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America, We Have A Problem
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America, We Have A Problem

by The MoleSeptember 18, 2013

I’ll spare you my personal thoughts regarding the FOMC’s non-taper announcement just minutes ago. If you have been visiting here for more than a few weeks then you know my general outlook on how the game is being played. And if you’re new here then let me boil it down for you: The crooks always win in the end and there is no final justice. Swallow your anger, embrace the pain, and try to ride their coat tails.

However, we have a much more pressing problem. Mere minutes before the announcement I happened to look at the DX and produced the chart shown above. If you’re a sub then you probably recall that I had pointed at the 81 mark as our final LT line in the sand.

Well, thanks to Bernanke & Friends that line in the sand was just washed away by a veritable ‘risk back on’ rip tide which washed ole’ bucky all the way below 80.5. I had my order waiting but got a lousy fill – no surprise there. The day isn’t over and perhaps we’ll recover some of that emotional territory but this is very very bad news – or in other words: America, we have a problem.

This is a technical LT short entry and the current target is near 77.5. From a trading perspective this is a fine entry and it’s supported by the P&F shown above (which my subs probably recall). A close below 80.5 will seal a triple bottom break out and increase the odds that this target will be touched.

From a general perspective as an (expat) American this makes me extremely sad as the Dollar’s purchasing power was just eroded a little further. In the international currency free-fall race to the bottom it seems that Bernanke is determined to win the game at all cost. I can’t blame him as it’s the only bullet left in his arsenal. But the further financial damage this is going to inflict on working class Americans (and other people across the world – this is not an isolated issue) will be tremendous. I don’t have to explain to you how stretched to the max folks are out there and expect commodities (especially fuel) and food prices across the board to respond in kind.

Another sad day for America – unfortunately given the political stalemate and inability in Washington the best we can do is to protect ourselves by proper hedging. I have been warning everyone about this situation for weeks and months now and I’m rather perturbed to see this DX trade having triggered.

It’s not too late – learn how to consistently bank coin without news, drama, and all the 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.

Cheers,

 


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 the usual social media waterholes.
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  • SS_JJ

    Well this rat is enjoying very much the “surprise” annoucement and is more than happy to have hedged his trades accordingly. Katching !

  • AcoBrasil

    I think they just blew the top on $BVSP (EWZ) at the 200sma weekly I just went short on that and $SPX.

  • http://dartht.blogspot.com/ Darth_Gerb

    He uses statistics as a drunken man uses lamp posts — for support rather than illumination.

    Widely attributed to Lang (e.g. in Elizabeth M. Knowles, The Oxford Dictionary of Quotations, Oxford University Press; and in Robert Andrews, The Columbia Dictionary of Quotations, Columbia University Press) but the original source has not been found.

  • Rightside_ot_trade

    Good advice as usual mole
    This summer I read The Payoff: Why Wall Street Always Wins
    By Jeff Camnaugh. Helped a bit understanding the possible reasons ‘why’

  • ridingwaves

    miners are like tech stocks today….SVM, go baby…ex divi on 9/26

  • https://evilspeculator.com molecool

    I only believe in statistics that I doctored myself. — Winston Churchill

  • ridingwaves

    outside of all the green shoots, Fed revises GDP down…and inflation up….

  • Skynard

    That totally blows me away with the dollar carry. Kudos Mole for your “Blow-Off” call. Needless to say some shorts were placed up their after being stopped out of every trade. Lol, NUGT trade made up for every loss today.

  • http://dartht.blogspot.com/ Darth_Gerb

    30+ %
    saaaa-Weeeeet.

  • phantomflash

    Well, the dollar goes up, and the dollar goes down. Today down. Later, when tapering actually starts, I figure back up.

  • Pervergence

    I just sat on my hands and watched……missed out…..but I didn’t know what the reaction would be…..

  • http://dartht.blogspot.com/ Darth_Gerb

    was going to ban you, but you posted a year ago.
    howdy stranger!

  • bdoone

    BKX up only .22%. I thought free money was good?

  • sburtt

    Am I the only sub not receiving Crazy Ivan trade alerts? I would of thought that with all this move the 30min would be active,,, but I have not received any email

  • BobbyLow

    Nope. It’s been silent. Not even any “Quiet Time” Messages. Don’t know if this is normal or something else.

  • http://dartht.blogspot.com/ Darth_Gerb

    sold my retail oiler’s.
    close enough to my ending T.
    Thursday move big, Friday’s snooze.
    -DG

  • Ronebadger

    almost a VIX lower BB kiss…very close today (can you say Government Work?)

  • http://ibergamot.blogspot.com/ i Bergamot

    Most unusual fed day.
    No whipsaw at all.
    Wonder why nobody commenting on Zero action?

  • Pervergence

    No 30 min on GC……which is what I want

  • bdoone

    Shitload of SPY 172, 173, 173.5 & 174 calls traded. OI very high. 173.5 calls alone OI 11.7K and 100K traded today…puts OI and volume nonexistent up here. MM’s like worthless options by OPEX, max pain and all that.

  • bdoone

    Priceline PCLN traded over $1000 today. It marks the first time ever that an S&P 500 stock has crested $1,000 a share level. Very interesting. I cant believe this thing as in the index and barely trades 500K shares a day.

  • sburtt

    I used ninjatrader in the past and I know the software is fussy.. I suspect it’s not sending out messages and it prob needs a shut down restart..

  • m123456

    it’s disgusting how they’re pumping I honestly wish i could go protest. it feels like when this thing busts its going to ruin a lot of decent people. sorry i know it’s not money related. sometimes i just get “fed” up. apologies.

  • Pervergence

    My insurance man said Buffet bought a large put on the SPY….anybody know if this is true….if so he is hurting right now

  • Pervergence

    It wouldn’t be so disgusting if EVERYONE was reaping the benefits…..

  • http://dartht.blogspot.com/ Darth_Gerb

    my bull friend use (key word) to own it back at $27. thousands of shares.
    I’m gonna go let him know.
    tee hee.

  • bdoone

    Didnt hear but from Aug 15th: Soros bought a put on1,248,643 SPY units in the quarter. Could’ve had his market titans mixed up.

  • Schwerepunkt

    Wow. That’s . . . gotta . . . hurt.

  • bullregard

    They could be just hedges, you know they cannot use stops on those sizes.

  • m123456

    everyone? it’s wall st and washington. almost everyone I know is still struggling to find work or is being downsized to part time. everything from insurance to gas to rent thru the roof. meanwhile stocks BLAST new high every second. it’s disgusting. and honestly bums me out about how greedy america has become. i know it’s always been this way but i’m shocked at how bad it’s become the last 5 yrs.

  • https://evilspeculator.com molecool

    Seriously? You would believe some rumors by an insurance peddler? LMAO!!!

  • http://dartht.blogspot.com/ Darth_Gerb

    yet, a lot of people. not sure about decent.
    you’re an old timer.

    a quote from you..
    “u should be mindful of your own quote. “makes fools of us all.” no one’s living ever seen a mrkt like this so be careful.”

  • bdoone

    correct. in his filing he was still long tons of stocks. Who knows? Could be Dec puts and hes unloading stocking now and riding puts lower…MM either way.

  • https://evilspeculator.com molecool

    Sorry – got my hands full today…

  • https://evilspeculator.com molecool

    Nope – please stop anticipating entries folks. They come when they come.

  • bdoone

    Maybe he’s got same insurance man as Buffet 🙂

  • m123456

    no doubt I’m a fool.

  • http://dartht.blogspot.com/ Darth_Gerb

    me too, but I’m getting better. 😉

  • Pervergence

    MOLE…..Is the 30 min GC feed up and running?

  • m123456

    true a fool and his money are soon parted. I’m broke but I don’t really care about that. Hopefully some good will come of all this BS. that said i hope eveyone here rakes it in until the inevitable next crash comes whenever that is 1day or 5 yrs from now. it’s the cycle. just the way it is.

  • bdoone

    And a quote from an unnamed wise sage made just yesterday (ok, it was Mole):
    “What we need to see is a blow off top with a clearly divergent signal.”

    Just waiting on the div now I guess.

  • Pervergence

    Well…..I didn’t say I believed him….just asking…..but he does insure alot of HUGE farms….so the guy does have a finger on the pulse of commodities.

  • http://dartht.blogspot.com/ Darth_Gerb

    I agree. anybody care to reflect on 1998 or 2000?
    it was mo mo, until it wasn’t.

  • Pervergence

    That’s what I said…..

  • http://dartht.blogspot.com/ Darth_Gerb

    and you wonder why he can’t shake this leech? Muwahaha.

  • m123456

    i know. sorry. too busy being livid 🙂 zipping it now. don’t want to hijack. good luck to all.

  • http://ibergamot.blogspot.com/ i Bergamot

    Buffet has been a major seller of SPY options for years. Check his annual report (its a great read regardless). Judging by amount of options he written, I would not be surprised if he is one of biggest “market makers” in the world!

  • BobbyLow

    This crap has been going on for a very long time. For a few years, I was pissed off and traded off my emotions. That led to me being still pissed off and getting broker and broker.

    Now, I still don’t like what’s going on but I’ve accepted that it is what it is. I am no longer pissed off because I can’t be pissed off and happy at the same time. Life is too short. I no longer trade on emotion and am much better off.

  • Pervergence
  • Pervergence

    Most of clients own Gulfstreams and dragsters…..so they aren’t hacks in the AG business

  • http://ibergamot.blogspot.com/ i Bergamot

    Does he say anything about this year’s harvest?

  • m123456

    i wonder how he is now? it is true though. even when you have money most people who are happy have found things of more substance to fulfill them

  • https://evilspeculator.com molecool

    NOT how the game works.

  • m123456

    you’re right. my righteous indignation just flares on certain occasions like today. that said even if i was making millions i’d still be pissed. it’s not even the unbalance it’s how good the govt is at making sure people aren’t so miserable they revolt. it’s impressive.

  • Pervergence

    Never has….but it COULD BE BETTER

  • Pervergence

    My sis and bro in law are missionary docs(surgeons)……they could make a pile of money here….they love Africa.

  • m123456

    that’s awesome. wish i had some skills like that. I can advise people how not to lose their shirts 🙂

  • Pervergence

    I think there have been several studies that show under a certain income people are unhappy because they can’t provide….but after a certain level(pretty damn low) money does nothing for happiness.

  • Pervergence

    THAT IS a skill……

  • Pervergence

    Everybody has a gift…..

  • m123456

    i think it’s supposed to be like 75-100k (unless of course you live in nyc, sf or la)

  • Pervergence

    Didn’t ask….but I can if you want…..

  • m123456

    problem is unlike evil here I can’t tell them how to make money 🙂

  • ds2

    Mole, Could you please update the Daily Zero? Thanks!

  • https://evilspeculator.com molecool

    Will do tomorrow morning (my time).

  • Sean

    The article that reported this read the 13F wrong… it actually shows 7.8M shares at $1.25B notional value, so 78K put contracts… and if he was buying them OTM for protection then he could probably actually only spent $20M – $30M on the position and be protected into next year, so he still has time to be correct…

  • gsavli

    why not? the original purpose of options is protection against market falls. this is perfectly normal behavior, i’d say.

  • http://ibergamot.blogspot.com/ i Bergamot

    Who wouldn’t…lol

  • Pervergence

    I don’t trade farmy stuff

  • Pervergence

    Insurance poor?

  • Smiddywesson

    Oh well, I guess my retirement job is going to be a cannibal.

  • convictscott

    Considering he has > 80% of his net worth in long equities I think he will find a way to not kill himself for one more day 😉

  • Pervergence

    Is there going to be a 30min CrazyIvan GC feed?

  • convictscott

    Well if you are actively trading I would encourage you to forget that shit completely. It will completely utterly screw your trading ability. Morality and markets do not mix well

  • Pervergence

    Shit…..the only really rich person I know is Julie Wrigley…I don’t even read about Warren

  • Pervergence

    Think ol’ Warren might have just a BIT of influence on FED decisions??

  • convictscott

    The nature of the filters we are using is inherently slightly lagging as it is based on price. We are measuring normalized ATR against a 100 period average and defining high volatility as above one 100 period standard deviation from that, switching it on and off as appropriate. Unfortunately this keeps us out of the markets sometimes I would prefer to be trading, but all the alternatives have similar or worse problems. By taking all currency pairs we achieve a decent year end result though.

  • convictscott

    Doubt it.

  • convictscott

    Depends on demand. Right now only a few subs for the 30 min.

  • Pervergence

    pretty tight with Obummer….who is pretty tight with Bernanke…..would be surprised if Ben doesnt ask his opinion…..

  • Pervergence
  • http://www.ProfitFromPatterns.com/ Ivan K

    Perhaps more to the point is whether Warren is privy to certain decisions … after all he is of the old school … and also contributed heavily in ‘bailing’ out a certain USA insto.

  • Pervergence

    Thanks…..would like to see an unfiltered beta run…..

  • Pervergence

    “I think very cheap money makes things happen, it makes asset values higher. When asset values are higher, people do have a greater propensity to spend,” Buffett told CNBC.

    “I think Bernanke has sort of carried the load himself during this period.”

    !

  • http://dartht.blogspot.com/ Darth_Gerb

    how do you spot holes in large vacuous ranges?
    (hint: look for large candle moves)

    http://stockcharts.com/h-sc/ui?s=SLV&p=D&yr=0&mn=6&dy=0&id=p79616149652

  • Smiddywesson

    That sir, went right over my head. What is a large vacuous range? One which jumps around with lots of gaps and little directional intent? Teach me, I am ignorant and want to learn what you meant (not a troll)

  • http://dartht.blogspot.com/ Darth_Gerb

    I wanted to use the term volume hole, but that probably doesn’t apply.
    Yes, fast moves with no resistance, aka large panicky candles.

  • http://dartht.blogspot.com/ Darth_Gerb
  • Smiddywesson

    I’m glad I asked, slow moves fill in the vacuum behind them, but fast moves leave a vacuum, and nature abhors a vacuum. Kind of like a morning gap is likely to fill. What you added to this is a non-directional market REALLY hates a vacuum, probably because EVERYONE, even the winners are left surprised and willing to act upon it. This is a early morning commute thing to ponder.

  • convictscott

    It is very interesting how price gaps (and volume gaps) are a magnet for price

  • convictscott

    30 min only switches on in high volatility trending events

  • http://dartht.blogspot.com/ Darth_Gerb

    probably just a fibonacci….yep, there it is.

    http://s23.postimg.org/5git50tgr/fib_thing.png

  • convictscott

    My feeling is that it is something more fundamental, similar to the way a fakeout works, with losing traders waiting to get “their money back”, when there is a volume hole there is less of them, and price can vacuum through up to the next support/resistance

  • convictscott

    Nope. The fed decision making process doesn’t work that way

  • http://www.ProfitFromPatterns.com/ Ivan K

    After some time surviving in the risk taking game, one comes to realise that what another person / trader / entity does … does not matter at all … what matters is what said person does with the information / rumour they receive.

  • sburtt

    “switching it on and off as appropriate” is this done manually? sorry if I ask, but according to what you said your using the volstat to filter vol on 30min, this moved well above 1stdev on eur/usd just after FOMC announcement, with little surprise to me if you think we’ve been trading in a 20 pips range for the past 3 days (thats makes well over 100 candles) and then bang! 200 pips higher, I’m surprised that didn’t triggered the Ivan 30 min model

  • phantomflash

    Howdy. Ban? Well, I don’t know what posting frequency has to do with that, but looking at my Disqus history, I’ve posted here 14 times in the last year. My job and other responsibilities keep me extremely busy so I am not able to just sit around and chat. However I do find occasion to contribute a bit from time to time. Hopefully at least of some value…

  • phylum

    …..and that applies to the whole gamut …. family, finance, relationships, life;)

  • http://www.ProfitFromPatterns.com/ Ivan K

    One of those Universal Truths in my book.

  • phylum

    The interesting thing to me has been recognition of, and dealing with, the way different people hear the same message however interpret it differently …

  • http://www.ProfitFromPatterns.com/ Ivan K

    I am glad I am deaf and blind and illiterate (lol)… and in Vanuatu.

  • phylum

    I’m hearing you……BTW Port Stephens isn’t half bad either:) remember?

  • http://www.ProfitFromPatterns.com/ Ivan K

    Indeed I do … yet I prefer traffic light- … booze bus- … McDonalds- … free zones … additionally the skies here are still naturally blue as opposed to being chequered by chemtrails.
    EDIT: Not to mention virtually zero chems in local foods … dead cow actually tastes like beef etc.

  • http://www.ProfitFromPatterns.com/ Ivan K

    I am sure that all / most / some of you realise that the ‘Federal’ Reserve has ‘only’ a 100 year mandate / franchise … this expires in 2013 … shows the scope of vision held by some people (a bit like Japan introducing 100 year terms for mortgages in 1986 … or by 100 year debentures being issued and bought in 1993) … the obvious question begging is … what comes next … to replace the Fed?

  • phylum

    Far enough away from Kooragang to be safe. McD’s proliferating, yes, traffic lights, no …. hopefully it will stay that way….wishing:)

  • Schwerepunkt

    McFadden-Pepper Bill of 1927 gave the banks a perpetual charter. Only an act of congress can terminate the charter and that’s not going to happen any time soon. Here is the relevant language from that Bill:

    Skc. 18. That the second subdivision of the fourth paragraph of

    section 4 of the Federal Reserve Act be amended to read as follows:

    “ Second. To have succession after the approval of this Act until

    dissolved bv Act of Congress or until forfeiture of franchise for

    violation of law.”

  • https://evilspeculator.com molecool

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    ¨°º¤ø„¸F R E S H „ø¤º°¨

    ¸„ø¤º°¨ M E A T“°º¤ø„¸

    ¸„ø¤º°¨¤ø„¸¸„ø¤º°º¤ø„¸

  • https://evilspeculator.com molecool

    Uuuuh – it’s running right now… you didn’t sign up?

  • https://evilspeculator.com molecool

    What you want and what you get are two different things 😉

  • https://evilspeculator.com molecool

    Done.

  • http://www.ProfitFromPatterns.com/ Ivan K

    I have read reference to that also … thank you.

  • captainboom

    BTW, I love your buttered toast on the back of a cat Free Body Diagram for an avatar.

  • evilasevildoes

    couldn’t agree more with yesterdays post Mole