Reviewing August And How I Caught Two Huge NASDAQ Moves

August was my best month of the year.  The IndexModel inside Exodus was dialed into the action well, and I engaged two of the biggest rotations of the year with the help of my research.

Listen, the Sunday Strategy Session and morning trading report are designed for trading a hardcore time frame that most of you have no business working.  For you, buy-the-dip is a solid approach.  I need to be more specific with my actions because I want to be right, or know when I am wrong as soon as possible.  It also has to be repeatable and work in both directions (long/short).  I cannot be wrong because it feels wrong or some arbitrary gauge of sentiment.  That is why the Sunday forecast and morning hypotheses are so damn specific.

There is no voodoo.  The approach is mathematically driven.  How I create the statistics has been documented.  A few times.  I play around with trader psychology via two characters that live inside my brain: a chief scientist and a crocodile.  The crocodile can flare up sometimes and act like a drunken primate—reacting to anti Elon Musk (all Praise and Glory to The Leader) sentiment by flinging fresh-pressed feces at the faces of unsuspecting journalists—but I continue to shape my base instinct to be more reptilian because they have existed much longer than mammals.

Below is a chart I marked up.  The pink shaded area shows when I issued a Rose Colored Sunglasses (RCS) short bias, the brown area Bunker Buster.  The fact that bunker buster was issued before North Korea lobbed a missile over Japan is merely coincidence.  What is not of coincidence are the specific words that helped clarify my statistical thoughts at pivotal moments in August.  One from the Strategy Session, the other from a blog post.  And a tweet.

I present this chart not as an ‘I told you so,’ or a ‘hey everyone come see how awesome I am’ but instead to show you that auction theory works.  And hopefully, if you are going down the dark and lonely road of becoming a consistent short term trader, that you will consider formulating your own objective methods of trading.

Here is how I nailed two of the biggest uni-directional rotations of the year, both of which occurred in August after what has been a relatively low-opportunity year.  BEHOLD:

Still here?  Great, then I shall keep going.  This stuff can seem complicated.  It makes sense that you may consider it voodoo or nonsense.  Believe me, simplicity is key in this game.  Like I said, I want my methods to be repeatable over-and-over.  I want them to work in multiple markets.  Say I wanted to try my hand at short-term trading Bitcoin.  I would do my best to source clean data that could be used to build market profile charts to decide which price levels I want to work with.  Then I would build a trading model to determine directional bias.  Then I would build a renko chart for risk management.  Then I would devote a seperate computer to trade execution using the best service possible for seeing short term order flow and trade execution.

I do not want to short-term trade bitcoin or any other blockchain.  I want to hold them forever and see what happens.

But perhaps one day I will sashay into a different market.  For now, the NASDAQ is good to me.  It offers tons of useful internals that help to objectively tell the story.

If you want to know more about auction theory, you can ask me a question in the comments below, DM me on Twitter @IndexModel.  If it sounds like we cannot effectively communicate online, we can set up 15 minutes on the phone.  I just hope to see more people liberated from other forms of market analysis.

August was the best month so far this year.  Here’s to carrying the heat into September, cheers!

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