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Basically this is a global QE 3. This will not cure the problem. It will just allow the problem to continue because there is no consequence to irresponsible fiscal policy. I would hesitate to short in this environment.
The landscape/game plan has definitely changed. The EU will do swaps with the FED which in turn will print money. In essence the sovereigns are putting a floor on the market. At this point in time there are no restraints and the situation that created the problem has again not been addressed/fixed. This is going to be on heck of a short squeeze.
The metrics that are used by the private sector-companies, individuals like you and me- are completely different than are applied to governments. They can print money or create financial instruments that supposedly have value that they use to alter their balance sheet. Don't try to understand what they are doing. Just follow where they go. You will never be able to capture every move in the market. To try to do this will result in frustration. Most portfolios make an average of 8-10 %. Crossovers and CCI are a good way to trade . Do not anticipate the market follow the market. How long it will be in a certain trend is anyone's guess. If trading was a certainty we would all be rich. It takes a difference of opinion to make a market. Someone wins and someone loses. Taking a profit early is still making money.
This system, ARTS, allows you to follow the market. I'm following using the 15 minute charts and have made money. it won't make me a Donald Trump but it allows me some control and it is definitely more profitable than buy and hold or mutual funds
A good example of the magic of wealth creation are swaps as outlined in this CNBC article
http://www.cnbc.com/id/44963864
This is the power of leverage and computer balance sheets. So with this in mind it may be easier to resolve the financial crisis than you think.
Peter
SPY is in a trading range between 119.2 and 122.8. Whether we go up or down the markets will tell eventually. To front run the move is suicide because the markets will do everything in their power to confiscate your money. Logic will tell you that the PIGS should and will default based on simple math.
But economies and wealth is a man made creation and hence what happens will be dictated by what people tell you. As they have said all along the problem with Greece is not a new problem. It has been there for years. It has come to a head because no one wants to lend them money. If I came to a bank to borrow money with a balance sheet of 5:1 Debt to income I would be laughed at. The US is at that stage. It is about perception and confidence. Be Careful . I would wait and trade when the trend is established by ARTS and out of this range or tunnel.
Sell sorry about that. In at 36.81 BGZ
Huge spike in volume at 10:15 BGZ
In using any method of trading I often don't review each candle with all the rules in mind. Add to the ARTS charts Parabolic SAR. What this does for me is that when the signal changes I then evaluate according to the rules of the ARTS method to see if complies or not. Often times I need to focus on the rules and Parabolic SAR does that for me.
Another observation is the last 15 minutes of the day has seen an extraordinary increase in volume in the past 30 days. There is no pattern that I can detect but it does seem to mess with mechanical trading models, algorithms etc.
Peter
$SPX has been bound between the weekly 8 ema and the 144 ma. EOD is exactly at the 8 ema. Next week will tell where it is going. On the daily Arts the slope is moving up. Failure to breakout would show no conviction in this rally.
Peter
XLF is in sell mode. As Alan Greenspan said to save the Euro political solidarity is necessary. 17 countries to give up their political sovereignty to create one political and economic entity- not.
UUP is a buy using the Arts 15min. If the dollar rises it will be difficult for equities to rise as well. I think the success of a rally depends on the strength of the dollar. If the Euro is to survive, it must fall in price which will cause the dollar to rise. Just some thoughts.
I agree. Anticipation has caused more losses in my trading than any one factor.
Again negative divergences continue to appear. I think that this rally is strictly market makers doing. That being said, this will reverse quickly as it did the last 45 min of the day on Tuesday.
Peter
Negative divergences on the 60 and 15 min charts. Longs be careful.
Peter
Someone sold dollars in the last 45 minutes of the day. Is it in retaliation for the up coming trade war with China if the Schumer Bill passes- who know . All this is speculation on my part.
Peter
I am using a 1 min chart with the same numbers as the 5 min Arts to help with KISS situations when using the 15 min charts. The stop is the corresponding ma. BGU on the 1 min has now been rejected and is headed down at 2:24 BGZ going up
Peter
Good morning,
Which trading platform/software do you use/prefer in your trading? I use stockcharts does anyone have a preference?
Peter
Watch at @2:30 after Europe closes. This when the EU holds news conferences to bolster the markets. They have found the they need to support their own markets to get through this mess. For what its worth
Negative divergence on the 15 min Arts for SDS. Sold for lunch money. $spx bouncing off the 55 ma
Watch those downers. 1169.17 is as far down as Da Boyz are going to allow it today or not.
Island reversal, Bull Trap could be an interesting Wednesday. Opened SDS at 23.28
Your BGZ should be safe at 40. The 15 min ARTS is going long in about 15 min.
Peter
Beware the end of month window dressing. As you well know this can stay overbought for a long time.
The problem with any trade is trying to predict the future which is impossible. Fear of failure is a strong emotion. Loss of money in this economic climate is tough. My tendency is negative because as a business owner the government is bankrupt if bound by the same rules of economics as I am. The difference is that government can print money and with the mountain of debt mathematically the only way out is printing money or bankruptcy. We can not grow our way out of this mess. At some point this will collapse- how far and how fast no one knows. This system of ours is kept afloat by the confidence that it works. When we lose that confidence it fails=runs on the banks. It is as Abraham Lincoln said ( this is paraphrased) When half the people realize they will be kept by the other half and the the other half realize that they will not benefit from their hard work because it will be used to take care of the that half, society is lost.
WE pay our debts because if we don't we lose the collateral we put up to secure the loan. Government debt is not secure. They pay back their loans because they want to be able to borrow more- reassure investors that they will be paid so investors will give them more. If government is not bound by this premise because they can print money then the system breaks down. What happens after that is anyone's guess. That is the period we are in now.
Peter
$spx gap filled at @1167. CCI on 5 min GOM chart at 233.99 way oversold . No specifics as to how Europe will finance this debt fund. When CNBC broke news for the general outline it was all up. Conclusion market is headline driven which is difficult to predict direction. 15 min chart is too quick. The 60 min chart is eliminating whipsaws in recent days anyway.
Peter
96 % of Japanese debt is owned by the Japanese people compared to 40 % of US debt. We rely upon others to buy our debt. As far as the length of time needed to pay down debt so that the consumer can resume spending will take a minimum of 12 years- the time it takes to pay down 20% of the principal on a 30 year mortgage. Japan's recession is still going on and it started in 1980.
Peter
This is a balance sheet recession. A good book to read is titled In search of the Holy Grail A study of the great Japanese Recession. Sorry the author 's name escapes me. He his a japanese economist and a scholar of the great depression like our Fed chairman Helicopter Ben. The conclusion of managing the effects of this type of situation is to improve your balance sheet by paying down debt and the government to spend. The problem is we should have some savings with which to spend.
Peter
SDS support on the 15 min 22.94. Resistance is 23.12. We will be in a tight trading range until 2:15 FOMC meeting speak. Usual pattern of trades after FOMC if it goes up prior it will go down with the announcement and then close up at the close. The following day will be down. The pattern can be reversed down up then down in the close. It will will then be up the next day. Too quick for me to trade but that is the usual pattern. Scamman at Clearstation made this observation a long time ago.
Peter
Braided line is great- increased strength with less diameter. The downside to it is that the line is abrasive. The guides on your rod can get grooved in time. The guide on the tip of the rod is most prone to becoming grooved, Carbaloid (sp) guides are the best to use.
Peter
Glad to see that you are still around. I've missed Gleno, Footquarters, Omandan, the old gang. I've followed conversations since Clearstation. Hopefully all is well and the new job is working out.
Peter
Where I have gotten in trouble in the past is trying too predict where the market is going. You will be better served by reacting to how the market is behaving and getting a portion of the trend. No one can predict where it is going. Establish the trend and trade it. Get out when you make enough. Don't punish yourself for not getting it all. Trying to get it all, for me, resulted in lesser returns.
Peter
I've sent you an email about slope and have sent you my 60 min chart set up. I have not backtested it at all. Because it gets you in earlier you usually front run an entry as established by the faster ema cross of the 2nd ma. The forex trading method referred to as the Tunnel method uses your entry w/o the CCI. I also added Elder's candle instead of a normal candle as an additional filter or warning.
Peter
I have added to your chart the slope function from Stockcharts.com to further reinforce the signal. The slope is determined by your ARTS system. It has a tendency to get you in earlier on a trade in the respective time frame by 3 candles. Gaps are difficult to trade so the CCI still filters the entry even though the trend according to the slope or cross says go.
Peter
The 15 min ARTS told you to go to cash but when do you listen to the 15 min and when do you stay with the 60 min. In the past the 15 min charts has whipped sawed you fairly frequently. Thanks.
Peter
The observation that I use for the 5 min GOM is as long as the Candle settles above the mid line of the BB we are going up. Once you cross through it down I'm out.
Peter
The best way to look at these trades is just that a trade. Your increasing the probability that price will move in the direction you think because of observations, mathematical tendencies, patterns etc. Blasher's system increases your probability of success but does not predict the certainty of the future. Fiscal discipline allows you to be successful. Most traders fail because they don't follow rules. Good luck tomorrow.
Peter
It will be interesting how this unfolds. I will be interested to see how everyone enters or adds to the short positions with a huge gap down at the open in the $spx .
Peter
the market won't move much until the employment numbers come out, until people come back after labor day, and the Sept FOMC meeting in early Sept. The jobs program by the President maybe a downer. Watch your signals, BB on the 5 min chart etc Good luck. Good trading.
Peter
Thank you.
Peter
What is a top pane?
Peter
I am looking to short the market using the 60 min entry but it is again rising so I held off and will wait to see what shakes out