Now Reading
Happy Friday the 13th!
47

Happy Friday the 13th!

by The MoleJanuary 13, 2012

A very merry Friday the 13th to all my stainless steel rats. T’is the season to be evil! So let’s wet our beaks on the sweat of hapless retail piggies now being led to the slaughter.

Please be careful when wielding any sharp objects and don’t forget to wear your mask. Not that it really matters that much – if you leave no witnesses!

Truth be told I’m a bit banged up after dislocating my back at the gym last night. So the ole’ chainsaw will have wait in the woodshed as I scheduled an appointment at my gay sadistic Chinese chiropractor. So forgive me if I’m a rather brief today as I’m in in pretty bad pain when moving about and haven’t even found a moment for breakfast yet. But there’s a bit of panic in the market and the Mole owe’s you a post – let’s dig right in:

Well, my growing paranoia in the past days was validated this morning. The spoos dropped like a rock and bounced at the 100-hour SMA – thus far. I’m not entirely convinced this move is done yet and thus I have pointed out possible support clusters. Actually on this topic I have not much to add to yesterday’s update – if you are a sub please go and check it out for a refresher.

Since it’s an official evil lair holiday I’ll give this one away for free. The real chart to watch has been and remains to be the AUD/JPY. That upper 25-day BB plus those two daily buy Net-Lines thus far acted like a brick wall. The 79.71 NLSL is good until Monday and the one at 79.54 until Tuesday (roughly – the five session rule is entirely arbitrary).

So instead of the spoos I am watching the AUD/JPY when it comes to gauging the situation over in equities. That diagonal I painted is now starting to turn into resistance and unless we pop higher here in a jiffy we may just test 78 or 77.3 on the AUD/JPY. Also note the diagonal formation, which suggests that we are coiled up and that any ensuing move may be rather violent.

Bottom Line: Don’t forget that Monday is an NYSE holiday, so we’ve got a weekend plus a Monday session to bestow us with plenty of rumors, drama, and currency interventions out of Euro-trash land. So holding a boatload of positions over the next three days (either long or short) may be extremely bad for your health and doctor Mole suggests a rigorous diet of cash only and maybe a teaspoon of OTM options if you decide to live dangerously. I would not take any serious bets here though and I would also be very careful about calling bottoms (or tops on a medium term basis). IF you were short on Wednesday or Thursday then fine – holding them is maybe worth the risk as you have a bit of a buffer here. But please don’t chase this sucker to the downside or you may find yourself on the wrong end of my chainsaw.

Cheers,


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.
  • Anonymous

     But please don’t chase this sucker to the downside or you may find yourself on the wrong end of my chainsaw.
    YES! YES! everyone needs to read again and again. Oh update on the EUR/CHF. I went ahead and cut my position in half. Pretty excited actually the markets are testing the SNB.

  • Anonymous

    Agreed. I am not chasing the downside. Waiting patiently…

  • http://evilspeculator.com molecool

    I’m off – you’re in charge until I return.

  • Anonymous

    Sounds good.

  • Anonymous

    uh-oh

  • http://practicalt.blogspot.com/ Gold_Gerb

    Diet of Cash, yummy!

    obligatory graphic – [chinese chripracticy]
    http://images.wikia.com/cenobite/images/3/38/Pinhead2.jpg 

  • http://practicalt.blogspot.com/ Gold_Gerb

    dam! promoted to Capo.
    😉

  • nugie

    Truer words have never been spoken.  Thanks

  • Fibz

    what would really screw the market is if s&p said no downgrade, but some other shenanigans happened over the holiday.

  • Fibz

    what would really screw the market is if s&p said no downgrade, but some other shenanigans happened over the holiday.

  • Anonymous
  • http://iberianviews.blogspot.com/ catracho

    1.  The downgrades were expected and widely talked about a couple of weeks ago
    2. Convenient rumour on a Friday..nobody wants to bet big over weekend..flushes out weak longs and probably brings shorts in (especially SOH guys!..they are all gnashing at the short bit)
    3.  Holiday Monday in US amplifies above

    “engineered” fall in markets?   or am I just a cynic..:)

  • Fibz

    does seem engineered…

  • http://practicalt.blogspot.com/ Gold_Gerb

    I  don’t like today’s SPY W pattern.
    a) the lows are getting higher.
    b) the highs are ever so flat/tilted.
    c) the back-test on the fanline should have been a kiss of death, and wasn’t.

    the only bear scenario I can dream up, is the bulls are caught so flat-footed, they are buying everything up, so then they can short it.  and that sounds weak.

  • Anonymous

    With ya, if the bulls can take the SPX 50 EMA (1287), unless the kiss will be there.

  • http://practicalt.blogspot.com/ Gold_Gerb

    still need that BullishPercent confirmation/rollover.
    😉

  • Anonymous

    yeah that W pattern tells a story in the futures too,
    as most new longs and shorts have likely covered except ones since 1:42 higher low.
    also forming a triangle of some sort, from which will likely be a fakeout move

  • http://practicalt.blogspot.com/ Gold_Gerb

    SPY 128.84, FL kiss.

  • Fearless

    Bears f—ed it up on the second hourly candle (10 am to 11 am EST), it was kind of obvious.

    To officially establish a new short term bearish trend, bears needed:

    1) A large negative hourly candle to start it off;
    2) Follow up with another large negative hourly candle (failed, because the candle closed more than 50% off its low) with higher volume;
    3) Beat down any attempts of advancing the price above the high of the second candle (kind of did it, although they really sucked);
    4) Take out the prior low on the fourth hourly candle (f—ed up miserably).

    Bears may still get another chance though, just don’t know if it’s today or next week.

  • Fibz

    as of 3 hours ago EUR/USD ratio is still net long, but not significantly (1.16) w/ a daily change of -17% long, -26% short.

  • Anonymous

    Damn those bears!

  • Anonymous

    The poor EUR/AUD what a plunge it took today. It is on my radar again though for another long. Not yet though.

  • Anonymous

    O.K. trying a buy-write. FAZ 25c (next weeks) for a price of 23.30. Much closer to bid then ask, so I don’t think I will be filled…. will not move my order. If I do get filled I will be safe down to 23.30 and I have 1.70 worth of time. Should be able to get out 24+ no matter what happens Tuesday. Small profit but pretty safe.

    My only hope of getting filled is quick FAZ plunge with “hesitating” calls.

  • Anonymous

    like charlie brown and the football

  • Fibz

    wow… yea, no kidding. i was trading AUD/JPY today… hadn’t even looked at EUR/AUD. hasn’t broken yesterday’s low yet, but wouldn’t be surprised to see a gap up in SPX by tuesday.

  • Anonymous
  • http://practicalt.blogspot.com/ Gold_Gerb
  • Anonymous

    OMG! You made my day GG. Have an awesome weekend!

  • http://practicalt.blogspot.com/ Gold_Gerb

    *Market Closed*

  • Anonymous

    Wonder if she has tan lines?

  • Anonymous

    anyone love the spike at the close of the cash market?

  • Anonymous

    zero ignored it.

  • Anonymous

    Gold looks like it meanwhile reached the 50% retracement. I’m not sure this move is done yet, could very well go to 1679, 1697 or even 1705. A failed retest of yesterday’s high may, however, create a nice RTV sell setup

  • Anonymous

    stops are being raped in the after hours market…/es is about hit 1290.

  • Kudos

    Stops don’t get triggered when the market is in extended hours trading. If you had stops on the es futures market, that market has not closed. Thats why people chart both the ES and SPX

  • Anonymous

    Agree, it looks nice and proportional, and a RTV setup here would be a good one to take 🙂

  • Anonymous

    SPY settles at 4:15.  Stops on SPY can definitely be triggered during that settlement period.

  • Galazkiewicz

    Looks like two hammers painted in 7 days on the $SPX.  Not making a lot of progress, but they certainly are buying the dips.

  • Anonymous

    We have mixed evidence right here. 

    I suggest pulling up some bond charts to see the real clues 😉

  • http://evilspeculator.com molecool

    Did you read yesterday’s post? Bonds area our hot ticket – may be the trade of the year.

  • http://evilspeculator.com molecool

    That is complete horseshit.

  • Galazkiewicz

    I’m with ya.  We own about $1B in bonds around here, so follow ’em pretty closely.  Very confusing right now- not doing much other than put a small short eqty position on today.  That’s mainly b/c I’m backtesting set-ups, so don’t have a ruleset yet.  But, I’m not sure rules would provide much clarity right now. 🙂

  • Anonymous

    Nice call again Mole! Anyone hurting from the chainsaw better pay attention next time.

  • TwinTurboRX7

    zfx stopped at 10.xxAM? Is it possible to get an updated one by the close? and also update the daily Z. thanks mole.

  • volar

    NEW POST

  • http://evilspeculator.com molecool

    Sorry – I was at the doctor for much of the late morning and afternoon.

  • TwinTurboRX7

    Oops, sorry mole, should have read the post in detail, I skipped over to the charts and notes below that. Get well soon, I know how you feel, I had an elbow dislocated and shoulder sublocated, the later part still re-occuring…