Wednesday, November 30, 2011

Short confirmed. (+ Nov Trades)

My system moves to a 100% short position. You need some serious guts to go 100% 3x leveraged short in this free money environment so caution is warranted. There is a partial safety net, however. Tomorrow, if SPY closes green, it will flip the system back to healthy mode and thus stop out half the short position.

My system was built to catch these whipsaws, but these past few trades have definitely gone awry. I can't remember having 3 losing trades in a row, so the system is due to have a winner after these last 2 losers. I suppose this short signal is not over yet, though.

I'm going heavily short on the close. Best of luck to all. Take it easy!
Archiving November Trades...


Date
Signal
TNA
Nov 1
Cover42.77
Nov 2
Hold
Nov 3
Hold
Nov 4
Hold
Nov 7
Hold
Nov 8
Short50.02
Nov 9
Buy42.91
Nov 10
Hold
Nov 11
Sell47.16
Nov 14
Buy45.16
Nov 15
Sell46.90
Nov 16
Buy44.61
Nov 17
Hold
Nov 18
Hold
Nov 21
Hold - 1/2 Stopped
39.58
Nov 22
Hold
Nov 23
Hold
Nov 24
Closed

Nov 25
Hold
Nov 28
Short38.39
Nov 29
Hold
Nov 30
Short44.84




Tuesday, November 29, 2011

Hold confirmed.

No new signal today. System remains half short, half cash. Good evening!

Monday, November 28, 2011

Sell/short confirmed.

Assuming today's SPY range does not break to the upside, I can predict the signal.

If SPY closes above 119.60: Sell longs and go 50% short.

If SPY closes between 119.21 - 119.60: Sell longs.

If SPY closes below 119.21: Hold longs.

Again, these numbers are only valid if SPY does not exceed 120.18. If it does, I'll have to update. Thanks!

Friday, November 25, 2011

Hold

First off, apologies for the late update. With the beautiful weather, the kids and I were out hanging Christmas lights. I totally forgot the market was closing early today. Oops.

Anyway, I just fired up the laptop and see we had yet another hold signal. Very close to a buy signal, but not quite. I don't know if this means more downside Monday or not, but I would say probably.

If you read my comments section, you'll notice I bought some longs on the open. As I turned off the computer, we were up nicely so I was feeling pretty good at the time. Not so much anymore.

We will bounce eventually, that is a near certainty. And when it comes it could be HUGE. The problem of course is that we could continue to sink for who knows how long... I'm up to about 50% long TNA now with today's purchase. If we gap down huge on Monday, I will add more longs. Otherwise, I'm content with the position and will let it ride for a few days.

Have a refreshing weekend!

Wednesday, November 23, 2011

Hold confirmed.

We were very close to a buy signal, but not going to make it. That said, we were close enough that I'd be very surprised if we didn't get a sizable bounce the next few days.

Anyway, time to forget about the market for a while and enjoy family, friends, and all that we have. I'll see ya back here Friday. Happy Thanksgiving!

Tuesday, November 22, 2011

Hold confirmed.

The system remains 25% long. The VIX being down along with the market is somewhat concerning, although some will say it's bullish. I see it as complacency.

Monday, November 21, 2011

Unhealthy Mode & 1/2 Stop

3:52pm: On the close, we'll sell half the long position, keep the other half. This places the system in approx. 75% cash.

11:42am: The system is now in unhealthy mode starting today. Additionally, since we took out SPY 119.12, the system will move to 25% TNA and 75% cash on the close. Keep in mind, the last time the system was stopped out of a long position it was a great time to buy. This is precisely why we'll keep a partial long position going until the next signal. Then again, this could be early August all over again...

Lower prices are expected and my system will sell/short any strength over the coming days. I see today as a significant shakeout before higher prices later this week surrounding the holiday. Thus, I'm expecting to hold onto this long position then go short heading into next week.

We'll see how it goes... Thanks for reading!

8:06am: Judging by the futures this morning (/es -20), I have to mention the possibility that the stop loss could get taken out. The level to watch is SPY 119.12. If we dip below that value at anytime today or this week, the system will flip to unhealthy mode. This forces the system to exit half of the long position (ie. move to 25% TNA, 75% cash) on the closing price on day in which the stop loss level is violated. Today, perhaps?

Friday, November 18, 2011

Hold confirmed.

We are close to a 2nd buy signal (strong) - but not quite. So the system will hold 50% TNA over the weekend. Have a good one!

Wednesday, November 16, 2011

Buy confirmed.

4:05pm: Buy was confirmed. Not a strong buy signal, but it should be good enough for a bounce over the next few days. A gap up tomorrow almost guarantees this trade will be profitable. A gap down? Well, not so good. But that's why it's best to keep some powder dry. Time will tell. Good evening!

3:41pm: Open 50% long position in TNA if SPY closes below 124.15. Currently 124.35, so we need a weak finish. Otherwise, hold tight on the sidelines as there will probably be more down side tomorrow, at least according to my system.

Tuesday, November 15, 2011

Sell confirmed. Short if...

The system will exit the long position today. There is a chance of a short signal if SPY closes above 126.85. If SPY finishes equal to or lower than that, there will be no short signal.

Monday, November 14, 2011

Strong buy confirmed.

3:55pm: Buy signal (strong) is confirmed.

2:22pm: I'm getting a buy signal today. It's borderline right now, but we may even get a strong buy signal, which simply means the unhealthy mode is giving a buy signal in addition to the healthy mode (which we are in). A strong signal carries with it better results/returns than a normal signal, thus I will sometimes throw additional capital into the ring. Not always though. The official system does not, and if anyone is following my system verbatim, I would recommend not to deviate either. Just for reference, the system always allocates 50% of its capital on the first signal (no matter the strength) and saves the rest for possible dollar cost averaging - because believe it or not my system is not perfect and it can not nail the exact turning point every time. :)

Friday, November 11, 2011

Sell signal. Short if...

The system will close the long position today with a confirmed sell signal. The only question is whether we get a short signal, which would require a ~1 point spike in the VIX here in the last 30 minutes. (Unlikely.) The VIX value to watch is 31.10. We are at 30.13 right now, so like I said, unlikely. Anyway, head to sidelines and enjoy the weekend! Indulge in the finer things in life and forget about the market! See ya Monday.

Thursday, November 10, 2011

Hold confirmed.

The system will hold its 50% long position for at least another day. The market obeyed my wishes this morning and filled the opening gap allowing my order to be filled. So with nothing else to report, I'll sign off and see ya back here tomorrow.

Limit buy TNA 42.91

In the event that today's large gap up doesn't fill, I will not chase. I have my limit order in place. Should the order fill, the manual stop loss will be activated if SPY breaks below the 10/13 low of 119.12. According the relatively new stop loss rules, half of the long position would be exited on the close that day and the other half will ride until the next signal.

Wednesday, November 9, 2011

Buy confirmed.

4:30pm: I am seeing SPY 123.16 for the closing price, which confirms the buy signal. It was too close to call, so I'll get long in the morning. Shorts were closed, that was the easy part. Have a good one!

3:20pm: Wow, that was some drop. Now we're bouncing and heading the wrong direction. Anyway, nothing has changed with my system. We will get a cover signal to exit the short position. That is confirmed. As for the buy signal to move into 50% TNA, we need SPY to close below 123.18. Otherwise, we're back to sitting on the sidelines. Thanks!

2pm update: We are getting there for that buy signal! We need an SPY close below 123.18. Can we make it?!!?


1pm: The writing is on the wall. I can already tell my system won't have the guts to hold this short position through tomorrow (even though personally I want it to). On the other hand, it's refusing to go long also. So we have a similar set-up to November 1st. There is a decent chance of a rebound in the coming days but not good enough to get a buy signal today. We would have to absolutely tank this afternoon to get the buy.

I will update later, regardless. Happy trading! Oh, and yes, in case you were wondering I'm quite smitten today with my system nailing this move. When I woke up and saw the ES down 30, I think my small burst of excitement scared the crap out of my sleeping wife. :)

Tuesday, November 8, 2011

Short if...

If SPY closes at 127.09 or higher, system goes SHORT TNA 50%, while leaving 50% cash just in case we go up a bit more.

If, however, we close at 127.08 or lower, system stays in 100% cash.

No need for further updates today. Thanks for checking in! Have a good evening!!

Monday, November 7, 2011

Hold confirmed.

There is no apparent edge in either direction so the system remains on the sidelines yet again. Hasta MaƱana.

Friday, November 4, 2011

Hold confirmed.

No changes today. My system remains on the sideline. Enjoy your weekend.

Thursday, November 3, 2011

4pm: Hold confirmed.

Looks like we should go higher or flat-ish tomorrow. No downside edge is showing up.

Wednesday, November 2, 2011

Hold.

With VIX closing sub 33, a hold signal was confirmed.

3:43pm ET: A short signal will be confirmed if, and only if the VIX closes above 33. Anything lower than 33 will keep the system sidelined with a hold signal. Currently @ 33.26!

Unfortunately, as many of you know, the VIX will not settle until 4:15pm. So we may not know until then what the official signal is. An after hours trade or a trade on tomorrow's open may be needed.



12:57: As long as the VIX stays in the 33-34 range, I'll get another short signal. But there's plenty of action left today, especially with the fed release so I won't get my hopes up just yet.

October returns ~ 20%

Much like Oct 2010, the system had another stellar month this year. With a +19.67% return this month, the yearly return is back up to a lofty +26.63%.

This places Oct 2011 as the best month ever for my system. Personally, due to a busy schedule on my part with family and work, I missed a few trades and came away with a slightly less impressive 11%... but believe me I am not complaining! :)

Anyway, just wanted to update you that after a horrible August and ho-hum September, my system appears to be back on track. Here's to another double digit month! Cheers.

Tuesday, November 1, 2011

Cover/hold confirmed.

3:45pm: The 2nd consecutive cover signal is confirmed. Although obviously since the system is out of the market, it's as good as a hold which keeps it on the sidelines. It's predicting higher prices ahead, though too much risk to go long right now. See ya tomorrow.


1pm: While yesterday we saw a borderline cover signal, today's is quite strong. This may be a warning that higher prices are to follow in the short term. If there are any outstanding shorts out there, you may want to strongly consider taking some profits here.

Once again there will be no buy signal today.