Hurdles Ahead

We have come a long way in the past three sessions but the easy part of the journey is now nearing its end. For there are hurdles looming ahead plus I’m seeing some signature signs of short term shenanigans flashing all over the place. Let’s start with where we are right now:


Quite a climb since that is and there’s probably room for a few more handles. But bear in mind that we are now facing a trifecta of previously tested moving averages – at least per my lens and more often than not they have been observed.


On the NQ things are looking quite a bit more bullish – AAPL definitely had a thing or two to do with that. However daily resistance is right ahead and we’re about to smack into it. On the weekly panel we’re however above the 25-week SMA, so that’s pretty positive.


Today’s session looks like it’s been on cruise control – the Zero also suggests that the bots are driving this one higher.


Quarterly volatility has eased off quite a bit along with the VIX and the ratio has been leading the advance in the past few sessions. All good and given that we’ve got more than a week of trading ahead of us it’s not impossible that the bulls may actually pull this off and close the month above the NLSL.

So much for the good news – now let’s talk about some of the concerns:

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Elvis Has Left The Building

One of the prime directives I preach here on an ongoing basis (soap box included) is that we as traders must, by all means and without hesitation, yield the iron when it’s hot. Despite the emergence of financial media, trading blogs like this one, social networking, FB, twitter, etc. the daily grind of being a trader is really not that exciting. Unless you are completely nuts and addicted to a daily dose of adrenalin (which means that you are day trader) 90% of the time you wind up sitting around waiting for the moment to happen.


And when it finally does you strike without hesitation because you know that just for a moment the odds may be in your favor. The market has shown you a door and odds are it’s about to step through it. There are no guarantees and there never will be. But that is beside the point – you are a trader and this is what you do. Take action when the odds are shifted in your favor. And then you wait agin.

The orange arrow on the chart above shows you exactly that very moment yesterday near the open. That was one sweet entry and any self respecting steel rat should have at least grabbed a handful of contracts there. What happened instead was an ear shattering silence and tumble weeds rolling through the comment section. Maybe I should have put Ebola Alert in the subject line. As the old saying goes – you snooze you lose…


And still I concede that this may turn into one fat bull trap – yes, nothing is baked in. But to me it doesn’t matter because I got positioned near the lows when the odds were in my favor. If I wind up getting stopped out – that’s the cost of doing business.

The monthly panel now shows us in earshot of the NLSL we breached over a week ago. IF that really happens then the bears will be on record for having fumbled the best shorting opportunity in years. And you know what I’m going to say next – exactly: There will be a price to pay. Until that happens there is a short opportunity right below the monthly NLSL – but in order for this entry to be considered we would have to see some considerable weakness here today and tomorrow. What I’m seeing in the futures right now is not encouraging for the bears.


No ST setups this morning – Elvis has left the building and the time to get positioned was yesterday. For now we watch and wait…

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Mad Monday Morning Briefing

Welcome to our morning briefing. Here we are reviewing short term setups ahead of the NYSE opening bell. If you are a scalper or swing trader then these setups may be of interest to you. As usual keep in mind that these are short term setups although they could be used as early entries for more longer term positions.


Put your game faces on folks, judging by this morning’s activity it looks like we’re going to have a busy week. Equites are now near the make or break point. Short term this is an awesome opportunity to be long with very little risk. Simply put your stop below the 100-hour SMA. If we drop through it we may bounce back bear trap style but the bullish case would be extremely vulnerable. We don’t have a crystal ball but the odds are good here. Even worth being stopped out once or twice – so keep your position size small and build it it up as you go.

In case you wonder – yes, being short below the 100-hour is encouraged if we drop below it. But there will be attempts to reconquer it and unless your stop is above 1890 odds are you will be swept. No exact science – it depends on your trading style. But this is a major inflection point that will determine the direction for the coming weeks.


Similar view on the NQ but not as dynamic – the 100-hour is now pushing sideways which means it can serve as the line of scrimmage to kick this thing higher. If it fails the bulls will find themselves in a world of hurt.


Oh how much I wish this setup would fail but much to my chagrin it’s looking very very good. So I’m long here with a stop below the now rising 100-hour.

Quite a bit more waiting below the fold – secret decoder ring required:

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Please login or subscribe here to see the remainder of this post.

You have been briefed – now have fun but keep it frosty. See you guys later this afternoon.


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