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Chop Til You Drop
82

Chop Til You Drop

by The MoleOctober 10, 2019

Even a cursory glance at the recent price gyrations in equities is sufficient to make one want to pick up a new hobby or mistress. However it bodes repeating that statistically the worst period of the year is now behind us with much seasonal bullish bias ahead until late spring of next year. Which of course doesn’t mean we’re all in the clear just yet.

The current formation on the E-Mini looks like a natural bounce and go setup but assumptions like these are exactly how retail accounts tend to get wiped out. I’m not a wave wanker anymore but after months of churn and chop it’s easy to see how this could easily – and quickly – devolve into something completely different.

The volume profile chart has us back square in the midst of ‘ze ole’ choppy zone between 2880 and 2940. Thus far it has proven impervious to any antibiotic compound we’ve thrown at it.

UVOL yesterday mirrored the signal DVOL painted the day before. Chop chop ’til you drop….

Due to my cPanel migration adventures (don’t ask) I hadn’t checked this chart for a week or so and what I saw really surprised me. A clear drag to the downside on the SPX:VIX ratio in comparison with the cash index.

Which incidentally stands in stark contrast to the rather orderly manner of previous advances. But if you look closer you’ll see that sell offs come out of nowhere and pick up steam quickly. Over the past three session selling started late in the session and continued into the close.

Little details like that matter.

Speaking of which, the VIX is back near its 20 mark, but what’s worse is that the VIX:VIX3M is painting a rising base as well. RV of IV is also on the rise – all of which makes me worry about a mid/late October surprise.

Crude hasn’t really done anything since our long position but it hasn’t stopped us out yet either. The current formation on the daily panel does suggest a medium to long term floor pattern and I’m pretty happy with where we are. Should this one get stopped out near CL 51 however then things could get interesting with a potential drop toward the 40 mark.

Soybeans also took its merry time but our patience finally paid off. Stop now goes to break/even which may be a bit close for comfort but the roll-over is coming and if it drops this much beforehand then it’ll probably drive much lower anyway.

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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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  • Mark Shinnick

    Well, I need to see drv above 27.31; seems unlikely, otherwise labu is close to upside breakout.

  • Mark Shinnick

    Ok, so labu instantly backed-off from breakout.

  • http://www.quemango.com Herb InCebu

    Been having day trade fun with SOXS. Picked up 12% the other day and got some more at 36.50 a few minutes ago. Maybe with looking at with all the China surprise. I really don’t think there is going to be good news on that front any time soon and who is going to believe it at this point…

  • http://gerb-reloaded.blogspot.com Gold_Gerb

    “Fine richness and flavor to all your desserts”
    https://www.youtube.com/watch?v=FGo7W_mbWCE

    Mistress sounds good.

  • Mark Shinnick

    Its one of my favorites, close to upside breakout. The ranges keep getting tighter.

  • http://www.quemango.com Herb InCebu

    But wait, there’s more!

  • http://gerb-reloaded.blogspot.com Gold_Gerb

    LOL

    edit: Trade War, Recession, Brexit, Fiscal Cliff, Enron, etc etc – same sh!t different decade.

  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • http://www.quemango.com Herb InCebu

    I had an old alert on TLRY kick off today. TLRY is back to its IPO first day price. Remember Tilray? Someone is out there wondering of its going to get back to 300.

  • Mark Shinnick

    Yes…and all the bears see it….and so the bots see the bears.

  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • http://gerb-reloaded.blogspot.com Gold_Gerb

    12 month grind downhill.
    almost as bad as TVIX.
    😉

  • http://www.quemango.com Herb InCebu

    Hmm pot heads are a proxy for the VIX. Who knew?

  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • Mark Shinnick

    Come in RW.

  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • http://www.quemango.com Herb InCebu

    lol

  • Mark Shinnick

    Has average CPU operating temperature gone up since the first Intel?

  • http://gerb-reloaded.blogspot.com Gold_Gerb

    The power dissipation has been rising.
    While smaller circuits use less power, the number of circuits is increasing at a greater rate.

    you should know this Spock.

  • Mark Shinnick

    …since Gamma Hydra 4…memory hasn’t really been the same.

  • bankwalker

    Thanks for the mammaries …

  • BKXtoZERO

    L TVIX (day position) 14.02. Aaaarg in general after a nice looking AH session last night. Much above 2950 starts looking more bullish. My daily sized smaller holds were 13.5 and 14,5 area which was looking pretty sweet… Arg!

  • Mark Shinnick

    Roger that. At some point here my systems will begin to lose resolution. That will be a great way of getting me off the bus. Already the time and effort is getting nulled by offsetting results.

  • BKXtoZERO

    I was just eying up LABU…. saw your posts below. It will be great at some point. I like the leverage and the diversity rather than picking individual stocks

  • Ronebadger
  • BKXtoZERO

    Should call it Sediment Trader (he he he he)

  • Julie 35 – 25 – 36

    $SPX A possible triangle developing. Remember Guys if they can’t take you out they will wear you out
    JULIE

  • HD

    Rocktober continues. Traders love this. Quants, not so much.

  • HD

    We should have bot some PCG puts. Duh. CA is so weird.

  • HD

    SPX did a triangle EOY last year too.

  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • BKXtoZERO

    Long LABU (first timer) Out of day TVIX, but still holding small…

  • pepe

    Closed out USO trade yesterday for 10% loss. Re-entered trade end of day and closed out now for 45% return. Closed TLT trade at 3R. Since S&P is right at make-it-or-break-it 2,940 I’m going sidelines. Good TA but sloppy trading (getting in too early, drawdowns and then out too early). Must be the Moroccan and Spanish wines. Stateside mañana. 😉

  • Mark Shinnick

    Yeah, only in labu.

  • dojibarfly

    I think you meant Primates; same same

  • https://evilspeculator.com Sir Mole III

    All the trees are still standing.

  • http://gerb-reloaded.blogspot.com Gold_Gerb

    interesting huh.

    now if someone can explain how embers just happen to land on roofs and take down whole restaurants surrounded by asphalt.

    https://www.metabunk.org/data/MetaMirrorCache/e2078f6b9676df06fd7e6134c3680a58.jpg

  • http://www.quemango.com Herb InCebu
  • http://www.captainboom.com/ captainboom

    Having been through a house fire about 9 years ago, nature is remarkably resilient. I had two trees damaged in the fire, and I cut one down when I rebuilt, as it was too close to the new structure. The other one is still standing, and has started to suffer from insect infestation. It’s kind of rough on the side that was closest to the fire, maybe 15 feet, but if you look at it from the road about 50 feet away, you’d never know what it had been through. I’ve kept it as long as I have, as it’s a wonderful shade tree over the garage and driveway. I’ll take it down in the next year or two, and use it to heat my new house.

    I was also through Yellowstone back in 2013 when it was just starting to recover from the fires. It’s amazing how much is left standing, and how well it recovers.

    No deep state at work here. Just the way fire and nature behave.

  • Darkthirty

    It’s called jewish lightening, e.g. WTC bldg. #7

  • http://gerb-reloaded.blogspot.com gold_gerb
  • sutluc

    When I worked forest fires in the 80’s I used to see embers a long way away from the fire. The more wind the worse it was.
    Sprinklers are designed to combat fires internal to the building. Fires that start on a tar roof or in exterior walls and work their way into the building through the attic space are tough going for a sprinkler system. The sprinkler lines are hung from the burning structure and collapse when it does. Also, many sprinkler systems triggered at the same time result in low mains pressure.

    Green trees are hard to burn. They suffer damage , often fatal damage, but continue to look relatively untouched for a while. It takes specific circumstances to build a crowning fire, the type of fire that leaves trees as black leafless sticks. That doesn’t normally happen in broken terrain like grassland interspersed with small forested areas, or parking lots interspersed with small forested areas.

    Looking at that photo I would say that a ground fire burn through most of the areas of landscaping around the trees, with the exception of some areas of green trimmed grass in the foreground. Most of those trees are likely not fire resistant and will die.

  • Mark Shinnick

    Amazing image all that high pressure swooping down upon the West and South.

  • BKXtoZERO

    Out of DRV for small loss 26.63 near the open. I was right, not much damage from IYR as usual. TVIX down big but small position, leaving it on. Proabably addd at close today or near 2990-3000, LABU up, UGAZ up small, back to bed…. enjoy rally zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz

  • Mark Shinnick

    All the 2x/3x bear stuff got locked out. The problem is that the general range is still small compared to each’s atr’s, so there’s still no true breakout signalling.

  • Mark Shinnick

    That Sep 24 tvix target might be a good zone to add, see what happens.

  • http://gerb-reloaded.blogspot.com gold_gerb

    LABU, target the 50ma.

  • pepe

    Long UNG at $18.90.

    Note: In last nights analysis of my past few day’s trading, I realized that I would have held on to both long USO and short TLT if I had been more patient in the entry timing (and therefor made better returns). A good learning experience. If I can be more patient and wait for the trade confirmation I’ll do better, much better. My achilles heal right now.

    My take on the trade deal is that there will be no or a very small trade deal. Of course touted as the greatest thing in the world since the invention of derivatives. Buy the rumor, sell the news, I’ll say. But not making any bets – for now. 😉

    I thank Sir Mole and this community for accepting (or at least tolerating) this newbie from the city of angels.

  • http://www.quemango.com Herb InCebu

    This is stuff that needs to closed at the end of day. Otherwise should used futures so the stop comes into play overnight.

  • Mark Shinnick

    Yeah..I used to run many millions and had all those accounts but never completed the 24/7 software to be able to get vital rest. I’ve accepted a mostly US based market lifestyle.

  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • pepe

    Sold at $9.27 as I’m boarding a long haul flight. Good hunting everyone! 🙂

  • http://gerb-reloaded.blogspot.com Gold_Gerb

    nothing like a few Trillion buying back in. Si’?
    https://www.youtube.com/watch?v=C0jb9zWd4n4

  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • http://www.quemango.com Herb InCebu

    Not following why you want to hold TVIX. The VIX can theoretically go to zero. It is a derivative of a ratio not even an asset in its original form. The chart below is logarithmic otherwise it looks a parabolic collapse, and that is why it has such an appeal to gambling – look left and you see the huge potential a rebound could deliver. Only it cannot ever get back to those passed numbers because it is not based on value or even price. That is why it is always is constantly reverse split. Someone else could explain it more eloquently than me but the chart says it all.

    If you want to hold something that could really pop ROKU was mentioned by Mole a the other month and it is in play today. Same for TTD. Lots of stuff like that and if your are not afraid to go to zero with the VIX derivatives, you could really do well holding these. IMHO but I don’t know squat about what happens next just looking a t charts and drawing lines. 🙂
    https://uploads.disquscdn.com/images/bfadc977ba752a13519a0a8f67d9d3ff000624ed8f206f20180e13ef84db9e08.png

  • Mark Shinnick

    He’s refining his methods and position sizing and really coming-along. Already I think there are more periods when his sizing is at zero or very small.

  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • http://gerb-reloaded.blogspot.com Gold_Gerb

    DOW,
    RSI 50 is know to be a dangerous place, for overnight moves.

    Yes, if the sky is blue the sun is out.
    Yes, if the sky is gray it’s likely to rain.

    Let this Joker have his day, Life is a tragic comedy.
    https://uploads.disquscdn.com/images/73bbad6c0d19e85f0a56e3812946b434ba3c037134261cdbcff942cfc1f0b22a.png

  • Julie 35 – 25 – 36

    Hi GG We are taking a breather …. Prepping for winter hogs and all.Grizz is winterizing vehicles and Cyd’s vehicles are ready for winter.Halloween is coming up and going to several parties.
    JULIE

  • Ronebadger
  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • BKXtoZERO

    sold LABU and added TVIC 12.75 area a while back, still holding UGAZ

  • BKXtoZERO

    yes, I mostly short term trade it and swing. well aware of decay and risks.

  • pepe

    UNG: Got back in at the pullback to $19.08. Volume at halftime 10% above average daily. Potential reversal day with strong support at $18.75. Holding for a swing if we don’t spike.

    Found out they have free WiFi on the flight.

  • Mark Shinnick

    I’m still a holdout for the Sept 24 target zone.

  • Darkthirty

    Professional FF/EMT for 28 years. Never saw radiant heat travel that far, or embers ignite on newer code construction. Just my observation…

  • Mark Shinnick

    Come in RW.

  • BKXtoZERO

    will add more on any deal

  • Ronebadger
  • Mark Shinnick

    You bet 🙂

  • Mark Shinnick

    Yeah…the ranges have narrowed suggesting that even this is pretty heavy damage.

  • BKXtoZERO

    Out of half of todays’s tvix minor ding, in actuality the lot that sold was purchased 13.5 and 14.5, todays position scaled back from 2R to 1R (in other words, back peddling)

  • Darkthirty

    there were high temps over japan before the fukushima problem also. I was thinking HAARP…..

  • BKXtoZERO

    They are hurting my buzz…. I had my music all picked out….I had a theme properly set up. I was up on 2 lots…. The AH action was indeed a clue. A hammer…stop run. Aaarg.

  • Mark Shinnick

    Well…maybe imagine those with the short margin calls today. You have advantages around here….and you can often pick really good entries.

  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • Mark Shinnick

    Gartman Stopped Out Of His Short

  • BKXtoZERO
  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • BKXtoZERO

    Lotza shooting stars on Friday, here too