Info!! Thursday Thoughts

the position out of stocks registering fresh 20-day highs continued to lag. We had 1346 novel highs across the NYSE, NASDAQ, in addition to ASE, against 587 novel lows. If nosotros only confine the count to mutual stocks traded on the NYSE, nosotros had solely forty novel highs against xviii lows. That is good below the 100+ novel highs registered ii weeks ago.

* Lots of Good Reads - Kirk takes a look at sovereign wealth fund dominance, the side past times side bubble, frontier investment, in addition to more. Trader Mike The Big Picture displays 1 big picture when it comes to nutrient inflation.

* Tomorrow's Post - Will highlight strategies that traders tin lead maintain to heighten their self-control. As I write the novel book, I increasingly realize that traders involve concrete methods to charabanc themselves for success. I'll survive emphasizing those "how-to's" inward the weblog equally well.

* Quotables - Sharp Brains offers the Stock Market Beat on the NewsFlashr site, filtering peak tidings stories for traders.
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Info!! Trading Notes: Calendar Week Of September 21St

Friday, September 25th

*  Once over again nosotros saw an expansion of stocks registering fresh lows on Thursday, equally early on selling dominated.  We saw 300 stocks across all exchanges brand fresh 52-week lows, the highest let on since August 24th.  Buyers became to a greater extent than aggressive into the early on weakness in addition to nosotros shut good off the day's lows.  We've since rallied sharply overnight, consistent alongside the breadth interrogation in addition to model forecasts reported on Midweek in addition to Thursday.  My models remain moderately bullish over a 3-5 solar daytime horizon.  This volition induce got me buying oversold weakness that occurs at successively higher cost lows equally a full general game plan.

*  I've mentioned inward the past times that I similar to rail markets inward lawsuit time, rather than inward chronological fourth dimension units.  Below is a nautical chart where each information indicate for the ES futures represents 250 cost changes.  This agency that nosotros describe to a greater extent than "bars" when markets are busy in addition to volatile in addition to fewer when they are quiet.  This 50-bar charge per unit of measurement of alter stair out has been a useful estimate of overbought in addition to oversold weather condition per the game innovation mentioned above.

*  I volition last posting thoughts in addition to ideas coming out of the weekend Traders4ACause lawsuit tomorrow in addition to Sunday.  My speak volition bargain alongside research-grounded best practices for traders.

Thursday, September 24th

*  I'll last bringing a one-page best practise to the Traders4ACause conference this weekend in addition to exchanging alongside others who direct to write upwardly a useful trading strategy.  Great way to leverage usual learning.  My practise volition last an intermediate-term overbought/oversold indicator that captures both momentum in addition to value effects inward SPX.

*  We saw an expansion of novel lows yesterday in addition to over again selling of bounces worked good intraday in addition to over again nosotros stayed higher upwardly overnight lows.  I hold to exhibit us short-term oversold merely intermediate term a fleck overbought; my models are modestly bullish over a side past times side 3 solar daytime horizon.  My intraday leaning is to purchase dips that concur higher upwardly overnight lows, merely in addition to hence far I induce got been less than inspired past times the buying pull we've seen coming out of marketplace selling.  Influenza A virus subtype H5N1 reduction inward selling pull per unit of measurement area is real unlike from an influx of buying: something I'll last watching going forwards via NYSE TICK.

Wednesday, September 23rd

*  Once again, selling bounces worked good for much of the session on Tuesday equally the turn down continued.  We did run into reduced selling in addition to increased buying belatedly inward the session, merely yet shut alongside fewer than 10% of SPX stocks higher upwardly their 3 in addition to five-day moving averages.  When we've been inward a moderate volatility authorities going dorsum to 2006 (N = 44), we've had 33 occasions up, xi downward for an average four-day SPX gain of +.83%.  Although nosotros had weakness next the PMI let on out of China, the marketplace has since recovered in addition to I would non last surprised to run into farther bounce from the short-term oversold condition.

*  I hold to respect it useful to rail the frequency of occasions inward which NYSE TICK exceeds +800 in addition to falls below -800.  It's been a adept estimate of whether buyers or sellers induce got been predominantly inward command in addition to shifts inward the distribution of those occasions has been helpful inward identifying shifts from buying to selling in addition to vice versa.

Tuesday, September 22nd

*  Selling bounces that failed below the Fri solar daytime session highs ended upwardly beingness a adept strategy inward yesterday's trade, though nosotros were able to concur higher upwardly overnight lows in addition to bounced strongly at the terminate of the session.  Action remains consistent alongside the thesis outlined yesterday that nosotros pose inward an intermediate-term high alongside the Fed announcement.  My models are modestly bearish, overnight activity inward Europe has taken out those prior lows, in addition to my intermediate-term measures hold overbought (see below).  We're short-term oversold at present, in addition to hence my game innovation is to sell short-term overbought levels that neglect below today's overnight highs.

*  The intermediate-term pull stair out takes a 10-day moving average of the percentages of SPX stocks making 5, 20, in addition to 100-day highs minus lows.  (Data from the first-class Index Indicators site).  I mostly similar to last selling when novel highs induce got been elevated merely are right away waning in addition to buying when novel lows induce got been elevated in addition to are right away drying up.

*  The measures of put/call activity that I follow, for all indexes in addition to for all private stocks, are on the depression side.  I'm non seeing detail signs of bearishness on those measures, which has mostly yielded subnormal returns over the nigh term. 

Monday, September 21st

*  Understanding how nosotros best procedure information takes us a long way toward finding our edges inward markets.  Most traders produce non clearly empathize in addition to describe upon their signature cognitive strengths, inward my experience.

*  We hitting a buying crescendo afterward the Fed announcement, alongside NYSE TICK hitting multiple extreme positive readings.  What was meaning was the potent selling pull per unit of measurement area attracted past times those higher prices, taking us lower belatedly Th afternoon in addition to pretty much all solar daytime Friday.  Fri saw 334 stocks across all exchanges register fresh monthly lows, highest inward over a week.  My intermediate-term indicators remain elevated, in addition to I'm operating on the premise that nosotros pose inward an intermediate high alongside that Fed buying.  The lineament of the buying attracted to the short-term oversold status volition say a lot nigh where nosotros become from here; my game innovation is to sell bounces that neglect to induce got out the solar daytime session highs from Friday.  I induce got 1 model neutral to slightly weak in addition to roughly other that is modestly bullish for the 3-5 solar daytime horizon.

*  Below nosotros tin run into a nautical chart of buying vs. selling residuum since June; the information are derived from NYSE TICK.  The five-day moving average of this residuum has been a useful short-term overbought/oversold measure.  Since 2012, when it's been higher upwardly zero, the side past times side 4 days inward SPY induce got averaged a gain of +.09%; when it's been below zero, the side past times side 4 days induce got averaged a gain of +.36%.  When the five-day average of buying pull per unit of measurement area has been high, the side past times side 4 days inward SPY induce got averaged a gain of +.33%.  When buying has been inward its lowest one-half of its distribution, the side past times side 4 days inward SPY induce got averaged a gain of +.03%.  When the five-day average of selling pull per unit of measurement area has been low-cal (little selling pressure), the side past times side 4 days inward SPY induce got averaged a loss of -.07%.  When the selling pull per unit of measurement area has been heavy (top one-half of distribution), the side past times side 4 days inward SPY induce got averaged a gain of +.44%.

Info!! A Few Thursday Thoughts

* Tracking Adverse Excursions - This is a farming nail worldwide, the commodity bull marketplace is creating a novel develop of economical winners in addition to losers, too every bit a novel develop of winners inwards the stock market.

* Commodities inwards a Weak Economy - One analyst sees weakness amid industrial commodities, simply forcefulness amid those linked to the the U.S. dollar.

* Thanks - To those who accept passed along congratulations regarding the recent Business Week accolades.
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Info!! Thoughts On Taking Profits

I took profits on my brusk put belatedly today; it was definitely i of those gut experience decisions that may or may non come upward dorsum to haunt me. The stock indexes were weak today; there's no denying that. As nosotros approached the Midweek as well as Th lows, however, I noticed that nosotros exclusively had a footling over 500 NYSE, NASDAQ, as well as ASE registering 20-day lows. That was close the same equally Wednesday's grade as well as below Thursday's.

In addition, equally you lot tin run into from the Futures Heatmap from Barchart, intermarket themes were non providing equally many bearish cues equally I would lead maintain expected to run into if nosotros were going to sustain a intermission to novel weekly lows. We didn't run into odd line inwards the US dollar, as well as nosotros didn't run into odd commodity weakness--particularly from the metals.

In short, nosotros were weak; only non outstandingly so. Discretion the improve usage of valor, I cashed inwards my chips.

When nosotros larn to the run past times or bottom of a distinct range, there's e'er a judgment telephone telephone to last made for discretionary traders equally to whether nosotros merchandise for a breakout or fade for a deed dorsum into the range. And, sometimes, when the evidence is mixed, it's best to accept the chips off the tabular array as well as hold off for a clear signal. Success doesn't ask beingness involved inwards all marketplace moves; it only requires that the marketplace deed your means when you lot produce larn involved.
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Info!! Making Feel Of The Electrical Current Marketplace Weakness

I'm going to postpone my outset "Introduction to Trading" ship service to offering a fleck of perspective on the electrical current marketplace position weakness. The indicator reviews of slow convey indicated a stalling out of the marketplace position bounce since mid-July, alongside negative dollar flows into stocks in addition to to a greater extent than prove of sector rotation than actual sector trending. With Monday's reversal, we've seen a steady selling sentiment hitting the stock market, taking us to multi-week cost lows. Here are a few thoughts on the marketplace position action:

* Fear Goes Up - I mentioned a picayune spell ago that the VIX had broken to the upside in addition to that readership of this blog, which seems to cracking during periods of marketplace position weakness, was to a greater extent than consistent alongside levels nosotros run into at marketplace position tops than bottoms. Well, on Thursday, the position out of visits to the weblog swelled yesteryear 40%. An hourly watch of readership indicated that visits to the weblog expanded exactly at the fourth dimension the major indexes were breaking below their multi-day back upward levels. This doesn't necessarily hateful we're at a bottom, but the boundary inward the VIX to 24 in addition to the expansion of involvement inward psychology themes propose that 1 chemical component subdivision associated alongside bottoming processes has forthwith entered the picture. Institutional fearfulness has been on the ascent every bit well, alongside credit-default swaps on the rise. That way that it costs to a greater extent than to protect corporate bonds from default: a useful indicator of fears regarding economical weakness. We've all the same to run into equity position pick book operate yesteryear equity telephone call upward pick book on a multi-day basis; that's been 1 thought indication that has been introduce at recent intermediate-term bottoms. Nor is the pct of stocks trading higher upward their 20-day moving averages at levels unremarkably seen at bottoms. Fear is up, but several indicators propose nosotros could convey to a greater extent than to go.

* This is a Global Affair - The striking characteristic of the recent weakness is that it is associated alongside a rigid USA dollar (the dollar index is upward close 10% from its July low) in addition to weak commodities (the CRB Index has fallen unopen to 20% from its highs. Emerging marketplace position stocks are leading the downside, alongside EEM downward yesteryear unopen to a tertiary since May in addition to forthwith hitting novel lows. Global weakness is the theme: that is weighing on commodity prices, in addition to it is making the USA dollar a relative rubber haven. If I had to opine, I'd tell that the marketplace position is voting that the countries that convey been fighting inflation yesteryear maintaining high involvement rates convey gotten it wrong. As a result, they volition hold upward looking at recessions to a greater extent than severe than they would convey been otherwise. According to Bloomberg, global markets convey lost $17 trillion since the marketplace position superlative inward 2007, alongside global fiscal companies downward 29%. Incredibly, China's Shanghai H5N1 index has fallen from over 6000 slow final twelvemonth to close 2300 at present. Russia's RTS Index is downward close 40% simply since May. This is non simply close the U.S.; inward relative terms, the USA is outperforming many global equity markets.

* Keep An Eye on Participation to the Downside - We're seeing novel lows amid energy, utility, in addition to materials shares. The broad NYSE Index has moved to novel cost lows for the year, every bit has the NASDAQ 100 Index, but the advance-decline lines specific to mutual stocks inward those indexes has non all the same made novel lows. We had 417 novel 20-day highs amid NYSE, NASDAQ, in addition to ASE stocks on Thursday, against 1863 lows--a clear widening of weakness. Demand, my index of the position out of stocks closing higher upward their volatility envelopes, was 17; Supply was 187: a real skewed reading. Still, amid NYSE mutual stocks, nosotros solely had 10 52-week highs in addition to 99 lows. Compare that alongside close 450 novel lows inward mid-July in addition to 700 novel lows inward January. H5N1 position out of sectors, such every bit Consumer Discretionary in addition to fifty-fifty many of the Financial shares, stay good higher upward their July lows. It is non at all clear to me that this volition hold upward a fresh deport marketplace position leg down. I'm opened upward to the thought that this may hold upward an ultimately successful exam of the July lows in addition to business office of a larger--and quite significant--bottoming process. Participation to the downside volition tell the story.
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Info!! Thoughts For Thursday Eve

a 5-10-20 strategy.

* Tracking a Track Record - The Strategic Growth Model has been posting trades alive to their site.

* Trading With TRIN - VIX together with More has a yoke of skillful posts on the Arms Index together with its use.
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Info!! Thursday Items On The Radar

* Sign of the times: commodities are industrial pollution inward China;

* Hedge funds betting on gold;

* Lessons from a Navy SEAL;

* A Market Profile view of major stock indexes;

* Thoughts on the touching on of fossil oil prices;

* Influenza A virus subtype H5N1 reality depository fiscal establishment jibe for traders;

* An ETF if you're bearish on semiconductors.
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Info!! Eve Briefing For September 10Th

* MARKET THEMES FROM THURSDAY: Stocks traded inwards their overnight hit on depression book early on inwards the day, simply buying pressure--as expressed yesteryear NYSE TICK--was consistently rigid through the day. That led to an upside breakout that took us to bull marketplace pose highs inwards the major indexes. This has been an unusually consistent rally, amongst enterprise advance-decline activity as well as buying interest. Indeed, the A/D lines for the major averages accept registered bull highs. The divulge of stocks registering fresh 20- as well as 65-day highs continues to ascent 24-hour interval over day, then that we're non getting whatever transition sell signals. We saw fresh lows inwards the USD vs euro today, simply interestingly we're non seeing novel highs inwards AUD/USD. Oil as well as gilded also did non brand novel highs for this movement today. I'll endure looking for signs that these markets, which led the recent stock marketplace pose rally, mightiness endure forewarning of roughly consolidation of those gains.

* OVERSEAS/OVERNIGHT NUMBERS: 3:00 AM CT - Italy, industrial production; 3:30 AM CT - UK, producer prices. Earnings reports scheduled for Fri here.

* WORTH READING:

-- What stories *aren't* beingness told inwards the media;

-- Worthwhile thoughts on trading gaps;

-- Unstable marketplace pose relationships, questioning moving average systems, and much more;

-- Thanks to Adam for this link to an manufacture persuasion of hedge funds;

-- Economy stronger, simply still facing headwinds;

-- Nice overview of recent forcefulness inwards the major indexes.
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Info!! Marketplace Thoughts Going Into The Novel Week

A seat out of traders I've talked with get got been concerned virtually the weakness nosotros saw inwards the S&P 500 Index (top chart) belatedly concluding week. Should nosotros decisively get got out the past times week's lows across the S&P 500, NASDAQ 100 (bottom chart), in addition to Russell 2000 Indexes, that for certain would larn out along momentum inwards the bear's court.

Interestingly, though, nosotros started the recent weakness with lagging functioning with the NASDAQ stocks, simply those held nicely inwards a higher house their prior ii twenty-four hr menses lows on Fri (bottom chart). We besides saw non-confirmation of the Midweek in addition to Th lows with the Russell 2000 stocks (IWM).

Indeed, Fri registered to a greater extent than stocks making 20-day highs than lows (456 vs 404), which nosotros did non run across either Midweek or Thursday.

I went dorsum to 2000 in addition to examined all occasions when nosotros were upwards inwards the S&P 500 Index ($SPX) on a lx in addition to 20-day basis, simply downwards for the most recent week. Over the side past times side iv trading sessions, nosotros averaged a attain of .19% (163 occasions up, 102 down). Conversely, when we've been upwards on a 60, 20, in addition to five-day basis, the side past times side iv sessions get got averaged a loss of -.18% (301 up, 341 down).

In short, at that topographic point has been no bearish border when nosotros get got had a downwards calendar week inwards a marketplace position that has been upwards over the past times calendar month in addition to 3 months. Should nosotros hold upwards able to gibe concluding week's lows, peculiarly inwards the NASDAQ 100 in addition to Russell 2000 Indexes, keeping 20-day novel highs inwards a higher house novel lows, that would await favorable for the bulls. As always, I'll hold upwards tracking novel highs in addition to lows, every bit good every bit other indicators in addition to sectors, via Twitter (subscription is complimentary via RSS).
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Info!! Readings For A Thursday Morning

* Important post on theme related to recent post service on somatic markers too trading;

* Why happiness may endure commutation to performance;

* Blending aggression too self-control inward trading;

* Finding themes inward the markets;

* Thoughts too resources re: changing our psychological patterns;
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Info!! Even Out Briefing For August 20Th

* MARKET THEMES FROM THURSDAY: After around pre-opening weakness, stocks 1 time once again caught a bid as well as traded higher during the morning. Volume dried upwardly equally the solar daytime progressed, simply buying pressure level remained potent for the session. The S&P 500 e-mini (ES) futures made fresh highs slow inward the afternoon, simply at that topographic point were non-confirmations from several sectors, equally good equally from the advance-decline line. This had me questioning the vigor of the rally toward day's end. Another inquiry ambit was that, equally stocks made novel highs, nosotros did non encounter comparable line with commodities. Ten-year yields unopen off their highs, equally well. I proceed to sentiment the electrical flow activeness equally business office of an extended topping procedure inward stocks; if the non-confirmations examine significant, as well as therefore nosotros should likewise last seeing around short-term topping.

* OVERSEAS/OVERNIGHT NUMBERS: No major reports scheduled.

* EARNINGS: ANN, SJM

* WORTH READING:

-- Emerging economies Housing won't bottom until slow 2010?

-- Inflation not looking similar a threat;

-- No bottom inward sight for non-residential construction;

-- Recovery based on an addiction to debt;

-- Trading a intermission inward resistance;

-- Thoughts on a two-track economy;
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