Post Turkey Day Wrap Up

As expected today’s session brought us nothing but a tryptophan laced serving of whipsaw. Rather typical for those half trading days they often wedge between a long holiday weekend. Frankly, I don’t know why they bother – it must be that American obsession with productivity, which IMNSHO turns out to be a bit counter productive. I mean seriously – nobody in their right mind would touch holiday sucker trapping tape with a ten foot tentacle. Anyway, despite Thanksgiving festivities our FX setups marched on proudly and it’s time to finally pull the plug in whatever positions you may have held on to.

Cable – almost threw us off the off the horse after breaching that first NLSL. If you held a few lottery tickets for a push into T2 then it’s probably time to start closing them out. That’s way too many red candles for my taste and once I start feeling smug about a trade it’s usually time to pull the plug.

Same situation on the USD/CAD – we are now officially at our target, so don’t be greedy and call it a day.

NZD/USD – way beyond target. I told you guys to take profits a few days ago and if you ignored it – good for you but don’t push your luck now, buster! 😉

While we’re in the FX department – here’s a screen grab of the 60-min AUD/JPY panel on the ZeroFX feed. That was the second exhaustion spike in little over a week and I’m really starting to enjoy our new settings. Remember, ZeroFX is a free bonus to the Zero data feed – it comes with AUD/JPY, GBP/USD, and EUR/USD panels.

On the equities front I’ve been poking around in the financial blogosphere and do not see anything of value – people are either confused or scared – or both. Time for ole’ Mole to give you a few charts to sink your rodent teeth into:
[amprotect=nonmember] More charts and cynical commentary below for anyone donning a secret decoder ring. If you are interested in becoming a Gold member then don’t waste time and sign up here. And if you are a Zero or Geronimo subscriber it includes access to all Gold posts, so you actually get double the bang for your buck.
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This is really the one chart you care about right now – we start with the weekly this time around and work our way downward. You may recall that weekly 1158 NLSL I pointed out earlier this week. And guess where we are parked right now? Starting Sunday night in the spoos this is an excellent spot to take on long or short positions – maximum benefit with minimum risk. However, remember that this is an SPX chart – you need to add fair value which is currently between -1.75 – 1.90. So let’s use -1.825 which gets us to ~1156.25 on the spoos.

The daily doesn’t give us anything to hang our heads on – a cluster of NLBLs way above and support way below. Which supports the binary nature of our weekly setup: Whatever way she breaks on Monday I expect to see a long candle. I must however concede that after seven consecutive days down on the S&P E-Mini I cannot help but favor the long side a little. But don’t let that come in the way of taking a short trade should we start pushing through the support cluster shown on the next chart:

As you can see we’ve got a cluster of NLSLs looming right below – they will all expire soon but since they are slightly below the weekly NLSL shown two charts up I expect a bit of support here. Plus there’s are two of my lower Bollinger lines as well. If all that breaches we all dine in hell come Monday night 😉

Bottom Line:

See, that wasn’t so hard – I think we have a clear setup for Monday on the equities side right now. Since several of our FX setups are now at target it also gives credence to the probability of a short term bounce. But if – for some reason – it does not happen and equities (and the AUD/JPY) are looking weak on Sunday night then we may just go all the way to SPX 1100, which would be seven consecutive closes lower on the SPX. So, frankly – either way we are looking at a good setup. If you are being stopped out on the long side then you don’t have to play the downside if that’s a bit too scary for you. Just wait out any ensuing plunge and if we seem to slow near the 1100 mark then there’s an even better opportunity to shop for Black Friday sales.

Side note:

Since I am a cheap bastard I was tempted to go to Walmart at midnight to pick up one of those discounted LCD TVs. Am I glad I changed my mind at the last minute as the damn place turned into a freaking war zone from hell. Incidentally this was exactly the Walmart I was planning on going to. All Walmart locations in L.A. county are strategically placed in lower income neighborhoods – you won’t find one in West L.A. or in Beverly Hills, if you get my drift. Anyway – events like this once again reinforce my ongoing plans of relocating out of Los Angeles. After immigrating here almost exactly twenty years ago I am sorry to say that I seriously doubt we will celebrate Christmas 2012 here in California.

If there are any interesting developments over the weekend I will put up another post but I really don’t see much else of value in my charting universe as of right now. I expect the AUD/JPY and the spoos to give us important clues as to which way the beast will swing starting Sunday night. So if you’re a sub I suggest you occasionally check your email as I may just send you guys a quick update.

Have a great weekend.

Cheers,