Limbo Territory

I suggest extreme caution – we are seeing toppy looking tape but since we are still dealing with conflicting evidence this may be nothing but a sideways correction. The main problem is a lack of context – our daily NLSL on the E-Mini is about to expire and most likely we’re looking at a failed VIX buy signal today.

The recent gyrations can be easily interpreted in favor of a bullish or bearish outlook. When faced with lack of information/intelligence it’s human nature to resort to guesswork or gut feelings during such times and you know where that usually leads. For more meat on the subject I strongly recommend you catch up on my post on market weather, you haven’t already.

It is my not so humble opinion that we are currently in a limbo period within a still up-trending higher degree advance. Until we collect more bearish evidence I suggest you simply stay out of equities and keep yourself entertained with minimal pertinent exposure.

Our volume profile map shows us that there’s no ‘there’ there – a complete lack of context. As we are heading up we are gaining more volume but we are in pretty uncharted territory and that is often exploited by large market participants. It’s not unusual to see the tape run higher on fumes playing on the frustrations of over-eager hobby bears.

A little glimmer of hope on the horizon as we are most likely going to paint an inside day on the spoos today. A breach of either side may be worth a small position but I would play it cautiously until we see more context. In the past seven sessions we have effectively gone nowhere fast.

The Dollar is showing strength but is running into resistance right where it counts – and by that I mean that diagonal resistance line that’s now lining up with the 100-day SMA as well as a daily NLBL. There’s also the 25-week SMA above and that has been a wall for months now. I would remain short ole’ bucky until we see a breach of the 80 mark. Yeah, maybe if pigs learn to fly.

BIDU – quite a sell off yesterday and it’s being followed by an inside day. I think I’ll grab a few positions tomorrow if we get a clean breach during the session.

Not much else on my plate today – see you all tomorrow morning bright eyed and busy tailed.

It’s not too late – learn how to consistently bank coin without news, drama, and all the misinformation. If you are interested in becoming a subscriber then don’t waste time and sign up here. The Zero indicator service also offers access to all Gold posts, so you actually get double the bang for your buck.

Cheers,

This entry was posted on Wednesday, February 6th, 2013 at 1:58 pm. Both comments and pings are currently closed.

  • Joe_Jones

    I long for the day when pigs learn to fly ;-)

  • RacerXX

    tape def seems “frothy”

  • badflightrisk

    I see quite a few high flying pigs right now  : )

  • Rightside_ot_trade

    Snort snort snort

  • AmazingLarry

    ZNGA to target. Took half, reloaded. 

    /PL trying to break. Trade the news, you’ll get rich! ;)

  • bdoone

    VIX neg

  • bullregard

    I see a touchdown… Umpire?!

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

    Limbo period, and this is why (I) keep coming back.
    The man tells is like it is, no lipstick. Period.

  • BobbyLow

    It’s here!   Plus Pigs have been flying this market for a long time.   :)

    http://www.youtube.com/watch?v=o-r4Z1K_LDc

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

    clean your books.  here comes the Teacher.

    a little shoutout to Gold shorts.

    http://s4.postimage.org/p3w3db7lp/shoutout.png
    -Gerb

  • Joe_Jones

    Damn! We have Step 3. 

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

    okay, one more chart.
    and then I really got to go, otherwise Mole will have to W-2 me.

    AUD/JPY chart with the log enabled
    http://s7.postimage.org/un7vl7c8b/pig.png

    -Gerb

  • Joe_Jones

    funny how SPX, Russell and INDU were bid in a stair step fashion from 1.30 pm EST whereas NDX remained low, bucky stayed flat and bonds remained high. Algos and their masters win again, and again, and again…. 
    Divergences will have to close. Now who is right?

  • AmazingLarry

    Gerb – how do you do analysis on those leveraged ETF’s with the decay? Better yet, why? 

  • bdoone

    Pilfered from 2 business publications:

    Last week somebody put on a call spread on the VIX using the April 20 and 25 puts. They bought 150,000 contracts for a net of $75 per contract. That is an $11,250,000 bet that the VIX will move over 20 over the next 60 days.
    someone made a big bet against the financials ETF yesterday (ticker symbol XLF), and it has everybody buzzing. The trader bought 100,000 put options on the ETF

  • Skynard

    /NG filled the gap, short now for a pull back. Think this sym continues higher. 

  • Schwerepunkt

    Thanks. Not sure which file to put this “info” in, though. I’m sure the Gerb has some ideas . . .  

  • Schwerepunkt

    What you talking ’bout, Willis?

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

    oh you’re right, I forgot about the decay.
    let’s see what happens in a few weeks.

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

    chuck it.
    wasn’t it Mole who said – ‘if everybody knows, then it’s not worth knowing’?

    http://cdn.walltowatch.com/files/0/0/0/2/00023717.jpg

  • DollarChaser

    NZD/JPY looking interesting. Testing the 100hr sma and lower 25hr BB right now… Anyone else watching this one?

  • Skynard

    No, it looks like a decent opp though:)

  • Skynard

    AUD employment numbers should shake it up a bit:)

  • Schwerepunkt

    Brutally honest, Mr. I I – L L.

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

    we need a list of Mole’isms next to the cheat sheet.

  • newbfxtrader

    It doesnt want to go up bro. Means …

  • Skynard

    Another fake out, check out NZD:)

    Been waiting a long time for them both.

  • AmazingLarry

    VIX buy signal. SPX to 1800, VIX to -27. They pay you not to care. :D

  • Skynard

    Hum, awful quit around these parts:)

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

     Wait, I have something

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

    Don’t laugh, but this came to me in a dream.

    Dreams and intuition are powerful subconscious tools, so I decided to investigate.

    General idea is this:

    During a low volatility bull market, there is a half point in price and
    time. It could be a flag, a measuring gap or something else. At the time
    it looks like a small top, with divergence in indicators, failed
    break-out or support and strange volume pattern. Understand – not all of
    these conditions must be met, as long as it looks topish and scary –
    it’s a valid half point. This can last from few days to few weeks. I
    think we just had that Half Point. Now and most importantly – half point
    is confirmed by a powerful move, with recent top  taken out quickly and
    on volume.

    This did not happened yet.

    Note:

    I don’t see how all this can be measured precisely, and I don’t think
    its necessary. Just general understanding is good enough, as long as SPX
    takes out 1515 and continue up with low volatility.

    No harm to calculate targets: 1600+ on SPX sometimes in March 2013.

    But wait – there is a Bergamot T , which also points into March.

    As Darth Gerb said: “Speculators should be finding hard data to speculate.”

    I checked, as soon as I woke up – it was hard

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

    My tail is stiff every morning.
    a like for the charts.

    March eh?
    http://evilspeculator.com/?p=31658#comment-694337618

  • 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„¸




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