Tuesday, November 20, 2012

CCI Short.

The JT Composite system will move to 50% short TNA today as the CCI fires off a short signal. The JTS will remain cash. Something to watch...the JTS could flip to healthy mode if we close green today, tomorrow, or Friday. This is an intermediate signal that basically means long plays are relatively safe while shorting carries more risk. I use it strictly as a background indicator inside the JTS. It could also serve as a stop loss on a JTS short position, but with no current short position it's moot. I will take a 25% long TZA position on the close and keep my 25% long AAPL (non-system trade) position as well. I will not get serious about shorting until after the holiday. See you tomorrow. Thanks!

10 comments:

  1. TZA was unavailable for short at IB. That should not be a good sign for a short TNA trade, right?

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    1. Sounds good to me. (JKH can confirm.) Thanks for that piece of info, Marco.

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  2. J, sorry, but I cannot follow you on this one yet... my own personal rules.

    Today was a good day... sold and rebot... got nearly the extreme of the day on both -- very rare. Still like the long side, overall.

    Sp500 held the critical 1377 and ricochet'd off it w/a vengeance today. O/E guy gave huge odds for gap up tomorrow, so I added even more ES longs in A/H. If bears are to do anything w/this tomorrow, they gotta take out 1374 w/gusto -- and w/so many people saying "we are going to go back down, ... do not trust this rally, ... mkt can't rally... fiscal cliff, ... blah, blah, blah,... " I doubt the bulls are ready to hand-over the reigns to the bears.

    I thought today's action was constructive. Looking for a run up to 1399+ area. I'll be unloading a small barge full up there. Who knows, maybe I'll even violate my rules and go short w/you -- but only if you go 100% short, first. And I won't go heavy unless I see something that really screams "panic buying", first.

    XIV looks like it seriously wants to breakout -- up! That's bullish for the mkts, right?


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    1. yes..i think CCI is still a bit early to short. Good move on only going half short since you need to follow your system.

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  3. J - Just noticed the "Long XIV", "Short TNA" change to JT composite column. THIS IS SOOOO COOOOLLLLL. Love it !!!! Thanks

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  4. We're in a very interesting period.

    I have a question for J and JKH. Like you, I've always been dubious of Wave theory, even though there are people out there who seem to make excellent predictions based on some combination of Wave theory and TA.

    But my question concerns how you go about making market predictions. J, when you step outside your systems and look into the future, what are you looking at. And JKH, how do you go about making your excellent forecasts?

    Clearly the only way to predict the market's future is through some kind of pattern recognition. But some TA patterns, such as trend lines, have always struck me as fabulous predictor after the fact. That is, it's easy to draw a trend line of past market activity, but not so easy to do it in real time.

    So, how do you guys go about seeing what hasn't yet happened?

    P.S. I'd also ask Alex the same question, but, unless I'm wrong, you're basing your forecasts strictly on the behavior of the mechanical systems you've developed.

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    1. I look at a host of things: support/resistance, important moving averages, market sentiment, Rob Hanna's quantitative studies, Cobra's analysis, and Intrepid Timer signals. That's all in addition to my systems.

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  5. Similar to J, I, too, look at a variety of things: charts, websites, etc., even my "friends & relatives" (to fade them, obviously).

    But the more important tidbit I can give you Al, is this. The key to being successful is to (to quote Ceasar Milan) "Live in the moment" -- be like a dog. That is, it's far more important to accurately assess where we are now, vs where we are going. The classic newbie trap (question) is "where will the mkt be in XXXX timeframe"? That's not necessary to make it in this mkt, and it's putting the cart before the horse. You need to figure out how to know where we are now. That is, is the mkt ready to turn up, turn down, or keep going? That is what really matters. The forecast is secondary to making money. Figure out how to do the former, and you will win at this. To get to the forecast part, that will take years -- many years... think "decade" of doing this. I know you don't like this, but it's true: This is a lot of "gut". Nothing I can teach anyone. And 99% of people will either blow out (some, multiple times) or give up because they do not have the passion and drive that this requires. And I've seen a lot of blow-outs.

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