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Bear Trap Thursday Wrap Up

Bear Trap Thursday Wrap Up

Bear Trap Thursday Wrap Up

by The MoleFebruary 3, 2011

Extremely interesting day – I’m sure Zero subs were taking note of a significant bullish divergence between the spoos and the ZL this morning:

The time line I drew marks the end of this morning’s drop – as you can see the ZL was completely unimpressed and barely even dropped through the mark. What followed was of course predictable and any bears dumb enough to chase the tape down are now applying a second helping of Vaseline.

I ask you know – what other indicator is capable of keeping you ahead of nasty traps like this? Stochastics, MACD, RSI? I don’t think so…

When Geronimo entered its trade today we just had reached the upper standard deviation line of VWAP on the spoos. I was really skeptical there and even sent out a warning to my subs to only take a small position. But despite my doubts Geronimo completed the trade a few minutes after, which comes to show that steadfast discipline is required when trading black box systems. Even I am not immune and I wrote the damn thing 😉

I also would like to point out that Geronimo lost 13 ticks during yesterday’s sideways yawning session. I did mention it in the comment section but as I’m all about transparency I wanted to make sure everyone sees this.



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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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