Money Talks

I ought to be dedicating my E-Mini campaigns to rock legends more often as it seems to instantly bestow them with extra mojo right after entry. Of course the bullish divergence I observed on our Zero indicator Friday afternoon may have been a contributing factor as it was flashing ‘bear trap’ pretty much most of the session.

And just like AC/DC the Zero did not disappoint, the former with keeping things rocking and the latter with keeping them rolling at even keel by serving us as an early warning system for both bull and bear traps. Shown above are both the Friday and Monday sessions. Admittedly things started to look a bit dicey in the last quarter of the session but then price got pinned nicely toward the closing bell.

So what’s the deal here? Note how the Zero Lite (right panel) remains in bullish territory (above its dark blue 0 mark) the entire time on Friday while price is squeezing the longs all the way into the close. Although the signal strength diminishes considerably on Monday it remains above the mark again, which is actually not unusual ahead of the final squeeze – we have been observing this type of behavior many times over the past eight years (since I launched the Zero).

Anyway, I hope some of you guys were able to grab a seat on the bus before it took off. I’m moving my stop to 1R and hope that today’s session adds another one or two. If you missed out on this campaign then you should seriously consider signing up as a sub – call me biased but I wouldn’t touch the E-Mini without it.

I ought to be doing a bit more Christmas shopping today as the EUR is heading down shortly after Merkel’s coalition talks were officially declared as having failed late Sunday night. Maybe I’m missing the point but shouldn’t the EUR jump up as a response? Alright so I’m admit not being a big fan of Mrs. Merkel and with the EUR dropping fast I may just end up winning twice here.

In case you wonder – I don’t see an entry here just yet. In retrospect this may have been a great lottery ticket short position on Friday night but trading political events isn’t really my cup of tea, so most likely I would have abstained anyway. Besides, all it takes is for some unexpected agreement for the EUR to advance by a 100 pips in a matter of moments. Can’t speak for you but that’s too much event risk for this old trading Mole.

Bonds are looking very positive right here but I kind of missed a good entry earlier this morning (to which of course there is no excuse, you are right!!). So for now I’ll be waiting for a revisit of the 100-hour SMA which most likely won’t materialize as this one seems to gear up for a jump higher.

Gold is also looking like a possible long and if this wasn’t a short trading week I’d probably throw half an R or so into this trading pit. But given all that volatility recently and with participation thinning rapidly starting this afternoon I think I won’t test my luck for now at least.

And I have similar sentiments about crude in fact. Perhaps late last night would have been a possible entry but for now I see a ramp & camp formation that looks a bit too juicy ahead of the holidays as there low volume periods in comparatively small markets invariably invites monkey business.