“Casinos have a way of doing that to traders!!”
Well now, talk about “the tail wagging the dog”, the “casino environment”
brought about to us via central banks and their BFF scumbag LP banks, which
has turned everything financial into a form of roulette or craps, can finally be
explained … short dated options, specifically anything under 24 hours, which
according to Vampire Squid accounts for approximately 44% of total NYSE
SP500 volume! … the link directly below.
https://www.zerohedge.com/markets/whats-behind-explosion-0dte-option
They are called “0DTE”, for ZERO DAYS TO EXPIRATION, in essence 24 hour
puts and calls on the “Spoos” … I was “blown away” by this ZH article … I had
no idea it was that big, and by implication how it affects other markets like FX
… well, now we know … cuz when the gamma squeeze comes, the only “option”
[pun intended] for those on the wrong side is to buy/sell the underlying
instrument … welcome to the casino mi amigos!
And speaking of bullshit, cast your eyes on USDJPY for a prime example of how
this casino effect works … now in its 6th straight hour of going up, WITH ZERO
CORRECTIVE ACTIVITY, those “betting” on a stronger YEN are getting monkey
hammered … and if you’re short the Calls, you’re screwed, especially calls that
expire today … the deltas and gammas go literally insane, which by the way is
why people trade ‘em … better than craps, cuz you don’t have to travel to the
actual casino, and the payoffs can be in the thousands of percent … try getting
that from a roulette wheel! … and when the dust settles here in USDJPY, no
doubt the “Loser Formation” will set in for some serious chop going forward
… “thanks for playing, please come again … oh, and try our buffet,
it’s wonderful!”
Well, now that you know for sure that global financial markets have been turned
into casino games, all at the behest & outward permission and glee of central
banks and their BFF scumbag LP bank henchmen, it’s time to turn to today’s
“Slots-A-Rama”, where you too can spin the wheel and see if you win … markets
ain’t markets anymore, they’re casino games.
And lo & behold here comes USDJPY leading the charge today, what with the
Sunday night open, it’s up, up, & away … 6 straight hours of UP … again, do I
have to move to frickin’ Thailand or what? … the day’s range about hitting stride,
where we sit as I write at approximately 209 PIPS versus a 20 Day Range MA
of ~ 226 PIPS … the New York session so far coming in at about 90 PIPS [so far]
and a 20 Day Range MEDIAN of about 115 PIPS … all in all, it’s gonna be tough to
extend these ranges IMHO … “Trading Ratio” [TR] hanging right at the 3.0 level,
which is NOT as good as it should be given the range for the day … that tells you
big spikes and plenty of “rinky dink” small m1’s litter the landscape … TR should
be above 4+, and therein lies the problem for today, as I’ve written so many times
on the blog in the past, and that is “speed of light … crickets” trading conditions
… and that directly leads to INCONSISTENT VIX, the greatest account killer right
next to the “Flying Wedge of Death” [FWD] … looking back over these last hours,
gigantic spikes and pitiful M1’s, making you think “WTF is this?” … and while
some of it can be attributed to options in the cash market, news flow today with
the Saudi’s denying an oil production increase reported on “Dumbberg” is the
main culprit of spikes higher … still, even at a TR of 3, which is not ideal,
USDJPY can still give off some decent signals … I’m pretty much still in
“buy mode” when it comes to USDJPY, simply cuz 1) I don’t believe interest
rates are coming down cuz of inflation, and 2) the trade was way overloaded
with longs ripe for slaughter … now that the order book has been somewhat
wiped clean and the “one way” trade attitude been shattered [for now], this
market can “trade” … so I’m not interested in short positions in USDJPY, simply
cuz I can’t see what drives YEN higher outside of short covering, so I’m leaving
the sell signals alone for now.
GBPJPY lately has been a spread nightmare at “SLIPPAGE FX” [a/k/a Coinexx +
Turnkey] … that spread can literally be anywhere … one second it’s at 0.7 PIPS,
and a microsecond later it’s at 3.2 or even higher … push the trade button and
which spread do you think you get on your fill? … it’s the main reason why I have
shied away from this pair, while at the same time USDJPY has stayed very
consistent under 0.5 PIPS … Cable being Cable with an “effed up” government
headed for a depression looks stuck in some serious mud.
I posted the “Energy Trading Algorithm For FX” yesterday, and over this
upcoming weekend I’ll be making a minor addition to the material … it boils
down to “what if” you use a platform to trade that isn’t MT4? … for example, what
if you use Trading View, or any number of other platforms to trade, and most likely
they don’t have VIDYA in their indicators library … what then Skippy? … well, as
any mathematician will tell you, there are an infinite number of ways to obtain a
result using different variables and parameters that mirror the original premise
… what matters with VIDYA is not the lines themselves or their respective values
… what matters are their SLOPES, i.e., when they change … to that end on other
platforms you can use HULL MA 60 period, in place of the VIDYA 60 PERIOD, and
TEMA [Triple Exponential Moving Average] 34 period in place of the
VIDYA 10 PERIOD.
Both Hull and TEMA are readily available on most advanced platforms like
Trading View, and simply follow the same rules … they are very, very close to the
VIDYA SLOPE CHANGES, and most times they are simultaneous … it might be a
tad harder to notice the slope changes cuz they are a single color on most
platforms, and not multi-color, but that’s not something I can fix … it is what it is
… I’ll make a minor update this weekend to the trading manual pdf to add this info.
With the oil news, if you can call it that, driving USDJPY higher into its 20 Day
Range MA, both daily and New York [close enough for government work], without
any other catalyst, like sharply higher interest rates, or something else, it’s a very
low probability event USDJPY can muscle higher still … not saying it can’t
happen, just that it’s a low probability event risk, not the kind of trade I want to
get into, even for a scalp … one decent algorithm buy signal today in USDJPY
… PAMM UP FRACTIONALLY … it was a decent scalp on a good signal, the only
one I saw the entire morning into the New York afternoon … should have been
more, but with a TR dangerously close to going lower into the 2’s, why trust the
signal parameters with such little trading activity? … this is why I developed the
TR, to keep out of trouble in slow and/or choppy markets … and outside of the
m1 spikes today, it’s been both choppy and slow … you wouldn’t know it from a
cursory glance at the ranges, you have to look at the m1’s … and they tell a
whole different story than either the daily or New York session ranges.
Here in the mid to late afternoon, FED PIE HOLES are once again on the wires
going “blah blah, yada yada” about higher rates for longer, and throwing cold
water on those that think the Lounge Lizards are close to a “pivot” or actually
easing rates … according to them, they ain’t, not even close … and that’s another
reason not to get too excited about YEN rallies … the BOJ and their insane
steward, one “Peter Pan” Kuroda, are a long way from changing policy, and
most likely just looking for the FED to bail them out of idiotic policy decisions
… so be it! … onto tomorrow!
… OUTTA HERE … “The future’s so bright I need 2 pairs of sunglasses 😎😎,
and my own Brinks armored truck” 💓!! … Onward & Upward!!
-vegas
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