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Monkey Business
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Monkey Business

by The MoleMarch 23, 2016

We’re seeing quite a bit of intra-day monkey business over the past week on the equities side. Specifically I’m referring to gapping action, wild swings during the RTH, all in the context of minimal momentum (at least judging by the hourly Zero signal). Someone mentioned this morning that he has been observing a significant drop in L2 activity (i.e. b/a sizes and durations) over the past year and that does not surprise me as many large funds have been exiting over the past year. Whether or not HFTs are responsible is another story but in general it appears that liquidity has been drying up. And of course that contributes to more intra-day volatility as it’s much easier to bang the price in your direction or to set traps bait and switch style.

2016-03-23_zero

The Zero indicator does often offer us implicit information in that it shows us lack of participation or suspicious price action during difficult trading periods. So what exactly is ‘suspicious’? Well, for example systematic advances or long squeezes accompanied by minimal momentum (blue) or signal divergences after increasing hourly volatility (green). Or sudden signal changes like the one this morning (red) which in itself is a very small reading but clearly some players attempted to run some stops and since I took this snapshot we’re already seeing a little bounce.

In short – a ton of monkey business aimed at discouraging participants and lure them into futzing with their open positions. This type of tape is not for the faint of heart and my recommendation is to simply trail your campaign (if you’re still exposed to the long side) per your system rules, and then walk away and forget about it.

2016-03-23_AUDUSD

The AUD/USD is accelerating and what we may be seeing here is a sideways correction of sort. I’m looking to be long near that diagonal I drew on the hourly panel.

2016-03-23_ZS

Also waiting on an entry in soybeans – I absolutely love the daily panel which shows us a sideways triangle of sort with a pinched Bollinger followed by a break out and now we may get the last kiss goodbye (LKGB). Let’s see if it comes down lower toward the 900 mark and if it does Bob’s your uncle.

My favorite setup I’m keeping for my intrepid subs – please grab your decoder ring and join me in the lair…

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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.
  • captainboom

    Thought about this selective attention test after yesterday’s post on herd behavior. If you haven’t seen it before, it’s enlightening to follow the instructions.

    https://youtu.be/vJG698U2Mvo

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Ronebadger

    THAT was a gorilla?

  • CandleStickEmUpper

    Thanks for the post. Definitely explains the tape as of late. Also, Friday being a holiday makes for less liquidity this week, resulting in intraday tape bang up jobs

  • Round we go

    you’ve been hanging out at slope too long. also gapping action would require a rear shot.

    that rsi divergence is going to a bitch.

  • Round we go

    i saw the gorilla and kept track if they did not pass correctly. I did not count cus that did not seem relevant,

  • Round we go

    spot on post mole, monkeys at work is the perfect image as well.

  • http://evilspeculator.com Sir Mole III

    Indeed – in retrospect I should have taken this week off as well.

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

    divergence
    that is correct.

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

    perhaps. did you see the slam dunk??
    😉

    http://www.ultra-gor.com/Suns_Gorilla2.jpg

  • Round we go
  • http://evilspeculator.com Sir Mole III

    saw that pic but my wife would have killed me…

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

    Closed out shorts on dip this morning as possible things consolidate for another move up. But sooner or later one of the set ups will fail

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

    Waiting for more divergence to develop btw VIX/ SPY. Getting closer although things could easily drop out from here

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

    GDX potential short. If we bounce back up into the upper yellow zone right below the upper BB, will take a GDX short. But no edge for now

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • http://evilspeculator.com Sir Mole III

    Check out the signal range today. Quite a change in participation – there seems to be a tug-o-war going on.

    .

  • http://evilspeculator.com Sir Mole III

    Great tape for swing traders…

  • http://evilspeculator.com Sir Mole III

    I always get slapped doing that…

  • http://evilspeculator.com Sir Mole III

    Game recognized…

  • Yoda

    Was about to comment on this. Unexpected action given the short trading week.

  • Yoda

    It is getting ugly out there. Loving every single bit of it. :-)

  • Yoda

    Looks like GS and al. are setting up themselves to create the right market conditions preventing a rate hike in April.

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

    Just broke the trendline. Also noticed Treasuries showing divergence vs equities

  • Round we go

    FED communication correction? funny how the market read the FOMC dovish, when the FED wanted to communicate concern rather than complacency.

    http://www.zerohedge.com/news/2016-03-23/why-bob-pisani-asking-if-fed-alarmed-market-complacency-big-problem-janet-yellen

  • Round we go

    man northy got a winner here.

  • Round we go
  • http://evilspeculator.com Sir Mole III

    Wear a helmet trading that sucker. Wish someone would have posted that one earlier though – may have grabbed a short as it went expo.

  • kudra

    discernible market downshift today. we’ll see if it has legs. still very short the QQQ. been sitting tight and otherwise inactive.

  • captainboom

    The instructions were to count the passes between the people in white. I suspect that is to focus attention on the ball and people in white.

    The first time I saw this was a number of years ago in a training session for motorcycle safety coaches. It was projected on a screen across the room, and following the instructions, I don’t think any one of about a dozen of us saw the gorilla the first time. I thought it was a good lesson in inattentional blindness, which is something we now spend some time on in class with new riders, using different exercises.

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

    CRB
    http://stockcharts.com/h-sc/ui?s=%24CRB&p=W&yr=3&mn=0&dy=0&id=p44592076425

    tomorrow is ‘Friday’, given the last time CRB hit its head, it went sideways for 6 weeks.
    a repeat would put it at May before anything really happens.

    -GG

  • Billabong

    Markets closed tomorrow…

  • Round we go

    you may find out later that this week was the last kiss goodbye :)

  • Round we go

    I always decided for myself what is important. principles are primary, rules are secondary. I am always suspicious of rules and most of the time I am trying to exploit or expose the dumb rules, and their are countless dumb societal rules from my perspective. DId the number of passes matter in the end? they never explained why you should follow the rules. where was the pay off, for doing what they told you to do?

  • http://evilspeculator.com Sir Mole III

    I think I’m taking the rest of the week off if nobody is participating… :-/

  • Ronebadger

    Good time to take off…Happy Easter, everyone!

  • http://evilspeculator.com Sir Mole III

    They just finished Las Fallas over here in VLC. And now we’re heading into Semana Santa (Eastern). Does ANYONE ever work in Spain??

  • Billabong

    It’s the sourthern European dream … make the north work.

  • http://evilspeculator.com Sir Mole III

    Seriously – it seems that there is some type of fiesta once a week here. I do enjoy the lifestyle but don’t ever try to start a company here. It’s guaranteed to fail as the people here spend most of their time preparing for a slew of holidays.

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

    That’s why I loved working there. The whole month of August vacation is awesome.

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

    Closed SPY short from yesterday. Could continue down but supposed to close on activity below the 30 min – 2 hr BB.

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

    I’d like to see the list..

    I have counter-parts in Costa Rica and the count was lower than I thought.
    only 23.

    http://www.timeanddate.com/holidays/costa-rica/

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

    Sounds like my kind of place….

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

    I was a child of the 70’s. Grew up on American TV Programming.
    The six million dollar man was my hero. anybody remember the cardiograph during the intro?
    probably my first chart of interest. (arrow)

    Weekly BPSPX, at a level reached back in 2011 during a massive (sentiment) upswing.

    -GG

  • BKXtoZERO

    I got boring. Built a short position and holding. Can’t do oil and gold stocks every day although I am sorry I missed them both short again………

  • Round we go

    nobody participating? I am all in levered up short to my max. I would say that is participating :)

  • Round we go

    and it looks like it ended in a 90% retracement.

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

    I’ve been watching the internals of the NYUD.
    could be a pull-back to the end of April.
    of course that would be a big shock when everybody is saying “Sell in May”,
    and the end of April is actually some interim bottom.
    so yet again, selling of weak hands into strong. but who knows?
    -GG

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Yoda

    The sound fx is what gave him the super power 😉
    https://m.youtube.com/watch?v=heE1MqS9u6Y

  • mugabe

    we have the technology

  • mugabe

    not if they can help it

  • Round we go

    yah the way things look now, april inerim and june the big one.

  • mugabe

    has to be said, most of those are local hoildays . list is much shorter if you take them out

  • mugabe

    any excuse in the US to take a holiday

  • BKXtoZERO

    I was a kid in the 70s. I went to my candy store one day and the prices on everything went up. I put my bag of Dipsey Doodles on the counter and gave him the 0.16 cents and he said no, that is 0.25 cents and I remember being in shock for a little while. Candy bars were 0.11 cents, then 0.16, then 0.25, then 0.50 etc….. saw a pack of base ball cards at the drug store check out line last week and they were 3.50$/pack LOL. Yes, life sucks….. buy gold and silver. No one told me then.

  • Ronebadger

    are you saying that you are “MASSIVELY SHORT” ???

  • ridingwaves

    in bears favor
    selling usually doesn’t end on a Friday…
    in bulls favor
    It’s Easter egg hunting time in the Hampton’s…

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • mugabe

    you’d have been much better of buying an index fund

  • BKXtoZERO

    Bionic man and Bionic woman missed their calling, would have been huge porn stars together! ch ch ch ch ch ch ch

  • Round we go

    more my flavor as i am a bear. bit darker.

  • Round we go
  • http://greenlander1.blogspot.com/ Greenlander

    Staying out of this. Low volume last few days could set up another spike up next week

  • ridingwaves

    nice bounce off lows in miners…Happy Easter to all, time to drive…..

  • Ronebadger
  • Ronebadger

    Well, I just checked…I just went over 1000 Up-Votes. Thank you ALL for reading my drivel. Apparently, some of it is either amusing, intelligent, pertinent, funny, silly or helpful….because, that’s what I was going for…Have a great weekend!

  • Yoda

    Happy Easter!

  • http://evilspeculator.com Sir Mole III

    Happy Easter everyone!

  • http://evilspeculator.com Sir Mole III

    35 in Spain alone:

    Viernes 01/01/2016 Año Nuevo

    Miércoles 06/01/2016 Epifanía

    Domingo 28/02/2016 Día de Andalucía

    Martes 01/03/2016 Día de las Islas Baleares

    Sábado 19/03/2016 San José

    Sábado 19/03/2016 Día del Padre

    Jueves 24/03/2016 Jueves Santo

    Viernes 25/03/2016 Viernes Santo

    Domingo 27/03/2016 Pascua

    Lunes 28/03/2016 Lunes de Pascua

    Sábado 23/04/2016 Día de Castilla y Léon

    Sábado 23/04/2016 Día de Aragón

    Domingo 01/05/2016 Día internacional de los trabajadores

    Lunes 02/05/2016 Fiesta de la Comunidad

    Martes 17/05/2016 Día das Letras Galegas

    Jueves 26/05/2016 Corpus Christi

    Lunes 30/05/2016 Día de las Islas Canarias

    Martes 31/05/2016 Día de Castilla-La Mancha

    Jueves 09/06/2016 Día de Murcia

    Jueves 09/06/2016 Día de La Rioja

    Lunes 25/07/2016 Dia da Patria Galega

    Lunes 15/08/2016 Asunción de María

    Viernes 02/09/2016 Día de Ceuta

    Jueves 08/09/2016 Día de Asturias

    Jueves 08/09/2016 Día de Extremadura

    Domingo 11/09/2016 Día de Cataluña

    Jueves 15/09/2016 Nuestra Señora de la Bien Aparecida

    Domingo 09/10/2016 Día de Valencia

    Miércoles 12/10/2016 Día de la Raza

    Martes 25/10/2016 Euskadi Eguna

    Martes 01/11/2016 Día de Todos Los Santos

    Martes 06/12/2016 Día de la Constitución España

    Jueves 08/12/2016 Inmaculada Concepción

    Jueves 08/12/2016 Día de la Madre

    Domingo 25/12/2016 Navidad

    That does not include the ones specific only to Valencia:

    Las Fallas – between March 1 and March 19!! (almost nobody works really)

    Domingo 09/10/2016 Día de Valencia

  • http://evilspeculator.com Sir Mole III

    Obviously the regional ones are only observed in their own. But the Spaniards take puentes all the time – which means if one day per week is a día festivo they take at least two or three days off around it. I have no idea how anything gets done here. Actually nothing really does… except the AVE trains, those are usually on time.

  • http://evilspeculator.com Sir Mole III

    Oh yeah – I totally forgot about August. On TOP of all those holidays and half of March (las Fallas) nobody works in August. Seriously. The entire month most of the country is at the beach. I think from 261 theoretical workdays the Spaniards perhaps work 180. That’s almost half the year off.

  • http://evilspeculator.com Sir Mole III

    True – but in the U.S. you don’t get a whole month worth of vacation plus holidays. After busting your ass for 30 years as a valued professional you MAY perhaps work yourself up to 21 vacation days per year.

    I sometimes try to explain to the people here how good they have it but it’s like trying to teach a dog how to whistle – you’re wasting your time as they have no concept of the realities in non-socialized societies.

  • BKXtoZERO

    enjoy your second vacation in 2 weeks……..

  • BKXtoZERO

    That can’t mean too much because I have 876 and I am a complete moron!!! but congrats anyway :-)

  • mugabe

    mole’s got 11,300 up votes – but I suppose that if you’re a moderator/site owner you can vote for your own comments multple times. only explanation I can see

  • Billabong

    You too!

  • CandleStickEmUpper

    GDP number came out this morning. I have no idea why, when all markets are closed today.

  • http://evilspeculator.com Sir Mole III

    Yup, I’m spending all my weekends upvoting my own comments.

  • http://evilspeculator.com Sir Mole III

    And how about August!!??

  • mugabe

    BKX, you might find this post interesting re trading vs investing, as you’ve someitmes expressed a quandary:
    ‘Keep in mind that if you fail to define your trading, you will almost
    certainly experience inner conflict at key decision-making moments.The key is to focus on a particular style, which means sacrificing other styles. Once you define your style and objectives, it becomes much easier to stick to a plan and attain success’

    http://www.minervini.com/blog/index.php/blog/show/tips_on_how_to_trade_an_emerging_rally

  • http://evilspeculator.com Sir Mole III