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The Big Roll Over
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The Big Roll Over

by The MoleDecember 7, 2017

Equities futures are rolling into their March contracts today which is in part why we saw a distinct increase in realized volatility over the past week or two. Not being a huge fan of rainy winters in the Mediterranean I for one can’t wait for expiration day which also happens to be my spring vacation season. Then again I shouldn’t complain about the weather judging by what some of my trading buddies in Chicago are going through right now. Scraping ice from your windshield is one thing, scraping it off your contact lenses is another.

2017-12-07_emini

The E-mini has been flailing around like a Sudowoodo over the past few days and it goes without saying that any temporary weakness should not be trusted unless we see one of two inflection points breached:

2017-12-07_emini_volume_profile

The volume profile still shows the Emini trapped within a volume island between 2620 and 2660. As long as we bounce around in that range it’s best to simply place small contrarian trades in anticipation of another leg in the opposite direction. A breach and close above 2660 or below 2620 however will most likely launch a more directional move.

2017-12-07_VIX_dangerous_spike

And the odds are not necessarily on the bullish side judging by what I’m seeing on the VIX. Some intrepid steel rat asked about the VIX signal the other day (and was instantly hazed into oblivion since we are cruel and petty individuals) wondering if or why we didn’t trigger a VIX buy signal (relative to equities) after the big spike toward 15. Well, that is easily answered: we didn’t close OUTSIDE the BB and therefore no cookies.

However what I failed to explain to him that day was that this could actually turn into a more bearish scenario judging by wha happened last time. When you see IV explode and instantly reverse like this then that’s not exactly a very bullish sign. Healthy bull markets in the mid of their trending phase simply correct a little and then go on with business. Wonky spikes like the one last week however often produce follow up, so let’s not fall prey to whatever bull trap they may throw at us today or tomorrow.

2017-12-07_silver_DNBTD

Silver apparently has purchased season tickets at the woodshed judging by the current merciless sell off. Didn’t I tell you guys ’tis was not the season to be long precious metals? I hope you listened! Anyway, don’t buy the dip here – period.

2017-12-07_copper_LT

Copper however may throw us a bone if it can hold the diagonal on the daily and the 25-week SMA it just bounced at. It’s extremely early in the game here but alas…

2017-12-07_copper_entry

I am going to throw a very small 0.3% lottery ticket at this formation. Odds are pretty low (1:3 at best) but if it succeeds it’s bound to burn a bunch of shorts all the way into Christmas.

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

    SOX not cooperating, exit INTC short.
    http://stockcharts.com/h-sc/ui?s=%24SOX&p=D&yr=0&mn=6&dy=0&id=p33394423997

    SLV,
    actually – I’m going to start a entry position here.
    =P

    http://stockcharts.com/h-sc/ui?s=SLV&p=D&yr=1&mn=1&dy=0&id=p01362477272

  • StockTalker

    These power moves are a good indication.

  • BobbyLow

    I read in the previous comment section that you had shorted Bitcoin. This piqued my curiosity because for as many times that I’ve heard the term “Bitcoin” I really didn’t know what it is and still don’t – not really. I googled it and read a couple of articles on it and one thing that stood out to me was is it true that owning Bitcoin outright could be lost by something as simple as a computer virus or hacking? I also wonder if this is a replacement for Gold in some circles.

    In the mean time, I remain Short Gold and Short Oil.

    I’m posting a couple of “basic” links about Bitcoin for anyone who wants to read them.

    http://money.cnn.com/infographic/technology/what-is-bitcoin/

    https://en.wikipedia.org/wiki/Bitcoin

  • StockTalker

    Long /NG prior to reporting. both gaps have been filled.

  • StockTalker

    Cyber cash that someone dreamed up. think it goes back to -0-

  • StockTalker

    She’s going to blow hard, what a wicked bitch she is!

  • BobbyLow

    Crazy stuff. It also looks like a tailor made home for nefariously earned money.

  • StockTalker

    Exactly, smoke in mirrors for sure. What else will they dream of to take your hard earned money?

  • BobbyLow

    I traded it for awhile and found the violent price action after Thursday Reports on NG make the price action following the Weds Oil Reports look like a “walk in the park”.

  • ridingwaves

    funny, in comment yesterday I wished for the big boys to close gap on INFI and be done with it…..and they granted it….I love those guys….
    https://uploads.disquscdn.com/images/bd15e4424013bf75f45a0fbd7259baa4eaeb421a051d1559138738eba1b59af4.png

  • ridingwaves

    Natural Gas….

  • HD

    bottom line… nobody has lost money on it. nobody! worldwide.

    We over analyze things. Get stuck and watch a 20 bagger without participating. That chart hasn’t looked bearish all year. Curious if it’s bigger than da boyz at CME or if the futes will tame it.

  • ridingwaves

    I see a further run up for a bit to get shorts positioned right….

  • StockTalker

    Hehe

  • StockTalker

    BTC, time to get short. have not lost any money bc they sucked everyone in. You know what happens next……………….

  • Mark Shinnick

    At best it represents the Brexit of money; an exchange medium busted out of business-killing know-your-client banking regulation and allowing that type of dark capital a place to flow again More-and-more linkage is happening to interface it with everyday dollars and local currency. Its rules and price protect against fractional reserve banking and monetary inflation so in that sense is more like a absolute gold standard. That’s confidence producing.

    Already there are numerous examples of outright theft from hacking. Unlike cash there is always tracked that value, but not the natural person identification of the holder. Essentially, this is exactly the same holding risk that exists with cash where govt can simply confiscate, but now its hackers doing it …… so I still don’t see why this serous flaw upholds confidence.

    Greenspan is blowing it off as essentially a fad that is unleashing capital for natural productive purposes in the meantime.

  • ridingwaves

    I find it slightly suspicious that CME moved trading up to Sunday, the same week on fed rate decision….rates going up might be the trigger for sell off of significance for BTC too

  • StockTalker

    Here we go! Dow 24200 failed again.

  • Mark Shinnick

    Short covering could even provide some amazing accelerations B4 the true shorting opportunity. Its bound to be an amazing month.

    Hows bio in your lens?

  • Tomcat

    I feel like this is getting old saying, but $NG is the gift that keeps on giving. The spread that seems like I have been in (and out but mostly in) all year, is now in CONTANGO +.04. Spent the bulk of the year in backwardation (<-.60).

  • Tomcat

    What happened to the GOLDberg

  • ridingwaves

    I doubled down…..CEO bought 500K of shares yesterday….

  • HD

    I’m doing my best to NOT present them as Elliot waves but here is the WV pattern suggested yesterday. Has played out in cash now. I’m a seller. https://uploads.disquscdn.com/images/0e28a508ff97fba183d3cd95ffab08587c75df36e920d7fb8261b0285b727108.png

  • Darrell Osgood

    If you want to understand what Bitcoin is, where it came from, and how it works, but not get bogged down in the technical, I recommend the novel Cryptonomicon. It is intellectually intriguing and also makes a nice, satisfying thud when dropped.

  • ZigZag

    Pride myself on my vocabulary – what the hell is a “Sudowoodo”?

  • ZigZag

    There’s also a mini nat gas /QG which might be less stressful if natty double bottoms here.

  • BobbyLow
  • StockTalker

    There goes BTC

  • Mark Shinnick

    Facinating….still grappling with the EW thing. So lets assume a 50/50 chance the prediction holds, but that once the target is reached there is 100% implied instruction to sell. Isn’t that involving confirmation bias?

  • HD

    Mark, are you asking me if you should buy dips and sell rips? :-)

    Just 1 layer of probability. If you can quantify the wave it’s not a bias. Jmho

  • HD

    Google says it’s a “Pokémon” thingy!?! I’m not sure what that says about Mr. Mole……

  • Mark Shinnick

    Just asking for the codable rules. Ok, so the 6 swing thing is quantified, downside goes no further and the last swing at a higher low so it “must” then reverse through the neckline ?

  • Julie

    TAL took profits this a.m on a long from yesterday 3/4 off remaining 1/4 stop today’s low 29.06 30.88 was target
    JULIE

  • BobbyLow

    Good luck with your trade. This is your wheelhouse. :)

    My stuff usually does not work with equities but I ran a back test on the Financial Sector this week that might work. I’m currently stalking this sector for a shorting opportunity. It’s not ripe yet but when it is I’ll probably be using FAZ.

  • HD

    I’ve been beat to a pulp talking the waves here. I will just say use whatever you use to mark a low or high and if you want to add pattern recognition as another layer I personally think EW gives you that tool. I’m not saying it is guaranteed. So to clarify I did quantify the low yesterday and yet to do so for this rally. But! You have to pick your spots.

  • Mark Shinnick

    A nice house could be had for a tulip, so I guess nearly $20k buys a nice place somewhere.

  • Julie

    Long GDX Confluence of lower channel trend line and minor support RSI at 30 and MACD at level where previous advances have occurred Also CCI at or below -200 where an advance can occur https://uploads.disquscdn.com/images/543f5e8c5407f4405ce40117ebb7f8ff8927b4292dc66650cddec5fe4b8ded15.png JULIE

  • StockTalker

    Just getting started, watch and wait. Equities are next:)

  • ridingwaves

    thanks BL, but sometimes wheelhouses fall apart….will see but it looks like after all the brow beating of sector, it might get some bull wheels now….seasonality is prime..

  • Julie

    One word RW YUP I have been following INFI too posting charts and showing the gap
    JULIE

  • Mark Shinnick

    It really is tough for human level focusing on just the short swing pricing in one instrument; its why I quickly revert to variable time frames to better box-in/ characterize the activity. I’ve had to adapt my code to human execution because I’ve failed to convert my DOS system to internet data feed.

  • ridingwaves

    Julie, you first posted it, one of the first bio posts outside of goofy me on this blog, I like it, mentioned way back then that gap bothered me…sure enough, it played out….like it now…could be slow mover but chart is building nicely for bullish side….possible blue skies ahead for symbol, unless Kim jong fills skies with rockets….

  • OJuice

    Wait for confirmation Julie!

  • Julie

    I hear ya OJ Watching like a hawk
    JULIE

  • HD

    Great comment. You are highlighting some of EW. The human level and characterizing the activity. Ie Impulsive vs corrective. I suspect the more you code, I don’t really know what that means btw, you may see Fibonacci and more you see Fibonacci the more you will see pattern and the more you see pattern the more you will appreciate EW. GL

  • Julie

    SPX I showed this 10 min chart yesterday stating that I would nibble long above the horizontal blue line resistance; above the parallel channel and upper Ichi Cloud boundary Nibbled long at the vertical red line BUT 2640 is the Ichi Cloud baseline (21) on the 60 min chart and must get above. Very tight stop JULIE https://uploads.disquscdn.com/images/255dcb1e0f996f98b8fb2e1ac52cb3c1014ab2cd7d746dd361f164314d104614.png

  • OJuice

    Its in an attractive zone. But Step 2 is find support, and Step 3 is demonstrate a reversal.

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

    Mole’s gone over these general things alot; the POV of code writing is so damm intricate just getting any idea whatsoever properly defined to a machine in the first place so it can be scientifically tested….and so many ideas appearing to us humans in our biases and analog thought processes simply don’t pan out.

  • StockTalker

    Very clear W1 completed,W2 retrace on /YM looks to be complete. -3/YM 24250

  • StockTalker

    short /NKD 22635

  • Øyvind Nyhammer

    It is currently 03:56 in the morning in Tokyo …

  • StockTalker

    Lol, ok buddy

  • Julie

    SPX a consolidation on the intraday charts above the 60 and 10 min Ichi Clouds Now above the Ichi Cloud baseline (21) on the 60 min Shown SPX 60 min chart https://uploads.disquscdn.com/images/a9819f32f84050764fdbaea0684259cf03dc8b17137056dba034e2d19e4bc275.png JULIE

  • http://evilspeculator.com Sir Mole III

    You guys are just not with it – LOL :-)

  • http://evilspeculator.com Sir Mole III

    And you can slap yourself with it for not buying it at $20 😉

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

    I’m not into phallic cartoons, thank you very much!

    https://pm1.narvii.com/6041/4d84abd7e8bf437df9c30d726990636540a2eb39_hq.jpg

  • StockTalker

    BTC failure, game is on

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

    I’d post the PnF, but it looks like the Burj Khalifa Tower.

    http://stockcharts.com/freecharts/pnf.php?c=%24NYXBT,P&listNum=

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

    GDX may do good if silver rebounds.
    but copper’s got to hold too.

    [$copper]
    http://stockcharts.com/h-sc/ui?s=%24COPPER&p=D&yr=1&mn=0&dy=0&id=p76950923203

  • StockTalker

    WTF, that is nuts

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

    glad you like it, it’s a once in a lifetime peek.

    https://www.youtube.com/watch?v=iD4qsWnjsNU

  • ridingwaves

    I actually thought with CME taking BTC to futures announcement weeks ago was a good buy sign, running it up before the real trading starts….

    BTC creation and explosion is just the US treasury giving back to the Winklevoss’s after the sleight of hand steal of Facebook by Zuckerberg….

    making them whole…while America exploits the facebook user…

  • StockTalker

    Exactly why I short the MFer. Needs to break 14k

  • Yoda

    Any rats buying long gold here?

  • HD

    HWB days range. Locking in some beer money. Free ride now. Sorry that entry was $0.20 early.

  • BobbyLow

    Not me. Gold has turned out to be a sweet short. :) However if and when I see evidence of sustained buying, I’ll gladly flip over to the long side.

  • ridingwaves

    I think the banking cartel is going to hammer it with a rate raise next week to boot…..especially with btc futures opening up….but I’m a sheeple too, so I like the shearing, kind of like why I like direct tv….snark

  • BobbyLow

    I have never seen a chart like that. Thats insane! :)

  • StockTalker

    Looks like a 4 now, tightened my stop.

  • Yoda

    Selling looks over-done, kinda like bulls have thrown the towel on it. Just my 2c.

  • Mark Shinnick

    Yeah, some popular momo can easily come in to this relatively young breakout.

  • OJuice

    Looks over-done and being over-done are two totally different things. And the difference between a good trade and a bad trade.

  • BobbyLow

    I understand what you’re saying. Just different styles. I realize it’s not going to zero and there will come a time to be long. It’s that I prefer to buy strength and sell weakness. I’ve never been any good at buying bottoms or selling tops unless it was by shit luck. :)

  • Yoda

    tru

  • Mark Shinnick
  • Yoda
  • Yoda

    I should listen to you more

  • HD

    Put them all back on S. 5 point bounce off 2632 pivot.

  • StockTalker

    Another EOD selloff?

  • Mark Shinnick

    BTW, “5th wave extension” EW theory I suppose is now within its equities acid test?

  • Julie

    Where is GG and his time check ? GG ??
    JULIE

  • Julie

    Closing out long SPX for almost a breakeven. The 38% retracement could be it
    JULIE

  • BobbyLow

    LOL

    I believe there are people here who have back tested and forward tested methods with a proven edge and a positive expectency that can find better entry prices closer to a bottom or top than I can and that’s OK. Finding what works best for you is what’s most important.

    However, I’ve proven to myself that buying evidence of sustained buying and selling evidence of sustained selling is a good edge and has a decent positive expectency. The key is developing a system where you don’t get in too late after a move has begun and this is where back and forward testing comes into play. In any event, I’ve caught more than enough falling knives and shorted more than enough perceived tops that have kicked my ass. So I “ain’t to proud” to try to float along with the market instead of trying to swim against it. :)

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

    cut backs. LOL.
    actually, I had some production work to attend to.
    -GG

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

    GDX Target 50% retracement corresponding with the blue dotted horizontal lines resistance zone and Ichi Cloud conversion line (8) and baseline (21) approx. 22.25 JULIE https://uploads.disquscdn.com/images/b4acca7627b8087c7bfc39281d43e19ae1b199bacad9d20636e27cb5b2772f04.png

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

    GG INTC Perhaps a long tomorrow with a bullish close above today’s high at 43.60 and the daily 5 ema approx. 43.64 JULIE https://uploads.disquscdn.com/images/062828b411ed78d5c6c398d2fdccc27e6a85c01b00ac7415c434461045384fe5.png

  • Julie
  • Julie

    $BPGDM 7 ema Trend lines drawn on 7 ema A c https://uploads.disquscdn.com/images/3a38f156be0bc8266b22ac1f47eb98b279c47ea5965ced874c4b3b152724183b.png onfirmation is 7 ema crossing above the red dotted down trend lines drawn JULIE

  • http://evilspeculator.com Sir Mole III

    Nicely done.

  • http://evilspeculator.com Sir Mole III

    Yikes!! And look at f…ing Los Angeles – those bastards will enjoy 80 degrees this weekend!

  • http://evilspeculator.com Sir Mole III

    (note to myself – go long hemp rope)

  • http://evilspeculator.com Sir Mole III

    NO!!!

  • http://evilspeculator.com Sir Mole III

    Absolutely no participation today. It’s like everyone rolled into March and walked away:

    https://uploads.disquscdn.com/images/0ef53dc469325261a55ec56462b5f0e172d3ceca5c7b060cd36f035f929da74d.png

  • Mark Shinnick

    Its that pressure High that fanned the flames; the firebugs look and plan for that Tell.

  • Mark Shinnick

    Maybe rent hirise rooms by the minute?

  • ridingwaves

    La Nina kicking booty…not a lot of rain this year out west, just cold and dry…cold on the east coast and in midwest, sometimes the south…

    http://www.ospo.noaa.gov/data/sst/anomaly/2017/anomnight.12.7.2017.gif

  • http://evilspeculator.com Sir Mole III

    Guten Morgen!

  • http://www.captainboom.com/ captainboom

    Guten Morgen, Chef!

  • http://evilspeculator.com Sir Mole III

    LOL – I love your new avatar! :-)

  • Yoda
  • Yoda

    ¡buen día!

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

    ?????????

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