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KC shortUpdate on a upsloping trendline (blue) which acts as resistance On the 5 hour chart, we should have generated a sell signal. I still remain short via puyt spread 1x2s, as frost is no longer an issue. It appears the market is still digesting this from last week and should correct lower IMHO as physical supplies out of Brazil remain steady. Warehouse stocks in EU and US plenty as well. Dont get me wrong, as shown in the blue channel, even if we have a correction lower, the blue trend channel might indicate a change in trend, however the frost damage is simply not there and in order to rally, this market would need breaking news like that.... without anything of that sort coming out, I see a correction lower before making new highs. Still, knowing coffee, I remain short with 1x2 calendar spreads, buying the downside 1 leg in one month and selling 2 lower puts in a month further back.
KShort
by mjhillpp
2
No frost in BrazilSeems like no frost in Brazil. It was a busy weeks last week and throughout the weekend with fears a frost could hit coffee areas. None has been confirmed and worst fears did not play out. Once all of this is digested I expect some downside opportunities as the market goes back into trading technicals rather than emotions. Quite oversold and we saw sell signals on RSI and Stochastik a while ago. Also, the 5 hour chart will provide with a sell signal, which has been a superb indicator of short term price action (5-10 days). I am short via 1x2 calendar put spreads, long the 135s in Q and short the 125s in U and various other like this. As we move lower, option vega will come in and provide some nice profits. Also, selling the Sep (U16) contract provides with some good premium as this is considered the frost month. Looking at futures spreads, they have been weak the past two trading sessions and also foreshadow price action. Support at 134, then nothing until 125
KShort
by mjhillpp
5
Rising wedge, but for now running into supportAs we see some support is coming in from our longer term trend channel as well as the lower Bbands. So far the last three weeks have provided with the expected sideways action once reaching 50. Selling calls has been the right strategy so far (51, 52 and 53 calls). At this support I am covering my short calls, but will hold of selling any put spreads to see how the FOMC decision plays out. I would not be surprised to see no rate hike and crude test some downside targets. For now, neutral, but getting ready to sell some downside put spreads once we breach the support (if we do)
NYMEX:CL1!
by mjhillpp
Generated buy/cover signals on RSI StochastikGold bounced off of the support area for now Light volume during recent bounce indicates this is a retracement in the downtrend --> I threw in some Fibs to indicate where overhead resistance lies. Resistance at: - 7 day MA (currently there); a break would suggest the 20 day MA or the 38% FIb as target (1240ish) - 23% Fib at 1224, 38% Fib at 1240 Overall: the lack of volume on the bounce indicates the lows might be tested again as the downtrend is still prevailing. Took advantage of the break the last 5 days, but covering my short puts now I dont have any sells signals yet, hence I am not doing anything until I see some
COMEX:GC1!
by mjhillpp
Change buy from neutral as strong support was found on trendlinePro Long: - Trend line provided massive support (dark red line) - High volume at support and during the rally - future spreads very strong (N16-U16 turned into backwardation) - If we close positive today 7 MA will cross 20 MA generating buy signal Contra Long: - running into resistance on middle Bollinger Band (20 day MA) I sold the 2900 puts last week as a sideways prediction was put in place and will keep that position and add once I see a pull back into the lower trend line
CLong
by mjhillpp
Still waiting, beware bulls; risk reward not so greatPro Long (Chart): - RSI and Stochastik created buy signal - Orange support line Pro Long (Physical): - ICE warehouse stocks new lows - spreads tightening ever so slightly Contra (Chart): - still in middle to upper end of trend channel - room to go in terms of lower Bollinger band - long term trend still down - risk/reward for long position not there IMHO I start looking into selling put spreads out in August or September. For example the U16 110/100 p spread. Due to the negative put skew, 1x2s also work great IMHO (selling the one buying the 2s are also an interesting idea).
K
by mjhillpp
Pair Trade - Short CNQ and Long XLEThis is a pair trade idea based on CNQ/XLE pair cointegration. My calculations show that these two stocks diverged by more than 2 standard deviation and, based on mean reversion, should come back to mean. This pair's rolling mean is 28.3 over the last 280 trading sessions. The current value is 23.6 and one standard deviation is 1.8. The trad can be done by shorting CNQ and going long XLE in the proportion calculated through beta. Alternatively, it can be entered as two credit spreads - bear call spread on CNQ and bull put spread on XLE. This is how I will be entering this trade on Monday when the market opens - $CNQ $22/$24 Feb 21 bear call spread for $0.5 cr and $XLE $57/$55 Feb 21 bear put spread for $0.6 cr. Will be watching the bear call side and adjust if necessary.
NYSE:CNQ
by Options.Alpha
ITALY vs GERMANY - SPREAD AT THE HIGHEST EVER - STOCKS... "when they tell you that the Spread with Germany is at its lowest ever not believe... this is the only one that is important"... 01/01/2002 - 01/08/2009 : Spread vs DAX FTSE MIB lows . Divergence contained 01/08/2009 - 01/12/2014: BOOM BREAKS Spread between DAX and FTSE MIB . After 2000 days DAX " Overperforming " FTSE MIB approximately 130% since 2002 ( euro entry) 01/12/2014 - 13/04/2015: Stocks "fee" the ECB QE . Spread vs DAX FTSE MIB at the highest ever. DAX " Overperforming " FTSE MIB 167% since 2002 ( euro entry) EURO IS GERMAN RULES
INDEX:DEU40
by guado77
LTCUSD/BTCUSD - BEARISH CYCLE STILL IN PROGRESSWhilst I have shared this spread chart of LTCUSD/BTCUSD several times over the last 18 months or so, I have not directly published this as a main chart. However, as requested by quite few Crypto traders, I feel it is appropriate to so. This spread charts like any ratio charts can help to gauge potential trend change, but it must be used with care. Since what you are doing is looking at price behaviours of one instrument against another similar instruments in the form of price ratio. When this is compared with the actual price of the 2 instruments concerned, it would be observed that during the bullish cycle the riskier of the 2, tends to lead to the upside and also during the bearish cycle to the downside. Logic behind this is that, in rising market traders are willing to take on higher risk for potentially higher return, in doing so they tend to buy instrument that could give them potentially higher return but which also exhibit higher risk profile. In my experience, this types of relationships could be observed in ratio charts of SP500/Dow Ind, Silver/Gold etc,. Similar ratio analysis is very powerful part of intermarket analysis and could give advance warning of potential trend change or help to confirm it. Ration analysis could be applied by anyone interested in adding unique perspective on major trend analysis. I covered this topic in details during a relatively long live session which you could view on Youtube - link www.youtube.com However, caution needs to be exercised as the ratio chart could have potential trend change whilst both the base instruments might still be continuing the trend, except one might move less than the other and temporarily consolidate. On resolution of this in might continue in the existing trend. Nevertheless, strength and weakness are often seen first in the ratio chart. In this instance both LTCUSD & BTCUSD formed major all time high in Nov 2013, which was accompanied by corresponding high in the ratio chart. Applying similar technical analysis on ratio chart as applied on the base instruments, it is evident that the ratio chart has continued declining along with them. Elliott Wave analysis on the ratio suggests, that this ratio chart has some way to go before completing this cycle. Cross checking the ratio chart with the based instrument's respective price charts, it might be possible to get heads up when this bearish cycle or phase is near completion. Once the low is formed, both the base instruments too would have or be close to posting similar price lows but it might not be the final low in the sense that this might be just the larger cycle wave A from Nov 2013 high and any price progressions to the upside might be retracement. Just a thought to keep in mind at this stage. As always, do your own analysis for your trade requirement. Select to follow me and the chart for notification of future updates. If you like the analysis then please indicate this by thumbs up, comments and sharing it with others. If you have an alternative idea then please share for all to learn from. Thank you for taking the time to read my analysis. DanV danv-charting.com
LShort
by DanV
5
Somthing to Think AboutIn the grand scheme of things it looks as though a shift is ready to take place. It has taken me some time to realize that shift but it is finally here. Take look at the GBPEUR to the left. Notice how its price moves are converse to that of WTI, EURUSD, and XLE. The yellow circles you see are areas where similar behavior is forming. In the GBPEUR the opposite behavior is forming to the downside. You can see this correlation is approaching a long time resistance level. Just as the EURUSD is approaching a long term support level. Oil looks to correlate positively with the movement of the EURUSD. As it also moves in exaggeration to the XLE. Using specific points on the XLE as support and resistance. Could I be on to something.....YESSSSS or Maybe I"m reaching...? This can all simply be money moving back and forth. Most regular people like to sit in cash. There are times where this is good reasoning. Don't just sit in it. Swim in it till you are ready to strike and when you strike do it with the speed to the Millennium Falcon in hyperdrive. Note: Might be a good idea to run some spreads on these instruments. Should we be watching the EU and UK to know where we are going?
by HaydenKing