No Prisoners!

Round and round she goes. I think at this point we are way beyond the patient threshold of even the most callous market participants. Fortunately we have movement on the forex front which offers us a much needed reprieve from the eternal gyrations in the equities woodshed.

2015-02-09_spoos_update

I managed to hang on to my E-Mini shorts by a thread – that poke 2051.75 stopped me out but I jumped back in a handle lower with a stop above 2052. Right now we seem to be sliding lower but I’m playing with funny money here so I don’t really care what happens (but I’m still holding SPY lottery tickets from last week).

If we drop lower then I think that 2022.75 is probably going to stand as a first line of support. The lower 100-hour BB awaits there and so is the daily NLSL with the 25-day SMA right above. And if that one gives we still have the 100-day SMA and a daily NLSL at exactly ES 2007. So quite a lot of support waiting below us.

Please don’t take my exposure as any predictive/directional bias – I’m playing the tape as I see it and there is no telling where she’ll swing tomorrow. Mrs. Market is in a shitty mood this month and she ain’t taking any prisoners.

2015-02-09_GBPUSD_setup

But let’s get to the good stuff – forex is looking juicy this afternoon and we’re having ourselves a helping. Here’s cable which I want as a long above 1.5235 – my stop will be below 1.52 and change.

More below the fold – please join me in the lair:


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This ought to keep you guys busy for a while – get to work!

Cheers,

It’s A Long Way To The Top Or Bottom

Extreme exhaustion – I can smell it here in the comment section and all across the financial blogosphere and media. And if you’ve been hanging around the lair for more than a few days then you already know my modus operandi for dealing with one’s emotions – be those of the positive or negative variety: Acknowledge their presence, count to ten, then smile and stomp on them immediately. For we know what they are: annoying distractions at best and hurdles preventing you from banking your ill gotten gain at the very worst.

Look guys – at this point we don’t know what we’re dealing with here. And you know what – you don’t have to know, embrace the fact that you will never ever know what direction the tape will choose today or tomorrow, let alone sometime in the distant future. Predictions are for pikers. But what we do know is that it’s either a LT top or it’s a sideways correction with more upside ahead. And in each case the resolution will be boisterous and full of entry opportunities. You don’t have to trade today but you always always should prepare for taking trades tomorrow. Because just when the tape looks the most confusing the best entry opportunities happen to present themselves.

So this is what we don’t do:

We don’t get drawn into the swings and we don’t get emotional. Instead consider why the market swings in gyrations right now – the purpose is to exhaust participants and to draw them into emotional decisions. It’s a long long way to the top – or to the bottom. Meaning: Corrections near inflection points can take a lot longer than most retail traders care for or are able to imagine – most employ a lack of patience in combination with wishful thinking.

But ask yourself this: What really has changed from early January? We are still near the 2060 mark and now the resolution is nearer than it was five six weeks ago. And that’s good news right?

So this is what we’ll do:

First we analyze where we are right now and if we have an entry opportunity. Let’s start with participation:

2015-02-04_zero

Of which there is almost nothing today – see that flat line on the Zero Lite? It suggests that buying interest has dried up just when the bulls seemed ready to rip this thing higher and break the bear’s back.

2015-02-04_UVOL

UVOL also looks rather meager today – where are those bots today? All of this smells like either a big bear trap or distribution as institutionals are closing out long positions and prepare for more swings. But how do we know?

2015-02-04_spoos

Well, remember, we don’t. But we don’t need to know as we’ll use the short term panels to guide us until we get closer to our daily inflection points.  We’re still a bit too far from that daily NLBL at 2055 and if I want to get short I would prefer if we climbed a little. On the hourly we look in good shape right now and thus if you’re long I would remain long until that 25-hour SMA stops giving support. Once/if that 25-hour is starting to be threatened then we can talk about possible short positions but I think it’s a bit early for that.

2015-02-04_GBPJPY_setup

Alright, I can’t believe I’m giving this one away for free but here we go: GBP/JPY – once again we’re taking early clues off the hourly. Which means long right now with a stop near 178.2. If that one gives I’d love to be short with a stop above the 25-hour. The potential for this campaign is rather interesting – see the daily and weekly panels. Whatever direction it’ll pick will most likely turn into a runner. So keep your eyes on this one!

I also dug up several juicy futures setups – please join me in the lair:


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.

Have fun but keep it frosty!

Cheers,

The Last Bear Standing Is A Bull

The annoying thing about late stage bull markets and in particular the formation of long term tops is that they take forever to play out. Navigating increasingly volatile swings accompanying the final throws of a dying bull cycle takes considerable amounts of patience, discipline, as well as skill. Like Bob The Horse reminded us the other day: Bear markets go out in a bang and bull markets go out in a whimper.

Now the dirty little secret about early stage bear markets is that the last bear standing is usually a bull. Yes, you read that right. Traditionally it’s not weak handed bears who take down a bull market, it’s simply a lack of buyers. Guess what – all those snarling bears who were printing some mighty coin in 2008 are long gone, wiped out during their persistent attempts to call a top when there was nothing but green candles ahead. I myself have seen their (virtual) faces disappear right here – one by one they simply vanished. The few who survived the ravages of one of the most significant bull markets in history relented and changed their approach just in time before their accounts had melted away like late winter snow in the glows of a spring sun.

Arguably this has been one of the most hated stock market advances in history, rife with controversy, bail outs, and market manipulations. But let me assure you that in retrospect – many years from now – you all will miss it. Because it was just too sweet and too easy while it lasted. Your children and grandchildren will look at those monthly charts and ask you how in the world you managed to fail banking a fortune in five years of such bull market extravaganza.

And I’m not talking about fairness – you all know how I feel about QE and Fed/ECB interventions. But from a trading perspective – boy – it was pure manna from heaven and it won’t ever come back – not in our lifetime at least. What awaits ahead won’t be as directional and it won’t be as easy. If you thought trading was difficult in the past five years then you ain’t seen nothing yet.

2015-01-29_spoos_briefing

Now as you may recall I managed to squeeze in an ES short at 2040 yesterday morning and I consider myself extremely lucky as it went straight down from there. Now we’re basically hanging by a thread here and I’m not going to claim that we won’t see yet another FU rip higher, killing a boat load of shorts in the process. But that’s part of our existence as traders – not knowing. You don’t have a crystal ball and you basically just have to pick your battles as they present themselves. The war never ends and the goal is to simply keep winning more than you are losing. Choosing to be a trader is a bit like being born into European royalty in the medieval ages – there’s always a war on and participation is mandatory. And if you win enough you get to pillage ;-)

Anyway, if you take out shorts here then put your stop above ES 2040. Yes, it’s a huge range but that doesn’t matter – if this thing really breaks you’ll need that range anyway not to get shaken out. And if it bounces here and breaches 2040 then the bears are dead in the water (again) and we are painting new highs. Alea iacta est.

2015-01-29_EURUSD_briefign

EURUSD – I’m long here and I hate it. Stop below 1.1251, very much hope it’ll get touched but as you know I’m a lowly expat who earns in Dollars.

2015-01-29_DX_briefing

The Dollar index however is looking pretty solid here and I’m long with a  stop below 94.6.

More short term goodies 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!

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

You have been briefed – now have fun but keep it frosty. See you guys later this afternoon.

Cheers,




    Zero Indicator


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