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Japan Goes Sub Zero
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Japan Goes Sub Zero

by The MoleJanuary 29, 2016

I’m sure you’ve heard the news by now – in a surprise move the BOJ introduced negative interest rates, which caused for some interesting spikes across all JPY crosses. And I may I add that Kuroda was quoted by Reuters just a week ago that he had no plan to adopt negative rates now. Well, in his defense – he did explicitly say ‘now’ – by which he only could have meant ‘right now, this second’. Nobody asked him about the following week, did they?

Bank of Japan (BOJ) Governor Haruhiko Kuroda attends a news conference at the BOJ headquarters in Tokyo, Japan, December 18, 2015. REUTERS/Toru Hanai

Clearly this is a face you can trust.

2016-01-29_USDJPY

Unless you’re trading the Yen that is. Ouch – I hope none of you got caught on the wrong end of that candle. Interestingly the USD/JPY seems to have this magic barrier around the 115.7 mark. So next time we drop near there you know what to do (hint: don’t be long the Yen).

2016-01-29_spoos

The E-Mini is starting to get on my nerves which can only mean that we’re getting closer to a resolution here. The 1890 NLBL has expired at this point but that’s not necessarily a negative as we may be building a base here (more candles means more context). However at some point the bulls have to close the deal and push this puppy into third gear.

I’m not too worried about playing the long side unless I get an entry handed on a silver platter. And that would be somewhere around 1884.3 today – right near that 100-hour SMA.

2016-01-28_spoos_stop_out

Due to the whippy tape my mid-session scalp’s trailing stop managed to snag the session lows yesterday. Hey, at least it wasn’t for a lack of trying. Let’s see if I’ve got better luck today. Suffice to say that I’ll add a few extra ticks to my stop this time 😉

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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://gerb-reloaded.blogspot.com/ Blood_Leech

    obligatory clip!

    I design your eyes
    https://www.youtube.com/watch?v=nVlVTY-Pn9Q

  • http://evilspeculator.com Sir Mole III

    One of my top ten favorite movies of all time.

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

    I try to stay on your good side.
    😉

    TLT jumped. a move to safety IMHO.
    http://stockcharts.com/h-sc/ui?s=TLT&p=D&yr=0&mn=9&dy=0&id=p13623299637

  • Mark Shinnick

    Poignant stuff.

  • Round we go

    Excelent post mole. Love the iced japanese.

  • Time Bandit

    Holy Samurai Batman! Thank you Kuroda.

    Please believe me when I say that I’ve been on the shit end of the stick many times on these types of surprise decisions. But going long GBP/JPY at the close yesterday is just one step in helping to even things out. :)

  • http://evilspeculator.com Sir Mole III

    Better to be lucky than good 😉

  • BKXtoZERO

    got up to keep an eye on DUST position, added trailing stop, wake me when the market does something worthwhile. I will probably not be messing with gold or gold stocks short again. Central banks are getting desperate and although the trend has been down for metals and I tried to get fancy and go with a trend, I really don’t want to be short metals in a world like this.

  • BKXtoZERO

    works for me…..

  • OzarkHillBilly

    Back in what seems another lifetime, I loved to mix in parts of the soundtrack with a nice late night set. Been listening to it again lately.

  • BKXtoZERO

    you probaly had the post written but took extra time finding that picture for the post.

  • Round we go

    I kinda like just laying in bed and watching markets on the phone.

    Biotech bouncing.

  • Round we go

    Setup was good as it gets tho.

  • Round we go

    You stop out on qid?

  • BKXtoZERO

    dumped small tvix, lost .20, see if today is rally day?

  • CandleStickEmUpper

    Last day of the month to finish the tail of the monthly January candle on the charts

  • OzarkHillBilly

    The Bulls aren’t out of the woods yet. They need some Bears to throw in the towel here, IMO. But it “looks” promising at the moment.

  • kim

    tape looks extremely bullish today.

  • tradingmom

    spx montlhy

  • Time Bandit

    Sometimes luck can be favorable or unfavorable that’s for sure. My Lens told me to go long by Rule at a close above 170.53. If Kuroda had raised rates the outcome would have been totally different. That’s the business we’re in. Now we’ll see if this move is going to have any serious legs. :)

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

    +1 for the RSI reveal.

  • tradingmom

    spx weekly — one possibility

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

    a megaphone pattern?
    the price is under the 50 weekly! give it up sister.
    how about a down slope channel?
    😉

  • Time Bandit

    No but it’s getting close. I got into this trade very late and didn’t decide to get in until January 25th. I used an alternate form of stop from what I usually use and based my stop on QID at a close above the NDX High of January 25th which was 4268.11

  • Mark Shinnick

    Looks like few expect downside at the moment….interesting. Bot at 8.83

  • tradingmom

    I’m not saying that this is what I think will happen, but it is a possibility and it certainly would catch a lot of people off guard. We could easily revisit the lower trendline quite soon as well. :-)

  • tradingmom

    Hourly divergence?

  • Ronebadger

    Wait…..for…..it…..that kinda thing usually takes a while to pan out…probably not today…MAYBE, beginning of next week

  • tradingmom

    I agree. SPX 1922 would provide nice symmetry w/ the move from 1072 to 1902 and also take us to the apex of that triangle.

  • Time Bandit

    Well that’s half of it out of the way. :) The last time I said this, a kind of shit storm broke out but there are some things that I try very hard to stay away from. Gold is one of them. A short while back after many years of trying, I thought I had finally figured how to do it. Wrong. Yes, over a period of a year or so I could be profitable but the amount of NET profit would not be worth the aggravation of messing with it so I banned it again. Another one that I cannot trade for shit is most people’s favorite the EUR/USD. That fucker aggravates the shit out of me too so I don’t trade it anymore. Of course if I was day trading everything I just said would not apply because looking for a trend that lasts a few minutes or an hour or two is a lot different from looking for a trend that lasts a few days.

    OTOH, I know that I can trade Crude, Basic Materials, the GBP/JPY and possibly my recently added NDX successfully. I don’t have to trade everything (Believe me I’ve tried) and too many irons in the fire have a negative effect on my results . So find what you like, what you can feel, back test it and forward test it until you want to puke to make sure you have an edge doing the same thing over and over again. If you can do this there will very rarely ever be any surprises.

  • Time Bandit

    Discretion can be the better part of valor and I closed my GBP/JPY at +.25R after a reduction of 200 Pips off it’s high. I expected some selling off of the Spike but not like this. I might get back in later but turning a winning trade into a loser is not the way I want to end up the week.

  • ridingwaves

    pay the bank the store your money, let the market enjoy this saver wedgie, it will not last long…
    volume hole is still in play….

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

  • evilasevildoes

    nice chart

  • evilasevildoes

    yen lower hurts cl

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

    crouching tiger, just waiting for the JUMP.

    maybe Sunday evening is the time?

    [ES 6Hr]

  • tradingmom

    Chinese yuan peg set at 8:30 eastern Sun night…

  • ridingwaves

    CB action from last night is the only way over volume hole here, so you might be on to something… if oil starts leaking back to 20’s, kiss 1900 goodbye…1800 will come fast…

    looks like they will not need Sunday….pushing it over now…

  • Cui bono?

    What kind of stuff did you play? I’m a bit of an underground house and techno guy.

  • Time Bandit

    FBOW, back in Long GBP/JPY

  • Ronebadger

    just about there ~1921

  • http://gerb-reloaded.blogspot.com/ Blood_Leech
  • ridingwaves

    went short here….spx and qqq….
    this is playing out just like 2008… CBanker stick saves that don’t hold….

  • CandleStickEmUpper

    Short what?

  • Round we go

    What if we go to straight to 1940 instead :)

  • Darkthirty

    bull bus full?

  • Darkthirty

    AMEX/Nasdaq broke @ 10:22

  • Round we go

    Odd, more twitchy than the cold hand luke, that you usually are.

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

    on a MONTH END? Inconceivable!!
    *shocking!*
    😉

  • Round we go

    Didnt you get the trend letter.

  • Time Bandit

    This one is one my main horses. And I’m sticking with her through thick and thin. Just for the record, I don’t care what the general public thinks either. :)

  • http://gerb-reloaded.blogspot.com/ Blood_Leech
  • Darkthirty

    Stud service on those is so high, ya gotta use a stepladder

  • Time Bandit

    You’re right. Today’s price action messed with me a little. Once in a trade, I try to stick with it until I get stopped out. But I just didn’t like what I saw this morning and got out while I still had a profit. After price has appeared to stabllize, I got back in. It cost me about 40 Pips but in this particular case, I believe it was worth it.

  • Mark Shinnick

    Ok, so that got covered pretty qwik, but the objective for some 7 handle is now looking into the 6’s.

  • Time Bandit

    Man, you must have one hell of a library of clips and photos for every occasion. :)

  • Mark Shinnick

    Long slow climb…usually pretty stable, so wicked to short.

  • Ronebadger

    Actually…it’s so EVIL to short…

  • BKXtoZERO

    although I learned a lot here and changed a LOT, 1) bias is not completely gone with me. 2) I think I also got picked on for this but I simply looked at my performance on each vehicle I traded and said, ye know? I suck at these few and I do well on these few, so I am going to stick to these! Lately I was trying to broaden out and trying to play both sides to be a better balanced trader. I can see waking up one morning to gold 300$ higher but not the opposite. I am not in tune with gold for trading but favor upside longer term.

  • Mark Shinnick

    This sucker measures to beyond 1930…but if that’s a big inverse H&S neck line, this rally could get really intense.

  • ridingwaves

    yes…it was a 1/2 R small lot, so I can sleep comfortable on way up, I’ll short more on Monday or Tuesday if follow thru goes higher……the volume gap was filled by CB as expected but for some reason I had Draghi doing it….

    messed up on that one…

  • Time Bandit

    ” I suck at these few and I do well on these few, so I am going to stick to these! ”

    This is pretty much what I do so no argument there.

    The only thing I would question is the overall timing involved with shorting Gold. If we were at the levels when Gold was screaming and bouncing around the $2,000 level there was a lot of meat on the bone to short. Did I do it? No, because of a similar bias that Gold was a safe harbor yada, yada. But when the lustre began to come off Gold and dips were no longer being bought, that was the time to short it.

    Regarding seeing or thinking about something happening the next morning, I no longer do that and instead only rely on the prices and potential trends that I can see on my charts.

  • Mark Shinnick

    Consider a potential inverse H&S neckline beyond 1934.

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

    Have you thought about using MA’s of some type to stabilize the process?
    (Ken Long type stuff)

  • mugabe

    sold 1/3 of SSO long position for meagerprofit as RSI (14) daily getting near 50 on SPY.

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

    understandable. there’s another line I see.
    course, if this thing runs several days to the upside, you’ll kick yourself. 😉

  • Mark Shinnick

    Yeah…maybe just reduce the exposure to something more comfortable.

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

    Yes, Ultra Funds comfortable? an oxymoron.

  • mugabe

    I don’t think I will as I see this as pennies before possible steamroller. will set a fairly tight rein on 1/3 of remaiing position re limit order and will be generous(more ambitious) with the rest if we get there.

  • OzarkHillBilly

    I’d play anything if I liked it, but I ended up playing mostly breakbeats before eventually selling my turntables and getting on with life. It was a fun challenge to play for hours without a trainwreck, transitioning from some funky beats (lots of fun stuff from Florida in those days) to harder, techno oriented stuff, and then usually on to some trancey breakbeats to bring everything to a close. At the beginning I liked to sample some old Van Halen synthesizer sounds (like the first track on 1984 or maybe later on Cathedral from Diver Down) and late night throw in something from Blade Runner.

    These days I’m more chilled out but listening to those tunes brings back good memories.

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

    Have a plan, trade the plan
    Good Job.

  • Mark Shinnick

    :)

  • mugabe

    Yeah, and I think the plan needs to take into account context.

  • mugabe

    it’s fairly comfortable … R was 1% of account on original position and have upped the stop on remainder.

  • mugabe

    that’s interesting … I think I’m more rigid than you.

  • mugabe

    very tricky … v hard to know what would happen. wouldn’t call it a mistake.

  • mugabe

    it’s a bit of a lopsided megaphone:)

  • mugabe

    have a look at monthly MACD going back lots of years
    the monthly RSI is not encouraging either

  • mugabe

    all depends on your time frame:)

  • OzarkHillBilly

    Context is key!

    Coincidentally, I have some SSO calls that expire next week. They’ve potentially ground out a small profit for me today if I decide to close them here. I could hold over the weekend and see what happens, but if it goes against me then it’s almost a certainty that I’ll end up with a loss. Since I have other long oriented options that expire on the 19th, it seems prudent to let these go.

  • mugabe

    what about deliberately not trading an instrument you have a strong feeling about?

  • mugabe

    apart from chart considerations, you might want to decide how much portfolio exposure you want

  • Round we go

    short Stop run?

  • mugabe

    are you a replicant?

  • mugabe

    but he’s both!

  • mugabe

    is that when they dry their washing?

  • Mark Shinnick

    Just typical mini ramp&camps in long slow climb. We are not too far now from that neckline zone….getting interesting.

  • mugabe

    you absolutely must see The Lives of Others (German film) if you’ve never seen it. set in East Germany. brilliant.

  • OzarkHillBilly

    Very true. Lately mine has been multi-day to multi-week, taking up option positions in anticipation of reversals or sometimes continuations that will put me in the green within a day or two. So I’m certainly not counting on new highs, but I’d like to see a rally “proportionate” to the recent decline, and work off the oversold signals on the daily charts. Maybe by mid-February? Not that I’m counting on anything; I’ll roll with whatever happens.

  • mugabe

    I admit to having a bearish bias here (based on long term charts) so am skittish about longs that show profit … not saying that’s a good thing

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

    Ohne Dich

    check your ropes.

  • Mark Shinnick

    Yeah, I’m a bear on the hunt.

  • Time Bandit

    I’m going try to explore what I was feeling at the time I got out and why. After waking up to such a large gain, and then seeing so much of it peel off in such a fast way got to me this time. I’m not sure if what I did was the right thing to do or not. I think it was because I was expecting some kind of retracement but not as much.

    In any event, I’m back in the trade and will see what happens from here.

  • mugabe

    just taken my one yearly lottery ticket: SPY put expiring in June. dont usually turn out well:)

  • OzarkHillBilly

    I’m playing the game with embarrassingly small amounts of money compared to others here or even how I used to toss around money. I try to take into consideration what I would do if I had a $100k+ (real) account and apply that accordingly, while also taking into consideration that sometimes I’ll need to pile on or completely back off depending on what I’m seeing through my lens. I very, very much appreciate the helpful concern and comments from you, Mole, Scott, Bobby, and others.

  • OzarkHillBilly

    This whole week has been set-up to shake folks out of their positions. I’ll be reexaming my emotions and actions as well, probably with a beer in hand.

  • Cui bono?

    Nice, sounds like I would have enjoyed it. I ran in similar circles, and even booked some US mini-tours for european techno/house DJs for a bit. Hope you’ve found a way to keep music a part of your life as you’ve grown up :)

  • mugabe

    I think the yen move was particularly extreme … what do you do when you have have 2+ sigma event?
    equities has “just` been lots of churn.

  • Time Bandit

    For sure. The overall instability puts another edge on everything.

  • Time Bandit

    I guess over 500,000 Contracts per day is the new norm with Crude. There’s been exceptional volume lately.

  • BKXtoZERO

    trailing stop was hit this morning on DUST for +0.5R, not messing w/ this one any more. All cash awaiting (hopefully) a nice short set up

  • Billabong

    It will be interesting to see if Mr. Market will leave the 40 point ES move on the table going into the weekend. Within 11 points of 25 EMA…

  • Mark Shinnick

    Is there another volume hole to jump up through?

  • mugabe

    don’t think mr market cares about the 25 ema

  • OzarkHillBilly

    It’s certainly understandable, I’m definitely the same way right now. I’m trying not to get too far ahead of myself, and just deal with what’s in front of me. But it’s helpful to be aware of the past and mindful of the future …. otherwise we really wouldn’t be successful in the long run, IMO.

    I made big money from 2007 -2009, doing nothing but buying index puts (maybe Caterpillar and Apple as well) that were dated three months out. I hardly “traded” at all, except maybe in and out of some 2X ETF’s when the time seemed right. I simply rode out any upside corrections and rolled over any options they weren’t paying off. I even caught the bottom with calls …… I remember going home one day and thinking that soon I’d never have to work for a paycheck again. I then proceeded to blow all of it by betting against the market in 2010 and 2011, thinking I was some kind of trader, when really I was just some sort of options junkie.

  • Round we go

    Spx daily macd cross. And rsi looking to cross 50.

  • BKXtoZERO

    what do you take that to mean? Volume can confirm a move but I am not great reading tea leaves for volume. Could be capitulation short covering but is that indicative of real change in trend like institutional big player new longs or just some shorts covering in a final burst. I said 35 looked like a reasonable target so I am not surprised.

  • mugabe

    it’s quite hard for me to take a short-term long position in an index that I’m medium-term bearish on (for chart reasons)… the main reason being that I can take profits too quickly, even though I’m following a pre-determined rule.
    but as long as I have risk control and campaign management in place and follow it, nothing too bad can go wrong .. famous last words:)
    and I have to say that the position hasn’t caused me any angst.

  • mugabe

    lots of people think they know what’s going to happen

  • BKXtoZERO

    ?? I don’t care about “feelings”…. there is no love etc, just if you have a good bead on one and you often lose on another, why stick your finger back into an electrical socket over and over?

  • mugabe

    I mean all this macro stuff about central bankers and gold ie strong opinions (rather than feelings)

  • Time Bandit

    Thanks but I don’t think process stability is an issue here. Today’s price action on this pair was an anomaly and overall market instability also contributed to what I did. Fortunately, I was able to recover the trade at a relatively small cost. If I ever experience such a fast retracement of a very large gain in a trade that’s less than 24 Hours old again, I would probably do the same thing that I did today.

  • mugabe

    and?

  • Time Bandit

    I really don’t know what it means. It might be something as simple as big players in the Crude Pits having larger than normal battles going on between buyers and sellers.

  • http://greenlander1.blogspot.com/ Greenlander

    Ozark,
    If you want to go long you might want to try SPY instead. The liquidity/ spreads are not as favorable on SSO turning it into a more expensive trade.

  • Round we go

    4hr es looking good. but out of the bands. so it needs to keep pushing into monday. will see.

  • OzarkHillBilly

    This is not anything I’m banking on yet, but the March Fed meeting, or rather the market reaction to it, could be critical. If it looks like the market is setting up for a reversal there, then I might take a lottery shot at some longer dated contracts.

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

    Time Check
    ~Hour to go.

  • Darkthirty

    Hit the 382 retrace of the last wave. Could have been wave 4 in its entirety. Pretty zig zag

  • mugabe

    good point … on a very simplistic level, I think RSi (14) daily just below 50 is not a bad point to get positioned if the bear does start roaring .. if it doesn’t, then I’ll lose a bit less than 1% of account. it’s a lottery ticket.

  • http://greenlander1.blogspot.com/ Greenlander

    for options that is…

  • http://evilspeculator.com Sir Mole III

    Hey guys – hope everyone is having fun. I’m a bit exhausted and am going to call it a week. See you all on Monday morning!

  • http://evilspeculator.com Sir Mole III

    Zero snapshot for the leeches:

    .

  • Darkthirty

    short term last couple days showed MACD divergence

  • OzarkHillBilly

    This is actually something I try to take advantage of if it looks like
    the timing is right. For example, I picked up most of those SSO calls when the market was careening to a bottom last week and volatility spiked. I tried to find one of the most illiquid SSO strikes within reason and then put in a lowball bid, which was taken after a few minutes. It had really paid off by last Friday, even if I had taken the posted bid on it, but I decided to hang on and wait for more upside this week, which ended up being a mistake as the time premium eroded away. I also picked up TWM puts at about the same time, working with the same idea, but with a strike date and price that gives me more breathing room.

    Otherwise, I’m much more likely to work with SPY or IWM, as I did earlier this week. I’ve found that the tactic I outlined above usually works better with options that benefit with rising, rather than falling volatility. In either case, it’s not something I’m counting on consistently. But it helped pay the bills this month.

  • Darkthirty

    Gotta catch some of the EOD profit taking………………

  • Round we go

    Or vix selloff:)

  • Darkthirty

    Not sure if bots take profit

  • CandleStickEmUpper

    Have a great weekend. Zero rules my scalps this weeks. Banked.

  • ridingwaves

    why not close out strong thus making it harder to go into Monday bearish….I’m in red on bio trade and spx-qqq trade but not panicking…The vix has been holding above 20, has multiple support levels nearby…I might add a vix L play at end of day

  • Billabong

    Never dismiss someone’s lens … you never know (I’ll probably end up eating humble crow on this one).

  • Billabong

    Mark Schinnick (below) was asking about another ES volume hole … Any thoughts?

  • Billabong

    Crazy market … GC up, ZB up … markets up … everything is up (tongue in cheek).

  • Time Bandit

    Well that worked. I put in a conditional order to sell my QID when NDX hit 4268.12 and it sold off when it did. So that was good for a 1R Loss. All and all, between closed trades and what’s left in my account, I had a flat week. I suppose a Tie is better than a loss. :)

  • Round we go

    Your uco is workin. And your gbp/jpy is workin.

  • Darkthirty

    short 1930

  • Round we go

    Tna up 9%

  • Round we go

    They are trying to close at 1940

  • Darkthirty

    Been bit before!

  • Time Bandit

    Yep, so far so good on Crude. I’m also still holding on to my short Basic Material SMN with a stop at about +1R and perhaps the GBP/JPY might turn into another runner. But you never really know in this business. I suppose this is what makes the challenge and potential reward so rewarding.

  • OzarkHillBilly

    I’m sure there are lots of traders out there that wish they just had a flat week. For the record, I’m out of almost all my positions that I’ve mentioned to you. Still have a couple of longer dated options, but I’ll probably look at getting out of those if we get some follow-through on Monday morning. We’ll see what happens, but I anticipate making shorter term trades for the next couple of weeks.

  • Darkthirty

    SPX @1940?

  • ridingwaves

    it might hard to penetrate for bears now…will be real test for both bears and bulls if it gets there, they have all that new money and Chinese new years on the way, so why not run it to 1990-2K

    if bears are mean and hungry this year that lower blue volume hole would seem to be nice target…

    http://s2.postimg.org/nsvu1n2nt/Spx_long_term_close_of_day_pnf_1_29_16.png

  • Time Bandit

    Hey, I forgot to ask if you were feeling any better today? Last I knew you were laid up with pain in bed and in the need of scoring some medical weed.

  • Round we go

    Yup, on my phone spx live tape is easier for me to moniter cus tos on the phone sucks.

  • Time Bandit

    Also forgot to ask if you were feeling any better today Billabong? That was quite the operation you had.

  • Darkthirty

    Using ES for fun and games

  • Time Bandit

    That’s for sure Billy.

    I’m glad you’re able to work the volatility angle with options. Even though I had a decent working knowledge of the Greeks, I had difficulty wrapping my head around working implied vs. historical volatility etc. to my advantage when I did options. That takes a lot of skill and you appear to have it.

  • saltwaterdog

    Here’s an update to the EqC I provided last week when beers were on me apparently. 3 wins to start the week for a total of 6R and then a 13R drawdown commenced. Total of 24 campaigns this week, 5W and 19L for a net 7R loss. onto next week.

  • Time Bandit

    Well TGIF, it’s time for a weekend recharge. Catch up to Y’all later.

  • OzarkHillBilly

    Thank you; I’m still learning and I feel like I know just enough to be dangerous. The #1 thing I’ve been reminded of lately is not to overstay my welcome. The #2 thing I’ve been reminded of is that this is not how I want to keep trying to make money! But I do think some of the things I’ve learned with timing option trades will carry over well to futures and currencies later this year.

  • OzarkHillBilly

    The Zero contributed a great deal to keeping me in my long positions this week, especially on Thursday when I was doubting things. I’m learning on how to incorporated further into my decision making process. Thanks. I might have some questions next week about the signals.

  • OzarkHillBilly

    Everybody get some rest! Since we had a nice discussion this week regarding all of our various ailments, I know that I’m not the only one that needs it. I think January is just a precursor for what lies ahead this year.

  • Round we go

    Yah i can move a bit more but cant sit yet. i watch some deadly catch on youtube, today as i watch tape on my phone. So who are you, i would guess you would be andy.

  • Billabong

    Yes .. thank you for asking. Yesterday was rough and I was really bumbed out. Then today I passed a physical aptitude test and it was a ray of sunshine.

  • CandleStickEmUpper

    Weekly SPX candle ended on a high note with no top tail. That usually means more follow through next week on the upside. I will be playing the scalps accordingly. Have a good weekend all.

  • http://evilspeculator.com Sir Mole III

    Seems that your strategy does not thrive in intra-day volatile conditions.

  • http://evilspeculator.com Sir Mole III

    Flat week for me. Couldn’t get a decent entry in a woman’s prison with a fist full of pardons. Exception was natgas – she’s an cruel mistress but when she runs she runs..

  • http://evilspeculator.com Sir Mole III

    And that’s all you need sometimes, isn’t it? Just watch the tape crawl higher and stick with your plan. It’s strange – people subscribe and about 65% actually stay with it for years. It was the first service I offered here on Evil Speculator and I’ve enjoyed watching every single session ever since.

  • http://evilspeculator.com Sir Mole III

    WOW, that’s a huge horse.

  • mugabe

    sorry, wasn’t trying to diss your lens. I just mean that I don’t think buyers and sellers particularly care about the 25 day ma … which does not mean that price won’t turn around near there.

  • Round we go

    bots that dont profit will not exist for long.

  • http://evilspeculator.com Sir Mole III

    Basically two hammers – yep. My favorite scenario – so I’m jazzed :-)

  • mugabe

    Verizon- breaks out of 3 year base. Long. Will stop stop below stop of 3 months ago.

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

    3 year base, that’s something you can’t afford to fight.
    there’s also a 3 year trend line being crossed on the RSI highs.

  • mugabe

    I also like the look of MAT but it reports earnings after the bell on Monday.

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

    the toy maker?

  • mugabe

    that’s the one … also has a history of big earnings suprises …

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

    I’m not an analyst, maybe I should be.
    limited upside potential? 30 overhead.

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

    you know how it is going in before earnings..
    😉

  • mugabe

    Here’s how it’s done … hilarious:

    http://stockcats.com/narrative-generator/

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

    yep. Can’t believe they get paid for that crap.

  • mugabe

    I like it cos of the monthly MACD cross .. could be a major bottom but no way I’m buying it the day before earnings

  • Ronebadger

    TGIF – That’s what’s written on the inside of my shoes…Toes Go In First

  • http://www.ProfitFromPatterns.com/ Ivan K

    Saltwaterdog – I have found that a lot can be learned about the behaviour of a RBT by plotting the results of each component – in the case of multiple markets then an individual EqC and Distro for each … in the case of multiple events / triggers / setups then more charts. (I am of the belief that the results of any multi-market RBT are best seen as R per market .. as that makes for a level playing field when comparing different RBT’s.)

    Next step is to view those charts together with a chart of the actual market / s that are involved.

    If it turns out that the sub-optimal overall performance has been caused by one market and that market has had an abundance of sub 1R trend’ettes for example … then it can be a simple matter of comparing the number of the sub 1R trend’ettes during the period being examined to the DNA of the market.

    If there is no great difference between the two then the results from just one week (in this case) would be seen not to be outside the norm … and all is well … after then next 100 weeks the current movement down in the EqC will be just a blip.

  • mugabe

    btw, I by pure chance just read this post which has nothing to do with the stockmarket, but it is interesting to think about how much (or little) is applicable:

    On average, averages are stupid
    “Across our 100 locations, sales on average are up 3% last month.”
    This tells you exactly nothing.
    It turns out that ten of the outlets each saw their sales double,
    while most of the other ones are stagnating or even decreasing in sales.
    That’s the insight.
    Averages almost always hide insights instead of exposing them. If the
    problem is interesting enough to talk about, it’s interesting enough to
    show the true groupings and differences that the average is hiding.
    Here’s what’s worth discussing instead: What are the outliers? What
    do they have in common? Are there explainable trends, or is there merely
    noise?

    http://sethgodin.typepad.com/seths_blog/2016/01/on-average-averages-are-stupid.html

  • mugabe

    A primer on how to fail:
    Accept past correlations as a clean prediction of the future.
    Focus heavily on analytical ability, discounting common sense as too simple-minded.
    Always ask, “How can I achieve the same investment returns they did, but faster?”

    http://www.fool.com/investing/general/2016/01/28/failure-a-checklist.aspx

  • mugabe

    how much we know

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

    Look for patterns in complex adaptive systems, like the economy and stock market.

    OMG, I’m a failure.

    guess I should order my dart board now.
    😉

  • mugabe

    the problem ,as scott has said on many occasions, is that we imagine patterns that aren’t there, or are curve-fitted retroactively … this comment is not aimed at you, but at all of us:)

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

    you forgot.

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

    no, seriously. that is true.
    and in the past year(s) I’ve figured that out.

    I.e.: even if a pattern meets strict criteria, what is the probability of that pattern? without the stats. it’s wishful thinking and disappointment in the end.

  • mugabe

    and even with the stats …

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

    oh yeah, do we want to go down that rabbit hole?
    A true quant use to visit this forum (Volar), and when
    I learned that the Market is not an evenly distributed system.
    *Groan*

  • mugabe

    there was a lot of discussion about backtesting a few weeks back and that ‘past performance is no guarantee …

    Ivan has made the interesting, if cryptic, comment several times that the most robust systems are based on ‘human nature’ rather than clever data mining

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

    when is Ivan NOT cryptic? me thinks a bit too much island sun.
    but yes, Human nature is the commonality and exploitable.

    my personal weakness, I can’t play 9 out of 10 losers, even IF the 1 winner would pay off 10 or 100X. I don’t have the willpower to fail 90% even if statistically it would payout in the end.

  • mugabe

    Personally, I’m finding that taking fewer trades, more spaced out, and on a longer time frame, is easier to handle psychologically … and they’re less likely to be subject to the same market conditions (for good or ill) if they’re spaced out.

  • http://www.ProfitFromPatterns.com/ Ivan K

    Simply solution to that challenge from my side … potentially.

    Choose to view wins or non-wins as being made by your created and validated RBT … as opposed to personalising the outcome … you did not win / fail … the RBT did.

    You are merely the operator.

  • http://www.ProfitFromPatterns.com/ Ivan K

    Every one has a DNA that is the same and different to everyone else … it does take time … and an open mind … to discover the reality of one’s own DNA … once done, the road ahead becomes much clearer and cleaner.

  • mugabe

    Brett Steenbarger made the observation that the dominant emotion of most traders is not fear or greed but … frustration!

  • mugabe

    that’s absolutely true …and you’ve made that point many times

  • http://www.ProfitFromPatterns.com/ Ivan K

    Or perhaps ‘greed’ is … the ‘fear’ of missing out … should this be accurate, it changes the whole dynamic of market movements.

  • http://www.ProfitFromPatterns.com/ Ivan K

    to a moving sample

  • mugabe

    the famous detachment from outcome … but not so detached that you let the system destroy your account!

  • http://www.ProfitFromPatterns.com/ Ivan K

    From my side the only 2 unknown knows regarding risk-taking in any arena, especially in trading are:

    1) Based on life and stats … most of my decisions / RBT campaigns will result in other than a win … translation … strike rate will be less than 50% … I am either comfortable and or happy to accept that … or a dfferent RBT needs to be created … or expectations changed.

    2) Worst case result is a 50% loss at which stage the RBT has been deemed not worthwhile. This is based on 1% for R value … if that is too rich then assign .05% of the account to R … and then the worst outcome is a 25% draw.

    Once these two factors are internalised … ‘the famous detachment from outcome’ is much closer to being within reach.

  • http://www.ProfitFromPatterns.com/ Ivan K

    Final aspect of the YOUR DNA … Part III

    Capital – The amount of capital you are prepared to commit to trading will have a significant bearing on the actual market, or markets, you choose to, or practically can, get involved with. The size of your account may also play a role in the timeframe of approach that can be used. It is much easier to successfully short-term trade, or daytrade, a smaller account than it is a larger account. It should be noted that many futures markets have position size limitations as well, despite the fact that these do not negatively impact most traders (at least in the early stages of trading).

    Goal – The final aspect of your DNA is your goal or projected return from trading. This is a very challenging part as the future of any market or RBT is unknown in reality. Any backtest or back application will be, at best, a fascimilie of the future outcome … a guide if you will.

    Additionally your goal needs to be realistic as opposed to a pie in the sky figure … such as wanting a 10,000 % return in a year. Harnessing the Power of Compound can certain help create outlier returns. Compound growth requires a larger number of campaigns than simply striving for arithmetic growth.

    I am confident that you are beginning to see the value in some introspection before you embark on the adventure of trading … or at least in the very early stages of that part of your Journey. This can save you loads of angst, as well as potentially smoothing the road ahead.

    Next I will look at the DNA components of The Market, or markets, that you plan to get involved with and create a RBT for.

  • http://www.ProfitFromPatterns.com/ Ivan K

    A reminder of the previous points below.

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

    excellent idea, thanks!!

  • BKXtoZERO

    that was “one” of my earlier failings. Deploying capital too quickly and fully most of the time. These days the number of times I am 100% cash is probably 7 days out of 30 and my positions are smaller, in different things and spread out more over time. Correlation also killed the cat back then. Anyway, I agree!

  • BKXtoZERO

    congrats in sticking with it. My T+3 delay kind of burned up my buying power because I scalped long too many times (XIV) hoping to be up and hold some. Friday was a gift of a day but I was exhausted and out of bullets by the time it finally happened.

  • http://www.ProfitFromPatterns.com/ Ivan K

    Chaos Theory may have a clue as to Random or Not … Patterns or Not !

  • mugabe

    This an interesting and *long* paper which describes a longer-term strategy combining a 10 month moving averge and economic data on the US index. It’s a combination of momentum and fundmental readings applied to longer term index trading.
    http://www.philosophicaleconomics.com/2016/01/gtt/

  • Billabong

    That’s why for most of us a longer time frame is critical for pattern identification.

  • Billabong

    Yes … missing out. I just can’t wait for the next train to pull in the station.

  • Billabong

    Lots of good/sound thoughts, ideas, and wisdom in the comments below. I will have to come back and reread to digest a lot of it. I’ll add this story from the last week. We had an strong discussion on going long oil when it hit $27. My indicators were probably 80% on taking a long position. What with my physical recovery underway, I decided to pass on taking long positions in oil majors until a retest. The retest may never come, that’s ok. Having added patience to my approach has allowed me to miss one opportunity but still have the cash for the next one.

  • http://www.ProfitFromPatterns.com/ Ivan K

    All it takes is repetition repetition and more repetition … to hone ones skills … in anything.

    And desire also!

    Then all is possible !

  • Round we go

    keep it simple stupid :)

  • Round we go

    weekly volume compare, may signal possibility of a v recovery?

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

    so many lines,
    Fib lines, weekly pivot point lines, NLBL’s..
    hard to focus.
    😉

  • Darkthirty

    Don’t need books if’n ya caint reed

  • BKXtoZERO

    I never count anything out anymore and it has helped.

  • mugabe

    there is a lot of truth/wisdom in that. the reverse can be fatal. no scenario has a possibility of 0%. conversely, nothing *has to* happen.

  • http://evilspeculator.com Sir Mole III

    NEW POST!!!

  • OzarkHillBilly

    Patience is definitely a virtue. My good January would have been a spectacular January if I had not attempted to trade while traveling mid-month. Entered a position one day too soon, and that’s all it took to make a big difference. When I got back home and had access to my usual resources, I felt like slapping myself because it was so obvious.

  • OzarkHillBilly

    I tried to explain this concept to customers over a thousand times when I was a broker; hardly anyone listened.

  • OzarkHillBilly

    Trader, know thyself! Thanks for posting your wisdom over the weekend.

  • OzarkHillBilly

    Not that I would recommend jumping right into any crazy options without observation and/or experience, but one of the reasons I’m trading them now is because options settle T+1. It definitely helps when the market is whipsawing around.

  • http://greenlander1.blogspot.com/ Greenlander

    Yeh basically when you need to rush for the exits, it is tough to find a bid. That’s the biggest reason why I am not big on the levered ETF options. I have heard of guys selling spreads instead of going long to avoid having to close things out (assuming it goes in the right direction)