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There are some divergences in the indices. VXN is *down* for the day...
That's all my freebies for the day (aren't you glad, Mongo?). See all you lads tomorrow.
Yeah, and unfortunately, they are winning. However, got to believe that there could be some healthy profit taking into the Fri close, and also the Shorts have Max Pain on their sides. This will give the option sellers a lot of ammunition to hit their OE targets.
At this point, it will take a 50 pt drop in the NDX to get back to the pre-Intel announcement level. So, when is a drop a drop, before or after a 50 pt gain, especially when the net result is zero?
My favorite is the Hope Indicator, and this time it's hoping to get some profit taking into the close, but so far, not a seller in sight.
Probably the strongest are RSIs in multiple time frames of 5 days or greater. We are *way* beyond the historically optimal reversal points. And yet, it keeps grinding higher. It is always darkest before the dawn (not really, but that's the saying).
Concur with topping. Reversal indicators abound, but still continuing to grind up on thin volume. Naz hasn't topped 2B shares since 7/8...
Classic set up for a dive. Gap up, grind higher, with BBs getting very tight.
"In the money" options are calls (option to buy) with strike prices below the expiration price and puts (option to sell) with strike prices above the expiration price. At OEX, calls above and puts below would never be exercised and thus expire worthless. The Max Pain theory simply says that excluding other influences or factors, as OEX approaches, option sellers (i.e. the pros/boyz) tend to manipulate prices up or down by buying or selling the underlying equity so as to make the maximum number of contracts expire worthless.
Poker barely tolerates me as is, and frequently I find it too difficult to bite my "tongue". Then, some others just aren't very nice (re: the deleted post this AM). I guess they have not discovered the "ignore" feature, which I highly recommend to anyone who finds my posts useless or objectionable (or both).
With Fri being OEX, the Theory of Max Pain suggests a pullback to at least 36 on the Qs, and it could go as low as 35, but the lower target seems less likely in view of today's gap up and run.
http://www.optionpain.com/MaxPain/Max-Pain.php
RAB, I have found that a 10/66 MACD smoothed over an 11 day period is an excellent IT trend indicator, and it is still in decline. Moreover, the first derivative of the MACD (i.e. the slope or rate of change of the MACD) is increasingly negative. That can of course change over the next day or so if the market continues to defy gravity, but for now, it is still confirming an IT bear market.
Mongo, my friend, how *are* you??? I still post on RBTS when the mood strikes me, but mostly stay busy running the system. Kinda caught a crab on this Short, but the baseline signal is still up ~ > 40% YTD, about twice that using the trend equity stop strategy.
Poker, thank you for keeping it clean and collegial.
Ah, yes, the ever important question of *when*, especially when a day or two either way can make such a huge difference in your bottom line. IMHO, it is not good enough to get it right *eventually*, since the market will almost always oblige you, but to get it right close enough to the correct time that you don't lose your shirt.
It is also problemmatic that the market might go much higher *before* it goes lower, and that lower may be higher than it is right now. However, this should all be very comforting to know, since it enables one to trade it perfectly.
No, we are going down (from the AH gap up). If not tomorrow, then the next day, or perhaps the day after that. The problem, of course, is guessing exactly when. An up call will always be right eventually if you stick with it, and so will a down call. Using that criteria, one could say they are right all the time.
I see my error. I failed to sprinkle in a few alphabetic characters for good measure, or maybe I missed a finger. I am but a humble mathematician, and I grovel at the foot of the master. - Grasshopper
I think we have seen tomorrow's HOD already in the AH. Adami said the 8% earnings pop on Intel was a sell. Asian/European reaction could provide an additional bump, but 25 NDX pts on *one* earnings report is simply ludicrous.
Nothing like reality to tone down the rhetoric. However, tomorrow, we will drop to 3 of 5 of 2 of 1...
Oooh, that pesky Intel...
DJX p/c at 8.79...
You think maybe he misspells "Cheif" on purpose, or is he an idiot?
Wouldn't it be a kicker if San Fran Nan lost her next reelection bid? But, considering how squirrely the vast majority of her constituents are, that is just a conservative pipe dream, which underscores the real issue. Rail against Congress if you want to, but they merely reflect the will of the idiots who keep sending them back to office. Maybe KJI will do us all a favor and target SFO with his first nuke TD-2, *while* San Fran Nan is home for the weekend at taxpayer expense. Now *that* would be money well spent...
Most importantly, our proprietary weighting structure allows the historical market data to define precisely how much each rule should contribute in each of six defined market condition, e.g. ST Bull/Bear, IT Bull/Bear, to achieve optimal performance.
You and I will pay for them either way, but you can vote with your wallet by vowing never again to own a piece of crap with a GM label on it. Wonder how long Mo'Bama will use taxpayer money to buy union votes if half the population simply refuses to get screwed twice?
Stops are truly a love/hate relationship, but unfortunately you never know which until after the fact. Our testing with Merlin shows that the most effective approach is one that allows the stops to "breathe" around a base value as a function of volatility, the idea being that in highly volatile markets you need to give the stops a little more room to accommodate the thrashing around. Also, the optimal base values will migrate quite a bit as the market's trading character evolves. Of course there are stops other than Loss, such as Profit, Gap, Trend Equity, and OS/OB extremes, and each has its place in a well-designed, comprehensive, integrated strategy, and each contributes to an effective money management approach which maximizes the bottom line over time.
...and I shall. Seems whomever you know who claims to be VTO has had a different experience than the *public* record would suggest, but if you are happy, then I am happy.
Glad to see Matt finally let you out of jail. FWIW, I thought you got a raw deal and was one of your supporters.
I heard just the opposite. In fact, "VTO" stands for Vaughn T. Okumura. This info may be dated, but when you are retired at 36 living in Hawaii, maybe you don't make the news that often...
His approach was relatively simple, whether applied to an individual stock or an index. Buy when RSI drops below ~ 30, and sell when it gets above ~ 50. Not all that elegant, but consistency over time is the key.
Vaughn Okumura
Site: www.VTOReport.com
Location: Pearl City, Hawaii
At 36, Vaughn Okumura, CPA, is retired and living in Hawaii. His story is the same as many successful individual investors: a few hard knocks at the start, "visions of losing it all" as a stock account balance was depleted and a final, miraculous recovery. Okumura says his holdings went from $35,000 to $7,000 to $2 million after taxes in a matter of ten years.
He started his site, VTO Report, in 1998 to satisfy his passion for stock investing and to teach others his technical analysis techniques. Fundamentals? "It's like driving forward by looking in the rearview mirror," he says. On the other hand, "the chart of a stock will give you clues as to how a particular company is operating long before it reports its earnings."
Okumura's most successful strategy outlined on the site is his short-term trades of the Nasdaq 100 index. Up 10% year-to-date and 184% since 1997, the portfolio uses a simple relative strength indicator to determine when the market is overbought and oversold. His site's "smooth" stocks are consistent winners over many years. "Most investors buy stocks in a downtrend thinking they've uncovered a bargain," he cautions. "But in most cases, they end up with a portfolio of clunkers."
Favorite Stocks: Harley-Davidson (nyse: HDI - news - people), Stryker (nyse: SYK - news - people) and Sysco (nyse: SYY - news - people). "All three have been in nonvolatile uptrends over the last 15 years."
It doesn't matter what the settlement date is for your trade. If you owned the stock on or before the ex-dividend date, you get the dividend, but you also get to pay tax on the dividend at ordinary income rates, and the stock price is then adjusted downward based on the dividend percentage. Normally not a good plan to buy a stock just before it pays a dividend, in that you will immediately incur a tax liability for the amount of the dividend.
Personally, I will never again own an individual stock, because when you do, sooner or later you wake up one morning and are down 15 - 20% because the CEO got caught with his pants down, or some such similar nonsense, like being downgraded by some pencil-necked geek analyst. Pick a good index fund or ETF and learn how to ride the overall market trends...
I think it all depends on how you define "good" and what your expectations are. If you think you are going to find the "perfect" system which consistently makes you money with little or no effort on your part, then you are on a fool's errand.
I've often heard of using a 200 MA as a bounce point, but not a 233.
I realize that in some circles it is no longer politically correct to recite it, but it actually says so in the Pledge of Allegiance, which is also a part of the ceremony for those who become citizens *legally*.
We have continued to refine our Trend Equity Stop, which seems to be an extremely powerful and heretofore untapped (by us) technique for maximizing/retaining gains while minimizing risk by reducing trading exposure. However, anyone considering this technique should keep in mind that equity curve filters are themselves prone to curvefitting, so results going forward will likely fall somewhere between the live signal line (green) and the equity stop filter line (magenta), but considering the magnitude of the improvement, probably still worth the effort. See TMG example below...
John - It will work either within a macro or as a single manual action button click, but unless your code is *really* tight (i.e. you have all the bases covered re: any error conditions that might crop up, such as a Div/0 error due to an empty query response), turning it loose in full auto is *very* dangerous. I just have an order entry sheet with all commands I normally use with a macro button assigned to each one. I can then visually scan the command line and make sure all the parameters are correct before I click the button (and even then I still screw up sometimes). But, still far preferrable than having to go to the C2 site and go through Matt's arcane order entry process.
Most recently, I discovered how to make Excel do the daily Copy Downs all by itself, so unless CME has screwed us up with a table pointer change for their queries, we have the ultimate self-licking ice cream cone. See the code example below which locates the active cell based on a program sheet value, which can then be manipulated to select any desired range...
CurrentRow = Worksheets("Program").Range("K24").Value
Worksheets("Program").Cells(CurrentRow + 3, 1).Select
ActiveCell.Offset(0, 0).Range("A1:L1").Select
Selection.Cut Destination:=ActiveCell.Offset(1, 0).Range("A1:L1")
ActiveCell.Offset(1, 0).Range("A1:L1").Select
Chickens, and all other birds, are decendants of the dinosaurs, who must have really pissed God off ~ 65 million years ago when this big f**king rock fell out of the sky and slammed into what is now the Yucatan. Maybe that was just God's way of saying "I'm in charge, and now it is the mammals' turn", and maybe it just happened that way as a natural, albeit infrequent, event. Just look at the moon to see the frequency of these events that are not degraded by erosion or other geologic forces.
You are right, this ground has all been plowed before. The fact is, any method, even your frog entrails and chicken bones, will have some empirical validity if you can find enough traders who are stupid enough and gullible enough to put significant sums of capital behind them. Ever wonder why Fibs work? What is there that is magic about those particular ratios? Is it preordained that they *must* be valid? The fact is, they fail about as often as they hold. The reason they *appear* to work at all is simply because enough people believe in them (and program them into their trading strategies) so that to a degree they become self-fulfilling, so it is a chicken and egg argument.
I am emminently teachable, but that presumes that whatever you are pumping is worth knowing and that I would be a willing student, but simply garnering votes is not a valid measure of truth. In fact, that is what gave us a bastard socialist for president. Honest Abe Lincoln even once said "you can fool all of the people some of the time."
The market is a non-deterministic composite of statistical behavior, random/event driven behavior, and I would suspect a fair amount of manipulation by those with an agenda and the power to do so. The last two just have to be dealt with as they occur, but the statistical behavior can be reasonably determined with appropriate analysis techniques. However, that does not extend in any provable scientific or mathematical way to a pattern theory that is defined "a priori". Why is it that EWT has to be "revised and extended" so much? The market isn't always right, and in fact, is constantly getting it wrong. Just witness all the back and forth. Overshoot and adjust, just like with naval gunnery. The only thing it does is to reflect the mood of the herd in the moment, and how many times have we seen the herd charge right off a cliff?
Re: faith, you make the same falacious, circular arguments that have been made throught the ages, i.e. by equating truth and faith or using them interchangeably, when there is nothing at all in common between them. Faith is by defintion (look it up) believing in that which cannot be proven, so to speak of truth and faith (or "true faith"???) in the same breath is an oxymoron. Simply believing that something is true does not in any way make it true, no more than not believing in it makes it false, and therein is the conundrum, i.e. disproving a negative. Faith may not be a bad thing if it gives a person a moral center and any personal reassurance they may need of their place in the universe, but in and of itself it is neither here nor there. I suppose it would not really make a difference if you believed in the tooth fairy if you derived personal satisfaction and fulfillment from it.
Poker - People believe in a lot of things (e.g religion) based largely on anecdotal retellings without a single shred of real evidence that there is any validity to their beliefs. In fact, that is the very definition of "faith", i.e. belief in that which cannot be proven. As I once opined, even broken clocks are right twice a day. When the market is going with you, you casually dismiss any "outside" influence and maintain that the market would have done what it did anyway because you said so or EWT predicted it, but when it moves against your predictions, you are quick to rail against whatever *intervention* caused the market to go against you, and then conveniently "revise and extend" your count so that you are seldom if ever wrong, at least in your own mind. I have actually done quite a bit of research on EWT and learned enough to know that it is pure bunk, a waste of time, and is not worth risking one cent in trying to trade it (and I am not alone; it has been roundly discredited by most respectable market theoreticians), but as we all know, even bogus market theories can look precient over select time frames. Your bear market call was about a year early (and well in advance of your becoming an EWT disciple), but even then, I don't think you had an inkling of what the mechanism would be for the downfall.
Thanks for stopping by the board. BTW, I agree whole-heartedly with you that Mo'Bama and his socialist Demogogue friends in Congress may do so much damage to this country in four short years that we may never recover.
Maybe enough of "The People" who were sucked in by the lies and slick rhetoric will wake up in two years and smell the coffee, if it isn't too late by then.
The nice thing about the equity curve filter concept is that it is applicable to *any* system, although the optimization parameters would be different based on the efficacy of the underlying signal.