Absolute Power Corrupts Absolutely

As you probably know by now I despise FOMC days. Statistically speaking being long ahead of Bernanke’s announcements has produced a significant edge in the past few years but I usually bow out as I categorically refuse to participate in a market swinging wildly based on cryptic phrases delivered by the high priests of modern Keynesian finance. Call me weird but I abhor the sheer concept of giving a small group of private bankers such an inordinate amount of power over our financial system. But for some reason everyone continues to accept it as the status quo. Jefferson surely rolls in his grave. As the old saying goes – power corrupts, but absolute power corrupts absolutely.

This is the chart that has captured most of my attention right now. On a long term basis the DX has breached and continues to hold a very important technical inflection point. I have reported on this in much detail already (and more than once) so I won’t test your patience by regurgitating old news. But it’s good to see that ole’ bucky is clinging to the 84 mark and has managed to hold it through all that FOMC madness.

The hourly panel shows us back at the upper 100-hour SMA and at a brand spanking new NLBL at 84.4. This should be our new best friend as a push above it will probably lead us higher. A failure here is going to result in a roll over and who knows what next.

As a reminder here’s the P&F – now suggesting a rather juicy price objective but of course that all is predicated on pushing above 84.5 (this chart has not been updated today – it’s yesterday’s view – just FYI).

BIDU trade update – after running like hare gravity started to suddenly ruin the party and we’re getting closer to whence we came. In terms of managing this trade I think that the 100-hour SMA will be an important inflection point – your stops should be below that one. The 100-day SMA is only a handle lower and if you prefer use that to either reload (a retest of prior support is not unusual) or to kick it to the curb if we drop below. In terms of shorting BIDU I don’t see this is a good spot just yet – I’ll check again tomorrow once we have a bit more clarification.

More positive update from the crude front – actually there are two-fold. First, if you recall my early morning briefing – I was waiting for that 100-hour and 25-hour to come to a point to get positioned and things couldn’t have worked out better. Great short opportunity at the 25-hour and once it dropped through the 100-hour the writing was on the wall. I would take profits now and call it another short term winner for the team.

On the daily panel you recall the short entry two days ago near those lofty heights near that 97.5 mark. If you took a short there then probably want to start scaling out as the 100-hour is nearby.

A few more goodies below for my intrepid subs – we actually have a few nice setups on the equities front today. Please step into my lair:

It's not too late - learn how to consistently trade without worrying about the news, the clickbait, the daily drama and misinformation. If you are interested in becoming a subscriber then don't waste time and sign up here. The Zero indicator service also offers access to all Gold posts, so you actually get double the bang for your buck.

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

Cheers,