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Two Lines In The Sand
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Two Lines In The Sand

by The MoleNovember 1, 2013

Equities have held up overnight but briefly kissed the 1750 mark which I deem to be a line in the sand for the bulls right now. If we drop below it chances are we’ll see continuation lower – perhaps even leading to a medium term correction:

But let’s not be hasty here – at this very moment (at least while I’m typing this) we’ve got a great long opportunity here with a stop below 1750. If we drop below it then probabilities shift in favor of the bears. The very limited participation range on the equities side (as seen on the Zero indicator) however suggests that things could swing either way at a moment’s notice.

Another line in the sand you ought to be watching has developed over in crude. Some very interesting developments with even long term implications – please step into my lair:

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About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at the usual social media waterholes.
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  • BobbyLow

    And a mighty fine mornin to y’all. TGIF

    I would add that let your charts be your guide with Crude but oil can be very tricky in November and December. I don’t have the stats on a spreadsheet but during late fall early winter it can go nowhere while the equity market has a year end rally. This doesn’t have to make any sense but just is.

    And just think about all the news you haven’t heard about Syria or anywhere in the ME lately. Everything must be wonderful over there right now. Right.

    Edit: Crude oil is down about 9% since October 4th already but price was hyped up during the Syria mess. But OTOH, in the Spirit of overdoing things in both directions, it could still have a lot further to go.

  • http://dartht.blogspot.com/ Heisen_Gerb

    Chevron -6% revenue. timberrrrr.

    talk about dawg of the DOW
    http://stockcharts.com/h-sc/ui?s=CVX:$INDU&p=D&yr=2&mn=0&dy=0&id=p60546953185

  • ridingwaves

    ACRX trade mentioned yesterday..15% gainer..sold 1/4 shares, could be $20 stock within 12 months…holding out the rest for the triple whammy…

  • ridingwaves

    OSIR crushed late to party shorts who didn’t cover yesterday…FSLR the same..

  • BobbyLow

    I’ve become very accustomed to the games that are played in the oil market. The way that oil prices are explained to the public is a travesty.

    This is the game:

    Big “playas” gradually build long position. Then not too mysteriously the shit hits the fan in the ME, weather forcasters forecast record number of hurricanes, natives get restless in Nigeria and of course no tapering of bond purchases are highlighted to create the illusion that Oil is a good buy at any price.

    After and while oil price is being pushed to the upper limits, the public is bitching and congress is bloviating about investigating the excessive price of oil, the big “playas” are building their short positions.

    Then out of nowhere, everyone in the ME are sitting around a campfire singing Kum Ba Ya, there are no hurricanes, the weather is beautiful, natives in Nigeria are on holiday and as price is driven back down, the big playas gradually rebuild there long positions all over again.

    This cycle is repeated over and over again with actual real supply and demand having very little to do with price.

    Of course this is all just my NSHO and if there was actually anyway I could actually prove this, I would probably croak from some sudden “accident”. 🙂

  • Dyellowflash

    I aint posting my trades or blabbering without charts, but credit to ZL for showing negative participation at that 5m spike in prices just now! Great JOB!

  • Skynard

    New low AUD, was memorized by how well it was holding up against the dollar.

  • neowave

    waw crazy ivan is in a bad run, hoping it will turn soon

  • BobbyLow

    USD/CHF is still running strong along with GBP/CAD

    “Run Forrest Run”! 🙂

  • beentohardknocksU

    I’ve noticed that $RUT seems to be a lot weaker than its big brother $SPX – fairly obviously so today (one down, the other up – or at least it WAS up until a few minutes ago).

  • Skynard

    Hehehe:)

  • jmoney3000

    Im taking the fact that there is no one in the comment section–this is the real move

  • SilverEagle

    we’re through mole’s 1750 line

  • BobbyLow

    Gotta love the strength in the dollar based on QE forever. Oh wait, LMAO

  • BobbyLow

    Real move in what? I’m seeing some great moves in currencies and a down move in oil, some scalping opportunities in the eminis for those that have balls to do so but equities still suck.

  • Sean

    Looking at the CI results file, as of 10/18 it looked to be on pace for ~36R/year (I think as advertised was ~30R?)… and given the win rate and trade frequency there is a 50/50 chance every month will have 5 – 6 losing trades in a row, so even more than that would be common… also, there should be no “hope” in a mechanical system, either the data says it works or it doesn’t… I trust that Mole has tested this and it does produce the 30R/year, but that requires following the rules exactly for the whole year, so I would recommend a “set it and forget” approach otherwise you’re going to end up doing dumb things…and if the draw downs are hurting maybe your risk level is too high…

    Edit: The top one is for monthly frequency and the bottom is for yearly, which I tried to delete, but apparently didn’t take…

  • jmoney3000

    Equities

  • https://evilspeculator.com molecool

    She’s playing with fire!!

  • Skynard

    AUD tagging hourly 100 lower BB, long

  • Skynard

    chart

  • https://evilspeculator.com molecool

    Really do not have anything to add to Sean’s comment – he laid it out perfectly 🙂

  • https://evilspeculator.com molecool

    Hey Sean – can you email me that Excel sheet? Thanks!

  • BobbyLow

    Well maybe so but the Equity Bus is one that I no longer choose to ride. But good luck to those who do. 🙂

  • Sean
  • https://evilspeculator.com molecool

    Well, we are at the line in the sand – review:

  • http://dartht.blogspot.com/ Heisen_Gerb

    agreed. I noticed this first during the open of the Gulf War. what? the battle will only be 4 weeks? collapse.

  • http://dartht.blogspot.com/ Heisen_Gerb

    negatives, Hmmmm.
    and that scale can resize intraday right?

  • Skynard

    If we get a bounce will shock it:)

  • newbfxtrader
  • https://evilspeculator.com molecool

    It’s still a small scale. A signal of -.08 is not that meaningful. But I wanted to point out that there was no participation yesterday on the way up and then the signal started swinging downward on the way down.

  • Skynard

    You may see a div carving out here, although it is the largest signal for a long time. Ready to fire:)

  • https://evilspeculator.com molecool

    That was always the danger the Fed was facing. And there is NOTHING they can do about that. IF we truly run into a situation when all the Fed printing starts having zero effect then they are literally up shit’s creek. But this was just a little correction – wake me up when we push above 82 or higher.

  • http://dartht.blogspot.com/ Heisen_Gerb

    did you say carving? it’s a long way to T-urkey day.

    SPX timing based on price/histogram review.

    http://s15.postimg.org/upfwpjb7v/Nov_spx.png

  • ridingwaves

    adios a todos, thanks for all the points of view and trading knowledge passed around. Thank you Mole for your expertise and input on the market. Your straight forward approach in regards to trading is much appreciated and was very helpful… good luck in trading to all. I don’t trade futures or options so i believe my bio equity symbol setups and whining doesn’t help anyone here….cheers and felices fiestas

  • BobbyLow

    I don’t remember seeing any whining coming from you and even if perhaps most of us don’t trade bio equity, it doesn’t mean you don’t help anyone here.

    This place is like a smorgasbord where we can take what we want and leave the rest. As far as charts go, I probably contribute the least. But when it comes to making mistakes over the years, I’m an expert because I’ve probably made 75% of all available mistakes that can be made. So we can each bring something to the table. Everyone wont like what we bring but someone will. 🙂

  • Wyo_Redneck

    And, even though there are not very many of them and I’m trying not to be biased, but BTFD hasn’t worked out to well these last couple of days.

  • https://evilspeculator.com molecool

    That’s too bad to see you go. I don’t trade bio tech but others here may even if they’re quiet. Either way best of luck to you.

  • https://evilspeculator.com molecool

    That’s too bad to see you go. I don’t trade bio tech but others here may even if they’re quiet. Either way best of luck to you.

  • https://evilspeculator.com molecool

    Aware of that and this is a tough spot as we’re at the inflection point with a lot of sideways churn. Nothing wrong with being long here with a stop below 1750. But as we’re swinging below I have to take out a short with a stop above. I may get yanked around a bit but that’s the price of admission.

  • https://evilspeculator.com molecool

    admin@ yes – I’ll edit your comment so that the spammers don’t pick it up…

  • https://evilspeculator.com molecool

    which used to be so much easier – now disqus really sucks after all the ‘improvements’.

  • Skynard

    Have taken a few of those trades, although feel more comfortable trading futures and read all your posts. Good luck riding those waves:)

  • https://evilspeculator.com molecool

    Take a look at crude on the hourly panel – we are still waiting for long setup here but as we are sitting on 95 it would have to happen here or the setup is bust. We may get an IP here – so let’s see…

  • https://evilspeculator.com molecool

    I think you nailed it – the energy futures guys in the NY pits are all blue collar street kids who are having their fun with it. NG is even worse – smaller market and they enjoy fucking with everyone who isn’t part of their insider club. They all know each other by the way and they literally have a script they all follow.

  • https://evilspeculator.com molecool

    This is too funny – ES sitting on 1750 and CL toying with 95 – both inflection points. Of course holding here in any direction ahead of the weekend is risky…

  • CorporalCarrot

    I would say this tape is taking people to the woodshed both long and short.

  • SS_JJ

    strange tape today. When ES goes South, the silver miner that I track, HL, goes up.

  • https://evilspeculator.com molecool

    Yup – don’t like this tape ahead of the weekend. Best to stay out of a good trade than to be stuck in a really bad one…

  • CorporalCarrot

    A-fucking-men.

    I would say however, that if this holds today we resume our March to 1800. Big money still has no reason to be in anything other than stocks right now, and I can’t see anything in the near term thats likely to shake that view and cause an allocation change. As such the path of least resistance is upwards and I really do feel if it was going to happen for the bears it needed to happen today (even though I hate that phrase, as in the greater scheme of things bears don’t exist).

  • http://dartht.blogspot.com/ Heisen_Gerb

    what was that gangster movie with Steve buscemi and the best move is to do nothing?
    I can’t find it. I know you posted it years ago.

  • SS_JJ

    Thanks for stopping by to say bye. I, for myself, really appreciated your comments all this time.
    Good luck Waverider.

  • BobbyLow

    Correctamundo!

    Currently holding 5 open Forex Pairs at this moment. My rule for Fridays is that if I’m not stopped beforehand, all positions are to be closed by 4 PM EST win, lose or draw. Learned this one from the CI Format. However, I think CI is closed by 3 PM on Friday.

    I saw enough Fuckery going on Sunday evenings that tells me that it’s OK to wait until Monday morning to see if I want to put on any new positions

  • BobbyLow

    It isn’t often that you see Oil sell off during the last few minutes before the close of Open Outcry at 2:30 PM on a Friday? Hmmmmm?

  • SirDagonet

    fantastic, underrated actor IMO… in Fargo: “you should see the other guy”

  • Skynard

    ZL is sayimg “Time to tank”. Smooth hourly looks to have resolved now below the signal line:) Although looks to be showing a div, it needs to turn down for the bear case. Spike!

  • SilverEagle

    One point range for 90 minutes… too quiet out there.

  • https://evilspeculator.com molecool

    Yeah, dangerous – they’re teasing everyone before they snap it. Or reel in both sides and fuck you on Sunday night. No thanks – not worth the risk.

  • http://dartht.blogspot.com/ Heisen_Gerb
  • SilverEagle

    Yeah, I had put in a small short position when we broke through that 1750 barrier, but not willing to get face ripped off on Monday morning. If it truly turns will be plenty of points to ride down.

  • CorporalCarrot

    Market going up with zero pointing down = ????

  • Skynard

    New low made, trying one here:):) Still below the signal with both hourly as well. 5 min is bearish!

  • bullregard

    Open Interest stayed almost constant since the last roll over… throughout this sell-off. I am not sure what it means, but seems to be different than other sell-offs.

  • https://evilspeculator.com molecool

    I know – this is rare and reeks of fuckery. Someone is trying to hold things together here to avoid a slide lower EOD. OR they’re accumulating and then letting it slide last minute to screw with the longs as well. Either way I have little appetite to participate – after all I do not HAVE to trade just because the tape is moving.

  • https://evilspeculator.com molecool

    Let’s however also remember how small the range is here… so very small wiggles look exaggerated.

  • buysidetrader

    thanks mole

  • SilverEagle

    I have 176.50 as touch on trendline – not sure where that equates on ES. We turn there and it’s 3rd touch, might be trying to ramp it back there into close.

  • CorporalCarrot

    Textbook tankage into the close. Wouldnt be surprised to see this shit the bed in the next few minutes then god knows how it opens up on Sunday.

    Have a good weekend all. I think something gets resolved early next week but who knows how.

  • BobbyLow

    Yes it has been strange indeed.

  • SirDagonet
  • BobbyLow

    After a combined negative result on the Forex Front of – 5 R for Monday and Tuesday, I finshed up the remainder of the week strong with a combined result of +17.2 R over the next three days. The net Forex result for the week was +12.2 R. Nice way to finish the week.

    Have a great weekend everyone! 🙂

  • http://dartht.blogspot.com/ Heisen_Gerb

    no beer closing?

    S&P ’20’.
    1769.41 band / 1769.64 Close =
    99.99% pure batch

    http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=1&dy=0&id=p73368690902

    -Gerb

  • sleipfisk

    I think we’re going to stay in a trading range for the next 15-30 days, say 1750/40-1790/1800, and that it’s going to break down from that range before mid Dec, maybe to 1620/40., before a rally that I’m unsure if will take out the highs or not, let’s leave it up to the markets to decide. I think we’re topping out, so I’m biased, but I don’t think this will crash NOW. Trading range -that’s the signal I got from the current price action.

  • https://evilspeculator.com molecool

    And all that thinking is based on…. what?

  • http://www.ProfitFromPatterns.com/ Ivan K

    The Black and White of the daily chart (anything else is conjecture according to my L.I.V.E.T.M. process):

    Clearly SPX cash is in STH (Staircase to Heaven) mode … also it conforms to your Crazy.Ivan Trend Trade long … the Hammer bar of Friday provides one of the obligatory buy Timing Tools … and finally it is also one of my 3D buy setups that you have chosen not to include in your CI project.

    On the other side, there is a RTV sell present on SPX for possible action on Monday.

  • https://evilspeculator.com molecool

    ¤ø„¸¸„ø¤º°¨¤ø„¸¸„ø¤º°¨

    ¨°º¤ S H A K E N ¤º°¨

    ¸„ø¤º° B A K E !“°º¤ø„¸

    ¸„ø¤º°¨¤ø„¸¸„ø¤º°º¤ø„¸

  • https://evilspeculator.com molecool

    Duly noted and reported this morning. Thanks Ivan.

  • https://evilspeculator.com molecool

    Yes, we may include some of your other patterns as well. I needed some time to code them properly and test them for a few months before I would be ready to include new patterns. At this point we have reached what I would call a stable code base and I would consider adding others.

  • http://www.frivjogo.info/ Friv Jogos

    There is the unity in it.