Dangling By A Thread

Once again we are trading near bearish territory but I don’t mean to attach any directional bias via this post’s title. We all have seen major support come and go many times over the past few years. In most cases they served as great opportunities for the bulls to BTFD. Now clearly market conditions are shifting and the bearish case has been gaining a lot of credence over the past few months. However short of having a crystal ball the best we can do is to position ourselves appropriately near important inflection points and monitor the tape carefully for early clues. But have no fear - the Mole is on the case, as usual.

2015-07-28_spoos_briefing

We are actually enjoying quite a bit of context right now and I plan to take full advantage of that. The spoos are now testing a weekly NLSL near 2063 and thus far it’s holding. Should we close the week below it then the trend will most likely switch to the downside. So this will be a key week and that’s exciting!

I’ve moved my trailing stop covering my remaining shorts near the 100-hour SMA. May be a bit tight but unfortunately there’s no NLBL or old NLSL to bolster resistance. Sometimes you just have to make due with what you got.

2015-07-28_NQ_briefing

The NQ thus far the strongest of the bunch and here our inflection point is 4550 – above it we are pretty much in bullish territory. Below it we may be testing the 100-day SMA but there’s a LOT of support to still be taken out – so call me skeptical.

2015-07-28_YM_briefing

The YM clearly is the most bearish index here and after scaring the children a little we bounced higher here overnight. Which however does establish 17319 as our bearish inflection point. If the YM goes then the ES and NQ may follow suit.

In general seeing such discrepancy between the three horsemen are not the hallmarks of a healthy equities market. Which is why I am considering the bearish case at this point – but I’m most definitely respecting all that support that still lays below us.

2015-07-28_ZB_briefing

Bonds – the 30 year now in shake out mode and I think it’s a plausible buy near 154 – if we get that low.

2015-07-28_EURCAD_briefing

EUR/CAD – also correcting and that would be expected after that first stab higher. Nice entry opportunity IMNSHO near the 100-hour SMA which is strongly rising now.

You want more? Then pay up and join the club – freebie mongers only get to see the tip of the iceberg.


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That ought to keep you guys busy for a while. Have fun but keep it frosty – don’t get over exposed, which means split your exposure between correlated symbols.

Cheers,

Pay Attention Now

I must agree with Skynard’s musing earlier this morning – we are about to see a large move on the forex and futures front. Equities are simply the tail being wagged by a big (and currently snarling) dog. Time to pay attention – summer or not – these are conditions in which to bank some coin.

2015-07-23_spoos_briefing

We are somewhat in limbo on the spoos right now but I think we’ve got an short term inflection point around 2114 – so if we push up a little I’m planning to be short until 2115 – long above that. Small position sizing here as I’m preserving my capital for much better setups (see below).

2015-07-23_EURCAD_update

EUR/CAD update – our evil plan is proceeding as planned and this is now officially a daily campaign. I’m trailing a respectable distance away to lock in a bit of profit just in case but allow enough room for a continuation higher.

2015-07-23_ZB_briefing

Bonds – I’m actually already in ZN but if you have an appetite for exposure I think the ZB is looking trendy this morning.

2015-07-23_natgas

Natgas – I’m short near the high of the current trading range. Actually I think this is about to breach higher so I plan to flip for a long near 2.93. As you know NG can move fast so I’ve programmed it all in for quick execution.

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


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That ought to keep you guys busy for a while. Enjoy the setups but don’t get over exposed – and I’m referring especially a certain reader with a shampoo like avatar.

Cheers,

Welcome To The Real Spoo

I often use the term ‘spoos’ here and some of you noobs may have wondered why the heck I’m calling the E-Mini S&P futures like that. As you know the ES is a futures contract with the S&P 500 index as its underlying that trades on the Chicago Mercantile Exchange (CME). All E-Mini contracts there expire quarterly in the months of March (H), June (M), September (U), and December (Z).

The word ‘spoo’ however originated back in the days in the XMI pit on the America Stock Exchange (AMEX) in New York. It comes from the symbol for the September contract: ‘SPU’. Even though the name is based on the September contract symbol, it is used to describe contracts of all expiries. When somebody speaks of the ‘spoo’ or the ‘spoos’, they are referring to the current, most active E-Mini contract.

Well we just rolled the active contract over to September and for the next three months when I’m talking about the spoos I am indeed talking about the September contract. For me the roll over into the September contracts really mark the beginning of summer trading. Usually that is a time for sideways churn but given what we’ve been through in the June (M) contract I have an inkling that things won’t be abiding by the usual script this year.

As a side note: The roll over also resets the fair value which is at its widest today, slowly degrading (actually increasing as it’s negative on the spoos) until we are near par with the actual cash index on the day of expiration (which was yesterday for the June contract). The why and how is a bit outside the scope of this post but I’m confident Google will help you educate yourself if you care.

2015-06-11_spoos_update

Alright, so let’s see where we’re heading on those spoos. If you managed to snag long positions in the past two sessions then you are in pretty good shape and I suggest you hold at least a portion of your exposure for a ride lower. Every tick higher now establishes new support below and increases our chances that we’ll at least ride to ES 2108.75 – per the new U contract.

For now I’m holding my stop a bit above break/even but will be advancing it to the spike low near 2095 if we manage to scrape 2110 today or tomorrow.

2015-06-11_NQ_briefing

That said – it seems the ‘easy part’ of the ride higher is nearing its end. Look here at the NQ which expresses quite nicely how much resistance we have accumulated on the way down. At minimum we’re going to stumble a bit starting at 4500 until 4550 – above it we’re in the clear and most likely destined to push higher. So if you’re looking for short opportunities then that’s your range ;-)

2015-06-11_gold_update

Remember when I was harping about my perfect gold entry yesterday? Well someone with deep pockets must have read this post because I was taken to the woodshed this morning and quickly relieved of my ill gotten gains (i.e. stopped out at break/even). In retrospect I should have taken partial profits when it reached the 3R mark. To be more nimble is supposed to be my modified modus operandi and I probably just have myself to blame. Quite a lot of intraday volatility across the board these days and we need to adjust our trading activities accordingly.

Quite annoyingly this actually bolsters the original entry but it’s way too late now to jump back in – revenge or chase-after campaigns usually result in losses.

2015-06-11_wheat_briefing

Wheat may be a long if it manages to pop back above 510 – if it does then I’ll be long with a stop below 505 or whatever spike low is in place at that time.


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Cheers,




    Zero Indicator


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