Inflection Point

This is pretty much it folks – after months of sideways churn followed by a massive wipe out we have now reached an inflection point that will determine the character of the tape for months to come. I cannot emphasize enough how important it is for you all to pay attention – right here, right now.

2015-09-02_spoos_briefing

The spoos are sitting on weekly support and resolution is approaching. I’m short here but am prepared to flip above ES 1938. The only chink in our plan’s armor is the fact that we are heading into a long weekend. This makes getting positioned here/today rather risky in that we most likely will see sideways tape for the coming days followed by a large gap on Monday night.

Today is probably the last session this week to expect any meaningful participation (except perhaps tomorrow morning during the ECB press conference), which complicates matters a little. But heck – I’ll be your huckleberry. For now I’m exposed only 1/2R and if the tape moves in my favor 1R I’ll be adding another 1/2R. It is important that you don’t get drawn into making large bets which could turn into very large losses on a gap higher or lower next week.

2015-09-02_ZN_briefing

The ten year bond futures look like they are in the process of completing a floor pattern after a rather massive shake out last week. Good spot to start accumulating again IMNSHO and I’ve grabbed a bit of exposure which I am splitting with…


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Cheers,

Time To Pay Attention (Again)

Most market participants suffer from chronic recency bias in that they weigh recent data or experience more than earlier data or experience. In particular retail traders more often than not expect more of the same, which actually is correct most of the time. Except for when it matters the most. Come again?

2015-08-31_spoos_briefing

If you have come here for a while then you have seen me use the word ‘inflection point’ on various occasions. I use that term rather deliberately as it succinctly expresses a moment in time in which an equilibrium between potential outcomes can be shifted rapidly by comparatively small movements in price. Say again?

Back in my wave wanking days this is a typical situation I would refer to as the 1-2 conundrum. Meaning – do we push higher and then fall into our graves, or do we drop from here and then ramp higher and continue the long term bullish trend of the past few years. The implication of that would be that down actually would be short term bearish but long term bullish – whilst a move up would set up the bulls for an even bigger correction.

Since then I have come to accept that these are all valid scenarios but that there is quite a bit of a gray zone in between. And without boring you to tears let’s just jump to the conclusion which is that there is a myriad of ways this one could play out. But that is exactly the part we need to focus on. What matters the most right now is what happens in the coming days, starting today! If we push higher on quite a bit of participation (you are a Zero sub, right?) then the bulls have a good thing going and may be able to defend continued attempts to draw the tape down.

Interest hike be damned – whether or not it comes in September or next year or in 2020 – I suggest you watch the tape as it will give you all the information you need. But let me be crystal clear about one thing. If you are a bull then this is most likely the most important moment of the year. On the other hand if you are a bear then this is most likely the most important moment of the year. And if you are neutral – like me – then…. well, I guess you got the point.

By the way, in case you are curious. I am still holding the remainder of my long positions as I have not seen the need to pull them (i.e. my trail has not been touched). I have however advanced it to near the bullish Maginot Line, which in my mind is near 1940. If that one goes then we probably correct quite a bit lower.

2015-08-31_gold_briefing

Gold is actually in a similar spot and I just took a small long position here with a stop below 1127. However it could easily resolve the other way and drop quite a bit lower. The price pattern allows for either scenario which often annoys traders. In my book however this is where the benefit to risk ratio is the largest – in that I can apply deterministic rules within a small price range whilst expecting increasingly larger price moves the further we advance from said price range (up or down).

The majority of people feel uncomfortable embracing uncertainty and perhaps a long time I was one of them. One day however I realized that this is where the real opportunities are and it is probably the one take away I am still thankful for having studied Elliot Wave Theory. However when it comes to predicting future price movements EWT is absolutely useless. There is simply no predicting future price movements – many people smarter than you have tried and all of them have failed. What you can predict however (sort of) is volatility – but that is a topic for another day 😉

Alright, quite a few setups waiting below the fold – 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.

In case you guys need a good tune to get you in the spirit of things:

Alright, if nothing else this is what I need you to take away from this post.  Pay attention now and bank coin all the way into December/January. I mean it.

Cheers,

Taking Profits

It’s pretty much a binary situation – either you pulled the trigger yesterday when the getting was good or you were debating the end of life as we know it over at ZeroEdge or some other perma-bear watering hole. There is a small crew here who over the years has worked hard to gain membership to the exclusive 1% club. To earn the privilege to walk among men (and women) who are able to print coin in any market environment. Many have tried and most have failed – and we rats would not have it any other way.

2015-08-27_zero_profits

Frankly I really don’t care what anyone else thinks. This was brilliantly timed and executed. If you missed the mark then you only have yourself to blame. Frankly I’m tired of the noise and will instead revel in my ill-gotten gains whilst laughing maniacally.

Anyway, I’m taking partial profits here and then I’m heading over to the local Kindergarten to hand out lollipops wrapped in stock trading tips.

The future is now – so don’t bring a knife to a raygun fight. If you are interested in becoming a Zero subscriber then don’t waste time and sign up here. A Zero subscription comes with full access to all Gold posts, so you actually get double the bang for your buck.

Cheers,




    Zero Indicator


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  3. recent misdeeds

    1. Inflection Point
    2. Time To Pay Attention (Again)
    3. Inside The Mind Of A Retail Rat
    4. Taking Profits
    5. Relive The Bounce
    6. Rammstein
    7. Sky Diving Elvis’
    8. Steadily – Consistently – Systematically
    9. The Tale Of The Big Bad Bear
    10. Long Term Support