Bait And Switch Tuesday

Guys – don’t let this happen to you! If you’ve been trading equities for more than a few months then you probably have seen the following play out: Equities are dropping near the open, everything is screaming sell. Suddenly there’s a spike to the upside which triggers more bids and results in a short squeeze continuing most of the session. So how to keep from getting screwed like this and in many other ways on a recurring basis?

Simple! Sign up for the Zero which shows you real participation on a 5-minute basis. What you are looking at above is a textbook bullish divergence on the Zero Lite during the quick drop post NYSE open. May I also add that yesterday’s sell off had very little juice as evidenced by the tiny signal range accompanying it. That’s not always a sure sign of a bear trap but it bodes paying attention the following day near the open.

What worries me more however is the ‘heartbeat’ like signal on the hourly Zero (left panel). I have seen this a few weeks ago and it preceded a shake out a few days after. Which brings me to the next chart:

The E-Mini is continuing to flesh out a sideways wedge of some sort and I have a hard time justifying entries anywhere except near the extremes. However, that said – the hourly is looking good and I just added 1/4R with a stop below 2084.25 (VWAP). Low odds on this one succeeding however, you have been warned.

My NQ campaign met Sir Gregor Clegane today who made quick business out of my long positions by chopping them into pieces. Not a big deal as they were nicely in profit but a shame nevertheless given the jump higher.

Updates updates – Sugar looking good but I’m moving my stop to break/even as I don’t trust a concerted number of pull backs all across the futures and forex.

Coffee – always suspected this one may be a trap and I closed it out near break/even. This one just doesn’t have the mojo and I’m too correlated with all the other open futures positions already.

Copper – looked so juicy and then pulled back. Still like this one but I’m moving my stop to break/even as well.

Silver – also moving my stop to break/even. Not a definite rule in my systems but when it happens across the board I think it’s more than justifiable, especially given my current exposure. So let’s see how many of them survive the night and into tomorrow – if they hold below I think we may have real runner potential as this was quite a shake out today.

Crude – I bet you all forgot about this one already! I took a second long position on the 9th and so far it’s remained in play courtesy of my more conservative stop below the 50 mark. It’s finally tickling the 100-day SMA now and perhaps it’ll muster up enough mojo to finally break free. Anyway, keeping my stop below the 50 mark as I’ve been waiting for this one to play out a while now.

The future is now – so don’t bring a knife to a raygun fight. If you are interested in becoming a Zero subscriber then don’t waste time and sign up here. A Zero subscription comes with full access to all Gold posts, so you actually get double the bang for your buck.

Cheers,