Tender Loving Setup Care

Some of last week’s setups are in need of some TLC and despite the rather annoying tape there are handful of new developments worth sharing. As I only see a summer skeleton crew I decided to make this a freebie – so leeches everywhere rejoice! 😉

Let’s start with currencies – the AUD/JPY is painting an inside day + NR4 combo. I would prefer seeing a continuation upward after last week’s NLBL breach, however if we drop through today’s lows tomorrow then I may take a few positions off the table. A drop through that NLBL would of course put us back into shorts.

Another inside day + NR4 combo over on the CAD/JPY – you know the rules. If not then please consult the cheat sheet which is available from the menu bar.

EUR/JPY may have gotten you long on Friday but you should have closed or reverted into a short by the bell as we remained below that NLBL. And that Net-Line will remain to be our long/short separator until Wednesday.

EUR/USD is making our life difficult today – today’s drop represents a reversal into short positions, assuming of course we don’t push back above by the close.

Ole’ bucky meanwhile is painting a trifecta – an inside day + NR4 + a NLSL retest. It trades like a regular ID setup but I would love love love to see a push higher here, which would also represent a NLSL reversal. Could really shake things up. But let’s not have wishful thinking get in the way of a good setup – we’ll take this bugger either way.

Cable is also painting an inside day + NR4 combo today. Same rules – you know what to do.

USD/CHF is mirroring the EUR/USD and we are now long, again assuming we don’t drop below 0.9777 by the close of the session.

On to commodities – crude has me back in cash until it picks a direction.

Gold lagging behind silver today – very interesting. Either way it’s also painting an inside day + NR4 combo – trade accordingly.

Natgas just breached a NLBL – which represents a long trigger. Of course after a long candle like this anything can happen, which is why the NLBL is our fork in the road for either playing continuation or a reversal.

Sugar looking pretty sweet as it just reverted its Thursday/Friday NLSL breach. If this holds it could grow some legs. But bear in mind that the NLSL expires tomorrow so unless we drop back below today we won’t get a short entry if she drops below. But our stop below that NLSL still remains in place no matter what.

Treasury futures – 10-year flavor: I would not take this inside day as the candle is clearly too long. BUT I would exit any short positions from last Friday if we push above today’s high of 134’175 tomorrow.

And then there’s that beautiful NLSL reversal on soybeans – you may recall that inside day setup which was followed by a little fake out attempt on Friday. I have recently started to take 2+ day breaches as long as any fake out attempts have been small (e.g. just a few ticks) – no stats on it yet but I think it’s technically permissible.

That wraps it up folks – keep it frosty and keep it clean. Managing positions through days like this are part of being a trader – nothing glorious and probably more work than it’s worth. But they are part of the game and it’s best to do like Data – turn off your emotions chip and simply follow the rules.

Cheers,