The current tape is very positive and sets us up for a nicely timed reversal starting sometime next week and leading into week 43:
As you can see we have a little bit more to go before we hit both the 100-day SMA and the upper boundary of my 25-day BB. Yesterday’s mini correction was very healthy for the overall uptrend – it produced a reset in the consecutive days up and it shook out some of the weak hands. Not that I am eager to take or hold long positions here, no sirree. A correction is needed as I don’t think that we will make it through the Gobi desert of volume without squeezing out some of the excess ballast. We need some tall candle chasers to push through that low volume desert from hell. That’s right – even the suckers have their role to play and are needed to help us rats bank the coin we so rightly deserve 😉
We touched the lower BB line on the VIX this morning instead of breaching it. That buys us a bit more time and if the longs are lucky it’ll help pointing the entire bubble back to the downside. If things work out according to plan however I’d like to see a spike lower outside that lower boundary which would set us up for a VIX sell signal. Heck – it’s been July since we saw one of those!
I suggested a long trade on sugar futures to the subs yesterday – once that 100-day SMA was breached it was confirmation of a push higher. I have taken the liberty to point out possible target ranges. If you’re a noob – T1 is where you take 70% of your position off the table (your mileage may vary based on your risk profile and capital commitment guidelines) and the rest may be held into T2 with a stop near T1.
I have one more chart for the subs today – not many setups I find delectable right now but this one is worthwhile pointing out:
Charts and 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.
Soybean futures – I love them soybeans as they are tasty, highly directional, and they are fast movers. We just breached the 25-day SMA but my signal to take a long position is the 1275.75 NLBL on the hourly panel. It’s good for a bit longer and if successful should take us into 1340 as T1.
That’s all I have for today – have a wonderful weekend!