Sorry about the grammar. It's early.

Jon

I trading my portfolio using 5 systems. Two are mine and 3 are public. The three public systems are Ken Wong's PMv8, Glenn Mccullough, and Markettiming.biz. As of last night they have now finally all gone short. Here is the results from the lastest round of longs. Congrats Ken.


___ OPEN_CLS____GAIN
PMv8_9/1__9/14___.7%
GM___9/7__9/20__-.3%
MT___9/1__9/21_-1.0%

Jon
"Follow the charts, not the heart"

FreeMarkets * I checked their web site about 10PM Central and I swear that they were still calling for long for 9/22. Thanks for the big heads up. I had already decided that enough was enough and was going to end the trade this morning. This long trade surprisingly only lost 1%, since it was entered 9/1. Guess I'm not telling you anything you don't already know.

Jon

Husk * I agree with you 100% but I think Glenn was a little late also considering his excellent performance for 2005.

Jon

Table * Found it. Thanks.

Jon

Matrix ** Does anyone know how to post a data matrix. The following is how PokerSam did one this morning. Tabs don't work and the font is non proportional. Spaces don't work at all.

Jon

index------close------support 1-----support 2
QQQQ-------38.93-------38.88----------38.08
S&P--------1221.34-----1220-----------1180
COMPQ------2131.55-----2104-----------2065
OEX---------566.06-----562------------550

Rydex at Brown * They only allow trades at the close.

Jon

KovuLK * Markettiming.biz * It blows me away also that they are still long. I would love to know what they are looking at to make their decisions. It sure isn't any charts that I watch. They gave the long signal on 9/1 and the Qs closed that day at 38.92. They closed today at 38.93, so we are up 1 penny. I can't see how they will let this go very negative. They are the last of the short term traders that I know of to stay long. Glenn McCullough finally went to short today after going to cash yesterday. I am trading with Glenn and PMv8 also. Not taking hugh short positions, but it is nice for a change to see my account going up, even a little, while the market is caving. I benchmark myself by how much money I made vs how much I would have made if it was all in the SP500. After all, if I can't beat that, why all the effort, other than for the sport.

Jon

Husk * Glenn McCullough * I like what I see with his trades also. I have committed 20% of my funds to following him.

Jon

Did you catch the headlines today for the Sunday Wall Street Journal. "It's Fourth and Long for Stocks." I think most realize that this could be a very key week for the stock market direction. I know everyone on this board does. We will all be a lot smarter come Fri.

Jon

2X * CCI * Refer to my post 4262. I am the one that memtioned using the EMA3 of the CCI(20). The CCI is a very fast indicator and I wanted to slow it down a day or two. I decided to try using a EMA3 to do that. I still use 100 and -100 cross overs of the new EMA as the trigger. If you use a cross over of CCI(20) and the EMA3 of the same as a signal, you will speed up the indicator even faster than the original CCI(20). Not a good idea in my opinion. Although, what I have now is not as robust as I would like to see it.

Jon

Husk * ADX * I take the +DI(35) and -DI(35) and construct a EMA(10) of the difference of the DI's. I then look for a change in slope of this smoothed line as my trigger. I use this in conjuction with watching for a slope change in the MACD(12,26). Let me caution you, this system will beat the S&P500, but only by 5-10 points. PMv8 is better.

Jon

Husk * CCI * It didn't take me long working with CCI(20) to see that it was very fast. For the present I slowed it down a day or two by using a EMA3(CCI(20)). Like I said, I am just playing, watching, and getting use to the indicator. I am getting good results, but nothing like I would really like to see.

I very much love the ADX because it doesn't use the closing price. I have lately stopped watching the ADX and just using the +/-DI's. I developed a ADX of sorts by doing a smoothing of the difference in the +DI and -DI. I also follow the MACD, long time favorite. Thanks for feedback.

Jon

QQQQ Trader * Thanks for feedback.

Jon

Todd ** mt.biz ** Thanks for reply. Yes I know about the AM by having an account directly with Rydex.

Before coming to this board, I had developed a MACD/ADX system that gave me 3-4 trades per year and would beat the S&P Index by a little in an up year, and a lot in a down year. I am watching Dr Joe here also, he seems to have about the same system. He also has a low number of trades, but would have you out of the market in a major downturn. I do not plan to ride another 3 year demise down. According to Harry Dent in his latest book, we have until 2009/10 to make a killing in another major run and then prepare for a major recession/depression. He has called the markets well for the last 10-15 years.

However, after reading all the posts on this board, I have concluded that if you are willing to work with a system that generates 25+ trades a year, 50-100% is possible. MT.biz, I think can do that. I really like what I see in PoorMan v8. I think it can do 50% also. 14 or 15 trades YTD. I am also watching Glenn McCullough. He claims he can, we will see. After studying PoorMan, I realized that to get the kind of returns I would really like to have, I had to speed up my parameters. So I am working with my old MACD/ADX system. I now call it DIM, since I am only using the DI's and MACD, not the actual ADX line. It's better, but only good for about 25%. The CCI indicator is new to me, and I like what I see. I am working with it to see if I can generate good signals.

Here is my summary of trades since the last long signal near the beginning of the month.

8/29 Long - my new CCI
8/31 Long - My new DIM and PoorMan
9/1 Long - mt.biz
9/7 Long - Glenn McC (seems late?)
9/14 Short - CCI and DIM
9/15 Short - Poor Man

Good Trading
Jon

Todd, Thanks for your message on the different brokers. I have used Brown for years, first because they had very low commisions, but now because they have the lowest margin rates. I tend to go 50-75% on margin when the market really starts trending.

I learned of Rydex funds through this board (thank you all very much). The 2X funds are a VERY interesting concept. I placed my first Rydex trade with Brown last week just to see how it worked. Since I do all of my trading at the open, at Brown I can only trade at the close of the day that I would like to trade at open for Rydex.

I like what I see with markettiming.biz and have allotted a part of my capital to trading with their signals. Since Markettiming's results are based on the NDX at the close of the day the signal is generated, I had to do an analysis to see how using the Q's at the open would do. I also analyzed how the Rydex funds would have performed with a very interesting result.

Performance for Markettiming trades closed in 2005 as of 9/1.
27.0% Using NDX at the close of the day of the signal
27.2% Trading Q's at the open of the next day.
55.6% Trading Rydex(RYVYX/RYVNX) at close on day of signal
71.2% Trading Rydex at close, day after signal.

It would appear that delaying the trades by 1 day (which is necessary with Brown) has a very positive effect for 2005. I have not looked at 2003/4. I plan to compare the big gap on the two methods of trading with Rydex funds. I have seen this effect before on other signal generating systems and I would guess it is the same here. When a system generates a signal, it is usually on a very strong day. More often than not, the next day the market will give back some of the gains before continuing the trend on the third day. Just a guess at this point, but I like the results. Within two or three trades I expect to be using Rydex 100% just for mt.biz.

Jon

Ken/Free Markets ** Brown shorts ** I shorted 300 shares in my Brown account a couple of weeks ago. It took about 10 transactions to fill the order, but it was at filled at the open as ordered. You shouldn't have any problem. Free Markets, did the see the same method of filling your order? Yours was a big one.

Jon

gkm8198-DMA-Thanks for the reply. I will check out Prophet.net

Jon

Displaced Moving Averages *** Trying to understand what these are. You said that a dma of 19,-9 was a 19 day ma shifted backwards 9 periods. To me this means to calculate the 19 period DMA for today and then plot that data point 9 periods prior. If this is true, then I have no data for today. What am I missing? I use MetaStock for my plotting. Thanks for your help.

Jon

2X-Be-Me *DMA 19,-9. Could you be more specific about what this indicator is and how to construct it. Is it a 19 period EMA of the MACD 5-15-10 histogram moved 9 periods forward?

Jon

Ken, re PM2Xv8 For what's it worth, here is my take on your system and the problems with trades in 1Q. For the present I am concluding that I can not trade like MarketTiming. They will make some 50 trades by the time the year is over. Their goal is to make 1 or 2% many times, and keep the losses to just a few trades. Good strategy, but I don't know how they do it, yet!

So we (maybe just me) are left with developing a trend following system. If we use indicators that are slow, we will only get 4-8 trades per year, but the drawdowns due to the whipsaws can be hugh. My older system (slower) had me in cash during the decline starting about 8/4 and going short just as the market was turning up. Talk about something that will make you sick. However, if you only want to trade a few times a year, this is the results. In the end it will work, but the results will be just ok.

So to avoid the above, you and I both speeded up our signals. The trade off is that during periods of chop, we get chopped a little also. If my analysis is right, you would have be down -3.6% at the 4/13 signal. However at that same point the market (Q's) were down -9.7%. But on the good side, when the market really starts to trend, baby your system nailed the turning points. As of Fri, you would be up 19.5%, 20..2% better than the market. There are not many Mutual Fund managers out there that can beat this. A really key point, is that at no time this year has your performance been worse than the market, and the chop started right after closing the first trade of the year.

I know you want to find a solution to this problem, and I hope you find one. I keep looking also. In the mean time, I will happy with a 20% plus return against the market, or 40% by using the 2X funds. And the best yet, the year isn't even over. Our problem is that we are just never satisfied with what we have, and that is what drives me everyday.

Poor Man 2X (v8)
Based on trading the Q's at open
Signal Pos Open Gain Cum B&H Diff

12/31/04 S 39.915 3.0% 3.0% -3.0% 5.9%
01/18/05 L 38.73 -3.2% -0.2% -6.1% 5.8%
01/20/05 S 37.49 0.0% -0.2% -6.1% 5.8%
01/31/05 L 37.49 -1.2% -1.4% -7.2% 5.8%
02/22/05 S 37.04 -1.1% -2.6% -6.2% 3.6%
02/25/05 L 37.46 -0.6% -3.2% -6.7% 3.5%
03/11/05 S 37.24 1.4% -1.8% -8.0% 6.2%
03/30/05 L 36.73 -1.8% -3.6% -9.7% 6.0%
04/13/05 S 36.06 2.1% -1.5% -11.6% 10.1%
04/25/05 L 35.29 8.0% 6.5% -4.5% 11.0%
06/30/05 S 38.12 2.7% 9.3% -7.1% 16.4%
07/07/05 L 37.08 6.9% 16.2% -0.7% 16.9%
07/29/05 S 39.64 1.7% 17.8% -2.3% 20.2%
08/31/05 L 38.98 1.6% 19.5% -0.7% 20.2%
09/09/05 39.619

Sorry the numbers are all run together, in the edit mode they are in nice columns.


Jon

Ken, I know what you are going through because I have been there many times. That is why I now print out my motto on top of many of my charts, "Discipline, not Conviction". Follow the charts, not the heart. Lot of energy being wasted here by others trying to decide when this market is going to turn down. It will, when it is ready. If we truly have a discipline that we believe in, then all we have to do is follow the trend as our signals tell us to do so.

I have been using a system that will make me money, but the signals are too slow and so a lot of money will be left on the table. I only went long on 9/7. Your system went long on 8/31. I really like what I see with your system. It will give a lot more trading signals per year, but at $5 a trade, who cares. What is important is that it quickly follows what the market is doing. I have modified my system to speed up the signals, but I intent to use your system as a key trading signal also. Several people have been impressed with the simplicity of your system and yet it appears to work well. I agree with them. You do a great job of posting charts. Keep it up. I know I am somewhat new to the board, but I really appreciate all the posts from everyone. I read them all. What a great group of traders.

Jon

daaverage/mvpsignalsystem- Thanks for your reply. I will look into it more. What an interesting turning point we seem to be heading into. Pokersam, appreciate your putting it on the line for us.

Jon

daaverage *Rydex* I was unaware of the 2X funds until I read about them on this board. I went to their web site over the week end, so pretty much understand now what they are. I use Brown, so I thought I would put in an order to see what would happen. At Brown, they only trade at the close of the day. This is not good. Who do you use? I understand that whoever you use only trades two times during the day. Really impressive results using Rydex for MT.

Jon

daaverage *markettiming.biz* I'm now in my second live trade with them also. I have my longer term system, but I am looking to them for a short term trading system. History looks good. Since the beginning of the 6/2 trade they are up 4.1% with straight longs and shorts. How did you turn that into 22%? Options? Rydex?

Jon
My motto:
"Discipline, not conviction"

I believe that the 2005 results are real because I now understand what Time Trac is and how it works. It's the 2004 and 2003 data that I am I have no way of verifing. But if the system makes me money, I will follow. And if it stops, so will I.

I checked out the Index Trader web site. Very interesting. Thanks for the info. They are giving signals almost identical to MarketTiming.biz. They both must be looking at the same thing, whatever it is. I love confirming signals, they are both calling for shorts.

I have been short with my system since open on 8/8, but did play a small amount of money for a bull the last few days. Tomorrow I will sell and add to my shorts. I believe that PokerSam has this one nailed.

Jon

**MarketTiming.biz** I will be watching them (and trading a small amount) and let you know what I see.

Jon

Todd, I agree with you, I want to see history. markettiming has all their trades posted for 2003 and 2004. After having signed up for a month, I now have access for all the history of 2005. What we don't know is if the history is real or made up. But I am going to commit a small amount of money to to follow them for the next few weeks. As the trades make "me" money, I will start to commit more and more to them. I am not sure how they are generating their signals, but I can tell they are coming before the market is moving in that direction. It would appear that as a trend flatens, it generates a signal.

They sent out a short signal last night for today(Wed), but their web site said to say long. I did not check my email last night and I did not check the web site this morning. I just checked the web site (Wed 6pm). It is now dated 9/1 and says to go short. There maybe some confusion because they are in the process of rebuilding their web site. Sure glad I missed the short call last night. It will be interesting to see how they report their results for this closed trade, it should not have today's gain in it.

Jon

Todd, I found it as you said. I wasn't sure about how it all works but I got a result of about 10.2% since 5/1. This compares pretty well with the actual 9.6% that I calculated. Thanks for the return, I will study the timetrac more when I have more time.

Thanks,
Jon

I see MarketTiming different than you do. Maybe you are confusing them with someone else. They do not have a Time Trac on their web site that I can find.

Using their signal dates and trading the Qs at open the following day, they are up 27.9% for all trades closed in 2005. As of May 1 they were at 18.3%, which means they are up 9.6% since that date. This is with no margin. There have been a total of 18 trades closed with only 2 losers.

Jon

Mixed Signals ** I am facing exactly the same situation as you are. I am short with my system, and in my heart (not that it matters what my heart believes) I think the market is headed down. My system usually runs for a few weeks, so it is not unusual to see periods of a pull back and then the trend resume.

The timing service may reverse their call tonight, but I doubt it. What ever they are looking at, I think they see a small up blip coming and want to capture it.

I have already acted as Husk suggested as option 2. I am short and I am long. My reasons are as I stated above, and also to keep the accounting seperate for the two systems.

Jon

daaverage ** markettiming.biz ** After reading your postings I checked out their web site. In trading the Nasdaq 100 for 2004 they were up 57.7% and 27.7% 2005YTD. This is really outstanding performance. I can't even come close to something like this. At $35 for a month, I though it was worth trying it out. I'm not sure how you got the results you got for June, but 28% YTD is good enough for me.

I calculated all the trades for the Qs for 2005 using the opening price the day after the signal was generated. I got almost exactly the same results.

Thanks for the headsup. I have never found anything like the old Jeff Copper 5 day I used to use.

Jon

Shorting

Ken,
Great comment. What's so great about shorting is that while everyone else is losing money (assuming they were not at least smart enough to get out of the market), you are actually making money. You are winning TWICE. Of course you can lose twice also, so I tend to cover shorts quickly.

I was a little worried about today after shorting at yesterday's open, but feeling pretty good right now. Don't like to hear all this bouncing talk, even though I know it is a fact of the markets.

Jon

Timing Cube

I sure agreee with your comments. I calculated the results of timing cube on the Qs for 2003 and 2004. Ugly results.

2003 TC -1.3% Buy and Hold 9.5%
2004 TC 37% Buy and Hold 49.6%

I used Jeff Copper's 5 Day Monemtun Trading Service back in 1999 and 2000. It worked well during the bull market and I made a lot of money. But it fell apart with the crash.

Jon

Backtesting of System

My rules are 99% fixed but there is still some judgement in what actions I might have actually taken. Decisions in the heat of the battle are difficult. Anyway here is my back testing results for the Qs.

...............My System...........Buy & Hold
.........Long....Short...Total
2003....42.7%....-5.4%...37.3%....49.6%
2004....11.1%.....3.9%...15.1%.....9.5%
2005.....8.0%.....3.8%...11.8%....-1.0%
(8/5)

2003 was a year that probably won't be repeated very often. It was basically nothing but a up year with a few fake bears. However, the results don't bother me at all. Having lived (sometimes I felt I was dying) the tech bust, I am convinced the sercet is to not lose money on major bears and capture as much as possible of the bulls. I looked at 2001 and 2002 just enough to know that the results would have been good, but did compute an actual number. Any year with any significant pull back will yield good results because of the ability to short or at least avoid losing money.

I have no problem using margin. I will be going on 25-50% margin when I am long. The margin rates with Brown and Co are the lowest I have seen. Margin will alter the results a lot. On shorts, it will be hard to even go 100% short for me. Today I am going about 60% short. Basically the markets want to go up, so shorting is risky. If the market goes up when you are short you lose twice, once for not being long and second for being short. That hurts.

Jon

Posting of my charts.

Ken,
You must have a lot of energy. Thanks.

Jon

Very impressive results. Makes me want to quit my day job and spend the day in front of my computer trading and drinking coffee.

Jon

I'm going short Qs.

Ken, I sent you a post last week about my system and some of the similarities to your Poor Man's 2X. My system is not as fast acting as yours, but trying to avoid whipsaws. As I said then, I went from long to cash on 8/5 at 39.55 (actually at open 8/8).

I watch the MACD(12,26,9) and ADX(35).
I will go short if:
(1)MACD fast crosses under zero and ADX confirms direction or
(2)-DI crosses over +DI and MACD confirms direction.

Today the 12 day moving average crossed under the 26 day, which gave me the trigger. The -DI is close to crossing but the big highs for the days are holding it from crossing.

I hope Paul is not right about a bounce back up to 1225, but he probably is. Will just have to live with the volatility.

You of course have been short all this time which has paid off well. However I am a little more cautious. I measure myself against the S&P 500. It is down 1.6% since 8/5. That is 1.6% I didn't lose, so I gained against my benchmark. The Qs have been down 2.6% in the same timeframe.

Jon

Buying Options at the Market can make you a lot of money but it can loose you a lot also. Buying a $1 option does allow for a very big investment without a BIG risk. 100% return on a small investment will not set you up to buy a yacht. A 25% return on a bigger investment is better.

Consider this. If you buy options that are about $5-6 "in the money", there is almost no time cost.

The Q's closed today at 38.50. Assuming that you want to go short, an Oct 44 would cost $5.60 at the asking price. That is only a 10 cent time cost. 2 options (200 shares) could be bought for $1120. This $ amount would only short 29 shares. Because the option is in the money, it will move dollar for dollar with the actual Q's price from about 41 down to zero. So if the price bounces up a little from 38.5, it will not hurt near as much as buying at the money. An "at the money" option would by almost totally wiped out if the price moved $1-2 dollars up (a 100% loss).

However you would own 200 for the price of 29. This gives you a 7 times leverage on your money. Of course this is risker than a just shorting the stock, but maybe worth the risk?

Jon

Bounces and Dips
Paul,
Great comments about bounces and dips in your post 1539. So true and yet so hard to believe while it is happening.

Jon