Kitchen Sink Monday

Folks, roll up your sleeves, grab your favorite morning beverage, and prepare to get busy. For whatever reason the market is throwing everything but the kitchen sink at us this morning. Let’s review the equities side first and then dive right in. Ready – set – go!

2014-10-27_spoos_overview

Things are looking good here – the last hurdle here remains to be the 100-day SMA and if it can be breached this week then I see little in the way of taking out that weekly NLBL on the right panel. If you’re wondering, yes I’m still holding those long positions.

2014-10-27_spoos_hourly

What I really like on the hourly panel is the 25-hour which is clearly being observed. There was an attempt to breach it but it failed right at the lower 25-hour BB. We are now starting to accumulate ST context below and that’s positive.

2014-10-27_EURGBP_briefing

Okay, on to the setups. EUR/GBP – I’m long here with a stop right below the diagonal (0.786). If stopped out I’m already set to be short with a stop above 0.788. Love this one.

2014-10-27_DX_briefing

The Dollar is approaching a convergence point between the 25-hour and 100-hour. I have to be long here until being stopped out at 85.5. Given the onslaught of excellent setups today I would not be short after that as I think there are better opportunities.

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


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Looks like this is going to be a fun week. Shake And Bake!!

Cheers,

Hurdles Ahead

We have come a long way in the past three sessions but the easy part of the journey is now nearing its end. For there are hurdles looming ahead plus I’m seeing some signature signs of short term shenanigans flashing all over the place. Let’s start with where we are right now:

2014-10-21_spoos_update

Quite a climb since that is and there’s probably room for a few more handles. But bear in mind that we are now facing a trifecta of previously tested moving averages – at least per my lens and more often than not they have been observed.

2014-10-21_NQ

On the NQ things are looking quite a bit more bullish – AAPL definitely had a thing or two to do with that. However daily resistance is right ahead and we’re about to smack into it. On the weekly panel we’re however above the 25-week SMA, so that’s pretty positive.

2014-10-21_UVOL

Today’s session looks like it’s been on cruise control – the Zero also suggests that the bots are driving this one higher.

2014-10-21_VXV_VIX

Quarterly volatility has eased off quite a bit along with the VIX and the ratio has been leading the advance in the past few sessions. All good and given that we’ve got more than a week of trading ahead of us it’s not impossible that the bulls may actually pull this off and close the month above the NLSL.

So much for the good news – now let’s talk about some of the concerns:


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Cheers,

Falling Swords

The best advice I can offer you guys right now is to not resort to guesswork when it comes to when we’ll see a low. We are sailing in dangerous waters and if you’re not already short then simply wait it out – get used to the idea that you missed the boat. Anything can happen down here and it will!

2014-10-15_1412

Most importantly don’t fall prey to mental masturbation such as this. So it’s Ebola that’s bringing down the market now? Is that a fact? It couldn’t possibly have anything to do with the fact that the Fed’s money pump is slowly drying up? Or that we’ve been in a raging bull market for five years and counting which is begging for a correction?

It’s strange how the financial media continues to draw correlations between events and market cycles, even if they are disproven over and over again. And even IF those events were the actual cause – it’s useless to follow them as there is no chance of exploiting the information. How many people went long crude thinking that Russian supply disruptions in Europe would swing prices higher? And how exactly has that been working out for you?

Forget about the news – just follow the charts – they tell us all we need to know.

2014-10-15_sppos_briefing

Or NOT. If you recall my write up on market periods – we are in the midst of a rocket right now and there’s no telling when it’ll end. The wave wankers have tried over and over to employ all kinds of measures to project when a ‘third wave’ may end. The last time I tried that was in early 2009 when everyone was looking far below 666 based on their careful counts.

2014-10-15_spoos_volume_profile

The simple truth is that you’ll never know until after the fact – so stop trying to guess. Don’t think you are smarter than the millions of participants who are looking at the very same chart right now. We may bounce here today and hold the 25-week BB, or we could drop like a rock here and not stop until near 1700. I don’t know – but one think I do know for sure:

Never ever attempt to step underneath a falling sword.

2014-10-15_VIX_VXO

The one chart that’s been a thorn in my eye is this one – the VIX:VXO. It keeps pointing up and I really don’t know why. But we are in rough waters as I said and perhaps whoever is pricing those ATM options is tripping over their own hubris. Or they know something I don’t. Whatever it is – when things don’t make sense then you simply wait it out. We’ve done well this year – no sense in getting caught up in all the excitement (i.e. panic) and resort to forcing the issue. That rarely results in profitable trades.

2014-10-15_gold_briefing

Gold is looking pretty interesting right now as it’s fighting to overcome triple resistance. My current entry is betting that it’s going to fail but a few ticks higher above 1230 I’ll be long. Dynamics can shift quickly here and this is an important inflection point – which makes for good entries.

A few more ST charts 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,




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