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Next Time I’ll Duck
74

Next Time I’ll Duck

by The MoleFebruary 12, 2012

It’s been a rather interesting day on my end. After practicing martial arts for some twenty years I finally got my nose broken for the first time during sparring today. My instructor actually reset it on the spot and although I needed some stitches afterward the doctor said my nose should make a full recovery.

I know – couldn’t have happened to a nicer guy, right? ūüėČ

Anyway, after stitching me up the doc also administered a tetanus shot and although there’s almost no pain I’m starting to feel a bit banged up tonight. So forgive me if I just do a really quick one tonight and then get some rest (update – of course that didn’t happen – plenty of goodies below).

Spoos – nice little pop on the books right now but it reversed right where it should have. Mark that line in the sand on your end if you are bullish – this should not drop any further than the current lows which coincide with my 100-hour SMA.

The volume profile on the spoos has changed quite a bit a lot could happen between 1330 and 1360 – tough to make a call inside here. BUT watch that volume hole near 1330 – if we drop below that then I think the bears may just take this all the way and we get a real correction for a change.

Alright – we all know sentiment is ridiculously bullish right now – even after Friday’s little wipeout. But I am not sure that we are looking at a major reversal – juuuust YET. If we power higher and get an opening SPX gap tomorrow morning then we’ll have to monitor the action carefully. I told you on Friday that the bulls are not out of the woodworks just yet – we still may see an inside candle or (even better) a RTV sell setup. Of course once we breach last week’s highs we’re off to the races. The next hurdle on the map would be the 1370 mark I posted about last week.

Quite a few more charts below for the subs – that’s right – a broken noggin’ won’t stop the Mole!

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More charts and cynical 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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SPXA200R – it’s climbing and a reversal here is a possibility. However, it’s a lot less extreme than what we got ahead of previous major corrections in the past three years. So my point here is that despite all that extreme bullishness I don’t see the type of conditions that would lead me to taking on medium to long term short positions.

Same on my MA on the SPXA50R – I do like the current readings but I would prefer a more extended divergence. I know this is not what you guys want to hear but: we could turn here but it’s possible that this thing drags out quite a bit more. Remember trend traders and overbought markets?

Same story on the JNK:TLT ratio – it took a hit on Friday but I don’t see a clear divergence just yet.

NYSE Bullish Percent Index – it’s climbing those charts but again – no distinct divergence yet.

Copper – not major divergence … yet…

AUD/JPY (via FXA:FXY) long term: NO divergence just yet. Admittedly this one does not always produce one.

Here’s the NYSE adv/decl volume ratio. It’s where we could see a slide but in the past we usually saw one more pop higher, which supports the evil scenario I pointed out in Friday’s post.

Silver:Gold ratio vs. SPX. Well, it could be spot on – this one seemingly disagrees with the prior charts. The readings don’t seem to matter much (based on prior observation), what matters apparently are distinct divergences. So, this one leaves the door open for a plunge right now.

Similar story on the put/call ratio – it’s possible we slide from here but I would feel more confident about the downside if we pushed higher one more time and then produced any divergences. Wishful thinking on my part? If you interpret the chart differently please let me know.

Gold – that P&F chart suggests a failed break out attempt right now. Which is surprising as gold looked very bullish until now. This may change next week and I wouldn’t take the bearish PO seriously just yet. IF we get a high pole reversal warning, then we should pay attention.

Bottom Line: The door is open for the bears to take this thing lower right now. If you are bearish then your first line in the sand should be last week’s highs at 1352.75 – after that the bulls only got 1370 to worry about. I am not in the bearish camp just yet – yes, despite insane sentiment and I am definitely cognitive of Volar’s most excellent sentiment charts. Price/momentum however needs to confirm that and unless we test last week’s lows again I will remain in a wait and see loop for now.
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Cheers,


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://evilspeculator.com molecool

    I may have to manually rebuild the ZeroFX again. Have not eaten since breakfast, so please forgive me if I get to that after dinner. Thanks – seems it’s one of these days….

  • Anonymous

     Better, Stronger, and Faster:)

  • Anonymous

    A gift:)

    Would make a very nice pattern.

  • Joe_Jones

    Sorry to hear about the nose Mole

  • Anonymous

    Thanks for the post mole

  • Joe_Jones

    4H AUD/JPY

    support becomes resistance?

  • Anonymous

    you are a champ Mole

    hope your nose is feeling no pain by now

  • http://evilspeculator.com molecool

    A champ would have ducked – but thanks. Strangely enough there is no pain whatsoever – even when my instructor reset it I felt nothing but a crack when it snapped back into place.

  • http://evilspeculator.com molecool

    You’re welcome – hope it helped to get your bearings.

  • Fibz

    I didn’t feel any pain when I broke mine either. Pretty strange. Just a lot of blood on my shirt.

  • Anonymous

    Hey Mole , no pain no raccoon eyes ? Thats good ,Good eye on for charts.¬† Here’s what my look out is some cit # coming in. mondays¬†¬† Cmn #

  • http://evilspeculator.com molecool

    Racoon eyes are sure to be forthcoming in a day or two. I have slight shiner below my right eye – not too bad thus far. Sure going to get a lot of laughs tomorrow at the gym ūüėČ

  • Anonymous

    Here some numbers for monday i keep an eye on

  • Anonymous

    trying this chart thang . what’s a good size format?

  • http://evilspeculator.com molecool

    FX – thar she blows…

  • Anonymous

    Apparently Nouriel Roubini turned bullish last week:
    http://www.cnbc.com/id/46296487
    Interesting from a contrarian point of view though ofc not indicative of more short term downside.

  • http://evilspeculator.com molecool

    Interesting indeed….

  • Anonymous

    outside bar on 60 min AUDUSD, typically outside bars happen most often within 3 bars from a top

  • Anonymous

    looks like a textbook retest

  • Anonymous

    good morning fellas.

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

    Roubini is the last bear on the bus.
    and a magazine cover curse to top it off.
    excellent.
    I shall await the ‘pull back’.

  • Anonymous

    Going long?

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

    no. not with BP risk in the 80 range.
    (yes, it could go to 90)

  • Schwerepunkt

    copper and gold not rallying?

  • Anonymous

    Waiting for a retest to go short.

  • Anonymous

    /HG is fighting with the 200-day SMA right now. A break would probably lead to 3.78 or 3.61. Additional target would be 3.51 where both the 100-day SMA and the lower Bollinger are located at right now. The bearish implications for equities are clear if we don’t hold those lines right now, I think.

  • Anonymous

    /ES 1350 looks good:)

  • http://iberianviews.blogspot.com/ catracho
  • http://iberianviews.blogspot.com/ catracho

    http://2.bp.blogspot.com/-CyvYFnHWJM8/TzkUZRFrkDI/AAAAAAAAAyk/44EtbsWhTUg/s1600/Copper+Full0312+Future.png
    If it gets to 376 or 365 probably a buy again…
    but yes foretelling some¬†weakness¬†for equity markets…understandable

  • Anonymous

    Line in the sand:)

  • Anonymous

    Added calls for the ride.

  • Anonymous

    We also still have the P&F target of 5 on the table. On the other hand, setups may fail and I don’t like the look of that weekly chart. Next support sits as 3.60, but there is a lot more space below and not so much above at the moment.

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

    Gerb may be all wet.
    but AUD/JPY 83.10 is getting some respect.  (emphasis on some)
    http://i40.tinypic.com/acx3du.png 

  • Anonymous

    No it looks real, selling exhaustion on 4 tick charts and the 10 min chart

  • Anonymous

    A lot of screwing around at ES VWAP

  • Joe_Jones

    for a change…
    :(

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

    someone said backtest? (retest)
    $INDU
    http://i41.tinypic.com/2hcnmso.png

  • Schwerepunkt

    OT: Anonymous targeting Greece. 

    I can’t believe they are simply a loose group of hackers with no government backing. China? CIA? The vaunted Andorran Intelligence Directorate for Security (AIDS)? ¬†

    Who are these guys?  

  • Anonymous

    Would like to see one last push at resistance, still waiting:)

  • Anonymous

    Have you got a splint on the nose, in any case, try not sleep on your face, knock it again, etc (obvious i know, just saying, so as to avoid needing surgery later)

  • Anonymous

    ¬† FINALLY….Mole hits one on the nose…

  • Anonymous

    I find the Daily Zero is two days behind…anyone concur?¬† I’m kinda interested in that.

  • Anonymous

    Please, some decorum Рnoses are very important for Moles !

  • Galazkiewicz

    Anyone backtest Fakeout Inside Period Sell set-ups on the SPX?¬† I’ve done a very cursory test going back two yrs on the daily, using Fakeouts from 1-4 days after the initial spike high.¬†I will expand this using more history and fakeouts past 4 days soon.¬† However, I was surprised that out of the 9 FOIP Sells that triggered, only 3 made 1R in three bars (33%).

    Most of these appear to have occured at the top BB and possibly in a short squeeze.¬† If you’ve tested this and have thoughts (or even if you haven’t and have some insight), I’d appreciate any feedback you have.

    In the past, CS has said his real world trades using this set-up was 75%, much higher than my very short test.  Thanks.

  • Anonymous

    Now short;)

  • Anonymous

    shorting too!

  • Joe_Jones

    Was about to say the same. Adding to short with stop at last week’s high.

  • Anonymous

    Nice set-up there:)

  • Joe_Jones

    looks well ripe indeed

  • Anonymous

    Need that line in the sand to bust now:)

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

    great idea for Mole.
    blood shorts.  
    Bwa-hahahha!
    put a black swan on them.
    http://fightunite.co.nz/wp-content/uploads/2010/05/Contract_Killer_blood_stained_short_front.jpg 

  • Schwerepunkt

    What’s the stop? 1352.5?

  • Anonymous

    I concur. Mole must have missed my request for an update on Friday.

  • Anonymous

    Possible RTV Sell set up today, IF we close below 1354SPX?  Do I understand that correctly?

  • Anonymous

    Yep, new high blows it!

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

    where is that SPX envelope thingy DG posted the other day…
    ah.

    http://stockcharts.com/h-sc/ui?s=$SPX&p=W&yr=2&mn=0&dy=0&id=p03629737739 

  • Anonymous

    Yes sir, my target was 1350 and pulled the trigger a little early. New high kills the trade.

  • Anonymous

    Anyone follow /SH soybeans?  Look like it just broke out of a nicely developed Bull Flag right at end of the day.  Thoughts?  Looks like it has alot to run.

  • http://evilspeculator.com molecool

    Sorry guys – no post today. My system seems to be infected by a computer virus and I had a bad night after sleeping with a broken nose. I guess it’s one of those days…

  • http://evilspeculator.com molecool

    Sorry, it took me literally six hours to get ZeroFX back up and running last night. I was wiped as you can imagine and forgot to take a snapshot. Will do it today at the EOD.

  • http://evilspeculator.com molecool

    Wer den Schaden hat braucht f√ľr den Spott nicht zu sorgen :-)

  • Anonymous

    Google translate is not doing justice, but im sure its witty :-)

    Anyway, good luck with your zero re-build (what about linux?)

  • Anonymous

    Think the bulls know it as well:)

    Dollar is strong and has not collapsed.

  • Anonymous

    “Simultaneously, ‘smart money’ ‚Äď that would be commercial hedge traders ‚Äď are short $7.4 billion of various indices (INDU,¬†SPX¬† NDX, RUT) as of last Tuesday, which was up from the previous week‚Äôs $2.7 billion. That‚Äôs a weekly increase of $4.7 billion for one of the largest weekly jumps I have ever seen and it is the highest such ‚Äúshort‚ÄĚ position since 2002.-Jeff Saut article

  • Anonymous

    You think thats why the VIX spiked friday? Its come down quite a bit today.

  • http://evilspeculator.com molecool

    No, it’s running – just took a LOONG time. I wish NinjaTrader ran on Linux as I personally prefer OS X or Ubuntu. It’s a problem with the NinjaTrader database – after collecting tick data for a few weeks it gets corrupted/overwhelmed. I then have to spend hours clearing and rebuilding – it’s a real pain.

    One of these days I’ll rewrite this thing for another platform – would prefer it was in C# though.

  • Anonymous

    Euro and aussie not following equities it seems to me. Are we there yet?

  • Anonymous

    Looks to be a possibility. Some indications of this rally running out of steam.

  • Anonymous

    Check out Bucky;)

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

    most likely a 

    (wait for it)……

    Rhino Virus.
    ūüėÄ

  • Anonymous

    Maybe gap down sucked in the ‘this-is-it’ bear crowd jumping into puts.¬†They are conveniently getting smoked today.

  • Anonymous

    NEW POST!