Everyone’s Getting Some

The gloves are off and everyone’s getting some today – a royal kick in the nuts that is! Gold, crude, and a few other futures contracts dropped to new lows this morning, just to turn on a dime and then massively retrace higher. Nasty trippy tape all across and I’m glad my exposure was limited courtesy of the holidays. I only got stopped out in my ST crude entry this morning, fortunately EUR/SEK more than made up for it.

So let’s talk equities – I already know the question rattling around in your dizzy rodent brains right now:

Have we painted a low or are we going to drop even lower?

First up the damage is pretty contained and my trailing stop hasn’t even been touched yet. Second I’m looking at some of the carry trade pairs and there’s no confirmation – so call me a bit skeptical on this one.

Third the hourly SPX touched the 100-hour and so far it’s been holding. HOWEVER, should we close the session below it then odds support a drop into SPX 2020ish.

Fourth – you may recall that the VIX:VXO was dropping early last week, so the current correction isn’t exactly a shocker IYKWIM. Plus almost every year we see a drop lower right after Black Friday before they turn on the rocket boosters in the final weeks. No guarantees ever that history will repeat but what gets me is that everyone acts so surprised, but perhaps that’s part of the entertainment.

But let’s not jump to any conclusions – I stick with my 2050 line in the sand. After that we’re probably starting to run a few stops and it’ll lead us lower into ES 2025 and then 2020. The latter correlates nicely with a NLSL on the weekly. Which is where I would look for re-entry opportunities after having been stopped out below 2035.25. Well, that’s my nefarious plan and I’m sticking with it.

Setups:

Juicy looking hammer on the GBP/JPY and I’m willing to take it both ways – triggers on the chart.

More setups below the fold – please join me in the lair:

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Cheers,