Friday, February 3, 2012

Short signal confirmed.

530pm: Short signal was confirmed. I moved to 75% short, 25% cash. Enjoy the weekend!

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Ugh, sad to have missed this big up day! We got the sell signal 1 day too early. Looking forward to today, I am getting a strong short signal right now. We are overextended and due for a pullback. Today may or may not be the top, but my system is offering a strong warning here.

If SPY closes 133.75 or higher, the system goes short. If 133.74 or lower, it remains on the sidelines. I will only need to update if we have a huge sell-off this afternoon.

11 comments:

  1. Appreciate the early read on the signal.
    Thanks

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  2. In anticipation of a strong short signal, I was wondering if you've given any thought to the "enter a position 50% at a time" rule.

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    1. I'm keeping it unchanged for now, although there's a good chance I will take a bigger short position if we have a strong finish.

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  3. Looks like we're getting a good price. No late day weakness...which bodes well for this short position.

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  4. Can you clarify your system returns? I notice that in July '11 you had a 51.24% YTD return. But then in August you posted a 29.44% loss, leaving a 6.68% YTD return.

    Is one of those numbers a typo or am I not understanding how you compute them?

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    1. Say you start 2011 with 10,000 and by July it's up to 15,121...up 51.21%.

      Taking a 29.44% loss on that amount equates to $4,451.62, which leaves you with 10,668...or up 6.68% from your beginning amount for 2011. Make sense? All my stats are compounded with every trade.

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  5. A little gap down, but SPY looks like it is heading to gap fill and VIX is heading down...

    I don't know that we can ever short this market until it tanks... then it's too late :)

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  6. Have some faith and patience RMI. Certainly my system won't have 3 failed short trades in a row. :)

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    Replies
    1. I am plum out of Hopium... maybe faith and patience will work... ;)

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