a ton today, especially on the futures side. But first Forex – here’s the USD/CAD which is painting a descending triangle formation. Now the odds for a breach higher is pretty low – I think we are talking like 15% or so. Which affects your position sizing – your odds of success are low but accordingly your pay off is high as many traditional chartists will expect a break down lower here – perhaps after a fake out spike higher. Sure, may happen, but every once in a while it just keeps running higher and burns the shorts in the process. Therefore my plan is to add 1/4R on a breach of 125.5 and another 1/4R on a breach above 1.266 – give/take a few ticks. 1/2R total with a stop below the 25-day SMA.


Cocoa – very nice formation here and I’ll be long above today’s hammer with a stop below the NLSL (you can also use today’s low as usual).

Quite a bit more below the fold – please join me in the lair:

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Setups Setups Setups

Way too much chatter on this board and way too little hands on trading. Almost none of you are riding this higher due to either a) lack of effort b) propensity for mental masturbation or c) trying to make predictions. Seriously? After six years plus of Evil Speculator goodness I expect a lot more from you guys. So once again, let me show you how it’s done:


The bulls are clearly back in charge here as we have crossed all bullish inflection points and are now squeezing the tape higher. What I like in particular here is that the upper 25-day BB is now starting to point up, which means there’s almost nothing but air above. Well, I said almost – there is a weekly NLBL at ES 2088.75 but we just sliced through the one at 2062.25 and may have enough velocity to push it over the edge. That said – tomorrow is the last session ahead of a three day weekend (PrezDay) – and I have an inkling we’ll park up here and leave any remaining bears to roast for a few days.


Bots clearly in buy mode – look how smooth the UVOL line is climbing today. The squeeze is on! Heck, I’m just glad we are finally outside that dreaded trading range we’ve been locked in for over a month. The human sacrifice I offered the other day seemed to have appeased Mrs. Market. Gold Gerb – thanks for taking one for the team – you will be missed.


Boy, I almost didn’t catch this pig except for the ST longs on the ES I put on the other day. However Thor came to the rescue and the current campaign is about 0.75R away from its target.


I promised setups galore, so step right into the lair – we even have a VIP section. And what happens in the lair, stays in the lair!


EUR/JPY – long here with a stop below the 100-hour SMA. It’s still early in the game but there is a good chance that the 25-day SMA remains in place. 1/2R only – if she goes we probably get a runner.


Crude – long above the 100-hour SMA with a stop below 50. 1/2R only – I do love the formation on the daily but we cannot exclude the potential for more monkey business as there are too many eyes on this symbol.

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!

Please login or subscribe here to see the remainder of this post.

Alright, that ought to keep you rats entertained for a while – have at it and hopefully I see a bit more participation in the comment section. The Mole deserves better!


The End Of An Era

Seems like everything continues to run in circles, so watch your six and don’t get over exposed. This is not the tape to be trifled with. On the equities side the roller coaster is now heading higher again, which actually may be positive in terms of being able to find exposure near our inflection points. But thus far we remain stuck inside the murky depth of the ES limbo range.


The only setup I would consider this morning is cocoa futures – it’s slowly easing its way higher and I would risk 1/2R on a close above the NLBL at 2,751. Now speaking of the futures…

It is with a heavy heart that I must share the ending of an era: The CME group has decided to close most of its futures pits. Clearly open outcry has been on the wane for decades and according to the CME now accounts for only 1% of total futures trading volume. So it’s understandable that they’re closing it down. But call me old fashioned – it’s still sad to see it go. And during outages pit trading has served as a backup, so I hope this won’t come back to bite them where it hurts the most. Because once it’s gone for a few years it would be difficult to reinstate.

Trading on the floor requires not only brass balls, stress tolerance, and a carbon fiber enforced voice box but a range of skills that’s becoming more and more rare these days. If you think electronic trading is tough then try to fill orders on paper slips and execute binding executions on only verbal confirmation or hand gestures. That brave new world we are building may be faster and more complex, but I also think it’ll be a lot more boring. Alright, I’m officially old…

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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