After The Burn Comes The Churn

After a big squeeze like yesterday it’s perfectly normal to see a sideways or sluggish session. After all it’s the natural prerogative of any self respecting market maker to instantly manhandle any late comers who weren’t nimble (or smart) enough to accumulate when the getting was good near the prior lows. I hope that doesn’t include any of you guys – after all you were given plenty of warnings right here in our humble lair. Now let’s see where we are on the equities side:

If you went long the spoos then you probably banked one R – it’s time to call it a trade now and exit. I’m not yet tempted to short this thing but I may tomorrow if we produce a shooting star candle tonight. Is that really too much to ask? 😉

Unfortunately Mrs. Market doesn’t take requests – even from the mighty Mole. Here’s the YM which has been lagging the ES quite markedly. I am cutting and running here – per the rules of course as it has not produced 1R within three candles. That’s right sucker – three strikes and you’re out.

NYSE advance/decline is looking divergent right now and although I won’t head over the the Slope it did light up one bulb on the Evil Lair’s Mad Market Monkey Business Panel:

Yes, that’s right – the lair is still operated via steam engine. You can see the Zero indicator running in the top left. Futures pairs are mixed via manipulation of levers and foot panels – as you can imagine lifting a good ask can be challenging.

Alright along the same lines (literally) is our NYSE advancing vs. declining ratio. Divergent right now and that may lead to a sell off late in the session (only one hour left, so it needs to get going).

Setups! Here’s the AUD/CHF which is painting a very juicy RTV-S (sorry mislabeled) and an IP-L. I’m only interested in the long side here as I prefer to take this one with the trend.

Quite a few more goodies below the fold – please join me in the lair:

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Cheers,