Express Sunday Chart Roll Call

It’s the shortest Sunday of the year, and it didn’t help that I fell out of bed late today. So please forgive me if I’m going to be very brief and just run you through the essentials. Hey, on a different note – why do they have to stiff us with a short day during the weekend? If those crack smoking farm boys want to shift around the time zones then let’s bloody do it during a work day – especially in spring. I’m sure you blue collar rats would agree 😉

Judging by our E-Mini volume profile last week’s whipsaw was inside what I would call the ‘play zone’. Below and above we are dealing with a dearth of available volume and in particular directional confidence. The bears and bulls are equally frustrated – for different reasons as the latter couldn’t get laid in a women’s prison holding a fistful of pardons and the latter are being pulled to the floor by the size of their own balls.

Here’s Mr. VIX dropping back into record low territory – we almost crossed the entire BB in four days. Maybe the shake out from hell but there’s not much space to run unless we are heading below the magic 15 mark. This is where we’re heading? Really?  Forgive me for being skeptical and I have seen things you people couldnt believe, battleships burning on the shores of orion, c-beams glittering in the darkness of the tenhausen gates…

Alright, I just popped my meds and are ready to share a few more goodies with my subs – not a boatload but I think you are going to really really like what I dug up. Please step into my freshly mined lair:

The simple stuff first – here’s copper still painting a divergence on a long term basis. We’re keeping an eye on this one.

MMMR – until we breach above 1378.04 I am going to be very skeptical about the long side here. Yes, it’s possible we drop the signal and run higher for a little longer – we don’t have a crystal ball after all.

To give my stainless steel rats a bit more context I put together a weekly MMMR. And I don’t know about those odds on the long side. Last week was a nice shake out but I think you’d agree that we’re right back to where started and holding long here seems risky.

I have usually plotted this ratio against the SPX in the past. Until I realized today that I have been only half right about that treasury yield ratio. It’s actually a much more interesting measure against the TBT or TLT (the latter is shown in blue on the chart). As the ratio is now nearing the upper channel I am very keen to see what happens next. And here we were waiting for bonds to fall into the abyss while we played the sideways tape. Maybe we’ve had it all wrong. Anyway, we’ll know shortly – either the ratio breaches the channel or it turns and we may just see a spike on the TLT.

This chart is courtesy of Sentimentrader  – donated by thepercolator, a deliciously evil new member of our rat pack. I also looked at the Yen vs. the SPX and yes, there is a major drop in the past few weeks. So we may just have ourselves a nice short setup here but if we pop across last week’s highs then all of this is going to be meaningless.

Bottom Line: I am going to make this very simple for you all. We do have a short setup here after last week’s snapback which shook out all the hobby bears. Who really wants to be short here? Exactly! Which is why this just may be the time to be short. However, price is king my little ratlings – so don’t be a hero. We’ll wait for inside candle or perhaps a retest variation sell setup. Don’t be a hero and let price direct your actions – in case you haven’t figured it out yet, it does not work the other way around 😉

Cheers,