The wonderful thing about Exodus is its detachment from emotions and the headlines that sometimes sets a mood in the wrong direction. Often times the headlines can cause one to make foolhardy decisions.
This is rarely the case with Exodus.
On Friday, the shortest term duration of all of our algorithms, the 3 month, flagged a systemwide Oversold signal. This isn’t something that I deem actionable, but more of a canary in the coal mine. The 3 mo algorithm’s threshold score is now higher than the 36 mo, which is the principle algorithm by which the system relies upon. This is indicative of a stronger trending market. It also means, according to the recent stats, that over the past 3 months the market has rallied off these levels.
Moreover, a sundry of bullish upside ETFs ended the week oversold, also indicative of a market that may bounce in the interim.
My feelings are irrelevant in regards to these signals. I’m overtly bearish on markets, but keenly aware that markets ebb and flow and tend to trend upwards over time. I do believe these signals to be backward looking and lacking sufficient data points to make any strong opinions, one way or another.
In short, if you believe the market will continue to behave as it has over the past 3 months, this is the point where you buy. However, if you believe the tides have turned for the wor st and a malevolent storm of 10,000 hurricanes approaches, ignore these signals and wait for the principle 36 month algorithm to be triggered, before dipping into the markets on the long side.
If you enjoy the content at iBankCoin, please follow us on Twitter
Wow. This was a pretty good call.
“My feelings are irrelevant in regards to these signals.”
Are they? I thought that you were sticking to following Exodus for market buys and sells (25% stakes).
Are you now ignoring Exodus in favor of macro-economic data and your judgement or did I miss something in your new post-trader strategy?
I only buy SPY when the algorithms suggest the market is oversold. Ergo, I am without feelings.