(note: this post was going to be posted inside PPT blog. However, considering how bad today was, I felt everyone could use a little information)
The PPT is not spitting out anything too resounding, but its definitely supporting an oversold environment. Stocks like ADBE, DIOD, YUM, DSW, BIDU, CMG, amongst over 100 others, are being flagged as OVERSOLD on our 12 month algorithms, accuracy north of 70%.
Some notable oversold ETF’s are: DBP, GLTR, CORN and DBS.
If you are using the OVERSOLD algos and expect instant profits, you are using them wrong.
Look at DBP, for example. It was flagged OS yesterday and dropped 3%+ today. But looking at the holding periods. Over 1 day, accuracy is slightly over 50% for a 0.24% avg return. If you bought and held for 5 days, based on PPT OS scores, accuracy is around 75% for an avg return of 2.6%. Over a 10 day period, the accuracy reigns supreme at 92% for an avg return of 5%. With DBS, The PPT has it OVERSOLD on all algorithms, 3,6,12 and historical with flawless accuracy.
However, like a baseball player on a 40 game hitting streak, eventually, everyone gets a turn at losing–even PPT.
DRV, 3x short real estate ETF, is OVERBOUGHT right now, indicating a sell for the fucktarded ETF. It’s overheated.
Here is the track record for DRV:
On 3 mo Algo:
Just 50% accuracy, with only 2 signals.
On 6 mo Algo:
Down 75% of time on 4 signals, avg loss of 7% over 7 days.
On 12 mo Algo:
Down 82% of time on 11 signals, avg loss of 10.6% over 5 days.
On historical Algo:
Down 74% of time on 23 signals, avg loss of 5.3% over 5 days.
This is a very reliable trade, in my opinion. The other side of the DRV wrecking ball is DRN. Incidentally, it is NOT OVERSOLD just yet, highlighting the complexities of the retarded nature of 3x ETF’s. Right now the tech score is 1.79. It needs to be 1.17 or lower to be OVERSOLD. The accuracy is nothing short of sublime.
On 12 mo Algo:
Up 93% of the time over 1 day on 14 signals for an avg gain of 3.85%.
It’s worth noting, many of the big ETF’s are not OS or OB. Despite today’s sharp sell off, we could see more downside before we bounce. This of course coincides nicely with the deadline to pass some sort of budget in Congress at midnight, on this coming Monday.
Bottom line: my computer brain is suggesting to avoid adding to shorts and start covering them. The dip buying bonanza is very close to ripping heads off again. My best guess, we get a fierce rally within 5 business days.
http://www.youtube.com/watch?v=ev-h4F-nZQg
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fig…thanks
Thanks for the PPT info. Sounds intriguing.
You will, of course, be right.
It’s interesting seeing the algo signals and hearing the time frames. It’s pretty much what I see on t-talk as well. Swing trades avg. 3-5 days now.
Now it’s a PC war with a lot of noise from the HF machines. TA is rapidly becoming worthless isn’t it?
Well, I am not a fan of TA at all, having learned it long ago. However, I’ve seen RC and Chess knock the cover off thew ball in 12631 time and time again. I guess it works for some.
I want to believe you’re right. So does my portfolio.
Very hospitable of you. Thanks for the analysis.
Was nice of you Fly to throw us all a PPT bone.
My CMG and GLD shorts beg to differ on Mr. Algo’s oversold thesis. Burritos with 48 p/e deserve to be spanked and GLD needs some reality not to mention being sold by some big hedge funds right now.
Very magnanimous of you.
Thanks.
At the risk of public hazing and possible banishment, I have a question SeÑor. I’m one of the wackos with the thesis that we’re following the 2008 analog, thus I think we’re looking at another leg down. So…even after a week like this, once the inverse etf’s register OB would they continue to do so all the way down? Or do they “work off” ob signals in the PPT with relief/dead cat bounces?
If they continue to trade higher through OB signals, The PPT learns and will adjust thresholds through the time based algos.
It will register an inaccurate signal from 1-10 days and then get ready for new signals.
Tom DeMark, I believe, was the first to create a system that used length of time in OS or OB mode, to determine if the duration indicated a trend reversal. I’d be curious if your system is using something similar… I never had any luck with that feature, BTW, as after backtesting/Monte Carlo, I realized it didn’t help me create profits. Same goes for divergences. They look good on paper but they rarely perform as expected.
The stock market can be predicted by three factors:
1) Technical Analysis: Very easy if you ask me. Any body can draw a line, identify bull/bearish patterns and find resitance and support.
2) Fundamentals: Well this is slighlty more difficult, you need to understand the business model, know how to read a balance sheet, etc, etc.
If you do a good job with 1) and 2) You probably have about 50%-70% of the story and you probably will make money most of the time if you know when to cut your losses if you do not get right the third factor. And that is:
3) Sentiment. Well if you master this one you are probably not reading this….
First, thanks so much @The_Real_Fly.
@JNROD: I think most of the analysts know 1) and 2) and yet their calls are 50-50 at best. Much depends on the market tide as a whole. How do you know if the EPS for S&P should be 15 right now or 25? 25 would be dirt cheap for the dot com era, but might be too expensive right now. There goes your fundamental analysis. As for TA, we all know the market can be overbought for months… enough said about TA.
Thanks Fly. Definitely appreciated after today!
I agree with the mathematician, monsignor Fly.
Just like last time, 3 days up/3 days down.
Although, Europe throws a monkey wrench into the mix.
The Gold down/Silver down/Copper down makes me feel like something’s up, I just don’t know what!
Good Luck, mates!
Lack of liquidity is UP. Debt to GDP is UP. Fraud is UP. Burlap is UP.
burlap is up
TLT is up.
Gold climbed with the market all of 2009-2010 so makes sense it would fall with the market this year as well.
So what’s left?
Bonds?
No.
Equities.
TLT
Very interesting. Leave it to the pro’s!
Toilet bowl repair.
This is scary http://barnhardt.biz/index.cfm.
What to do?
everyone, a must read!!!! especially why she’s closing down.someone should float this to the ows crowd if they know anyone there. corizine needs 25 years in the shithouse,no if’s or ands, and only in the butt.
NOT surprised at all.. ALOT of people are about to be screwed 2008 ten fold.. We know it, the government knows it..the sheep have NO idea..
I knew it and that is why I have already entered the appropriate short orders. Hey, I like to eat my lunches at the Four Seasons. But rest assured, that I as your humble public servant will begin hearings soon.
“”The rule of law is non-existent, instead replaced with godless, criminal political cronyism.””
So Bitch Barnardt busted her customers, the farmers who try to get good prices for their grain and cattle.
And she blames it on OBAMA’s administration?
At least her bucket shop went bust also.
fly, I’m surprised to hear you’re expecting a bounce, given your statements in your last post that “there’s a certain finality” to this leg down. i’m sure a bounce is imminent, but the question is: are you using a bounce to sell your longs or are you expecting we close out the year like gangbusters?
I’ve already told all of my family and friends, to either educate themselves and reposition their funds, or close out their 401ks, mutual funds, Ira’s, etc..Else they can count on suffering immensely..I’ve scared the shit out of them, for their own good..
You could be wrong, slight possibility anyways.
THis is a good time to have a good chunk of cash.
One bad headline and this market will roll over.
Europe is a stick of dynamite thats inevitably will go off.
THe question is how long is the fuse?
I think we’re near the endgame in Euroland. The fact the ECB refuses to act tells me there is no answer. The debts are too large.
Headed is headed towards a deflationary crash via massive debt restructurings.
If the ECB hits the print button hyper inflation is right around the corner.
No way out folks. There are fewer and fewer rabbits that the Fed and the ECB can pull out of their hat.
Game over within 6-12 months.
Absolutely, and we need to warn all of our friends/loved ones, else they will be fucked AGAIN..
Personally, I think you are greatly underestimating the malleability of the US.
This country has screwed the pooch regarding debt and deficits, but I do not believe that it is anything that cannot be fixed with solid leadership and accountability, something that we have been void of for 2, perhaps 3 administrations. The demographics don’t help (re: baby-boomers), but the heterogeneous lifeblood is still and will always be here. Sometimes to ugly family fights, but always solved with creativity and hard work.
After this crisis and the DOW hits 5k again, we’ll rebuild, I agree…
Dow 5k in 6-12 months? Are you trying to out- Alf, Alf? Or are you resurrecting Devildog? The Euro drama is fantastic theater and certainly provides unbelievable trading opportunities, but sooner rather than later, money is going to be put to work, off the sidelines and into the US markets. US markets lack confidence. And it sucks. But that is going to change. I promise you that…
Damn right it will. Infinite fiat money speaks. What’s your fancy today, Sir? A DJ-30 dirt nap, or one that rips tits to the moon? Or would you prefer one of your disposable peons decide?
Vegas Trader,
DOW 5k prediction is paranoia at it’s best!
I guess your purple crayon drew a line to that number…or is there some fundamental basis in that call? Do the math and imagine what it would take for DOW 5k…real world situation, not doom and gloom end of world scenario please.
Also, FWIW:
The financial crisis occurring in Europe is a “more serious” threat to the world economy than the U.S. economic meltdown in 2008, according to General Motors Co. CEO and Chairman Dan Akerson.
He only thinks its worse, because Obama will not be able to bail him out in an electin yr
With reference to the Sinatra video..
1971, wow, he still had some really good years ahead of him.
Candy Lightner got rid of the “one for the road” part of it.(look her up)
I have it from inside sources, that at the end, he didn’t even know who he was.
God Bless you. Frank, you have given us the best an unrepeatable world-class singer can give.
And a great woman beater..
That was a “man” back then, evidently.
You can’t even say “boob job” without getting fired today, even if the woman you work with started the conversation with it.
She probably had it coming…some women can bring out the worst in a man.
I’ll never hit a woman…but I’ll shake the shit out of them…
Thank goodness I don’t have to do that anymore.
When she came at me back in the early 90’s, I just grabbed her wrists until the cops came….and took HER away.
I am married to an angel now.
You could have just introduced her to dry anal intercourse, instead. Much easier than getting the police involved.
Right … “My nightstick or the PoPo’s my dear” … LOL
Lol
Fear is spreading out from the European periphery and even moving beyond the normal boundaries of the orderly transfer of capital to safe havens. Conditions are looking increasingly like the financial breakdown back in late 2008.
http://www.dailyfx.com/forex/video/daily_news_report/2011/11/18/EURUSD_NZDUSD_and_USDJPY_Setups_for_a_Financial_Crisis.html
Fear. Isn’t that what the TV pimps want my brain to engage in, so their boss can profit by turning me into a fruitcake?
Lol at Vegas channeling devildog
This time, the gross hemorrhaging will be so profuse, the governments tourniquet won’t be enough to save the already dead patient..
Than I’ll get my money back and my balls..
Vegas
You are too emotional
If you only knew my situation.. I’ll be a lot more positive and friendly once I get my money back.
Let me guess…reparations?
Well, out of curiosity, what is your situation? You’ve been pretty consistent about your underwater TZA position. I myself was underwater in TZA by like 6% and sold into last Friday’s massive buying spree. Obviously, in retrospect, not a good move. And though I was confident TZA would be higher some time in the future, I was too chicken to try and wait it out with the decaying piece of shit TZA is. At least cover a portion into this sell-off–you just don’t have the luxury of holding it into eternity.
Sorry meant to say 9%.
Rest assured Pedro, NO need to cover..
Santa is soon to be stuck in a chimney and 2012 is going to be real nasty, real quick.. We all know earnings are going to be atrocious for the 4th Q..
your out of your mind vegas. the game is rigged. the clam is watchin. count on it.
A game
http://stockcharts.com/c-sc/sc?s=TZA&p=5&yr=0&mn=0&dy=5&i=p23103993245&a=244975197&r=884
Page 2 find TZA if this link works
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID4746490
Buy yourself an Obama costume, and parade around in front of the White House wiping your ass on the sidewalk all day long, spelling “Hope and Change” over and over. The tips you get will more than cover your recent losses.
The Fly has a wagon he carries his balls in, and they are made of solid brass.
fuck europe. shits wack.
I’m sure this will only get gayer and gayer as this melodrama unfolds.
I told my wife back in 2008 when Bozo the Clown got elected that it would be 2015 before we got back to normal. She believes me now.
That clown’s boss owns the next clown’s ass, too, unfortunately.
Interesting how so many people have crystal balls on the markets and the economy. And how different people’s crystal balls say different things.
Stop calling it your money. It’s not yours anymore.
ROFL
Indeud!
My algos showing happy hour tomorrow after fucktard o’clock lol
Relax peoples, we have plenty of room
Where is the ‘Asshat of the Year 2011’ video !?!??!?!?!
Last November Ireland was going to send us to the depths of hell. How did that work out for the bears?
Fuck this shit, we’re going to hear the Turkey Gods roar soon enough.
Financial news propaganda is nothing more than a method to ensure your money is transferred to some fucking central banker con artist with vericose veins popping out of his wrinkled white ass.
Interesting interview on Bloomberg … the guest (Tim King, HSBC) says that Germany won’t concede to QE until they are in recession which is very near. Either they embrace QE or the EZ crumbles eventually.
Note: Euro up vs most currencies as ECB buys Italian bonds. Spanish bond yields up another .35 to 6.83% as the Euro Banking Congress gets underway.
Draghi asks “where is the implementation of the EFSF reforms?” He warns that they shouldn’t wait any longer do so and that “Continuity, Consistency & Credibility are of the essence and further delays could see the ECB lose credibility very quickly and at great cost. They “must resist temptation to resort to unilateral policies” and “work together to assure gains already achieved are further secured for future generations.”
FLY – was wondering what ur thoughts are on the significance of pre and post market activity, especially in the indices.. would that be considered a valid back-test of 1224?
MOS, POT and AGU are usually strong stocks to own between now and the end of the year, After yesterday’s sell off, they offer a decent entry point at these levels.
ANDE looks pretty good here too… original Jacksonian.
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Looks like the Bernank is trying to bring the Cranberry early.
Dollar down, but will it stay down? Critical question… I’m with the PPT on this one.
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This is pretty hilarious…
I guess he went all “HAM” on her?
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