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Back In Limbo
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Back In Limbo

Back In Limbo

by The MoleMarch 22, 2013

Technically speaking we are back in limbo territory right now – if you are not familiar with that terminology then make sure to catch up with my post on market weather. Although the current up trend remains intact it has weakened and the best the bulls can now hope for is a final short squeeze before things get a bit more serious. The bears of course still have no mojo but they really haven’t mattered since March of 2009 – always remember that it’s not the bears that break a bull trend it’s a lack of bulls chasing a tired trend.

Today we’ll zoom in a bit in order to gain clarity on the equities side. As you can see it’s been a tug of war of sort in the past few days and we yet have to see full resolution. However, although I do call this a limbo period let’s remember that the current remains intact and as such being stuck of where we are is semi-bullish. Hence my call to move back into a few longs as we crossed back above the 100-hour SMA (which was our short trigger a few days ago).

That inside period a few days ago actually still suggests some value as no real candle body has been able to breach it. Anything above 1551 puts us back into solid bull tape – obviously, doesn’t take much chart reading skills to arrive at that conclusion. While we’re stuck below 1551 and 1531 we’re in limbo. Below 1530 I’d cautiously suggest that the bears may just have a shot at this. However…

There’s still the matter of that volume hole sitting right below that old inside day trigger line. And quite frankly given the mojo I’m seeing I’m rather skeptical about a breach below. We’re also running out of time and that 1442.25 NLSL on the spoos is expiring today. Timing is everything and when an opportunity presents itself you better go and take advantage of it. That spells true in matters of love and war, and even more so when it comes to trading against the trend. The possible rewards are great but failure is always ignominious.

Let’s talk about the Dollar – in the past 10 sessions I count eight red candles and two green ones. So we are correcting here albeit in a sideways manner. Things may pick up some speed here and get us back to the 25-day SMA near 82.3. Probably a much needed correction it’s not necessarily bearish. What happens there of course is of course what really matters. The hourly panel looks a bit shot out but I would not venture to call a low here just yet.

Solid setups today on the FX and commodities front – please step into my lair:

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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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