Gold’s Monstrous Breakout, A VIX Spike, And I Stay Sidelined

Market Snapshot

Overall I am playing the moves intraday with the Premium Poppers, while waiting for a clear, concrete swing setup.

• ES (SPX): 7,761.50 / +0.04% / off the highs, full read below
• YM (Uncle Dow): 54,630 / +0.14% / holding up near its own highs
• NQ (NazQuack): 29,513.50 / still the laggard of the four
• RTY (Uncle Russ): 3,028.60 / +0.02% / full read below
• VIX: 15.90 / +0.63% / up again, and that is the bit bothering me
• GC (Gold): 4,330.00 / +0.51% / monstrous breakout move
• CL (Crude): 75.27 / +0.25% / meandering sideways, full read below
• BTC: 64,812.79 / no read today

SPX: Sidelined Until The Extremes Clear

On the SPX swings I remain sidelined, not taking the low quality bears until the MACD-v extremes are not a factor.

We have moved out, so 1 to 2 days and we will be back to normal.

Assuming a bear move happens, a new bear from the upper band tag likely will not happen. So a failed bull setup will be enough to get me on board the bear train.

The MACD-v histogram readings are now also suggesting a little more downside. Not enough in itself, and a sideways grind could be the most likely thing ahead of Friday’s NFP numbers.

Sidelined until the extremes are not a factor.

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Uncle Russ: The Bear Fired, But It’s Low Quality

The RUT swings are also similar, although the bear did fire this time. It is low quality.

MACD-v moves out of the extreme, and the histogram extreme suggests some further downside.

Just a nudge and a nibble to a new all time high before the eventual turn. False break? Liquidity run?

A nudge and a nibble, then the eventual turn.

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Crude Oil: Sell The Rally, And Sideways Is Fine

Crude oil provided a nice sell the rally setup off the VWAP from the breakout move.

That we are seeing price meander sideways is not a big deal for premium sellers. As I am writing this, I am a cat’s whisker from exiting for my profit target.

Time decay and sideways remains my friend again.

Below $74 will see a breakout. And if you look at the daily chart, these tiny narrow range days have provided some great following day pops in prices.

Time decay and sideways remains my friend.

Premium Poppers: A Losing Start, Then Chipping Away

The Premium Poppers are popping again. Standard breakout setups on both RUT and SPX.

RUT started with a small loss on the bull break. I locked in that small loss with a transformer, just in case, and then I can start chipping away at the day again with new setups. The 3rd BO got me bearish, and a 2 day VWAP flop looking to land at an average day’s move came in at the last minute. The software had it graded DOUBLE (+4) at 2x by then, with the flip bonus doing the work.

SPX had no bull break, so it is all bears. 1st and 3rd BOs, and looking to land an ATR move for a third trade. Graded NORMAL (+2) at 1x. All transformed, and the last trade coming in at the last minute.

No profit tents were landed. But that is not the goal. It is a bonus when it happens.

Profits locked all across the board, despite some small initial losses.

Profits locked all across the board.

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The Community Keeps Landing Profits

Don initially took the RUT Bull BO and closed it shortly afterwards for breakeven or a small loss, because he did not like the choppy sideways price action and was willing to forgo the trade. He waited, then took the SPX LP Bear and closed for 50%. Net positive for the day.

James called it a funny old market this week, then bit the bullet and took the SPX bear LP set to 60% and the RUT bear LP at 50%, as much less sure. Both closed in profit. He is holding on for that old RUT bear TnT.

Chris had one winner and one loser on RUT and one winner on SPX. A small positive day net.

And ellisiiip has their first butterfly going. Wish them luck.

Another great day’s trading again team. Awesome work.

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Fun Fact

Since I am a cat’s whisker from my crude target this morning, here is where that phrase earns its keep.

A cat’s whisker detector is a thin wire resting on a crystal of semiconducting mineral. It was the guts of every crystal radio from about 1906 through to the Second World War, and it was the first semiconductor device ever built.

The whole thing worked on a margin you could barely see. Only certain tiny spots on the crystal surface would rectify at all, so you nudged the wire around until you found one. Too much pressure, wrong spot, nothing.

And here is the part I like. The modern circuit symbol for a diode is a drawing of that setup. A wire touching a crystal. Every phone, every laptop, every screen you own traces its ancestry back to a bloke poking a rock with a bit of wire until it worked.

Source: Cat’s-whisker detector, encyclopaedic entry citing Braun, MacDonald, Revolution in Miniature.