The Big Tease
And we’re back to scaring the children – today it’s the bulls’ turn to get chased around the woodshed a little bit.
However, the big tease has now navigated itself into price territory that allows us to draw fairly clear support/resistance lines. Which is great from a trading perspective – I’m sure Scott (who loves price patterns) is going to have a field day with this.
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 it includes access to all Gold posts, so you actually get double the bang for your buck.
At this point we can basically draw two Maginot lines separating the bulls from the bears. Bernanke’s panzer divisions have consolidated around the 1305 mark, which is near the support cluster that was painted early this week. Not so coincidentally that is also the 78.6% fib mark of the initial push down. We drop through that and you’ll see a boatload of stops being triggered – oh so tempting…
The grizzlies have dropped their paratroopers at 1330 which not so coincidentally is the 23.6% fib mark of the initial push down. If we push beyond that mark the odds will strongly support the notion of painting new highs.
As long as we bounce between 1330 and 1305 we remain in what I call 1/2-1/2-hell – the bears think it’s an a-b-c preceding a major drop and the bulls naturally think we’re at the onset of a third wave to the upside.
For us stainless steel rats it’s an opportunity to let the pundits and the top/bottom callers wear themselves out – once their ammunition has been depleted we swoop in and line up to fuck the prom queen. For me personally that means I will take contrarian positions as long as we keep bouncing inside the 1305/1330 cluster. If I get stopped out I will immediately take an inverse position as I am the trading equivalent of a back stabbing sell out who flips allegiances at the slightest change in wind direction. It’s the only way to survive nasty tape like this – which btw, is completely and utterly engineered. If you are a Zero sub you most likely know what I’m talking about. Those cattle prod donning market makers have had their fun this week – and they weren’t in the mood of taking prisoners.
Stop watching the news – keep watching the tape. Once you fade out all the noise there is order in our little universe.