S&P 500 Analysis & ETF Trading

[kiy]

Ziko's...SPX-- Multi Time-Frame Analysis and Trading system
...I think Alex has a couple more charts to add for this set of charts.
DO you want to make any edits...on what you wrote...?...
SPX-- Multi Time-Frame Analysis and Trading system.

Tools/Indicators: CCI/RSI/BB/Moving averages (Simple+Exponential), ULT

Systems achieves both (1) Trend Identification and Following, AND (2) Mean Reversion

Volatility and Direction of move is captured (1) at the extreme points: when a fat tail risk event is crystalised (leptokurtosis or non-normal distribution). (2) Normal volatility levels are also captured but to a lesser extent.

Following are the time frames from monthly to 5 minutes.

System is based on RSI and CCI (dynamic and standard). Depending on the level of interest, I will explain each indicator of those (as I did with dynamic CCI earlier). Price goes above 10.1 upper band=equivalent to CCI 10 overbought level and vice versa. Price goes above 20.1=equivalent to CCI 20 overbought level and the reverse is true.

This has been tested, refined over time and has been working for me.

Each bigger time frame dwarfs the one below in terms of the length of the move. Daily chart is king, (it is the mean chart. Most profitable trades is when daily signals (weekly going along) and hourly says yes. Most powerful moves occur when all time frames signal together. You can trade individual timeframes in isolation, but need to look at one timeframe above and one timeframe below for proper positioning.

Each CCI represents a moving average...and each BB with the same value represents the deviation of this moving average from the mean. Larger moving averages, like larger timeframes..are more significant than smaler ones. But it is the smaller averages and time frames that give you the triggers.

Two trades:

1. Position trade with the direction of the daily
2. Swing trades which can range from a few minutes, intraday to a couple of days or a bit more. trade your own style and time frame tolerance. Always trade in the direction of the daily even for short term trades...if you really have to go against the daily signal..be nimble..and get out quick. Average True range or normal daily moves on SPX are 15 points. Of course this range inceases when volatility increases like October 2011 for example. Kiy will explain more on why the first 10 points are noise.

Provided you have the daily cover (i.e direction)..you can front run daily by a signal from 15 minutes. Signal migration from 15 to 30 to 60 is essential for trades. When the timeframe has triggered, (steps 1 to 3 depending on your risk tolerance) you move to the higher time frame...and stay with the trade as long as the signal is valid...stay with the trade..most important aspect.

5 minutes chart is just there for position optimisation,,i.e...refining entry price to a point or two. Kiy will have more to say on this.

Remember, anything within the one deviation is fair value, dynamic equilibrium...only when you move out of the one deviation things get interesting..psychology of the crowds in action is triggered outside of teh one deviation if you will.

Short trade -

Signal is generated when (1) a reaction is obtained from price re-entering BB10.1 (upper band), AND (2) price going below EMA 3 on daily. Second level of confirmation is when EMA 3 goes below EMA 5, AND (2) price goes through BB 10.2-Third confirmation is when EMA 3 and EMA 5 go below EMA 10. Fourth confirmation is when the three moving averages cross center line of BB 10.1/20.1 AND price of course has already gone below center line. Fifth confirmation is when MA 10 goes below MA 20. As long as EMA 3 is below 5 you remain short until price goes below 10.1 and 10.2 lower bands. At this time CCI is oversold, first alert is when price crosses 10.1 lower band upwards and goes out of oversold....and the chain is reversed.


Long trade is the opposite of the above.


I usually enter a 1/3 of the position with step 1, a 1/3 at step 2, and the last third at step 3.

The below are live charts..i.e. they will update as you go..I like big charts lol..sorry about that

I hope the above is useful and it is my contribution to the board.

Enjoy

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=71157292
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Monthly

Weekly

Daily

60 minute

30 minute

15 minute

10 minute

5 minute


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Monthly
http://stockcharts.com/c-sc/sc?s=$SPX&p=M&yr=3&mn=0&dy=0&i=p33752292221&a=303272717&r=1369020412603
Weekly
http://stockcharts.com/c-sc/sc?s=$SPX&p=W&yr=0&mn=11&dy=0&i=p58299861269&a=303273854&r=1369020904119
Daily
http://stockcharts.com/c-sc/sc?s=$SPX&p=D&yr=0&mn=2&dy=15&i=p47675755306&a=303274448&r=1369021158131
60 minute
http://stockcharts.com/c-sc/sc?s=$SPX&p=60&yr=0&mn=0&dy=8&i=p43372556401&a=303274636&r=1369021322280
30 minute
http://stockcharts.com/c-sc/sc?s=$SPX&p=30&yr=0&mn=0&dy=3&i=p69349873038&a=303275504&r=1369021453002
15 minute
http://stockcharts.com/c-sc/sc?s=$SPX&p=15&yr=0&mn=0&dy=2&i=p89368581260&a=303277406&r=1369023341294
10 minute
http://stockcharts.com/c-sc/sc?s=$SPX&p=10&yr=0&mn=0&dy=2&i=p10381158315&a=303283710&r=1369027654842
5 minute
http://stockcharts.com/c-sc/sc?s=$SPX&p=5&yr=0&mn=0&dy=2&i=p39898523892&a=303279724&r=1369025178373