“If you are a successful game player, it can be a fascinating, consuming, totally absorbing experience; in fact it has to be. If it is not totally absorbing, you are not likely to be among the most successful because you are competing with those who do find it so absorbing.” – George Goodman (aka Adam Smith), “The Money Game”
’19 Thought of the Day
Early Morning Outlook
“We cannot see our reflection in running water. It is only in still water that we can see.” – Taoist proverb
For newer readers, it’s always worth catching up on our Trading Reflections post.
If you are interested in a more structured way of tackling the business of trading, attending a live daily morning call or a more detailed discussion on the charts we post / trade ideas, don’t hesitate to check out our Premium content.
Wishing you a great day ahead.
Make Volatility Great Again
“You can never make the same mistake twice because the second time you make it, it’s not a mistake, it’s a choice.” – Steven Denn
Luckily, we can thank President Trump for helping to make volatility great again.
One of the key charts you should be keeping your eye on today is the VIX. In today’s session, we will go through this in detail and remind subscribers what levels to look at and what kind of daily moves will spark alarm bells in this mean reverting instrument. It is crucial to understand these dynamics in days like these and as we enter a key week in the markets.
Despite the fact that we have a lot of data on deck this week along with the RBA and RBNZ rate decisions, let’s not kid ourselves, it’s all only about the US-China Trade War. Most importantly, we will be keeping a very close eye on not only how China responds to the latest threats made by Trump on Twitter but almost more importantly, how Trump responds to their response. This will be the tell… we will also discuss this in detail along with our view on what is going on and how we believe this is going to play out.
Everyone will be focused on USDCNH, expecting it to take a stab at the 7 mark and on general USD strength. However, we feel that just watching DXY could be misleading and that the plays in FX will be a lot more nuanced. No change to our JPY and Commodity currency swings against the USD but we will be focusing a lot more on our view on how the EURO will react and how we would be looking to try and take advantage of these moves.
JPY and Gold were already telling us something on Friday and as discussed, Crude is a mandatory chart to keep an eye on in terms of general momo and flows. Going into the week, the ping-pong zone remains 62.50/60.00 with the swing short very much in play, so no change to our outlook and levels.
Should be a very interesting week. Don’t be greedy and remember that there is little edge in chasing moves. Furthermore, we would also like to offer up a reminder that traders that continually play for sustained straight line moves, very rarely have good long term track records. It’s never surprising but always disappointing to see how many people systematically trade against the probabilities, against the trading Gods, expecting to come out ahead…
For newer readers, it’s always worth catching up on our Trading Reflections post.
If you are interested in a more structured way of tackling the business of trading, attending a live daily morning call or a more detailed discussion on the charts we post / trade ideas, don’t hesitate to check out our Premium content.
Wishing you a great day ahead.
3 Key Charts/Levels
“The two most powerful warriors are patience and time.” – Leo Tolstoy
Today we will continue to focus on these 3 Key Charts and Levels. We can’t stress enough how important day/week closes will be for momo and flows.
For newer readers, it’s always worth catching up on our Trading Reflections post.
If you are interested in a more structured way of tackling the business of trading, attending a live daily morning call or a more detailed discussion on the charts we post / trade ideas, don’t hesitate to check out our Premium content.
Wishing you a great day ahead.
POST FOMC
“Awareness is like the sun. When it shines on things, they are transformed.” – Thich Nhat Hanh
No change to what we have been discussing this week on the blog.
As you can see here on the SPY chart, it’s all and only about follow-through on the indices, especially as we head into the NFP release and ‘Free Money Friday’. As we have been discussing and detailing in the webinars, we continue to favor RTY shorts off tactical intraday NQ longs but remain overall very suspicious of this strength and extreme complacency.
Remember to keep an eye on some of those bigger names we have been discussing: 3M, Intel and google, just to mention a few. Naturally, bulls will be looking for Apple, the ‘BuyBack King’ to keep on propping everything up. We’ll have to see what gives if any real selling shows up. Still nothing to write home about just yet… but as we have been discussing, the action in a lot of these names has been far from pretty.
Note for active 50Scouts members: *make sure you read out latest update* and keep an eye on your inbox for a free pass to Friday’s daily webinar session (make sure to check your spam folder too).
For newer readers, it’s always worth catching up on our Trading Reflections post.
If you are interested in a more structured way of tackling the business of trading, attending a live daily morning call or a more detailed discussion on the charts we post / trade ideas, don’t hesitate to check out our Premium content.
Wishing you a great day ahead.
Follow-Through
“I like to listen. I have learned a great deal from listening carefully. Most people never listen.” – Ernest Hemingway
As we discussed in yesterday’s post, we have a very busy week ahead.
It’s going to be all up to AAPL and then then FED to save the week but as we have been discussing, after Boeing, you now really have to pay attention to the price action in names like Tesla, 3M, Intel, Google, Caterpillar and Apple next… we can’t stress enough how complacent the market is here at highs with all these unicorns rushing to IPO.
Remember to keep an eye on Crude, as it will likely have to join in to see some follow-through either way across the board and on the DXY, where we will still maintain our non-consensus view.
Shorter-term, all about AAPL, then the FED and NFP. As we said on Sunday, real action is most likely stacked-up towards the back-end of the week.
Note for active 50Scouts members: *make sure you read out latest update* and keep an eye on your inbox for a free pass to Friday’s daily webinar session (make sure to check your spam folder too).
For newer readers, it’s always worth catching up on our Trading Reflections post.
If you are interested in a more structured way of tackling the business of trading, attending a live daily morning call or a more detailed discussion on the charts we post / trade ideas, don’t hesitate to check out our Premium content.
Wishing you a great day ahead.
Busy Week Ahead
“The first thing you have to know is yourself. A man who knows himself can step outside himself and watch his own reactions like an observer.” – George Goodman (aka Adam Smith), “The Money Game”
Get ready for an extremely busy week ahead in terms of earnings, data releases and central banks.
This week, we will be keeping a very close eye on:
– Start of seasonal weak period in equities and risk assets.
– Tesla, Wirecard and follow through on the SOX index as indices press to and through all time highs but a lot of single name stocks are not looking too pretty.
– we always prefer to privilege healthy market moves/rotations, so we will be looking for some select DXY weakness and focus on action around 98 mark. No real change to all of our bigger picture FX swings, just changing dynamics on the intraday/week plays.
– The nasty weekly close on Crude with the failure to hold above the 65 mark: too obvious or 55 mark attracts?
– Continued o/n risk with GoogL and AAPl reporting after the closes, FOMC on Wednesday and NFP on Friday. All in the context of Japan being off on extended holiday.
– more focus on what we have been discussing in terms of the continued tell on how metals have been performing, despite recent action in indices and dXY.
– And much more..
Note for active 50Scouts members: *make sure you read out latest update* and keep an eye on your inbox for a free pass to Friday’s daily webinar session (make sure to check your spam folder too).
For newer readers, it’s always worth catching up on our Trading Reflections post.
If you are interested in a more structured way of tackling the business of trading, attending a live daily morning call or a more detailed discussion on the charts we post / trade ideas, don’t hesitate to check out our Premium content.
Wishing you a great day ahead.
Follow-Through
“Positive thinking is more than just a tagline. It changes the way we behave. And I firmly believe that when I am positive, it not only makes me better, but it also makes those around me better.” – Harvey Mackay
As we head towards the end of the moth and earnings season, The key word is “follow-through”, especially as far as the Nasdaq, DXY and Crude are concerned.
We are at KEY inflection points, not only in terms of actual levels but also in terms of momo and sentiment. This will be the key focus of today’s webinar session
For newer readers, it’s always worth catching up on our Trading Reflections post.
If you are interested in a more structured way of tackling the business of trading, attending a live daily morning call or a more detailed discussion on the charts we post / trade ideas, don’t hesitate to check out our Premium content.
Wishing you a great day ahead.
Chart of the Day
“The greater the demands on me, the more I need to sustain my inner calm and stability.” – bkwsu.org
