Unique swing trading signals and stock market commentary.
Friday, November 23, 2012
Hold signals.
The CCI will remain short, but the JTS will stay in cash. This keeps the JT Comp (and me) 50% short TNA. Because the JTS is not giving a short signal, I will not add to my TZA. I will continue to hold my AAPL as well. Thanks and have a good weekend!
I'm building shorts... started Friday near the close. Can't go big due to my rules (which were made to be broken at the right times), but this is just too sweet of a spot to not try a short.
The masses will capitulate (if they didn't Friday at the close) early next week. After that big move, it's easy to see what played-out in most households around the USA where anyone who considers themselves a trader was present. On Thanksgiving day, they all were talking about the great rally the past few days, but few were in. There were MASSIVE OUT-flows last week prior to Tgiving, so the idiots bet w/their wallets -- and lost -- again. Still denying the rally (read: Wall of worry), while everyone was eating turkey, the moronic masses are bearish, so they bet it was going to go down, so they shorted Friday -- and got f*cked hard as all the newbies used stops and caused a large short-squeeze rally. My systems registered panic buying Friday afternoon. Now they sit all weekend long, licking their wounds, convinced that "this mkt just wants to go up"... "damn, I missed the rally, so I gotta get in Monday", etc., so they will go long (if they didn't -- at the close -- Friday) early next week. So, it's time for them to fund our accounts once again, as "the boys" take this thing down a click or so. you gotta love this game.
Expecting the best trading of the year is now behind us, though, and things will get slower and suckier as EOY approaches -- it always does. Ranges will contract. The easy money is done for 2012. I'm going to be tightening my profit targets until 2013 when things should open-up again.
Got a lotta traveling to do in Dec, so I may not be posting much.
Just FYI: I finally sold all my AAPL for 20pt gain. It was definitely a roller coaster. I rode it from 568 (purchase) down to 505 mid-Nov and back up to 588 today. It's fighting some resistance here at these levels so I'm not pushing my luck. Odds are good we re-test the 500 level eventually.
Thanks for sharing that, JT! Apple is a widely-watched and influential company, so your tactical approach to it is of benefit to even those of your readers who aren't directly holders of shares.
Also, quick question of JKH, about what percent of invested funds do you devote to a counter-trend move, or hedging move, which involves "bending one's rules"? This is an area in my own experience where I never feel certainty. Say, like now, there's an ironclad rule, governing a longer timeframe... and also a high-reliability shorter-term signal which (at least for a while) should partly countermand it.
The NYMO indicator mentioned by Algyros, above, is a good example-- it’s one of the most reliable.
Clearly there isn't a single answer, but to filter out extraneous life situation concerns, imagine responding to someone with average risk tolerance.
Following rules is easy, we just have to do it. However, bending them prudently is a lot more difficult, and quantifying the ‘bending’ is even harder.
Sticking to my "ranges are contracting" perspective and in view of the divergences today, I covered all the futures shorts I put on Friday during today's trading. Will be long O/N. The masses are still afraid of getting into this rally.
Daniel: No hard rules about percents for this... mostly a "feel" thing and what I can get filled on. But I will not let it get out of control. I watch my leverage and bias (quantifiably) every day. Every trader should do this, too.
thx, JKH, my own feeling is that I use TOO much of a feel thing, and I'm wishy washy and indecisive. I try to quantify, and say "1/3 size position", or ".20 max size position" etc., but I have no real consistency, and often seem most timid when I ought be most bold, etc. But I totally agree that it will always be a part of the 'art' of investing, and not the totally-objective...
Daniel, one thing I learned in this game is "it takes money to make money"... and (for me), scaling in really helped... and when I scale in, often I am moving in w/more "granularity" than thirds or quarters... some times tenths. hard to do that w/a small account, but I found it key to consistent profitability and smooth growth curves. So, maybe you should look "finer" in terms of partials.
I'm surprised your systems didn't go (second) short today, J.
ReplyDeleteGood weekend, everyone?
ReplyDeleteI'm also surprised that the JTS remains in cash. Perhaps it's read JKH's assessment of the wisdom of shorting the present market.
Please excuse the errant question mark. I have many questions, but wishing everyone a good weekend is not among them.
ReplyDeleteThe daily NYMO closing outside its BB is usually a very good indicator that SPY will move in the opposite direction. It closed above its BB Friday.
ReplyDeleteI'm building shorts... started Friday near the close. Can't go big due to my rules (which were made to be broken at the right times), but this is just too sweet of a spot to not try a short.
ReplyDeleteThe masses will capitulate (if they didn't Friday at the close) early next week. After that big move, it's easy to see what played-out in most households around the USA where anyone who considers themselves a trader was present. On Thanksgiving day, they all were talking about the great rally the past few days, but few were in. There were MASSIVE OUT-flows last week prior to Tgiving, so the idiots bet w/their wallets -- and lost -- again. Still denying the rally (read: Wall of worry), while everyone was eating turkey, the moronic masses are bearish, so they bet it was going to go down, so they shorted Friday -- and got f*cked hard as all the newbies used stops and caused a large short-squeeze rally. My systems registered panic buying Friday afternoon. Now they sit all weekend long, licking their wounds, convinced that "this mkt just wants to go up"... "damn, I missed the rally, so I gotta get in Monday", etc., so they will go long (if they didn't -- at the close -- Friday) early next week. So, it's time for them to fund our accounts once again, as "the boys" take this thing down a click or so. you gotta love this game.
Expecting the best trading of the year is now behind us, though, and things will get slower and suckier as EOY approaches -- it always does. Ranges will contract. The easy money is done for 2012. I'm going to be tightening my profit targets until 2013 when things should open-up again.
Got a lotta traveling to do in Dec, so I may not be posting much.
Safe travels.
DeleteA not so funny joke: TNA up with SPY down .6
ReplyDeleteWell, back and now trying to find a good time to sell my TNA and buy a little TZA... or, if the JT-S goes short, then I am all in!!
ReplyDeleteJust FYI: I finally sold all my AAPL for 20pt gain. It was definitely a roller coaster. I rode it from 568 (purchase) down to 505 mid-Nov and back up to 588 today. It's fighting some resistance here at these levels so I'm not pushing my luck. Odds are good we re-test the 500 level eventually.
ReplyDeleteThanks for sharing that, JT! Apple is a widely-watched and influential company, so your tactical approach to it is of benefit to even those of your readers who aren't directly holders of shares.
ReplyDeleteAlso, quick question of JKH, about what percent of invested funds do you devote to a counter-trend move, or hedging move, which involves "bending one's rules"? This is an area in my own experience where I never feel certainty. Say, like now, there's an ironclad rule, governing a longer timeframe... and also a high-reliability shorter-term signal which (at least for a while) should partly countermand it.
The NYMO indicator mentioned by Algyros, above, is a good example-- it’s one of the most reliable.
Clearly there isn't a single answer, but to filter out extraneous life situation concerns, imagine responding to someone with average risk tolerance.
Following rules is easy, we just have to do it. However, bending them prudently is a lot more difficult, and quantifying the ‘bending’ is even harder.
Sticking to my "ranges are contracting" perspective and in view of the divergences today, I covered all the futures shorts I put on Friday during today's trading. Will be long O/N. The masses are still afraid of getting into this rally.
ReplyDeleteDaniel: No hard rules about percents for this... mostly a "feel" thing and what I can get filled on. But I will not let it get out of control. I watch my leverage and bias (quantifiably) every day. Every trader should do this, too.
thx, JKH, my own feeling is that I use TOO much of a feel thing, and I'm wishy washy and indecisive. I try to quantify, and say "1/3 size position", or ".20 max size position" etc., but I have no real consistency, and often seem most timid when I ought be most bold, etc. But I totally agree that it will always be a part of the 'art' of investing, and not the totally-objective...
DeleteDaniel, one thing I learned in this game is "it takes money to make money"... and (for me), scaling in really helped... and when I scale in, often I am moving in w/more "granularity" than thirds or quarters... some times tenths. hard to do that w/a small account, but I found it key to consistent profitability and smooth growth curves. So, maybe you should look "finer" in terms of partials.
DeleteFWIW, the daily NYMO is now above its BB for a second day. That usually portends a downturn in equities.
ReplyDeleteMy calculations were off. NYMO closed below its BB. However, that's still short term bearish.
ReplyDelete