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Decent Exposure
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Decent Exposure

by The MoleApril 19, 2017

I leave it up to you to decide whether its due to sheer luck or perhaps skill but we actually seem to be accumulating pretty decent exposure and there’s more waiting in the bullpen (see below). It has always been my opinion that the true skill of a trader reveals itself not by what he/she does during the easy times but by how he/she operates during those nerve wrecking periods when things tend to get messy. And to be clear – this doesn’t necessarily mean a necessity to take action or to attempt to ‘beat the market’ at its own game – which obviously none of us will ever be able to do.

2017-04-19_spoos_update

Yes equities are still meandering all over the place but the recent price action suggests that we did pick a pretty good spot for grabbing some long exposure. Now we are far from being out of the woods on this one but I do enjoy seeing a new spike low which formed overnight. I’m moving my stop at about 0.5R now as another drop toward our entry zone will most likely lead us much lower. This puppy has to get out of the gate now and that fast.

More Tape Reading

Someone asked me yesterday as to the exact definition of a spike low. Well in theory it’s a candle that is flanked by two candles with a higher low. A major SL of course is one that at the same time represents a recent price extreme – I personally use a 10 candle window to identify a major SL. Of course there is also always the advantage of additional context – for example a spike low breaching through a Net-Line Sell Level (and recovering). Or perhaps a SL dropping through terminating near a lower Bollinger you find valuable – you get the idea.

2017-04-19_silver_entry

So given that I think you will agree that the current major spike low on silver is a pretty damn good one. What has followed since then is the retest that I usually wait for. I wait for one more (non major) spike low and then enter with a stop below the major SL. And voilá – that’s my setup for silver.

2017-04-19_EURUSD_update

Good and bad news on the EUR front. The bad news is that my favorable exchange is being taken to the woodshed. The good news is that I (and hopefully you) was long since about 1.0625. I’m moving my trail at about -0.5R MFE now which may surprise you. Well, my reasoning is this – either the EUR keeps burning the shorts now or it will most likely correct back a bit deeper. If it does I can always find another entry. Oh by the way, did I mention I’ll have to raise the subscriber fees now?

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About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.
  • http://evilspeculator.com Sir Mole III

    Hey guys – you may find this link to the popular category useful.

  • http://www.captainboom.com/ captainboom

    Lol. That opening picture is great. Nice find.

  • Mark Shinnick

    Yeah, good idea there… a rich classic to suit circumstances.

  • HD

    SPX gaps up, opens HWB the recent hit from 78.36-29.13, sellers. Typical whipsaw Wednesday OPEX action

  • OJuice

    Thanks for the post. The devil is in the details with respect to excellence in futures trading in challenging times.

    Took a position in /ES yesterday COB on account of the mounting evidence. Been watching oil, but it scares me. P&F chart has a target of $41 on $WTIC.

  • Trouzzer_Snake

    SI just tried to shake out some weak hands… Stopped on a dime and reversed before the SL. Definitely not for the faint of heart!

  • HD

    JMHO, there was some symmetry in GC, gold. 1200-1260 and 1240-1300, exhaustion gap up Sunday night trapped a few late bulls. Looking at fibs going back.

  • Mark Shinnick

    That looks like a challenging position; not exactly a sprightly bounce. Next hour or two is usually the tell.

  • Mark Shinnick

    Ok, what do you see as a logical downside objective?

  • Yoda

    SPX needs to overcome the 25 and 50 daily sma, which appear to act as resistance for now

    https://uploads.disquscdn.com/images/fd7563835ceee42488efb448a219913fa23b6e80a874f643aca54e840f1d1303.png

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    ..there’s a descending trend line on your slope indicator highs for the past few months.

  • Mark Shinnick

    We’ve hit some volatility support here…so this could delay the usual if that ends up happening yet again.

  • HD

    Hi Mark, excuse some wave wanking but it has a 3 wave ABC back look already at .382. Buyers already in at that price. Chart attached. https://uploads.disquscdn.com/images/1a7a88be0369617c63c79df642adfc11a935c8d5a4459f15f18048b5308f3ba7.png

  • Mark Shinnick

    Yeah, the wave stuff makes no sense to me but the fibs can’t ever be dismissed quite so easily.

  • Mark Shinnick

    So far a rather typical dead cat bounce for volatility. This typically leads into some upside equity drama beyond the most recent narrowed range.

  • HD

    Check out CL, oil. They gave another chance to sell >53.

  • Mark Shinnick

    Bot some miners

  • Trouzzer_Snake

    Someone want to explain /SI rollover to me? I looked at the June contract before I bought and it had no volume. But I just got a note from my broker saying I need to roll over by 2p CT or I get liquidated. If June is the front running contract why is there no vol?

  • http://evilspeculator.com Sir Mole III

    How’s my crew?

  • http://evilspeculator.com Sir Mole III

    Okay, here’s some homework for you – find out how much volume silver gets in comparison with the S&P E-Mini futures. (hint, it’s actually not a big contract)

    Here are the 10 most liquid ones:

    https://uploads.disquscdn.com/images/30a143976e92b7c18070c15c197bd273843eee5b760ef1019d8c51d3e024f59c.png

  • Mark Shinnick

    I’m fucking with everyone else in the market …except for your team.

  • Trouzzer_Snake

    I’m not talking relative vol to ES… the June SI had a few hundred contracts traded daily vs. 40K+ on the May contract.

  • Ronebadger

    Present…watching and waiting

  • Mark Shinnick

    When I did mainly futures, all I did was observe which contract happened to be quickly accumulating volume. On a day like today, that wouldn’t happen quite until the most local move had been completed, when traders then bail.

  • Trouzzer_Snake

    OK, just re-read the email… Looks like there is some time still on the May contract. 4/26 is rollover date.

  • Trouzzer_Snake

    Took the /SI short…

  • ridingwaves

    L EW 96 S todays low

  • StockTalker

    If we get a spike off of /ES2340 support will flip to long side.

  • Mark Shinnick

    Gosh… why do that now?

  • StockTalker

    Signal not looking very bullish ATM

  • HD

    That’s 10 HanDles down from the HWB open. Sellers. Not saying it’s over but I am. Have a great day all. Thx for the welcome.

  • Mark Shinnick

    I guess you’re figuring on a failed retest.

  • http://evilspeculator.com Sir Mole III

    Ha – that would be an understatement 😉

  • http://evilspeculator.com Sir Mole III

    Yup they just send it out early I guess.

  • ridingwaves

    someone really likes RMTI over the last 3 days….

  • http://evilspeculator.com Sir Mole III

    Whatever gets your asses over here!

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    dumped GDX. 5 days wiped out by 1. !@#$

    it was like putting down old’Yeller.
    rules are rules.

  • Mark Shinnick

    This is a very telling support right here at the end of measured move down.

  • http://evilspeculator.com Sir Mole III

    stuck by the rules – well done.

  • ridingwaves

    hard to play with OPEX next week on metals also.
    looks like reflation trade is getting taken to woodshed today

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    true. But will support hold? that’s something I can’t afford. A surprise overnight move continued downward.

    The trick for me is, I can *always* get back in. But my rules will tell me when, and how much.
    -GG

  • Mark Shinnick

    Yes, not sure I believe the reflation thing just yet.

  • Mark Shinnick

    That’s key; to execute per plan.

  • ridingwaves

    by the looks of today, so do many others

  • Mark Shinnick

    Well, volatility has just kept creeping up from its earlier support should be running into some resistance around here…otherwise….:/

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    USO,

    W. T. F…

  • Ronebadger
  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    maybe he’ll hang himself.
    what a nut job.

  • Yoda

    Good riddance

  • StockTalker

    Hourly trend line, see if it holds.

  • Ronebadger

    Apparently, everyone has a dark side…unfortunate…

  • Mark Shinnick

    Yeah, we are all too scared to confront something.

  • ridingwaves

    bears must feel like Russell Crowe in Gladiator trying to get back to his wife and kid by dying.
    “jeez, how many men do I need to kill before seeing them”

  • BobbyLow

    I’m in the same boat with NUGT but my stop is still hanging on by a thread. My profit on this trade has “gone the way of the Buffalo”. :)

  • Mark Shinnick

    Well said.

  • ridingwaves

    did Commodus just stab Maximus…will bears rejoice…

  • OJuice

    Hilarious. I’d give you two up votes if I could.

    Dip buyers might feel the same way too…

  • StockTalker

    Hum, Lost hourly support, 2300 test

  • Yoda

    If we close below ES 2330, a bearish engulfing daily candle we will get.

  • ridingwaves

    fed is talking down market, new trend

  • Mark Shinnick

    There’s that volatility just hanging in there, Mole. Its got to re-prove itself but not just rolling over.

  • OJuice

    Something specific today was said? I’ve been preoccupied and assumed /CL was being a drag.

  • kim

    😉

  • http://evilspeculator.com Sir Mole III

    They’re teasing it out to the max. Don’t let it get to you… there are other contracts 😉

  • http://evilspeculator.com Sir Mole III
  • http://evilspeculator.com Sir Mole III

    One of my favorite movies – the final scene always tears me up:

    https://www.youtube.com/watch?v=CA_N_QVxbKg

  • Mark Shinnick

    How do I put this… try not to think of the 3x’s as a trend following tool, but a breakout one most suitable for only 1 to 3 day new local trend moves at a time. Think about using them at first for only that purpose, but then abandoning in favor of the 1x for positioning with any more major trend.

  • OJuice

    Fuck yeah. That is an amazing scene.

  • http://evilspeculator.com Sir Mole III

    “I will have my vengeance – in this life or the next.”

  • http://evilspeculator.com Sir Mole III

    Well, it’s been a rough day but it’s one more day toward a final resolution. Every shit period ends at some point 😉

  • OJuice

    Hard to keep the eyes dry for that one for sure. I had forgot how damn great this movie was.

  • BobbyLow

    Thanks but I’ve done it both ways Mark. I adjust my position sizes for the 3X so what happened today although not fun was also not surprising. I use a multiple of Average True Range (ATR) to calculate the amount of my Risk which then determines my position size. My future stops are also determined by ATR so as the position moves in my favor so do my stops.

    I had been using this system on the hourly and although it was profitable, I got tired of getting jerked around and going in and out of multiple trades between Long and Short so I went back to using my Daily and adjusted my ATR.

    Now what might be hard to believe is that I “can” get a longer term trend trading NUGT and DUST but because these things are so volatile, I use a wide ATR/Stop otherwise it will not work. There will be days like today but a real trend in NUGT or DUST can develop like the apx 6 week run in NUGT during January and February for +30% return on one trade. This is where the 3X leverage can pay off and make up for all the fits and starts that doesn’t work.

    I’ve traded GDX and don’t like it because I can get the same results trading NUGT/DUST using 1/3 the Capital.

    But I guess everything still depends on what is the best fit for individual personality, and time frame.

  • HD

    I might need to change my avatar. This site is good luck. I know Sir Mole called it “wave wanking” but when elliot wave works it really works. That’s about max for what anyone can expect from an EW call though. The count only works till it doesn’t. CL pays the best IMO. https://uploads.disquscdn.com/images/fc851183a119cb29312206510016b1fa436c57cf7557e206c408c8a81bca3360.png

  • Scott Phillips

    Herein lies the problem with the bullshit that is wave theory.

    We have a bug in our brain wiring where we remember the times it works, and conveniently forget the times it doesn’t.

    NOBODY doing wave counting actually keeps records of how often they are right or wrong. Viewed properly this is the worst kind of intellectual dishonesty.

    Disgraceful really. Positive claims require positive proof. Wave theorists claim to be able to predict the future, but never check whether that is in fact true.

    Have YOU ever checked how often it works? Or just falling back on the “I know a guy who knew a guy who made millions from it”, or the ever popular “Sure Prechter is a loser, but you should check out this Pug guy who’s nailed it forever” (I checked his record he’s nearly as retarded). Or maybe you trot out the video where Paul Tudor Jones talks about wave theory (notice he doesn’t do that anymore and is embarrassed about it)

  • BKXtoZERO

    Howdy Scott you madman. You must have a file by now that you cut and paste from LOL.

  • Scott Phillips

    Thats a great idea! Fucking stupid theory just won’t die

  • http://evilspeculator.com Sir Mole III

    @HD – this one is for you, old post but still very applicable. Note that we used to be counting waves ourselves back in the days. Fortunately we got cured and moved on to REAL technical trading (which is why we are still around today):

    http://evilspeculator.com/building-your-trading-system-a-practical-guide/

  • http://evilspeculator.com Sir Mole III

    I actually posted one of your old articles for him which may (or may not) wake him up. It’s up to him 😉

  • http://evilspeculator.com Sir Mole III

    LOL – the wave wanker intervention file :-)

  • HD

    Sounds like a sore subject? I get it. Your comments are spot on too. Most wave wankers want to trade the book, rules etc. If you watch the market I’m sure you have seen 3 wave moves and 5 wave moves, triangles, flats etc. I simply use those elliot wave patterns in my “technical model.” I feel that adds a layer of probability the trade will go as anticipated. Nothing works 100% of the time. Price, pattern and time. Hopefully you guys will see it’s just a half ass EW count and 80% technical set up. Selling CL >$53 that last few days really has very little to do w EW and much more to do w price and resistance.

  • http://evilspeculator.com Sir Mole III
  • http://evilspeculator.com Sir Mole III

    Of course it’s not personal – we are just trying to make you aware of the possibility that you are fooling yourself. Sunk cost effect is a strong cognitive bias. I however challenge you to statistically correlate your ‘calls/counts’ with your actual entries and if you can PROVE to us that your counts have a strong edge then we are happy to eat humble pie and help you perfect your methods.

  • Mark Shinnick

    Yes, our methods will certainly tend to reflect the best fit for each of our individual personality, makes perfect sense.

  • HD

    stats “60% of the time it works everytime” The counts don’t mean as much as the trade. If the count is wrong and the trade works I am ok with that. I also don’t want to monopolize the chat. I’m here to see your guys set ups too. I have 3 counts up GC, CL and SPX. The CL worked, The GC was looking for fibs going back (in progress?) and SPX, needs more data. We can use those as a starting point. Thx for all the ideas.

  • Mark Shinnick

    Could we characterize wave as being a sort of time filter?