Mole Hunting

I have some family obligations to attend to today so let me get right to the point. This may be day you’ve been dreaming of, your chance to actually stick it to the Mole once and for all and, assuming you finally drop that disgusting glue sniffing habit, go on to tell your grandchildren all about it. Do I have your attention now? I thought so 

As you may recall I am still long the EUR/USD from late last week and thus far it’s been behaving. Not that I would shed much of a tear should this one suddenly fall off the plate (noobs: expat here earning Dollars living in Spain). But looking at this morning’s formation I couldn’t help but notice that this is actually a very juicy (but low probability) short opportunity. Because if it breaks it would most likely result in a gap fill and you know what that means (i.e. target < 1.08).

So ask yourself this: are you a man or a mole? Long or short? What’ll it be? Now seriously speaking the long side still has the better odds at about 60% – it would be > 70% if it wasn’t for that gaping hole below and the fact that we’ve been pushing sideways since. But there is still an opportunity for the bears to take this one to the woodshed but it has to happen before we push > 1.09455. After that I’m doubling subscription fees (j/k).

Now the short position I actually am taking is in the ES but before you get all excited and back up the truck let me assure you that the odds of this one succeeding are most likely below 20%. For a long entry I would need to see a more thorough retest yet. And why is that?

Take a look at the Zero chart from last week and compare Thursday’s session with Friday’s. IMO participation/momentum suggests that we are either producing more context before a stab higher or are heading lower for a little shake out. Besides, we have two gaps there below us – dangerous territory if price keeps hanging around here.

Side note: If you haven’t signed up for the Zero yet then waste no more time and do it now. But be careful as it’s addictive and you won’t ever want to trade the E-Mini without it.

Another reason why the short side has very low odds of succeeding right now is steamroller advance we’re seeing on the Nasdaq right now. I mean the damn thing doesn’t even afford us the courtesy of a decent retracement. How rude. If you’re long here – good for you!

Campaign Updates

Copper doesn’t seem to be in a particular rush apparently but at least it’s still pointing in the right direction. I’m not yet ready to advance my stop here as tempting as it may be. The Mole has learned from the last time he exited prematurely (ahem).

Soybeans has turned into Dr. Seuss’ worth nightmare on the hourly panel. Someone is going to poke out an eye on all those spikey formations. However quite frankly this is something I should have anticipated after such an extended low volatility melt down. The good news is that we’re painting higher highs and higher lows, so this still has a decent chance of resolving. No action here for now.

Alright, I have two super juicy setups waiting in the bullpen for you guys. Please grab your secret decoder ring and join me in the lair:

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