Spoos Back At Resistance

Very interesting session thus far – the spoos opened lower but reversed almost immediately and have since been pumping higher without taking as much as a breather. Judging by the Zero Lite accompanying momentum/participation has been minimal. It’s possible that this is just a counter snap but I think the final hour before the bell will provide us with a few more hints.

As I am typing this the spoos have approached an inflection point which cannot be breached if the bears want to get a bit more play next week. We ran up all the way to that NLSL and are now pushing sideways. I would be short here with a stop right above that NLSL. Next best resistance is that NLBL at 1414.25. If you are taking a short position here and we close below that NLSL today then I strongly suggest you watch the spoos starting Sunday night – for obvious reasons.

VIX reversed at its 20-day (2.0) SMA today – we should always expect resistance there and the bears will have to conquer this one if they want to see further downside (in equities). In the past three months we have only spent eight sessions above that SMA, which in itself speaks the to the strength of the medium/long term trend.

Ole’ bucky retested its 100-day SMA and immediately dropped back. Great entry if you managed to catch it. Unfortunately I was plagued by technical issues all day and did not have a chance to send out an alert. In any case, what’s important here is that SMA which will be the our Maginot line going forward. If not breached post haste (i.e. in the next two sessions) then I am afraid further weakness awaits and we may drop all the way back to 79. And that does not bode well for my exchange rate here in Spain.

A few more setups for you subs and then let’s call it a week. Please step into my lair:
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For starters we have an inside day on the USD/CAD. Both sides are looking good here.

Wheat heading for NLSL support and I want to be long here unless of course we breach that Net-Line.

Soybeans – another inside day. This thing has been on a rampage and I would take either direction here. If this was equities I would probably not go long on a green breach but always remember that commodities move differently than stocks. If you haven’t followed FX or commodities then you have not seen a truly nasty short squeeze.

The 10-year is pinned right below resistance. I am short here again with a stop a few ticks above that NLBL. Also would be long here on a breach – no directional bias.

Corn – also heading for NLSL support. Same idea – long until we get a breach. The hourly panel indicates that the easy bear food may have run out as we touching both the 100-h and 25-h BB lines.

Last but not least – crude. Perfect NLSL touch today (this seems to be a theme today on the commodities side) and we already bounced back. I am long here with a stop below – keeping it simple/stupid. Seasonally this one could be walking sideways for a few days or a week. Thus I would not recommend options – stick to the futures or you may get theta burned.

That is all – enjoy your weekend!

Cheers,