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It’s Crowded At The Top
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It’s Crowded At The Top

by The MoleJanuary 16, 2013

Careful grasshopper! It may be lonely at the top of the entrepreneurial food chain, but it’s certainly getting a bit crowded at the top over in equities. Let’s review some of our usual suspects:

My most bullish chart right now – price (tough to argue with – so that’s why I’m putting it up). Still looking supportive and as long as this diagonal holds take anything below with consideration. There are cracks in the marble but thus far the edifice is holding up.

One of my salient ones today – UVOL vs. DVOL and quite obviously the latter outpaces the former by far. I hope I’m not looking at quirky TOS data so please check your own sources and report back here.

NYUD – definitely not supportive of new highs.

 

NYSE advancing vs. declining issues. The current trend on the signal is down while equities are tirelessly marching up.

Finally, our trusted Zero indicator is showing zero participation today (right hand panel) – completely flatline all day. Based on prior observation (four years + and counting) this does not mean we are about to turn as it may lead to a mighty blow off top.

Once again, I’m not going to argue with price BUT – as soon as the diagonal on the spoos gives way I’m ready to dip into some short positions. Until that happens I bite my time as usual and carefully craft my nefarious plans. We are evil speculators after all 😉

Update on cable – if you were a sub then you probably are short right now. The weekly triple breach (both SMAs and the NLSL) is very positive and let’s see if it holds until Friday at the bell.

EUR/USD – I was out of commission on Monday and missed to report on the touch of the 100-week SMA. But I want you all to be aware that this pair has hit a weekly resistance level. I would be short on a retest (a.k.a. last kiss goodbye) but of course would be equally happy about a break out in the coming weeks. Just not here in Spain at the ATM – I guess you can empathize…

Bonds – the 10-year did observe our diagonal resistance line thus far – despite a little fake out earlier in the session. I’d remain short here with a stop above. The diagonal is falling fast thus we should get resolution in a jiffy. I’d flip for a short if we close above.

We have quite a bit of activity on the commodities and FX side today – so please step into my lair for more setups:
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I’m long wheat with a stop below the 25-hour. Reason of course is the breach of the 25-day SMA (not the 25-hour but it’s better to manage the latter with the former). The big test is ahead of us however as the weekly NLBL is most likely going to put up some resistance. Clearing it would most likely result in a trend change. This is a speculative entry and you can wait for the weekly breach if you like.

Soybeans – looking pretty positive here on both the daily and weekly. I’m long with a stop below the 25-day SMA. Bear in mind that we had false breaches before so this may happen again. I will probably set a trailing stop and make sure I won’t get lured back below a falling SMA. I’ll be honest – it’s a speculative one and tough to manage right now. But worth a shot with small exposure.

ZB is following the 10-year it seems – thus far it’s own SMA is holding. I’m short as well with a stop above. Similarly we should get resolution here quickly – always appreciated.

Sugar is dropping into long term support again and I want to be long until the prior low of 18.31 has been taken out.

Natgas – breach of both SMAs and it’s holding – it’s also now above both weekly SMAs and that’s very positive.

Coffee – a breach of the 100-day would get me into a short position. But as soon as she breaches I would be long as we probably have a confirmed weekly NLBL breach. A bit tricky – I know – but I think it could turn into a runner.

Copper looking bearish – today’s drop through the 100-day would usually put me into a short position. But considering the weekly panel I would wait for a drop below the 25-week SMA.

Gold! SMA breaches on the hourly and daily panel. Positive and I’m now long with a stop below the 100-hour. Will swap that for a stop below the 25-hour if it holds up until Monday.

Dollar – I’m now switching to a long position as we retested both short term SMAs. But my stop is below the 25-hour while it provides support. A push above the 25-day would be positive. If we drop back below the ST SMAs I’m slipping back into my original shorts (with suspenders).

USD/CHF – great short setup here at the dropping 100-day SMA. Mind the weekly NLBL that’s looming right above and which I expect will offer additional resistance.

I have an inkling some lambs are being led to an early slaughter here. The tape will show its cards soon enough and we are accumulating sufficient context. Until then let’s keep it frosty and stick with the setups.

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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.
  • itslance

    Perfectly timed post as usual!

  • http://dartht.blogspot.com/ Darth_Gerb

    A midday post? Mole, you’ve out done yourself.
    😉

    *gag, too many charts*

  • http://evilspeculator.com molecool

    Frankly I was scrambling to get it done. Getting late over here.

  • http://evilspeculator.com molecool

    It’s a lot of work and I’m still feeling the burn from the trip. Looking forward to the long weekend – probably will just sleep and rest up.

  • captainboom

    Mole, did you notice someone in the last thread pointed out the hourly Zero appears to now be the daily Zero?  I like the daily, but I miss the hourly.

  • itslance

    Appreciate the effort!  Hope you feel better.  Tell Mrs. Evil, no more trips to frogland :)

  • http://dartht.blogspot.com/ Darth_Gerb

    oh that’s right Monday is a holiday.
    *let’s see who doesn’t read this, and shows up Monday*

    air travel kills me.  ear plugs & hydration – helps.

  • http://dartht.blogspot.com/ Darth_Gerb

    pssst.
    there’s a small pool on his next trip location. you want in?
    😉

  • Skynard

    Ending diagnal 5 min, no where else to go. SPX still failed so far. See what happens:)

  • http://dartht.blogspot.com/ Darth_Gerb

    Hmmmphf.
    AUD/JPY isn’t exactly fleeing to the downside.
    i’m so disappointed

    EDIT: thou I think the divergence is gaining.

  • AmazingLarry

    One thing I’ve learned in all my evilness is to respect the “volume hole.” Never heard of such a thing until ES. Such a great tool. Thanks for that Mole.

    That said, there’s a beauty that copper has been attracted to like a magnet for almost two years. How interesting that is winding up right on the damn thing! Stacking phat cash for the ultimate resolution. 

  • Joe_Jones

    Less than one handle away from the September high. LOL. Algos in overdrive. Be prepared for a 20 handles short squeeze if the high is breached. 

  • itslance

    Can someone that has good time and volume data look at 13:12 on LVS?  I show a volume spike of 559K traded with almost no price movement.  Looking for clues if it was accumulation or dumping of shares.

  • itslance

    Yeah, put me down for LA! :)  That’s where he went last time the market took a huge dump, right?

  • AmazingLarry

    I’ve had SPX 1492-95 as a fib fan and also TL target for a long time. I think you’re onto something. VIX to -57 lol. 

  • http://dartht.blogspot.com/ Darth_Gerb

    I believe so, but that’s his old haunt.
    and technically he spent 4 days & nights in the desert seeking divinity in the Cali Desert, or was that a SanDiego bar?

  • itslance

    Divinity?  Is that what he’s calling hefeweizen these days? 😉

  • Skynard

    Stick a fork in it!

  • Joe_Jones

    LOL. Won’t be surprised if we gap higher tomorrow. Anyway, some juicy short set-ups are looming ahead.

  • Skynard

    AAPL tagged the 50 exactly on the 60 min and retreated.

  • http://dartht.blogspot.com/ Darth_Gerb
  • http://ibergamot.blogspot.com/ i Bergamot

    Unusual.
    Very narrow range on Nazdaq A/D.
    Low -582; high -314. Negative all day long, thats no good.
    Over past 6 months I only find 2 days with this narrow range. One end of August, one beginnin of November. Both happened after a low vol sideways consolidation, both followed by explosive continuation of preceding trend.
    Just one more piece of the puzzle

  • Ronebadger

    Daily Zero at 8+ at end of year….is that some sort of aberration? or for real?

  • captainboom

    I don’t know if IB counts as good data, but I don’t see a total that large in that time area.  I do see a trade of 5491 at the ask of 52.10 at 13:09:57.  That’s the biggest trade in 5 minutes either side of 13:12 on my screen.

  • captainboom

    Is that two bullish hammers in a row that I’m seeing on ES daily?

  • itslance

    Thanks captainboom!

  • bdoone

    Good info but what date in Nov? SPX 1432 on Nov 2, and 10 days later 1360.

  • Skynard

    Market closed, now the dirty:)

  • http://evilspeculator.com molecool

    Get now why IB data can’t be relied upon?

  • http://evilspeculator.com molecool

    ear plugs – I’m religious about them.

  • http://evilspeculator.com molecool

    San Diego strip joint, it’s where I found enlightenment.

  • http://evilspeculator.com molecool

    ooops – let me fix…

  • http://ibergamot.blogspot.com/ i Bergamot

     Nov 6

  • badflightrisk

    This site helps watch the block trades

    http://finance.avafin.com/stock/lvs#tab5

  • Joe_Jones

    Thanks

  • itslance

    Awesome resource!  Thanks for sharing!

  • Skynard

    /ES possible hourly NLSL breach:)

  • itslance

    How do you get net lines and the Narrow Range indicators on your chart?

  • Skynard

    Here is the script, someone here had posted it.

    input method = {default CloseToClose, OpenToClose};
    input price = ohlc4;
    def upClose = if method == method.CloseToClose then price > price[1] else price > open;
    def downClose =  if method == method.CloseToClose then price < price[1] else price < open;
    input timeOut = 5;

    def netSellLine = if sum(upClose,3)[1] == 3 then low[3] else double.nan;
    rec nslCounter = if !isNan(netSellLine) then 1 else nslCounter[1]+1;
    rec netSellLineHistory = if (nslCounter==1 and !isNan(netSellLine[1])) then max(netSellLine, netSellLine[1]) else if nslCounter==1 then netSellLine else if nslCounter netSellLineHistory) then 0 else if low < netSellLineHistory then 1 else nslViolation[1];

    def netBuyLine = if sum(downClose,3)[1] == 3 then high[3] else double.nan;
    rec nblCounter = if !isNan(netBuyLine) then 1 else nblCounter[1]+1;
    rec netBuyLineHistory = if (nblCounter==1 and !isNan(netBuyLine[1])) then min(netBuyLine, netBuyLine[1]) else if nblCounter==1 then netBuyLine else if nblCounter<=timeOut then netBuyLineHistory[1] else double.nan;
    rec nblViolation = if (nblCounter==1 and high netBuyLineHistory then 1 else nblViolation[1];

    plot NSL = netSellLineHistory;
    NSL.setPaintingStrategy(paintingStrategy.HORIZONTAL);
    NSL.setDefaultColor(color.pink);
    NSL.setLineWeight(2);

    plot NBL = netBuyLineHistory;
    NBL.setPaintingStrategy(paintingStrategy.HORIZONTAL);
    NBL.setDefaultColor(color.lime);
    NBL.setLineWeight(2);

    plot nblBuy = if nblViolation==1 and nblViolation[1]==0 then NBL else double.nan;
    nblBuy.setPaintingStrategy(paintingStrategy.ARROW_UP);
    nblBuy.setDefaultColor(color.white);
    nblBuy.setLineWeight(3);

    plot nblSell = if nslViolation==1 and nslViolation[1]==0 then NSL else double.nan;
    nblSell.setPaintingStrategy(paintingStrategy.ARROW_DOWN);
    nblSell.setDefaultColor(color.white);
    nblSell.setLineWeight(3);

  • Skynard

     Are you referring to the moving averages?

  • Skynard

    Re posting, removed it by mistake:

    Have both scripts if you like, Let me know and will post them.

  • Darkthirty

    could you define nlsl please?

  • newbfxtrader
  • Skynard

    Have a look at the “CHEAT SHEET”

    http://evilspeculator.com/?page_id=24885

  • Skynard

    Give it some time Bro, it will catch up:)

  • Skynard

    AUDJPY only 100 pips off it’s high, data coming out. May be a good candidate now:)

  • http://dartht.blogspot.com/ Darth_Gerb

    candidate for what?
    you must put more words in your commentary.
    do it for the readers!
    😉

  • newbfxtrader

    Trade the news. Coming up in 5min.

  • Skynard

    Adding short, it’s at the 50 now.

  • newbfxtrader

    Yup looking good.

  • Skynard

    Possible IH&S on the daily /DX.

  • newbfxtrader

    Blasphemy! Someone let Bernanke know…

  • Th3_Acist

    Helicopter being gassed up on the runway…

  • Th3_Acist
  • http://dartht.blogspot.com/ Darth_Gerb
  • http://dartht.blogspot.com/ Darth_Gerb

    92.75 – much better
    maybe 92.33 will be hit this time

  • Darkthirty

    Thanks for the cheat sheet link

  • Curiousmind3861

    wow looks like the long AUD short Yen combo not working tonight for the bulls :) Haven’t seen so much downside action in AUD for a long time…AUD bulls had been almost invincible. Time for bears to growl??

  • Joe_Jones

    Some critical levels coming up: 92.48 on that pair and 79.95 on DX

  • newbfxtrader

    Spoken too soon! Look again…

  • Skynard

    Bet ya, allot of frustrated dollar bulls out there. /ES tested high again.

  • http://evilspeculator.com molecool

    Don’t be frustrated – we all know where they stomp on this thing. Use it.

  • http://iberianviews.blogspot.com/ catracho
  • http://evilspeculator.com molecool

    Oh crap – don’t say that!! 😉

  • Skynard

    Lol, he is scaring the children:)

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

    sorry ! But then BIG dollar rally..

  • http://evilspeculator.com molecool

    ¤ø„¸¸„ø¤º°¨¤ø„¸¸„ø¤º°¨ 
    ¨°º¤ø„¸F R E S H „ø¤º°¨ 
    ¸„ø¤º°¨ M E A T“°º¤ø„¸
    ¸„ø¤º°¨¤ø„¸¸„ø¤º°º¤ø„¸

  • itslance

    Yes please, I’d appreciate it!

  • Curiousmind3861

    I know, should have kept my mouth shut!! wake up to see usdjpy gained a 100 pips from overnight, crap!!