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Houston, We May Have A Problem
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Houston, We May Have A Problem

by The MoleAugust 16, 2019

We’re past the half-month mark and since the current gyrations aren’t exactly conducive to anything outside of playing the swings I thought it would be a good idea to go over our momentum charts. What I found is rather worrisome on a medium to long term basis, albeit there is grounds for optimism more short term.

ย 

Let’s start with the latter and then we’ll zoom out and review the long term picture. On the surface yesterday’s bounce and continuation in the futures overnight looks positive. However a quick glance at the chart above and the increase in realized volatility is palpable.

NYSE volume does not reflect much confidence and although I do believe that continuation over the next week has reasonable odds (i.e. 65% plus) I am not jumping into long positions here.

SPX:VIX started to point higher yesterday – let’s see if this continues.

Okay, so the first glaring signs of trouble occurred when a bona fide VIX Buy Signal was almost disqualified. My rule is that a breach > the recent spike high on the VIX must occur. Which means a push in the VIX to > 24.75 would open the door to much ugliness.

ROC on the VIX is also concerning. What usually happens is a drop to -40, a punch higher > the 0 mark followed by a correction and then a drop back to < the 0 mark. However over the past few months ROC has remained stubbornly > its 0 mark and is now pointing higher. This usually does not end well.

Much more waiting below the fold for my intrepid subs:

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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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  • http://gerb-reloaded.blogspot.com gold_gerb
  • https://quanto.live QUANTO

    Thanks mole. I like the fact this blog has always remained true to the system it follows from back in 2010 when I saw this blog. Good job Mole.

  • bankwalker

    OPEX today …

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

    The thing to know about out of control missiles is this: If it looks like a streak across the sky, you’ll be alright. If it looks like a dot, don’t worry about it.

  • zzezzezz

    FULL RETARD SHORT /ES @ 2870 MF’rs!!!!!

  • Mark Shinnick

    I’m not with you on that one at this point.

  • Edgy
  • ridingwaves

    ballsy but I like it…
    note-China is now going full on QE…..
    Whatever stick saves they try are now self defeating…..
    VIX 25sma crossing all sma’s, similar fractal as october…..all cycles down now thru end of sept….
    a race to the bottom has begun…signed mr. bull (now shit)

  • zzezzezz

    I was waiting for GG or Sir Mole to say it! ๐Ÿ™‚

  • ridingwaves

    your ok, they squeezed every retail bear on Tuesday to death with the tariff reprieve for apple….the big boys might be all in now…

  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • http://gerb-reloaded.blogspot.com Gold_Gerb
  • https://evilspeculator.com Sir Mole III

    Thank you Quanto ๐Ÿ™‚

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

    QE and Currency debauchery around the globe is not going to help, opex shenanigans to reel in some fish either….but easier to catch fish with fresh bait……
    took some shorts out here….thanks for the cheap ride….

  • BKXtoZERO

    Out of TMV for a quick 4%…. keepin em green.

  • BKXtoZERO

    Long some TVIX 20.08

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

    Damn NUGT sold off without me.. That was one volatile SOB. I had a good entry and fended off being taken out 2-3 times. NOW… they go. (I am triggered again) RRRRRRRR

  • HD
  • BKXtoZERO

    I am already positioned, so I allow myself some “news” or entertainment these days… https://uploads.disquscdn.com/images/ff0e49d439260434eb764e0b9706e1efd20ecfaf30430678bc874927f8a523aa.jpg

  • Julie 35 – 25 – 36

    Chief Inverted yield curves in the past have led to recessions BUT not every recession has led to a Bear Market.The Gurus and media are hyping a recession with the yield curve inversions which now is Too Obvious. We know what happens when something is Too Obvious. It’s possible now the yield curves to widen and mess everyone up. It is true as stated above that not every recession has led to a Bear Market. It’s possible that the market will go side wise for a number of years.One item that I have pointed out is the last 1 1/2 years SPX has basically gone no where Hope you are feeling better Chief
    JULIE

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

    a very memorable episode.
    ba-Wooosh.
    ๐Ÿ˜‰

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

    did you make home, or did you get stuck behind some Buffalo?

  • Julie 35 – 25 – 36

    Hi GG We made it home just a little after 8 pm last night and I will be in the office on Monday .Cyd will go back to work on Monday too. Grizz as expected from all husbands is catering to all my wishes and whims.lol
    JULIE

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

    a wedge chart for you.

    https://finviz.com/quote.ashx?t=ADS

  • Julie 35 – 25 – 36

    Chief Personally I prefer the Equity Put Call Ratio i lieu of the VIX Tom McClellan several days ago in an article detailing the Equity Put Call Ratio. I use a similar format but use the difference between the 5 and 60 ema’s of the Equity Put Call Ratio The VIX I use numbers esp important is 16 – 17 which has been a floor in Bear Markets. A Bear Market requires a certain level of fear to maintain and previous Bear Markets have not gone below 16 – 17 VIX. Presently the VIX must go below 16 – 17 for the Bull Market to resume
    JULIE

  • Julie 35 – 25 – 36

    Yes GG That is an excellent example of a falling wedge. Remember that when a break out of the wedge the target is where the wedge began
    JULIE

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

    so the GE rise today, is a ruse?

    https://finviz.com/quote.ashx?t=GE

  • Julie 35 – 25 – 36

    SPX 2884.41 is important to have a bullish close above
    JULIE

  • Julie 35 – 25 – 36

    Clarification GG The target is called the high back of the wedge which in the GE chart is approx 8.50 – 9 Carl and Erin Swenlin of stockcharts have both given excellent interpretations of the high back of a wedge
    JULIE

  • ridingwaves

    fake news….Zeroedge at it again…

  • Julie 35 – 25 – 36

    As stated previously I would like to short oil (USO) but needs a bearish close below 11.21 Now the consolidation the previous 3 trading days is working off the overbought condition. so it could bounce. If it does bounce USO must have a bullish close above 11.34 UNG my stop on a closing basis on remaining 1/4 position long is 18.85
    JULIE

  • BKXtoZERO

    As stated previously I would like to see TVIX gap up 10$ with me holding a nice sized position. Make it easy on me….. Pa choooooo

  • BKXtoZERO

    Really? Dang… I am at work now.

  • Julie 35 – 25 – 36

    Hi BK As stated previously that would be both lunch and dinner at your favorite Indian buffet along with a very generous tip lol
    JULIE

  • BKXtoZERO

    Agree. That last sell off was tipped by a weak close. In the bull every close is a strong close and without a study…I bet its very high odds taking cues from close.

  • Julie 35 – 25 – 36

    BK I was going to mention the cabin that you go to in the North Cascades that you have shown pictures.When I was young my grandparents would take my brother and me camping in an area Goldbar – Sultan. I remember a mountain that was called The Sleeping Giant. When my grandfather had time we would go there every summer.We would also go to Diamond Lake Area and Crater National Park in Oregon too
    JULIE

  • BKXtoZERO

    Nice. I ride my dirt bike around gold bar…not too far from me just south of Everett.

  • BKXtoZERO

    Julie… In addition to discussion on closes….I have begun to hypothesize that intraday selling is more of a bearish tip than gap down s. I haven’t done any study but my sense has been that intentional intraday melt downs are more bearish than gaps.

  • Julie 35 – 25 – 36

    Yes BK anyone that does not observe intra day buying and selling is deluding themselves. Gaps are market makers doing there usual sleight of hand
    JULIE

  • Julie 35 – 25 – 36

    Market makers gaping above a resistance or below a support
    JULIE

  • ridingwaves

    last night coming back from Seattle, plane on final approach, landing gear down, runway about 200 yards away, SFO approach is over water, all of a sudden, full power up, nose pointing towards moon, after 3 minutes of everyone looking at each other and some just looking at shock, the pilot comes on and says a plane came in to close to us and thus the re-circle back around……I kissed wife and dog, though dog seemed more eager when got home which after that flight was Uber, where do they get these drivers, Bangladesh?

  • Julie 35 – 25 – 36

    SPY Very lackluster volume with OPEX expiration today IMO a dead cat bounce.Monday’s following OPEX tend to be down and Monday historically is the worst performing day of the week
    JULIE

  • ridingwaves

    Bio has been in long beat up sideways pattern….its going to have to break one way or another…..
    step up and make your bets…..I see a gap on XBI at 75, which would work fine with SPX gap at 2690……I buy my jeans at gap….just kidding..

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

    Volume is perfect for August in Spain. I was hoping to see 2900 but… yup dead cat.

  • http://iberianviews.blogspot.com/ catracho

    Been out all day – gardening – tempted to sell into this – if it wasn’t a Friday – flying to Spain tomorrow -for 17 days – will still be following

  • Julie 35 – 25 – 36

    Banks BKX having a strong day let’s see waht they do next week IMO very key and must be watched
    JULIE https://uploads.disquscdn.com/images/415314b3f6c50d557e4d8527b4aeb146348c601dcdd8534f803c4f70585cff2f.png

  • ridingwaves

    Sangria and Mole……have fun…..

  • http://iberianviews.blogspot.com/ catracho

    thanks – sangria not my thing ! Red red wine and cold beer (not mixed)

  • ridingwaves

    July was officially the hottest month in Earthโ€™s history
    Cold beer sounds like the winner. Wine is my winter go to….
    Canoeridge, this little gem of a winery makes Napa and Sonoma seem further away….great reds…
    http://canoeridgevineyard.orderport.net/wines/Tasting-Room-Exclusives

  • BobbyLow

    That must have made you pucker up. Sounds scary as hell!

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

    I’m familiar with SFO. I once had a November take-off at midnight with a hard rain, no moon, and a full load of passengers. Let me tell you this, a swim was a death sentence.

    I’ve also flown into SanJose with a fog, and the pilot went around, something ‘just wasn’t right’ on line-up.

  • http://iberianviews.blogspot.com/ catracho

    Looks like the obvious support at 200 dma is the trigger for this rally – but it needs more legs – lets see what Monday brings! https://uploads.disquscdn.com/images/21b324d0755c5811477a8fbe7f9c7d9378fa8af0cdcaf4a46fb0e88e81fee3c6.png

  • BKXtoZERO

    Disqus may be fixed? Scanning down through comments I think I see all sub-comments whereas they used to be hidden. Fixed?

  • BKXtoZERO

    Enjoy your trip!

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

    this too shall pass
    ๐Ÿ˜‰

  • Julie 35 – 25 – 36

    Catracho Insert the 55 ema on a weekly chart. Weekly 55 ema was support also. Have a great time in Spain
    JULIE

  • BobbyLow

    Julie you were speaking about Oil down below and I’m probably going to either cut my already 1/2 Position in 1/2 again or just close the entire short while I’m at Break Even before the COB today. I’m not liking the price action at all and I don’t care what Opec or Supply and Demand says. It’s just getting too close to not being a viable short at this time -especially going into a weekend.

  • ridingwaves

    I was more pissed because of long day, knew it wasn’t right when power drive began, I land a lot here so it was foreign to my experience.

    I was hoping it was not this near biggest aviation disaster ever at same runway……if you watch video look how close he comes to tail of jet on taxi…800-1000 would have perished….
    https://www.youtube.com/watch?v=aGQlQFn0euI

  • http://iberianviews.blogspot.com/ catracho

    thanks – I’ll have a look

  • http://iberianviews.blogspot.com/ catracho

    cheers! (salรบd)

  • ridingwaves

    it can be a beast in heavy NW storm with wind, that area is wind alley to begin with….

  • BobbyLow

    I noticed this too. I read the comments about the new change on a Disqus Thread right after they did it and I think there was only about 1 out of a 100 people who liked the new format. Hopefully they put it back the way it was for good. And if so, I’m glad they did.

  • Julie 35 – 25 – 36

    Hi BL USO must break 11.21 support Price action first and foremost irrevalent of what the talking heads say.Yes i agree not a good idea to hold over weekend.Next week we should know a direction. Have A Great Weekend BL
    JULIE

  • BobbyLow

    You too Julie. I hope your arm/hand feels better.

  • Julie 35 – 25 – 36

    I am doing a lot better with swelling decreasing and minimal pain
    JULIE

  • ridingwaves

    stupid change, a simple radio button for truncated messages on/off via user profile preferences would have been easier…easier to code too..

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

    I hope her butt feels better.

    hey! it was a long ride.
    ๐Ÿ˜‰

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

    Time check.

  • Julie 35 – 25 – 36

    Attention all campers in Western states.Read this report last night Lyme Disease and ticks. MT WY OR and ID have the lowest incidence. Northeastern States esp Maine Vermont and New York have the highest incidence. Be careful Easterners out in the forests and grassy areas Everyone Have A Great Weekend
    JULIE

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

    yeah, you’re definitely on drugs.
    ๐Ÿ˜‰

  • BKXtoZERO

    Out of half tvix with customary small ding. Holding very small over the weekend

  • Julie 35 – 25 – 36

    Only drug is an antibiotic Amoxylin (sp) No pain pills
    JULIE

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

    I must be tired. I have my eye on a scalp position long at 2:47 PM at 2886 looking for a little run before the close. That’s set at BE now so we’ll see what happens. I said that I only had a 1/2 Position of Short Oil and forgot that I added another 1/2 yesterday. So anyway I just took 1/2 off and will carry 1/2 Short over the weekend. I hate when I’m holding a marginal position but some of those have paid off so WDIK? ๐Ÿ™‚

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

    “forgot that I added another 1/2 yesterday”

    yeah, you’re going to have to improve that someway.
    I hear it gets worse with age.
    ๐Ÿ˜‰

  • Julie 35 – 25 – 36

    Cyd is allergic to penicillin and wears ID She is allergic to many things.
    JULIE

  • Julie 35 – 25 – 36

    GG There are people that one bee sting can be fatal
    JULIE

  • bankwalker

    killing those 2900 puts …

  • BKXtoZERO

    Where have you been? I won’t call you Turtleman. How has your system been doing? Trading?

  • BobbyLow

    It does. LOL

    Seriously though I had a pretty hectic day today with some other stuff going on and didn’t even open my platform up until this afternoon so I was a little more foggier than usual. ๐Ÿ™‚

  • bankwalker

    working my butt off … trading longer term for now ..

  • BKXtoZERO

    I missed you. You had some good signals and the MKT was in a fun phase. Post more….

  • bankwalker

    Thanks. Working pays more LOL!!!

    I’ll be around more now.

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

    me too. I was driving in, and knew it was going to be ‘one of those days’. Work went haywire, I’m doing what I can to relax and brush off the PTSD.

  • BobbyLow

    My short went out of being viable right at the close so I got rid of the second 1/2 in A/H and I’m flat. I’ll revisit it again on Monday.

  • BobbyLow

    Yikes! I know all in all that it’s safer to fly than to drive and I used to love to fly but now I find flying a big PITA. BTW flying into Logan can come in over the water too and one of the times I flew into Boston, it looked like one of the wings was going to touch the water for a swim before the plane leveled off and touched down. That made me pucker too. LOL

  • Darkthirty

    More conspiracy facts: Lyme disease originated on Plum Island NY at a biological warfare lab.

  • BoboM

    Julie:

    It’s Bobo from danerics. Where have you been? Don’t be a stranger.

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

    XLE Second Half forecast.
    Energy is tied to manufacturing & transports. Energy is not looking good.

    With the exception of April, RSI has been underneath 50 since last October.
    If RSI gets near 30, price will fall. If price falls, RSI will go near 30.

    Dare I say, a full panic would make 49 a very real, tho extreme possibility in the near future? Your call.
    https://uploads.disquscdn.com/images/a1089d8aab89ff781114a8b2a6530aae2436d0b0a45b7b6ae4b110bf323b9e2c.png

    ps. Given the theory of equal time, 2 years were positive, these last 2 could be negative.
    -GG

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

    Tesla,
    a clear 25 weekly cycle. YMMV.

    Year over Year shrinkage?

    https://uploads.disquscdn.com/images/5944ee0533cf0ae108c565e12ea57d0505093f4852f997e770ab89cdde8ab98a.png
    -ElonGerb

  • Julie 35 – 25 – 36

    GG Just 12 miles south of Bozeman and your in some of https://uploads.disquscdn.com/images/ddf9a063016efe78b86e956d1b1a7b6d4ba55089ec563b74102dd4b2f125c8f4.png the most beautiful places on earth. Gallatin Canyon gateway to the beautiful Lee Metcalf Wilderness (Spanish Peaks)
    JULIE

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

    why do you think I stare at stock screens nonstop?
    got to get some $$$ to get up there.
    ๐Ÿ˜‰

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

    and yes, there is another meeting there soon.
    they must have some dam good hookers food!

    https://www.cnbc.com/2019/08/16/heres-what-powell-could-say-at-jackson-hole-to-soothe-the-markets.html
    WTH Julie, is there some trillionaire that lives there,
    and the powers-that-be fly to his calling!?

  • Darkthirty

    Epstein doesn’t have the pizza catering contract anymore……

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

    Doom Porn from a UK analyst, Raoul Pal
    lots of big charts around T 18:00
    https://www.youtube.com/watch?v=V7zEXiqiiqA
    No drama, just a very lengthy description of laying it out.

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

    LOL…. I don’t need any help but the guy who went full bear tard last Friday may have to do some tilting if the downtrend line is broken. Futures up a bit…. It is NEVER the end of the world AND…. usually by the time Mole posts an end of the world kind of post it usually is (finally) on the hairy edge of a plunge but we all know the authorities know that too and step in most of the time.

  • Darkthirty

    Thought rupaul was one of those trans things

  • https://evilspeculator.com Sir Mole III

    Are you holding naked puts?