Zero Progress

As we are now pushing toward our annual Christmas holiday it’s time to take stock of the past year – no matter whether you are a bull, a bear, or stainless steel rat. First let’s see how equities fared in 2011:

Well, I see absolutely no progress – we had a lot of talk, a lot of rumors, plenty of drama, and even more opinions. But in the end the S&P 500 has not moved an inch since mid December 2010. And that sad fact, just like your holiday cookies, happens to be already baked in. Even if we get a break out next week and equities stage a Santa rally we will most likely end the year at zero sum

Now, does that mean we rats didn’t bank any coin this year? Of course not – we played this tape like a fiddle because we don’t take sides – we only take positions 😉

Now compare that with gold, which had its own share of volatility but over the year eked out quite a bit of upside progress. Now, you all know I’m not a gold bug but if we get near 1700 I would love the be long the shiny metal again – or short if we close below that diagonal support line. I’ll better keep an eye on my Net-Lines chart when/if we get there.

I’m going to continue the long term theme below for my intrepid subs – please join me in the evil lair’s watch tower:
[amprotect=nonmember] 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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Silver has been a lot less profitable – there was a surge early in the year but it decided to fall off the plate late summer. Also almost net zero for the year with only a few handles of upside progress. This could change quickly however if we fall through that H&S support line I have pointed out on the chart.

Over the past year the AUD/JPY has actually done a bit better than the SPX – I see a bit of downside progress here. I understand that this concept may be alien to you – but as stainless steel rats we do not care which way the tape swings. If took out a short position in silver futures a year ago you are currently profitable. Granted – if you know how to draw a line you should have banked quite a bit more coin.

What’s more interesting to me right now is that inverse H&S configuration which at the current time lines up almost perfectly with that magic 80 mark. A breach of that may get us almost back to 90. Once again this is a long term trade, so please don’t get confused when I propose Net-Lines or ZeroFX short trades in the interim.

Crude’s turn – we do have a bit of upside progress on an annual basis but boy – the volatility! The magic 100 mark is in play again right now (for the nth time) but the line I drew suggests that 103 is your uncle if you are betting on higher or lower gas prices for 2012.

Soybean futures – your other white meat replacement. I do like that (rather steep) diagonal resistance line and as long as we don’t breach it take any touches as an opportunity to trade the trend down. Remember cocoa – the trend remains your friend until it’s done. FWIW – a reversal play here could be a lot of fun – I hope it’ll drop a bit more to make it even more interesting.

Bonds – the 30 year futures first. Quite a bit of upside progress for the year! Equity traders would kill for that kind of mojo. Also, a nice diagonal support line – which until broken should act as support for your long trades.

And here’s the 10-year for good measure. Not only does it offer us a nice diagonal support line on a long term basis – if you have been a good boy/girl then we may even get a juicy inverted H&S pattern for Christmas this year – yes, even if you’re Jewish, Hindu, Muslim, Atheist, etc. Again, I’m going to keep my eyes peeled on my short term net-lines chart if we get close to 131.

On a personal note: Yesterday was the 20th anniversary of my emigrating to the United States – quite an opportunity for reflection and of course to party! Fortunately it didn’t get quite as crazy as in the Hangover 2 – which you guys have to see – just cover your eyes during the tranny bit – I’m serious, you’ll thank me later.

Anyway, I had an awesome time and per my last count all my fingers and limbs remain attached.

On a serious note: I must say among the best choices I made since I hopped over the big pond was to start this trading community a little over three years ago. Every day I wake up and am looking forward to digging into my charts and putting up a post. Maybe even getting a smile or two out of you guys – or at least seeing you not being taken to the cleaners. I absolutely love what I do and each day is another opportunity to bank a little coin and have fun taking it from the suckers (evil is as evil does, right?). Compared with some of my nine-to-five worker bee friends I truly consider myself a very lucky man these days.

I have big plans for 2012 and will be working hard to make this place even better – stay tuned and keep chiming in.

Cheers,