Make Or Break

The longs are on the verge of having their asses handed to them. Now, it’s still possible this is just a big ole’ trap for the bears but I am not seeing any efforts to push this pig into the green.

The strange thing about the recent tape is that it’s not sellling that’s driving all this – it’s a lack of long interest. And often that’s how trend changes really become reality. It’s not the sellers that drive it lower – it’s a lack of buyers.

The fat lady however has not sung just yet – but she’s getting warmed up, so let’s take a look at at few charts:
[amprotect=nonmember] Charts and 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 subscriber it includes access to all Gold posts, so you actually get double the bang for your buck.
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The chart that is usually calling the shots. Copper is pointing to the downside and we are not seeing anything resembling a divergence.

A slightly different perspective on the VIX – usually we are following the 20/2.0 BB but here I’m using my double whammy BB combo, just like on my FX charts (and sometimes equities). How is that relevant? Note those orange arrows I painted and then look at the equivalent chart in equities:

First up it seems we may be failing the psychological 1,300 mark pus we are pushing below that lower 25BB line which may lead us to drop to 1260 or lower.

But what’s a lot more important is the formation of the BB – it’s resembling what happened back in May 2010. And the timing lines up with the arrows I painted on the VIX chart.

I guess you already suspect where I’m going with this. The longs are running out of time and space right now and right here. Or maybe the big boys don’t care – a little shake out is after all long overdue. Regarding this being P3 and the Prechters of the financial sphere finally having their day? I am very suspect about that – as I have indicated in my comprehensive report last week – the charts are still not proposing a huge. Not yet – that is of course.

Bottom Line:

I don’t want to be long here and I also don’t want to be short here. Standing by for better setups – I suggest FX swing trades – much easier to play right now and most importantly: you can get out overnight 😉

Cheers,

Mole