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Keep It Frosty
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Keep It Frosty

by The MoleSeptember 2, 2011

My apologies in advance if this post is not rife with doomsday predictions and reports on the end of markets as we know it. Yes granted – the two bomb shells reported last night [1][2] were impeccably timed and were sure to introduce some volatility in the tape. I cannot help but congratulate the FHFA on ruining the Labor day vacation of quite a lot of fat cat banksters. When it comes to popping middle fingers this one casts a big shadow.

As for the ton of bricks that fell on the tape overnight: Well, these are things we simply cannot predict, so don’t beat yourself up on the trade you might have missed. Instead keep your cool and spend your energy on focusing on the trade that’s right in front of your nose:

That’s the mental state I need you guys to be in – but make sure you wear a thick sweater. Anyway, I’m seeing a nice breakout on the currency pair I have been pimping a few days back:
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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 or Geronimo subscriber it includes access to all Gold posts, so you actually get double the bang for your buck.
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That’s right the USD/JPY has been sticking with the script. Despite all the commotion earlier this morning it held S2 is now painting a NLB signal on the hourly. Right above is the 25-hour SMA and a breach of that would be confirmation that we at least push into 77.

On the daily it’s a similar picture but we really want to see a push and close above the 77 mark (also the 25-day SMA line) which would get us into T1 at 78 – T2 is at 79.5.

I’ll probably chime in later today, once that first shockwave has finished reverberating through the tape. If you are on the way out then let me wish you a wonderful and enjoyable Labor Day weekend.

Cheers,

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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://practicalt.blogspot.com/ Gold_Gerb

    that’s the frostiest picture i’ve ever seen.
    good thing I have fur.

    GLD, if it’s going to go ballistic, have at target.

    http://tinypic.com/r/3498fba/7

  • http://thefxspeculator.blogspot.com Onorio

    Small lotery short on EURCHF, top of the downtrend channel..tight stop

  • Anonymous

    ‘Gold’_Gerbil = access to ‘gold’ posts?

    If not, Mole, why not give GG a free week trial, seeing as the price of nutmeg oil and sawdust has gone through the roof :-)

    edit – reply to GG

  • Fearless

    Subscribe to ES and you can read my post regarding exponential moves 😉 I covered that subject in trend trading 101.

  • http://evilspeculator.com molecool

    Moles vs. Gerbils – no can’t do – it’s personal now. Gloves are off 😉

  • Anonymous

    No worries, was just trying to help out our rodent friend :-)

    edit – reply to Mole

    anyway, on to the tape, i have takne a small long position, let see

  • omelette

    hourly inside bar on /es about to complete.

  • Fearless

    Skynard, yes I am waiting for the pullback on AXP. There is a long term trendline that needs to be tested as support.

  • Anonymous

    fuck disqus.

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

    that’s what happens when the gloves come off.
    😉

    be afraid.

  • http://thefxspeculator.blogspot.com Onorio

    RBS has widen spreads in FX, some pairs are with 30 pips spreads right now, this is usual before news but i don`t understand why at this point…

  • Anonymous

    second that

  • Anonymous

    broken now to the downside

  • http://evilspeculator.com molecool

    One of my systems just died out of the blue – possible virus. So, ZeroFX is out of commission until I manage to fix this. Wish me luck.

  • Anonymous

    crossing fingers here.

  • Anonymous

    Pay for your porn mole!

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

    SPX 1178 – check the fib fan

  • Anonymous

    USD/JPY been long some time already. Like watching paint dry! Will close my trade when usd/jpy > 200! Waiting for Shirakawa to go nuts and crank up the printing presses.

  • http://evilspeculator.com molecool

    Okay, I got the system back. Will spend the rest of the afternoon on maintenance though so ZeroFX will be back on Tuesday.

  • http://evilspeculator.com molecool

    I do!!!

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

    (cheaper than the EX.  a joke days ago you pay one way or the other)

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

    Market needs about 20 more DOW pts down to rest/test on that multi-week pennant formation.

  • Anonymous

    I have a question about volume.

    Recent big sell offs with big Volume were attributed to dumb retail selling to the sharks because “The Children Were Scared”.   Today’s SPY action might be lucky to hit Average Daily Volume.  

    So not to be a smart ass here, but my question is who’s selling today?

  • Anonymous

    Those lines on the zero are working their magic

    :-)

  • Anonymous

    ok, probability please on chance of gap fill!
    they do say bigger gaps are less likely to be filled, at least not on the same ay

  • http://evilspeculator.com molecool

    VIX down only 7% = interesting.

  • Anonymous

    100% after QE 3 is announced.

    😉

  • Anonymous

    Where are the Marines when you need them?

  • Anonymous

    you mean up

  • Anonymous

    Gone on Labour day

  • Anonymous

    if everyone and their sh^rk are hoping for QE3, then may be it wont happen ?
    anyway, i live in hoping :-)

  • http://thebhbgroup.com TheBHBgroup

    good luck to us all!

  • http://thefxspeculator.blogspot.com Onorio

    If QE3 is about to happen why the fuck is USD rally? If QE1 dodn`t work, QE2 either, why will QE3 work?

  • http://evilspeculator.com molecool

    Yeah – fuck – sorry – that crash really threw me off a bit.

  • Anonymous

    theta discount before long weekend?

  • Anonymous

    I agree, but they may still go for it?

  • Anonymous

    It wont!  QE3 would be just another nail put in the coffin of the American Economy by the Banksters.

    The Dollar is probably rallying via a Short Squeeze. Long Bond is Up and Short Bond is Up.  Risk is off at least for today.

  • Anonymous

    With one brain fart allowance per week, TGIF!

    😉

  • Anonymous

    brain fart?!?!?

    Toes Go In First?!?!?

  • http://evilspeculator.com molecool

    Computer crash that is 😉

  • Anonymous

    thank God it’s Friday

  • Anonymous

    I have TGIF on the inside of my shoes

  • Anonymous

    I have TGIF on the inside of my shoes

  • Anonymous

    Do some research and understand how QE works.. you will be surprised.. There is no money printing, It’s simply an asset swap, fed swaps Treasuries(long term interest deposits) with short term depos, hence increasing deposits commercial banks hold with the Fed. Thi si process has nothing to do with money pulley that is not altered. Effectively they are altering the duration. Use depreciation in driven by the psychology.

    By the way does anybody know with what money Ecb is buying Italian and Spaish Bonds?? Shouldn’t this affect Euro?

  • Anonymous

    Do some research and understand how QE works.. you will be surprised.. There is no money printing, It’s simply an asset swap, fed swaps Treasuries(long term interest deposits) with short term depos, hence increasing deposits commercial banks hold with the Fed. Thi si process has nothing to do with money pulley that is not altered. Effectively they are altering the duration. Use depreciation in driven by the psychology.

    By the way does anybody know with what money Ecb is buying Italian and Spaish Bonds?? Shouldn’t this affect Euro?

  • volar

    must be. Normally the VIX is like 99% correlated to stocks in SEP. 

  • Anonymous

    ‘do some research’ – now that seems like work to me :-)
    Although there is no money printing, its still all a bit ‘dodgy’, aint it?

  • Anonymous

    MOLE – is that breach good enough?

    ZL seems stuck at my end

  • http://evilspeculator.com molecool

    ¤ø„¸¸„ø¤º°¨¤ø„¸¸„ø¤º°¨ 
    ¨°º¤ø„¸  N E W  „ø¤º°¨ 
    ¸„ø¤º°¨ P O S T “°º¤ø„¸
    ¸„ø¤º°¨¤ø„¸¸„ø¤º°º¤ø„¸

  • Anonymous

    Mole, thanks for the comment and lines you drew on zero. It made my coins for the day.

  • http://evilspeculator.com molecool

    You are really kicking ass lately – congrats!

  • http://evilspeculator.com molecool

    Now don’t get cocky, little Mister! 😉

  • http://evilspeculator.com molecool

    It’s a good start but we are running out of time – at this point we want to see acceleration until the futures close at 4:15pm EDT.

  • http://evilspeculator.com molecool

    Daily Zero is back! Only for a few minutes – but hey, I do what I can…

  • Anonymous

    Couldn’t do it without ES.

    I don’t miss my old day job for anything.

    Cold beer time now. Have a great Labour Day.

  • Ride30b430

    I do respect what you are saying.  A federal reserve note, dollar, has a duration of zero. 
     
    This is why I believe it IS printing money.  The Treasury issues debt, the primary dealers (bid on) buy it and then flip it to the Fed.  So, in all reality the Fed is the buyer of Treasury debt.  The Fed has to create money to buy the treasury debt (Print).  Now if they simply allowed the debt to mature it would reserve the purchase, but they are re-investing the interest and principal (QE lite).  The dramatic rise in M1 is my proof.  You are also correct that the banks are holing the new money on reserve with the Fed earning interest. 
     
    Logically, one would think that the end of QE would cause a bump up in rates as the Fed is no longer buying as much (they are still re-investing), but the opposite happens each time it ends.  For me that is one more reason to believe we are living in the twilight zone.

    Insomnia is a bitch,

    Ride30B430

  • Ride30b430

    I do respect what you are saying.  A federal reserve note, dollar, has a duration of zero. 
     
    This is why I believe it IS printing money.  The Treasury issues debt, the primary dealers (bid on) buy it and then flip it to the Fed.  So, in all reality the Fed is the buyer of Treasury debt.  The Fed has to create money to buy the treasury debt (Print).  Now if they simply allowed the debt to mature it would reserve the purchase, but they are re-investing the interest and principal (QE lite).  The dramatic rise in M1 is my proof.  You are also correct that the banks are holing the new money on reserve with the Fed earning interest. 
     
    Logically, one would think that the end of QE would cause a bump up in rates as the Fed is no longer buying as much (they are still re-investing), but the opposite happens each time it ends.  For me that is one more reason to believe we are living in the twilight zone.

    Insomnia is a bitch,

    Ride30B430

  • Ride30b430

    I believe with the money pledged by EU countries last year, Bailout package one.  The funny part is Spain and Italy pledged some of that money…..
     
    Two thoughts on why the Euro is strong. 
    1.  Banks are scrabbling for liquidly and hording Euros.  Just like when the dollar ripped late 08/09′. 
    2.  The PIIGS are going to get kicked out of the EU and the remain countries will    have very string currencies.  (This may    be a little far fetched, but a thought)
     
    When Greece defaults we will conclusively know why.

    Where do you ski/ride?  My home Mt. is Alpine Meadows, Tahoe.
     
    Ride30b430