Some days, it’s almost more than I can handle; and I
knew getting up today and reading the financial press, that I was going to find
more than just a little complaining about 1) the French Fry elections and what
they mean [which is nothing, cuz nothing will change with France’s Obama], and
2) the distinct lack of trading action, not only in the stock indices, but
every market on the MT4.
And sure enough, while I haven’t even got the coffee
made yet, here’s our old buddy Richie Breslow over on Zero Hedge [ZH] via his
gig at Bloomberg, bitching, moaning, and complaining about “price discovery”.
As I said, some days …
]Here’s the link in case you want the full banana to
peel: http://www.zerohedge.com/news/2017-04-25/breslow-what-weve-seen-so-far-week-has-been-gap-repricing-without-any-price-discover
]
Let me boil this down for you: “hey, I got expenses … wife/mistress/girlfriend/boyfriend/whatever …
and they got expenses … we need to make money down here, and those a-holes over
at the Fed with their near maniacal penchant for wanting to kill volatility …
hell, yesterday ‘they’ killed the VIX, sending it to a 10 handle … we got to
have some movement OK? … it doesn’t matter up or down … how the hell am I
supposed to afford summer school for Buffy in Geneva, Switzerland in a couple
of months if the Dow30 is stuck in a 20 point range all frickin’ day”?
To which my response is the following: “Why should you be exempt from what the rest
of the country is experiencing in everyday, normal life? Tell Buffy to get up
off her privileged teenage ass and mow lawns this summer and save the money;
show her that getting up at 6 A.M. and working until it’s dark is what a lot of
people do. You and your Libtard buds down on the trading floor and/or in the
hallowed halls of Bloomberg, where everybody makes 6 figures cuz it’s basically
minimum wage for the wannabes, can take solace in the fact you most likely
voted for the nutjobs that have decimated 1) the ‘baby boomers’ retirement
savings, and 2) the entire middle class of the country between both coasts. So
while you bitch & moan, you’re not some ‘island’ somewhere where your
actions had nothing to do with the outcomes you now don’t like. Ma & Pa
used to trade stocks, but they don’t anymore cuz “the Street” & government
screwed them over; while all your buddies at the TBTF banks got bailed out, got
their bonus on time, and then got free money from the FED from QE to play
futures, and all the while Obama made sure the middle class got the shaft and picked up the bill
… and now listening to you complain about ‘price discovery’, like you’re some
innocent bystander that just suddenly noticed it, well … excuse me while I
puke”.
And what Richie and his ilk are now discovering is
what real traders, not those that sit behind a desk at Bloomberg and wax
eloquent, have known for a long while; namely, in a world that has gone 24/5,
how the hell do you have any idea where action is gonna come from so you can be
there to capture it? Anybody that has attempted to trade anything in the FX
arena [including XAUUSD] can tell you it’s damn near impossible to consistently
be in the trading session [Asian, European, or U.S.] where the day’s action is
gonna be; in essence it’s become a random crap shoot. And the dirty little
secret is what the manipulators in the precious metals and FX pairs have known
for years; namely, pick the point in time where action & liquidity are
lowest, and then come in like a “bull in a china shop” and wreck havoc in the
direction you want; find out from the dealer banks [who you take care of very
well] where the large stops are and then clean out whatever stops have
accumulated from the retail Sheeple crowd along with any/all institutions
playing as well. Go to another bank and place the corresponding opposite order
to buy/sell to be on the other side of the stops; when you’re finished now come
in immediately and bring the market back to where it was 10 minutes ago before you
started. EASY PEEZEE.
You get up in the morning [wherever morning is] and
you look at a chart and more than likely your first reaction is, “WTF was that 3 hours ago”? And from
there it’s … crickets! And the beauty
now is, Ritchie and his brethren have now finally discovered “speed of light … crickets” trading; “oh, won’t the days/weeks/months ahead of us be a hoot, cuz this isn’t
the last of the complaining or the wails of anguish & gnashing of teeth as
the Hamptons
crowd discovers what a drop in revenue means”.
Make absolutely no mistake, trading conditions over
the last few years especially, have taken a turn for the worse; not just in
stock indices, but everything that is traded. Central banks around the world
hold trillions of dollars of every
asset class imaginable, all for the sake of completely managing volatility and
desiring preferred outcomes for their policy objectives. Ten years ago, before
the financial crisis [“you know, the one
the Fed said wasn’t a problem and was completely under control, all the while
the Bush administration stood there like a deer in headlights? Yea, that one”.],
when both the Dow30 & the SP500 were HALF THE LEVEL THEY ARE BOTH AT NOW,
daily ranges, intraday volatility, and both big down as well as up days were
the norm and not the exception, there was a “trading flow” to the market; today
that’s gone, and you can place the blame squarely at the feet of the most
worthless, counter productive, globalist, screw the middle class, wealth
stealing & currency debasing Federal Reserve System. “You think “The Wizard of Oz’ is about Dorothy & Toto? Guess again;
while there are many interpretations, the book as well as the movie were meant
for adult audiences and wasn’t meant to be a children’s story as many would
have you believe today. The evils of the ‘Fed’ very much at play here”.
Turning to today’s trading … already we see it …
another mini melt up on nothing, in thin conditions, and before anybody gets to
their screens … this is the “stealth” rally I was referring to yesterday, the
“preferred” way the elites at the FED and around Wall Street want to see asset
prices increase in value … “so much
preferable to that hand-to-hand combat style of those … icky! … floor trader
types who still infest the world and bring nothing but unwanted volatility to
the party … can’t we just all agree it’s better that markets are ‘planned’ by
us so that prices can rise easily and painlessly over time and everybody can be
happy”?
And the sad thing is, there’s more than a few
Chuckleheads that would shake their head in agreement to everything I said in
the last paragraph; where all of life, not just markets, can be “smoothed over”
by the friendly hands of a liberal & progressive, all knowing, all caring
government that will control and run your entire life without any pain
whatsoever. “Government as religion; what
could possibly go wrong”?
Well, an hour before the New York open and it’s
“mission accomplished” for the planners, as “somebody” shoved the Dow30 up 100
points on “nothing”; “oh wait, round up
the usual suspects of 1) President Trump’s tax plan, 2) health care back on the
table, and 3) no gov’t shutdown [why exactly would that be bad?].” So
essentially, we’re up 370 points on the opens of the last 2 days on what
exactly? Which of course begs the question Richie Breslow asked this morning on
ZH, “So, now what”? [“Psst! It’s CAT & MICKY D’s earnings
don’tchaknow”?]
And the only answer I got that makes any sense is, “we won’t see a top until Gartman goes long
S&P’s with one of his standard ‘the sky’s the limit’ to the upside
recommendations … and then 10 minutes later the market rolls over and heads for
wherever his sell stop is placed”. Look for a post on ZH coming soon.
Little over a half hour into this melt up, and I’m
really not likin’ what I’m seein’ here; and the reason I don’t have a “thrill
up my leg”, is cuz I know how, in a heart beat, how this is gonna end, and it
ain’t gonna be pretty. First trade of the day, and I’m stretching the
definition of a “signal” here simply because it’s a bullish engulfing pattern
off of a correction for about 19 minutes that went totally nowhere in price.
And while I’m in this thing at a disadvantageous
level, the SP500 keeps rallying while the Dow30 stalls a few points above my
entry; when the SP500 stalls, I liquidate, meaning of course it’s now time for
the Dow30 to punch up immediately 10 points in another bat of the eyelids. “Meh, it is what it is”. And what
becomes immediately apparent is that the Dow30 in approximately 36 hours of
trading since it opened Sunday night, has taken out 35 DAYS of price action ON
THE DOWN SIDE since the March 1 all time high. “Sure, by all means, buy the rally up; and if you’re lookin’ for me to
tell you where the top is in this stuff, fugetaboutit”! You wait, somebody
somewhere will come along and say that new bear markets are 4 M1 candles in a
row down.
And surveying the financial trading horizon, here at
mid morning in New York, I can’t help but notice that maybe … just maybe … some
of this indices bullishness is a direct result of some serious, long term
EURJPY short unwinds taking place; add to that the rotation into the Dax30, and
it starts to make perfect sense when viewed through the rose colored glasses of
Europe’s elite financial managers, that they can get a “double play” being in
European stocks. “I think they’re nuts,
but what do I know … I’m just a trader … they’re ‘financial managers’ (snark
snark)”!
And here we are at that point, where if the indices
were still trading in a physical “pit”, you’d start to see the cries of “this shit ain’t ever going down … ever! …
EVER! … again! And guys who normally trade 1 or 2 contracts now find themselves
long 5 or 7 contracts, up a couple of ticks and feeling all smug about there
‘soon to be’ new found riches, if it can only go up a few dozen more ticks
don’tchaknow”. Yup, seen this “train wreck” before … nothing is gonna be
any different this time around, nor will it be in the future “X”
days/weeks/months/years into the future as well … “I trade the past, and these types of emotions are part of the trading
condition … learn it, love it, live it … you’ll know when it ends”.
I have written lately of Sokyu Honma & Gann;
directly below one of their favorite chart patterns to get short; I have no
idea if the Dow30 holds the top or not today on the M1. What I do know is both
men loved this “triple top” formation with a thrust down [bearish engulfing
pattern] making up the third leg and the start of the down move. Of course,
this candle formation has more power the longer the time frame, and would be a
powerful top if seen on the daily or weekly candle chart.
Here’s another reason for the mini melt ups the last 2 days; short option gamma exposure that was rumored to have been behind the February melt up; cuz when you’re short a shipload of calls to capture that premium, and the market ain’t cooperating by staying even or down, your only option [pun intended] is to buy futures for protection. And as we all know by now, that can get quite ugly the closer we get to May or June expiration. Just another in a long list of reasons why you might want to rethink that “I make my living by mostly being short stock indices” meme [when they go up 80% of the time].
Ok, here at midday [Noon in New York], and from the open in New York, it’s a familiar theme at play; namely, bounce somewhere and then … die! For the last 2 hours the Dow30 has fluctuated by about 20 points top to bottom. Again, signals don’t mean a whole lot in chop; it’s simply a flip of a coin.
Here in the Chicago
Noon hour, things have really slowed down; trade flow totally absent, and I’m
wondering if anybody is looking to take profits into the P.M. from being long,
or if they’re just going to let things ride? I’m not sure with another leg up
[if it were to come] that I’d want to stay long overnight; I’m not sayin’ look
for a any kind of sizable correction, just that I wouldn’t want to have a sell
stop below the market get hit off on a move down. At this point, though, market
is getting support from earnings, the sizable unwind in EURJPY, and constant
rumors of hedge funds stuck yet again short gamma; this stuff really does need
some mild profit taking to appear, but exactly who that is that goes “first”,
is a mystery to me going into the close.
Here at 12:13 Chicago time [17:13 Turnkey server time],
the market makes a new high, powering into some buy stops; from a bullish
standpoint, this is one of the worse things that can happen, as now there is
approximately a 90% probability the market sees no new high after 1 P.M.
Chicago time. Of course, the way this stuff has acted the last 48 hours, the
other 10% might certainly be in play with a moon launch later. Market seems to
be in a “feeding frenzy” at the moment.
About an hour to the close, and it feels like maybe …
maybe … this stuff might be running on empty a little. That’s not to say things
can’t change quickly, but I don’t see any buying bursts, and at some point
longs have got to start unwinding some … more than likely overnight into the
morning … most bullish thing that can happen going forward are lower openings
that go higher the rest of the day.
Take away the minutes ± from the opening of New York
trading, and these last 2 days have some of the worst trading action you will
ever see in stock indices; just more of the same I’ve been writing about for
months, which is “speed of light … crickets”
and not a damn thing in between. Tomorrow sees more “fun & games”, and
I’ll be here to capture some it … that is, if it moves.
PAMM/MAM spreadsheet directly below.
Time for the beach! … I’m outta here … until tomorrow.
Have a great day everybody!
-vegas
OUR ‘TURNKEY FOREX’
PAMM/MAM IS NOW OPEN AND
OPERATIONAL; SEE “PAMM/MAM MANAGED MONEY PROGRAM” IN “DOWNLOAD LINKS” SECTION
IN RIGHT HAND COLUMN FOR DETAILS [VIEW ONLINE AND/OR DOWNLOAD] AND START YOUR
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