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Wednesday Morning Briefing
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Wednesday Morning Briefing

by The MoleMarch 26, 2014

Welcome to our morning briefing. Here we are reviewing short term setups ahead of the NYSE opening bell. If you are a scalper or swing trader then these setups may be of interest to you. As usual keep in mind that these are short term setups although they could be used as early entries for more longer term positions.

The whipsaw continues – yesterday’s candle produced an inside day period which theoretically has already triggered a long. Thing is though – I didn’t take it yet.

As you all know I have been playing the TF and it kicked me out of my short campaign at break/even yesterday. It has also produced an inside period but that trigger has not been breached yet.

If you look at the hourly then you see the 100-hr SMA holding up here – at least as of now. So this gives me additional context and in this crazy tape I need all the help I can get. So if I get a long breach on the TF then I’m willing to take that trade – of course we also have a short trigger on the books, just for the record.

Quick update on one of our short term entries from yesterday morning, the NZD/JPY. It triggered as hoped and has been working its way higher rather nicely. As we may have a runner here my approach will be similar to the campaign management we employ on CrazyIvan.30 which is geared toward trending charts. After the ISL it advances stops further to the most recent spike low. The last one I see was at 87.85’6 – at least on my TOS feed – two candles ago we produced a double bottom and that one doesn’t count.

More goodies below the fold for my intrepid subs…

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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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  • Rightside_ot_trade

    Context slowly clearing on US equity charts but across all 4 still in a fog to me, staying out for now. Under the hood the SMH keeps making higher highs, as XLF inside day yesterday triggered long this morning.

  • Rightside_ot_trade

    /RB. Looks like a Daily RTV-B with yesterday’s hammer a second lower low but cycling around the 25 SMA and Buy line

  • Skynard

    Sticking to the FN plan man, hell or high water. Not going to lie, it takes some big balls sometimes. Watch treasuries:)

  • Rightside_ot_trade

    /CT. Hourly double inside fail

  • Harry Coin

    Other than the candle period, is there any difference in campaign management between CrazyIvan.30 and CrazyIvan.480?

  • Skynard

    /ZW partial profit level

  • https://evilspeculator.com molecool

    I have recently complained about the comment count but just dropping by the Slope for a few minutes my eyes glazed over quickly. Better few comments of value than hundreds offering nothing but mental masturbation…

  • Ronebadger

    “mental masturbation” – you can do this over and over and over and over…. it’s fun!

  • https://evilspeculator.com molecool

    yes, but not profitable.

  • Skynard

    /DX headed for 80.5, dollar bulls need a new high today.

  • teslaman

    Possible temp support at DJI 16380.

    Speculative long now (16381.7) with stop at 16349.

    2hr: http://prntscr.com/34ap26
    4hr: http://prntscr.com/34apt4

  • Rightside_ot_trade

    > 6R

  • mugabe

    By the way (to up the comment count), there are some excellent audio interviews with trend trader and new market wizard tom basso on the net. Interviews 2 and 3 on Michael Covel’s site are especially good, and there’s also a good one (especially the second half) on andrew selby’s trading site. won’t be difficult to find them.
    They are especially useful imo as follow-ups to scott’s posts.

  • mugabe

    And this is a good post(not from Tom Basso) on leverage and volatility- which are not the same thing.

    http://www.followingthetrend.com/2014/01/why-leverage-is-pointless/

  • mugabe

    one interesting thing that basso says is that your trading system must be in line with how you view the market. for example, if you think that moving averages are useless, then you shouldn’t use a system based on one. This is not exactly the same as saying your system should fit your personality.

  • aiki

    Concur on the interviews – there are also chapters on Basso in Schwager’s Market Wizards books (http://tinyurl.com/mhwmgzt) Thanks for the leverage link

  • mugabe

    there’s more to life than money

  • mugabe

    Re your information diet point, reading comments on the slope is imo bad if you want to trade well. i was there a week ago and was not impressed. lots of emotion / backslapping / TA tea leaf stuff.

  • Skynard

    /ZW stop 695

  • Skynard

    Ooopsy:)

  • Skynard

    Good day rats:)

  • Skynard

    One thing left to do, smoke a big fatty. /ZW stop 700:)

  • https://evilspeculator.com molecool

    This is not a philosophical discussion. IF you engage in trading the markets then you can either do it right or you can suck at it by doing what 99% of retail traders do. I work my ass off every day to get a leg up and the noise I’m seeing on most blogs has NEVER benefited my bottom line. If I’m here looking at my charts then I’m maximizing my time to bank coin. Otherwise I have better things to do quite frankly – hit a beach, travel, spend time with my ex model wife, teach my MA class, etc. etc.

  • https://evilspeculator.com molecool

    Nothing new – look back at what Scott said about your market lens. Unfortunately I see very little discussion on the volume of information he provided – which far outweighs what basso or some of those trend traders have produced. I respect Michael Covel but quite frankly this is stuff that I was getting excited about ten years ago. I have moved on to the next level since and I think maybe that was Scott’s frustration here – many of you guys are still stuck in trading 101 mode and I don’t see much willingness to change that.

  • https://evilspeculator.com molecool

    Appreciate you are participating here but instead of looking to the outside – how about some discussions on all the stuff Scott posted? Pearls before swine?

  • aiki

    missed this one till now – excellent! Hilarious!

  • Billabong

    Talking of volume … he pumped out 62 pages in four days. I just finished my second time through. What a great reference source. Please tell Scott this would make a great trading book for someone in the middle of a trading career looking to improve and become an expert.
    I wonder if folks appreciate the value of R. It takes a while for some one like me, but it is an interesting concept. And with a little practice using it, it makes sense. I built my spread sheet and I’m ready to go.
    Van Tharp says to include your trading costs … ok. When you decide the market is ready to rock and decide to leverage up on margin, how is the margin interest (billed at EOM) carry cost spread across the already computed R values? Or you don’t worry about it?

  • Sean

    That 25d sma is a tough nut to crack… long above…

  • 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

    Honestly the sticklers (like Scott) probably count it – I myself am way too busy running the blog, trading, developing systems, my life, etc. Yes, I should probably account for margin interest but I leave that the purists. My job is to bank coin and I also like to keep it simple. Folks like Van Tharp (with IQs quite a bit higher than the rest of us) thrive on complexity. I’m somewhere in the middle and have learned to draw the line somewhere. Yes, I ‘could’ be doing XYZ on top of A through W – but I just don’t have the time.

  • aiki

    Sorry – I am still absorbing so much of that, but here is the beginning of an RBT I hope to test and trade based on Scott’s and your material. I went back to the beginning (seriously) and started only with volatility regimes. Then added some trend components. It is a simple system (perhaps, too simple) designed to buy or sell extremes of volatility:

    1- Price at or beyond the edges of 2.1BB (or better, 3BB), then closes inside 1.6BB.

    1a- This coincides with MACD crossover (for additional confirmation only).

    2 – Then look for a possible move to 25 SMA.

    3- If price does NOT close beyond the 8EMA in expected move towards the 25, expect a possible reversal into a possible trend with price grinding between the 8 EMA and the 1.6 BB or the 1.6BB and the 2.1BB. (This can go on longer than you think…)

    4- Stop one tick below entry candle. Too inflexible, and probably not so hot. I hope to optimize entries for use on a 60 minute chart so the stop doesn’t have to be so wide.

    5 – Bonus points: 100 SMA support in confluence with others per above.

    Exits outright or really tighten stop : at 25SMA

    On two closes beyond 8 EMA

    fast MACD cross

    These are not optimized campaign management exits – they are just reasons to be out.

    This 25SMA area, where we have been recently is usually (at least, I think) low vol chop – probably good for an intraday trader buying support and resistance using stochastics or the like. I want to avoid this and wait for the next move out of this area.

    So the idea is to buy extremes back into a low vol chop near the 25SMA.

    Closes beyond the 8 EMA confirm or deny. Near the BB lines, a close beyond the 8 EMA: a change is coming. Two within 5-6 bars: it is really coming, two in a row: it is in your lap. 8/25 Crosses usually have legs.

    So right now, we (look) as if we (might) be heading for more 25SMA chop. However, the 8 EMA and 25 (in correct order) is still supporting below, but we have had a close below the 8 within 5 bars.

    The 100 SMA is below almost smack on top of the 1.6BB.

    Or not – nothing is perfect – Okay…just a start. Would love some feedback on stops and exits especially if there are any takers.

    PS – this is ALL a result of the Scott and Mole brain dump over the last few weeks- can’t thank you enough…

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

    You can either choose to include brokerage and slippage (and be generous) … or halve your profits … and double your losses … if the end result is still positive, then job done … best to be ‘brutal’ at the start than to be unpleasantly surprised later.