Inside Inside Day Pays Off

It’s been a fun ride since last night when the spoos were breaching the red line on our inside day chart. I really hope you didn’t snooze that entry as double inside days have pretty high odds of success:

Whether or not we bounce back here is of course the one big question circulating in our rodent brains right now. Not to worry, the old Mole is on the job to offer a few insights you may find useful in making a call here. In essence – we are at an inflection point right now and right here – one that seems to be rather pronounced on the equity, currency, and commodities front. So please step into my lair for a quick inflection point chart roll call:

All I can say is ‘watch the spoos’! That NLSL at 1360 is the doorway to 1350 and if we break that we’re going to 1312 or even 1300. Yes, a long trade here is permissible – just keep your stop a few ticks below that NLSL.

Ozzi/Yen – very same picture and there’s even the upper 100-day BB line for extra support. Same setup – you can be long here but the odds are 50/50, and I would actually hope to get stopped out for a run into 85.0 or lower.

Ole’ bucky has attempted to push a bit higher and that’s good news. However, nothing exciting is going to happen unless we breach the 80 mark. That’s really the event we’re waiting for as it may accelerate things on the equity side. In the meantime it’s positive to see it hang on to the 100-day SMA – let’s keep it that way (tengo que pagar mis strippers en dólares).

Euro/Dollar – also sitting right at the cliff’s edge and is supportive of our DX chart – a drop below that would get us to 1.3.

Kiwi/Dollar has made the plunge and unless we see a bounce back and breach above that NLSL we are going to 0.8 or lower. If you missed out – don’t chase it and wait for a last kiss goodbye.

The old lady is also sitting right at the knife’s edge and thus far support has been holding. I think you are getting gist of it at this point – it’s definitely the currency side we ought to be watching, especially after hours. Just embrace your inner vampire.

Dollar/Loonie – a surprising turn about here as this thing was just about to fall off the cliff. We are now near resistance however and then we have that NLBL at 0.999, which of course also represents a threshold ahead of parity. Definitely a situation to watch – again, it’s fine to be short here unless we breach the parity mark.

Copper is sitting on its NLSL right now and thus far it’s holding. I think a breach here would be necessary in order to see anything exciting on the equities front. And even then we’ve got support near 3.73, so I remain skeptical.

Silver is tinkering with its NLSL at 33.9 and unless it corrects that situation swiftly we should be heading toward 32.4. THEN things will get really interesting but let’s talk about that once/if we get there.

Some of you long term subs may remember my RSI_EMA chart on the spoos. As you know I have been tinkering with that 2011 analog idea for the past few weeks and the current pattern thus far is supportive of that theory. We are in a similar spot as last year plotting a similar fractal formation. Based on this we should correct a little lower here and then continue upward before things start falling apart in a big way later this year. Now, having said that – as you know history never repeats itself – but it rhymes. So as soon as we see a detachment from the 2011 script we must immediately cast this analog in our mental trash bin. Until that happens of course this seems to be a handy guide.

Cheers,