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Excellent...
Could make BB 60,2 double Bands...I know you like 20.2 and 60,2...
I am suggesting= first that the closes indicator to read when price is at the outer bands is the trin/stochastics...trinStochastics being the best...
You said "includes philo CCI B% thingy i never understood"...what part...Philosophy or the %B...always have traded %B before CCI...
%B is the Bollingers put to percentages and is really telling you where price at=price being the best indicator...
That looks good...
I'm trying to make stochastics of the TRIN work on 30 minute...
Good chart...I usually use the 5 or 10 minute...but TRIN is the most unique indicator...re-sets each day and crosses all timeframes...
Enjoy...
Trin...
I had to go out ...
Need to see the TRIN raw data not only the EMA...like tick is showing in the Back ground...
I'm mainly focused on the Trin and where stochastics fast slow lines cross...and need to see raw trin between .90 and 1.10...
And what the hell was I doing going short with stochastics of trin showing such an obvious 2 day of momentum...
Tick and TRIN
I don't think I've posted this full set of charts that I call the Tick and Trin set...
Get what is said about TRIN yesterday and follow the next few post and you have a real "key"...=kiy...Ki...comes from...and its the TRIN...be sure to understand what is said about TRIN not being a perfect indicator...
<img src="http://stockcharts.com/c-sc/sc?s=SPY&p=60&b=5&g=0&i=p39175418743&a=203098957&r=7471">
<img src="http://stockcharts.com/c-sc/sc?s=$SPX&p=D&yr=0&mn=6&dy=0&i=p05637132117&a=202930972&r=2627">
...this is daily signal(sometimes early) with moving average crossover of CCI...
<img src="http://stockcharts.com/c-sc/sc?s=VXX&p=D&yr=0&mn=9&dy=0&i=p55022102356&a=200820254&r=123">
<img src="http://stockcharts.com/c-sc/sc?s=$SPX&p=1&yr=0&mn=0&dy=4&i=p48281270923&a=159129548&r=5">
<img src="http://stockcharts.com/c-sc/sc?s=$SPX&p=5&yr=0&mn=0&dy=3&i=p12799985243&a=163409901&r=8">
<img src="http://stockcharts.com/c-sc/sc?s=$SPX&p=15&b=5&g=0&i=p44095237932&a=202389515&r=5316">
<img src="http://stockcharts.com/c-sc/sc?s=$SPX&p=15&yr=0&mn=0&dy=7&i=p04580600218&a=163409900&r=466">
<img src="http://stockcharts.com/c-sc/sc?s=$SPX&p=30&b=5&g=0&i=p78924320561&a=202389539&r=2291">
<img src="http://stockcharts.com/c-sc/sc?s=$SPX&p=60&b=5&g=0&i=p83426028267&a=202389579&r=4984">
<img src="http://stockcharts.com/c-sc/sc?s=$SPX&p=60&yr=0&mn=1&dy=10&i=p28591256453&a=163409899&r=587">
<img src="http://stockcharts.com/c-sc/sc?s=$SPX&p=D&yr=0&mn=6&dy=0&i=p15160818253&a=163409903&r=794">
<img src="http://stockcharts.com/c-sc/sc?s=SPY&p=5&b=5&g=0&i=p44516783606&a=202434724&r=5361">
<img src="http://stockcharts.com/c-sc/sc?s=$SPX&p=60&yr=0&mn=2&dy=0&i=p73613459850&a=145757603&r=650">
<a href="http://charts3.barchart.com/procal.asp?sym=$INX">S&P 500...Projections<a/>
...I've said trin is one of the keys...Trin...is not a perfect indicator...read page 2 of this link...and can get your own adv/vol and adv/decl issues from market internals link below...BUT...as noted in definition...it is the "direction"...and trend of the Arms index that is more important...
<a href="http://www.onlinetradingconcepts.com/TechnicalAnalysis/ArmsIndexTRIN.html">http://www.onlinetradingconcepts.com/TechnicalAnalysis/ArmsIndexTRIN.html<a/>
<a href="http://www2.barchart.com/momentum.asp">Market internals<a/>
<a href="http://www.quote.com/us/stocks/chart.action?s=%24TRIN&chartUi.period=V&chartUi.bardensity=LOW&chartUi.studies=CCI%2820%29%3BPR%2810%29%3B&chartUi.overlay=%24SPX&chartUi.bartype=LINE&chartUi.size=620x300&chartUi.minutes=10">TRIN overlay<a/>
...10 minute TRIN is key***
<img src="http://stockcharts.com/c-sc/sc?s=$TICK&p=10&yr=0&mn=0&dy=6&i=p86903766458&a=145712331&r=807">
<img src="http://stockcharts.com/c-sc/sc?s=$TRIN&p=15&yr=0&mn=1&dy=4&i=p65906875483&a=177359065&r=337">
<img src="http://stockcharts.com/c-sc/sc?s=SPY&p=5&yr=0&mn=0&dy=2&i=p69323614100&a=147179272&r=940">
IPO_Trader chart...as long as loads will watch it...
<img src="http://stockcharts.com/c-sc/sc?s=SPY&p=5&yr=0&mn=0&dy=2&i=p70860575968&a=191533387&r=604">
<img src="http://stockcharts.com/c-sc/sc?s=$TRIN&p=5&yr=0&mn=0&dy=11&i=p30035264132&a=243647670&r=618">
<img src="http://stockcharts.com/c-sc/sc?s=$TRIN&p=D&yr=1&mn=6&dy=20&i=p93042016174&a=239119036&r=745">
<img src=http://stockcharts.com/c-sc/sc?s=$TRIN&p=D&yr=8&mn=0&dy=0&i=p66841928877&a=246187154&r=7412>
<img src=http://stockcharts.com/c-sc/sc?s=$TICK&p=D&yr=8&mn=0&dy=0&i=p98482828199&a=246187149&r=1219>
<img src="http://stockcharts.com/c-sc/sc?s=$BPSPX&p=D&yr=0&mn=6&dy=22&i=p43969617336&a=153926945&r=230">
<img src="http://stockcharts.com/c-sc/sc?s=SPY&p=D&b=9&g=0&i=p40984079797&a=139439402&r=979">
difference on 60,20 stochastic chart
I left the 4 in cause I was on a weekly chart playing with 4week...
Good eye...
That change on the TRIN to a 30minute chart may also come with "slow Stochastics...not fullStochastics...
tja1 nice chart
Ziko; if I didn't know better I'd think you were talking to Ha...and my first re-action is why do I want another volatility band like that when I've got stochastics...
I think momentum is the question when price is at the outer bands...not volatility...and volatility at best as an indicator is only coincident ... momentum is where TRIN...stochTrin and ChiOsc come in...its the momentum part of the CCI calculation that makes it slightly different fromBBs=%B...=CCI...difference is small.
So any way ...I've got more to say about volatility and momentum but need another chart...= change this 5 minute into a 30 minute and add ChiOsc...
First want to compare some with tja1 chart...
Quest-tion=fundamental cycle
20,2 contained within the 60,2Bands...
20 trading days a month...
3x20=60 day cycle of quarterly earnings...
Earnings reports are now relatively over for most recent quarter as of thur/friday...now whats the Market to focus on...?...until the next set of earnings...guidance...upgrade/downgrades...
We have just finished the January effect...I suggested a month and a day of "window dressing" includes end of month window dressing for the fund managers...
Fundaments include what is S&P relative "fair value" ...at what PE ratio Market thinks it can price itself at based on projected forward earnings...
I really don't need to know how to act unless price is at one of the 60,2 bands...act with signals...
Warning: Goat Rodeo
January 30,2012 John P. Hussma Ph.D.
Goat Rodeo
Goat Rodeo - Appalachian slang for a chaotic, high-risk, or unmanageable scenario requiring countless things to go right in order to walk away unharmed.
Over the years, of the most frequent phrases in these weekly comments has been "on average." Most of the investment conditions we observe are associated with a mix of positive and negative outcomes, so rather than making specific forecasts about future market direction, we generally align our investment position in proportion to the average return/risk outcome, recognizing that the actual outcome may be different than that average in any particular instance.
Increasingly however, we have observed sets of conditions that are so heavily skewed toward bad outcomes that they deserve the word "warning"...
While the downturns that followed have provoked increasingly large and desperate actions of central banks to kick the can down the road by preventing debt restructuring and financial deleveraging (in some cases by violating legal constraints - see The Case Against the Fed ), the fact is that the S&P 500 has achieved a total return of just 1.2% annually over the past 12 years, as a predictable outcome of rich valuations and still-unresolved economic imbalances.
I could admittedly do better, and would certainly have captured more upside from temporary speculation, had I committed myself to the principle that central banks will act strictly to defend the bondholders of the banks they represent, even if it means trespassing into fiscal policy, subordinating public interest, empowering the worst stewards of capital, violating legal restrictions, and inviting long-term instability. Still, none of those actions improve the long-term outcome for the markets, and more importantly, none have prevented repeated and serious downturns from occurring, despite all the can-kicking.
Once again, we now have a set of market conditions that is associated almost exclusively with steeply negative outcomes. In this case, we're observing an "exhaustion" syndrome that has typically been followed by market losses on the order of 25% over the following 6-7 month period (not a typo). Worse, this is coupled with evidence from leading economic measures that continue to be associated with a very high risk of oncoming recession in the U.S. - despite a modest firming in various lagging and coincident economic indicators, at still-tepid levels. Compound this with unresolved credit strains and an effectively insolvent banking system in Europe, and we face a likely outcome aptly described as a Goat Rodeo.
My concern is that an improbably large number of things will have to go right in order to avoid a major decline in stock market value in the months ahead. We presently estimate that the S&P 500 is likely to achieve a 10-year total return (nominal) of only about 4.7% annually, which reduces the likelihood that further gains will be durable even if they persist for a while longer. In the context of present valuations and a probable Goat Rodeo in the months ahead, my impression is that the recent market advance may be a transitory gift.
Whipsaws, Noise and Exhaustion
In nearly all real-world data, there are short-term fluctuations, random effects, and other influences that create "noise" in the values that we observe. Typically, those sources of noise confound the "signal" that we want to identify, so unless the noise is filtered away, there is a risk of being misled by meaningless short-term fluctuations. In finance, there are countless approaches that essentially involve noise reduction. For example, a moving average is just a simple noise-reduction technique, where very short-term fluctuations ("high frequency components") are averaged away, leaving the smoother influence of longer-term fluctuations. Similarly, the Coppock Curve - the 10-month exponential smoothing of the averaged 11-month and 14-month rate of change of the market - is really just a "low-pass" filter that cuts away high frequency fluctuations and allows the market's long-term (low frequency) cycles to pass through.
In late October, I noted a condition that we characterize as a Whipsaw Trap - which essentially involves a breakdown in a broad set of market internals, followed by a recovery driven by some of the more volatile components (sectors such as financials and transportation stocks are good examples). I noted that only about 30% of these whipsaw traps were followed by further advances - a statistic that was based on subsequent market action over the following 6-8 week period. The real question is "What then?" The answer is both straightforward and troublesome. Specifically, whenever we've observed a whipsaw trap that then advances enough to a) drive the S&P 500 earnings yield below its level of 6 months earlier and b) raise advisory bullishness beyond 45% - or bearishness below 30%, the result has almost always been hostile. Essentially, what this combination picks up is an already fragile set of market internals that has enjoyed an "exhaustion rally" that both exceeds earnings growth and is met with overbullish sentiment.
The previous observations of this exhaustion syndrome, and the deepest decline from that point to the low of the next 7 months, on a weekly closing basis, were: November 1961 (-25%), August 1987 (-33%), July 1998 (-18%), July 1999 (-12%), August 2000 (-22%), May 2001 (-24%), March 2002 (-32%) and May 2008 (-43%). There were also two instances of this syndrome that were not associated with a market plunge: January 2006 during the housing bubble (which ultimately led to a market collapse well below those levels), and November 2010, just as the Fed was initiating QE2 (which still did not prevent the market from trading at lower levels about 9 months later).
If we think in terms of "exhaustion rallies," the syndrome we're observing here is a multiple indicator version of signals like the Coppock "killer wave" - which occurs when the Coppock Curve reaches a peak, declines, and the market then recruits an advance large enough to establish a second wave higher. Some technicians have debated how best to define the signal (e.g. the decline required to define a negative shift) - in our view, it's not a good idea to use a single indicator in the first place - but in any event, the selloffs from those exhaustion waves have often been brutal, and a few overlap the syndrome outlined here.
In short, market action is presently showing features associated with "exhaustion rallies", which have often been followed by deep losses over the following 6-7 month period.
As a side note, we've seen a similar whipsaw in various economic statistics recently, where I continue to view the modest but tepid "recovery" as a reflection of high-frequency noise. Here too, the underlying "signal" remains weak, but the more volatile components have been positive. Unfortunately, the typical result is that the divergence snaps shut in the direction of the signal.
[Geek's Note: What I call a "Whipsaw Trap" is basically a breakdown in a broad range of market internals, followed by an advance in more volatile, high-frequency components that isn't enough to survive moving averages and other low-pass filters. It's difficult to draw a true signal from noisy data unless you have a lot it, and unfortunately, the more data you need to use to infer a signal, the greater the "lag" there is in recognizing that signal. Think again of a moving average - the longer-term the moving average, the more it lags behind recent action. The better you want a microphone to cancel noise, the longer the delay you have to endure between the input and the output. Generally speaking, we get better and more rapid information about the true, underlying "signal" if we can draw that signal out of multiple indicators, each which carries part of that information. Methods to distinguish "signal" from "noise" run through much of my financial, economic, and scientific work, for example Market Efficiency and Inefficiency in Rational Expectations Equilibria , and A Noise-Reduction GWAS Analysis Implicates Altered Regulation of Neurite Outgrowth and Guidance in Autism . The benefit of inferring signals from multiple sources is why the rational expectations paper used vector ARMA models for inference, why the GWAS paper exploited the local correlation of association signals within the same chromosomal region across multiple data sets, and why good leading economic indices combine multiple series rather than using any single indicator as an acid test].
Recession risk remains high
Last week contained very little to alter our view that a global economic downturn is likely here. While we recognize the modest, low-level improvement in a variety of indicators (see Dodging a Bullet, from a Machine Gun ), and also estimate that recession risk is something less than 100%, this is far from a suspension of our recession concerns. To the contrary, a concerted global downturn that includes the U.S. remains the most likely outcome.
Last week, the Conference Board released its revised version of Leading Economic Indicators, which shows a sharply weaker trajectory than the former version if the LEI. Indeed, the revised LEI has already turned down, though to a lesser degree than just before previous recessions.
Finally, while we typically discourage drawing inferences from any single indicator, it's at least worth noting that with the release of Q4 GDP figures, the year-over-year growth rate of real U.S. GDP remains below 1.6% (denoted by the red line below). A decline in GDP growth to this level has always been associated with recession, usually coincident with that decline, though with a two-quarter lag in two instances (1956 and 2007), and with one post-recession dip in growth during the first quarter of 2003. As it happens, the GDP growth rate dropped below 1.6% in the third quarter of 2011.
Given the strong and rather obvious relationship between the most recent year-over-year rate of GDP growth and the prospect of oncoming recession, it's difficult to understand why Wall Street so completely rejects the likelihood of an economic downturn. Then again, that's exactly why we're expecting a Goat Rodeo.
Market Climate
As of last week, the Market Climate for stocks was characterized by conditions we associate with a "whipsaw trap," coupled with overvalued, overbought, overbullish conditions and evidence of exhaustion that has only a handful of generally awful historical peers. Strategic Growth and Strategic International remain tightly hedged, though in both funds, we've clipped a few percent from our hedges to reflect the more defensive composition of our holdings. Though steep market declines tend to be indiscriminate (with even defensive stocks often acting as if they have a beta of 1.0), we recognize that "risk on" days can also be very uncomfortable when defensives lag the market and our hedges bite with full force. The modest change to our hedge is intended to maintain our downside protection while hopefully producing a little bit less day-to-day discomfort on days when Wall Street suddenly goes "risk on" and chases banks, financials, materials, and high-debt cyclicals, all of which we hold with smaller weight than the major indices reflect. Overall, however, we would still characterize our investment position as strongly defensive.
In Strategic Total Return, we're seeing some moderate shifts in the Market Climates for bonds versus precious metals. We used last week's weakness in bonds to increase the duration of the Fund toward a still moderate 4.5 years, while using the strength in precious metals shares to clip back our holdings below 10% of assets. Given the volatility of precious metals shares relative to bonds, the overall effect is to move the Fund to a somewhat more conservative stance, in the sense that day-to-day volatility is likely to be lower than it has been with a more significant precious metals position. While the Market Climate for precious metals shares remains positive, we observed a discrete reduction in our projected return estimates, and are aligning our investment stance proportionately.
5minute ...noise...edit...****
30minute should show better than flatline just below +100 if this 5minute cycle draws some selling...
ChiOsc will help make some sense of the noise if Ha would explain ...cause I'm out of posts...
The stochastics of the TRIN does a good job if you're into daytrading and timing your entry/exits...trinStochastics signals=fast linr cross slow line and then turns up from oversold level...suggests price can start some down... if the trinStochastics can make it to upper level...may even trigger more selling...
5minute...
Funamental reason for 20,2 and 60,2 daily...what is it...eDiT*****
show a chart...some charts...and what timeframe...
I haven't a clue what you "think" you're saying...
Been waiting on 1340 for 2 weeks...TidEeDiT*********
15minute said go...so get on with it...LOL...go and at a high price is some sort of divergentdeviant behavior...get on with it...CCI flatlines as comes out of overbought...INsane...deviant*&&^^%$@*s.
Now's the trade...need some follow through =1340 and then see if 1338 gives...target 1311...maybe...1295(1292 over shout...my bias)
one minute is NOWWWWWWWWWWWWWWWWWWWWWWWWW...!...Sideways above 1340 is insane...what...wants higher...same pattern for weeks...bulls win.
TZA...see 2nd chart
Could remove 10CCI and do overlay %B...10CCI is usually very early.
Or place %B just by itself...
Often better to get signals from the index not the ETF...kind of like SPY often runs a point or two above Cash SPX...
Daily NDX at outer band...%B at .99(99%)=just the Bollingers laid out flat on a graph....99=where price is at...price being the best indicator...followed by stochastics...
The "magic formula" is BB=%B=CCI...all basically say same thing so you have multicollinearity working for you...that is if price is the best indicator...
Enjoy
Listen to the signals...
Listen to the signals at signal lines with the technical indicators of choice...Pick your price=signal lines on chart price levels like support/resistance ...Bollinger Bands...trend lines...
Don't listen to me...I could be crazy and on drugs...
Signals are there...place your bet...I can't pull the trigger for you...
Good trades come with signals...pull the trigger...the test is really you...not the trade...pulling the trigger...without opinion or emotion...