The Zombie Apocalypse Is Near!

Of course the MSM is all up in arms about ‘evil’ Russia deploying troops in Crimea (it’s in Southern Ukraine – a peninsula of Ukraine located on the northern coast of the Black Sea). And the usual suspects are spinning at max hype velocity fully expecting all this to trigger WW3. I guess I better start stacking up on beans and bullets. Oh wait – my arsenal is all packed in long term storage over in Los Angeles – bugger!

Look guys – I tell you exactly what’s going to happen. Absolutely f..ing nothing. Like all other real or manufactured crises of recent past this is going to blow over eventually. Despite all the bellicose rhetoric neither the Russians or the West have any interest in escalating this conflict beyond the region. Of course I have no idea how it’s going to resolve and whether Putin will eventually cede control of Crimea after securing Russia’s interest. But unless you are Ukrainian or Russian, honestly, do you really care? Is this going to affect your life, your investments, or your trades? I mean going forward? Really? So why should you care?

If there is any damage then it has already been done. Obviously our long campaign on the equities side has been taken to the woodshed. But that’s ancient history – what we care about is what lays ahead. However there is no predicting how all this will play out and thus I recommend you fade the paper and instead stick with the charts, as usual. Don’t get caught in this week’s hype – stick with what works and don’t let the news lead you to become biased. Because that leads to the express elevator to the woodshed. By the way, if you want the skinny on this train wreck then head over here.

I already mentioned that the long campaign has been stopped out – last night I was actually pretty lucky hitting a bid two ticks below break/even at ES 1844. Since then equities have further degraded – the E-Mini is now trading below a new daily NLSL at 1838. If we close below it then we may revisit the 25-day or the 100-day – but as you can see they are both swinging up now and unless we fall off the plate I expect on of them to act as support.

During uncertain and headline sensitive times like these I usually switch into survival mode. Until further notice trading now becomes an exercise of asset protection and damage mitigation. Which means I am extra picky about setups, my position sizing drops to below 0.5R, and I make extra sure that there is little correlation risk. In other words hunkering down, waiting out the storm, and live to fend another day.

A bit more below the fold for my intrepid subs:

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Cheers,