Friday, Nov 27th
* Not much changed from yesterday alongside honour to U.S. stocks, equally nosotros boot the bucket on to concord of import back upwards inwards the lower 2080s inwards the front end calendar month ES contract. I boot the bucket on to move inwards the style of buying weakness that holds higher upwards overnight lows, but await merchandise to move deadening today given the long vacation weekend that many U.S. traders volition move taking.
* So far, the number of stocks displaying odd forcefulness inwards the recent motion higher has been modest. Below is a nautical chart of the number of NYSE issues closing higher upwards their upper Bollinger Bands minus the number closing below their lower bands. (Data from the splendid stockcharts.com site). To this point, that stair out of forcefulness has been waning.
* Another resources that I stimulate got constitute quite useful is the Stock Spotter site. They furnish purchase in addition to sell signals for private stocks based upon their bicycle models. They also stimulate got toll forecasts for each stock in addition to ETF. I've constitute those forecasts for SPY to stimulate got value in addition to stimulate got backtested them for the improve operate of ii years. At present, their forecast is bullish for stocks over a adjacent two-week horizon.
Thursday, Nov 26th
* Happy Thanksgiving in addition to many cheers to readers! I aspect frontward to a dandy 2016. This latest article describes a structured procedure for dealing positively alongside setbacks in addition to failure. So much of the departure betwixt the successful trader in addition to the unsuccessful 1 is how they bargain alongside the inevitable losses dealt past times markets (and past times our faulty processing of market-generated information).
* We've continued modestly higher inwards overnight trade, equally the basic strategy of buying weakness that holds higher upwards key prior twenty-four hr catamenia in addition to overnight levels has been a practiced one. The relative outperformance of little caps is something I'm watching. Utility stocks, faced alongside the prospect of rise rates inwards the U.S., stimulate got been relatively weak. Below, the graphic from the splendid FinViz site shows mixed surgical procedure amidst U.S. sectors. It continues to move a rotational environment.
* On a to a greater extent than global scale, I'm watching the relative surgical procedure of China, emerging markets, Japan, in addition to European stocks, given the prospect of farther easing from overseas cardinal banks in addition to a charge per unit of measurement hike from the Fed. Note the relative forcefulness of the U.S. dollar of late; that is also a theme that is impacting U.S. shares. I know besides many traders who are in addition to so busy looking for short-term setups that they completely immature lady larger themes that are driving stocks on the longer fourth dimension frame.
Wednesday, Nov 25th
* We tested the overnight lows inwards early on merchandise yesterday in addition to constitute rigid buying off the lows, bringing us dorsum toward the upper halt of the recent range. The inability to sustain weakness is consistent alongside a marketplace seat inwards a rise cycle, though I do detect tepid breadth therefore far inwards the motion higher. For example, the past times duo of days, we've seen to a greater extent than stocks register fresh 52-week lows than highs. While I do recollect nosotros stimulate got a practiced chance to attempt out recent highs, I am far from convinced that we're launching to a fresh bull leg from here.
* Dec promises to move an eventful month, alongside ECB in addition to Fed meetings that could Pb to monetary easing in addition to an involvement charge per unit of measurement hike, respectively. I recollect it's possible that, alongside a dovish Fed hike in addition to monetary ease inwards Nippon in addition to Europe, nosotros could reckon a renewed "QE" merchandise inwards stocks.
* The nautical chart of cumulative upticks vs. downticks amidst all listed stocks (red delineate of piece of job below) has been heading to novel highs. That reflects relative forcefulness late amidst smaller cap issues. Interestingly, the cumulative upticks vs. downticks for Dow stocks exclusively is inwards a recent downtrend. This rotational merchandise could good boot the bucket on through this vacation period.
Tuesday, Nov 24th
* Yesterday's merchandise was interesting inwards that nosotros saw considerable buying involvement inwards early on trade, equally tracked past times NYSE TICK, but much of the forcefulness centered on smaller cap issues in addition to non the NASDAQ in addition to SPX large caps. What turns a bull, rise stage of a marketplace seat bicycle into a topping stage is that buying involvement fails to accept prices meaningfully higher, equally around segments of the marketplace seat display weakness equally others concord up. In yesterday's trade, it was the NASDAQ index--and AAPL specifically--displaying weakness. As buying failed to force indexes higher, sellers came inwards during the afternoon in addition to took us lower. Yesterday's merchandise was a squeamish illustration of how markets plough on a brusque fourth dimension frame. It was also a squeamish illustration of how it's of import to rail multiple marketplace seat sectors, non simply the index you're trading.
* Painful sense has taught me to non move long stocks alongside pure volatility (volatility per unit of measurement of trading volume) is low. Forward returns simply aren't positive on average. As you lot tin reckon below, pure vol had gotten quite depression recently, a xanthous caution light. With the downing of the Russian jet overnight inwards Turkey, stocks stimulate got fallen dorsum in addition to taken out stops inwards the 2070s inwards the ES futures. Pure vol has expanded meaningfully. Adjusting volatility expectations in addition to risk/reward is key here. On 1 hand, corrections that get upwards pure vol offering practiced entry points on the long side. On the other hand, nosotros at nowadays stimulate got a province of affairs where idiosyncratic (geopolitical) factors are moving markets. It is hard to successfully merchandise historical patterns when idiosyncratic conduct chances factors dominate. I'm opened upwards to buying weakness that cannot accept out the overnight lows, but inwards no rush to larn involved.
Monday, Nov 23rd
* How much fourth dimension do nosotros waste product in addition to how much mental clutter do nosotros do past times staring at screens, opening superfluous email, in addition to reading cloth irrelevant to our conclusion making? How does that clutter clog creative processes in addition to interfere alongside generating novel in addition to improve ideas in addition to trades? This post on media consumption tackles a really of import topic: nosotros can't get together practiced ideas if we're non collecting the right puzzle pieces.
* We're trading inwards a relatively sideways gain inwards the ES futures, correcting to a greater extent than inwards fourth dimension than inwards price. That is mostly what markets do when they're trading inwards a practiced uptrend, in addition to that's how I'm treating this marketplace seat until proven otherwise. The exclusively flies inwards the ointment are depression levels of implied correlation in addition to pure volatility, both of which are associated alongside subnormal near-term returns. My basic strategy, equally has been the instance recently, is to purchase weakness that holds higher upwards overnight in addition to prior day's lows.
* I mostly similar to purchase oversold levels inwards rise markets in addition to sell overbought levels inwards falling ones. Influenza A virus subtype H5N1 large portion of profitability comes from practiced entry execution. The same applies to move out execution. When positions become our agency but are stretched to the upside or downside, it mostly pays to accept at to the lowest degree around of our seat off inwards markets that display short-term hateful reversion. I aspect at a medium term charge per unit of measurement of alter stair out on bars created every 500 toll changes to furnish perspective on overbought in addition to oversold. It's non something I merchandise off of directly, but utilisation to mostly guide practiced in addition to bad merchandise location.
* Not much changed from yesterday alongside honour to U.S. stocks, equally nosotros boot the bucket on to concord of import back upwards inwards the lower 2080s inwards the front end calendar month ES contract. I boot the bucket on to move inwards the style of buying weakness that holds higher upwards overnight lows, but await merchandise to move deadening today given the long vacation weekend that many U.S. traders volition move taking.
* So far, the number of stocks displaying odd forcefulness inwards the recent motion higher has been modest. Below is a nautical chart of the number of NYSE issues closing higher upwards their upper Bollinger Bands minus the number closing below their lower bands. (Data from the splendid stockcharts.com site). To this point, that stair out of forcefulness has been waning.
Thursday, Nov 26th
* Happy Thanksgiving in addition to many cheers to readers! I aspect frontward to a dandy 2016. This latest article describes a structured procedure for dealing positively alongside setbacks in addition to failure. So much of the departure betwixt the successful trader in addition to the unsuccessful 1 is how they bargain alongside the inevitable losses dealt past times markets (and past times our faulty processing of market-generated information).
* We've continued modestly higher inwards overnight trade, equally the basic strategy of buying weakness that holds higher upwards key prior twenty-four hr catamenia in addition to overnight levels has been a practiced one. The relative outperformance of little caps is something I'm watching. Utility stocks, faced alongside the prospect of rise rates inwards the U.S., stimulate got been relatively weak. Below, the graphic from the splendid FinViz site shows mixed surgical procedure amidst U.S. sectors. It continues to move a rotational environment.
Wednesday, Nov 25th
* We tested the overnight lows inwards early on merchandise yesterday in addition to constitute rigid buying off the lows, bringing us dorsum toward the upper halt of the recent range. The inability to sustain weakness is consistent alongside a marketplace seat inwards a rise cycle, though I do detect tepid breadth therefore far inwards the motion higher. For example, the past times duo of days, we've seen to a greater extent than stocks register fresh 52-week lows than highs. While I do recollect nosotros stimulate got a practiced chance to attempt out recent highs, I am far from convinced that we're launching to a fresh bull leg from here.
* Dec promises to move an eventful month, alongside ECB in addition to Fed meetings that could Pb to monetary easing in addition to an involvement charge per unit of measurement hike, respectively. I recollect it's possible that, alongside a dovish Fed hike in addition to monetary ease inwards Nippon in addition to Europe, nosotros could reckon a renewed "QE" merchandise inwards stocks.
* The nautical chart of cumulative upticks vs. downticks amidst all listed stocks (red delineate of piece of job below) has been heading to novel highs. That reflects relative forcefulness late amidst smaller cap issues. Interestingly, the cumulative upticks vs. downticks for Dow stocks exclusively is inwards a recent downtrend. This rotational merchandise could good boot the bucket on through this vacation period.
Tuesday, Nov 24th
* Yesterday's merchandise was interesting inwards that nosotros saw considerable buying involvement inwards early on trade, equally tracked past times NYSE TICK, but much of the forcefulness centered on smaller cap issues in addition to non the NASDAQ in addition to SPX large caps. What turns a bull, rise stage of a marketplace seat bicycle into a topping stage is that buying involvement fails to accept prices meaningfully higher, equally around segments of the marketplace seat display weakness equally others concord up. In yesterday's trade, it was the NASDAQ index--and AAPL specifically--displaying weakness. As buying failed to force indexes higher, sellers came inwards during the afternoon in addition to took us lower. Yesterday's merchandise was a squeamish illustration of how markets plough on a brusque fourth dimension frame. It was also a squeamish illustration of how it's of import to rail multiple marketplace seat sectors, non simply the index you're trading.
* Painful sense has taught me to non move long stocks alongside pure volatility (volatility per unit of measurement of trading volume) is low. Forward returns simply aren't positive on average. As you lot tin reckon below, pure vol had gotten quite depression recently, a xanthous caution light. With the downing of the Russian jet overnight inwards Turkey, stocks stimulate got fallen dorsum in addition to taken out stops inwards the 2070s inwards the ES futures. Pure vol has expanded meaningfully. Adjusting volatility expectations in addition to risk/reward is key here. On 1 hand, corrections that get upwards pure vol offering practiced entry points on the long side. On the other hand, nosotros at nowadays stimulate got a province of affairs where idiosyncratic (geopolitical) factors are moving markets. It is hard to successfully merchandise historical patterns when idiosyncratic conduct chances factors dominate. I'm opened upwards to buying weakness that cannot accept out the overnight lows, but inwards no rush to larn involved.
Monday, Nov 23rd
* How much fourth dimension do nosotros waste product in addition to how much mental clutter do nosotros do past times staring at screens, opening superfluous email, in addition to reading cloth irrelevant to our conclusion making? How does that clutter clog creative processes in addition to interfere alongside generating novel in addition to improve ideas in addition to trades? This post on media consumption tackles a really of import topic: nosotros can't get together practiced ideas if we're non collecting the right puzzle pieces.
* We're trading inwards a relatively sideways gain inwards the ES futures, correcting to a greater extent than inwards fourth dimension than inwards price. That is mostly what markets do when they're trading inwards a practiced uptrend, in addition to that's how I'm treating this marketplace seat until proven otherwise. The exclusively flies inwards the ointment are depression levels of implied correlation in addition to pure volatility, both of which are associated alongside subnormal near-term returns. My basic strategy, equally has been the instance recently, is to purchase weakness that holds higher upwards overnight in addition to prior day's lows.
* I mostly similar to purchase oversold levels inwards rise markets in addition to sell overbought levels inwards falling ones. Influenza A virus subtype H5N1 large portion of profitability comes from practiced entry execution. The same applies to move out execution. When positions become our agency but are stretched to the upside or downside, it mostly pays to accept at to the lowest degree around of our seat off inwards markets that display short-term hateful reversion. I aspect at a medium term charge per unit of measurement of alter stair out on bars created every 500 toll changes to furnish perspective on overbought in addition to oversold. It's non something I merchandise off of directly, but utilisation to mostly guide practiced in addition to bad merchandise location.
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