Monday, July 25, 2016
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Curious Thoughts

The Robots Want To Cruise Higher into Month-End

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All the models have been updated, the algorithmic signals tracked and accounted for, and there is little to suggests a change coming for the markets.  Instead the research suggests a continued drift of the calm and upward variety.

We have an FOMC rate decision Wednesday afternoon, but 97% of participants are priced for no change.  Almost everyone is certain, through all the Fed-speak, that the FOMC is a predicable organization.  Pair that with a decent start to earnings season and you have little reason for change.

The last week of July looks like another snooze-fest, perhaps best suited for chasing the narrowing pockets of momentum that are likely to show up, if only for overnight holds.

I may have jumped the gun late last week with my shorts.  I do not believe in Starbucks and their China campaign.  It is bound to fail as frauds and gross water taint their brand.  So I shorted SBUX into earnings which is so far a losing proposition.  I also took a position in the triple-lindy-inverse China ETF YANG.  Both of these positions are subject to liquidation next week, given the model signals being generated.

As always, TBD.

Exodus members, the 89th Strategy Session has been published, go check it out!

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Stocks Rip Higher After Chaotic Weekend

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Early this morning, combing through news feeds, premium chat rooms, and my precious twitter stream there was a recurring sentiment among market participants–a toxic mentality that often leads to errors.

This will not be a long lecture, only a quick reminder:

You are not in control of the markets.

If you feel anger or frustration or confusion, it could be a [failed] attempt by your psyche to impose your will on the marketplace.

Step back, lads.

Moving on…markets are ripping higher after being in balance since Thursday.  This is hypo 2 from the morning report.  Why are the markets attempting to breakout of balance already? Just after 10am, just after the NAHB Housing Market Index the rally began.  The housing read was just a touch below expectations and is not the likely catalyst.  Bottom line–it doesn’t matter why, just do what is right for your and your money in these conditions.

This is the first week I have no edge coming into.  I booked my AMZN short, a trade I took exclusively on snapchat [username: vCali].  The purpose of showing my trades is not so others follow along–instead the purpose is to show what methods seem to work [for now] for me.

I have killed these markets from the last week of May, all through June, and into today.  Typically I would pound my chest and continue my aggressive campaign now, ultimately foregoing a decent chunk of my hard-earned gains.

This time, since I have no edge, I am backing off, for the win.

Markets do not care about your reaction to external events.  If they only want to move based on central banks and earnings, so be it.  Accept it, trade it, or move on to a different vocation.

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Simplify Your Trading Plan And Win More

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One of the constant factors in business, and make no mistake trading is a business, is the potential force of external events.  You can take a trade according to your plan and if someone bigger and with more resources takes the other side of the market you will be stopped out.  It happens all the time.

Another external factor is news and opinion.  You will be barraged with news every.single.day.  Which is fine.  Opinions are fine too, but you need to determine whether they matter.

Nine trading sessions back the most dependable signal inside Exodus triggered, the Historical Hybrid Oversold signal.  This algorithm has 73 samples under its belt.  Most of the stat guys I talk to say it takes 50 samples to be statistically significant–I agree.

So when this algo triggers, I pay attention.  It triggered on Friday, June 24th aka the day BREXIT was made official.  That meant your job as a trader was the gird your loins and buy the market Monday.  Monday was a real bloodbath, if you recall, but there was a slight hint at the end of the day–a failed auction in the NASDAQ and an afternoon ramp across the board.  It was time to buy.  The result?

Hybrid-OS-06242016-2

The best performing algo signal of the year.  You throw some leverage behind this and you made upwards of 20% in less than 2-weeks.

I always tell Exodus members that if they can execute the 36-month Hybrid Oversold signal consistently, not missing a beat, they are well on their way to becoming a consistent trader.  This is how you build discipline.  You start with a very simple trade, you master it, then you add another to your repertoire.

It seems so easy, but it is not in practice.  Trading can be simple if you let it be.  At the end of every single Strategy Session (we are approaching 100 consecutive weeks) I write, “Trade simple”.

Simplify all your businesses to the point you can execute them no matter the external factors, and if you have been blown off your feet by a catastrophic event–take a step back.  There will always be another trade.

Distinguished members of Exodus, it is my honor to serve up the 87th edition of Strategy Session.  It is live now, go check it out!

PS – iBankCoin research suggests we could see a calm week of sideways consolidation.

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Potent Blend of Algorithmic Metrics Suggest A Calm Open To July

in Penny Dreadful (season 3, episode -). - Photo: Jonathan Hession/SHOWTIME - Photo ID: PennyDreadful_301

The interwebs are fairly active this holiday Sunday, which is surprising.  I just assumed people would be boating and eating BBQ meats, not scouring through market research ahead of the short week.  And while I appreciate the idea flow, it makes me think the markets will set out to frustrate as many people as possible next week.

What would be the most frustrating course of action after ultra violent rips lower and higher? 

A mindless drift, perhaps with a head fake or two.

Thus, this is my core thesis heading into the first official week of July trade—a whole lotta nothing.

Keep yourself sharp, however, because in the distance I hear white noise…the whisper of a waterfall perhaps.  The only scheduled catalyst on deck is due out Friday morning.  Watch how the market reacts to NFP, it will tell the story for July.

Until then let’s celebrate freedom by filling coffee cans with firecrackers and launching bottle rockets at our neighbors, being real menaces like our Founding Fathers.

 

 

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Routine Trumps Festivities: Month-End Strategy Is Live Inside Exodus

ExVIC

News of Brexit reached me inside the refugee camps of Electric Forest early Friday morning.  Celebration ensued, a British flag was hoisted, and it was immediately made clear I was claiming a swath of camp as my own.  My position was fortified by age [I am old] and gifts of Pabst Blue Ribbon.  Inside the mobile command unit I was taking many calls from Exodus members, eager to discuss the recent market happenings.

So I had to do a bit of adulting and leave the music festival 2-days early.  Initially I planned to connect to mothership remote and do my research from a tree stand.  Alas, a solid connection could not be achieved so I missed my favorite DJ, Bassnectar, opting instead to return to mothership last night and be ready today to dig into all the data produced by Friday’s knee-jerk reaction.

Because listen, and I had to have this talk with more than one Forester, once you’ve gone 84 consecutive weeks putting out Tier 1 research, never once skipping a beat, you do not abandon your post at a generation-critical time.  If I can instill one trait into my millennial readership, it would be routine.  Routine will be your rock.

So Exodus members, go check out this week’s Strategy Session.  I dug into the data, hardcore, and left all the news bites out.  If you want objectivity, this is your report to read.  If you have a hard time getting a feel for the info, drop me a comment below.  You can also reach me on snapchat [username- vCali] or Twitter/StockTwits @IndexModel.

This week’s report is literally my best research yet.  Behind our wall, the town is humming with information including a controversial stance from Le Fly.  Not everyone agrees on the best course of action going forward, but I will keep adhering to the guideposts of my model, diligently executing the decisions it makes.

Next week ought to be a Hold On kind of week:

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Research Reports from iBankCoin Laboratory Keep Investors One Step Ahead of June Markets

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The Exodus Strategy Session has been freakishly accurate for the first two weeks of June.

Think of the Strategy Session as a weekly research report that takes into consideration all the predicitve analytics inside the software.

The report also contains my working auction theory model, which has been running live for 81 weeks straight.

Attention to detail is paramount to any model because garbage in = garbage out.  The minute factors are presented each Sunday, but they utimately help shape each week’s Thesis for The Week.  Think of it like an executive summary.  Below is last Sunday’s Executive Summary:

Raul’s bias score 3.33, Medium Bull*. Look for bulls to attempt higher prices early in the week. Janet Yellen speaks Monday and may try to talk up the likelihood of a summer interest rate hike.

Expect price to roll and head lower as early as Monday afternoon.

* Rose Colored Sunglasses Bearish Signal triggered, See Section IV

Two weeks ago the summary was still bullish, despite the market being on a pistol hot run, see below:

Raul’s bias score 3.58, Medium Bull*. Look for price to continue working higher across all major indices. Keep an eye on the lagging Dow Jones, and whether it plays catch up or attempts to lead us lower. Look for Friday morning’s Non-farm Payroll data to provide market direction into the weekend and into the month of June.

Note: U.S. markets are closed Monday in observation of Memorial Day. For a full schedule on all trading products, click here.

* Rose Colored Sunglasses triggered, but extreme reading suggests calm upward drift. See Section IV

A great deal of passion goes into this research. It is one of two things your good pal RAUL takes seriously.  The other thing is my morning trading report.

The Executive Summary is a 10 second read based on 4-5 hours of research and is one more way you can outsource your analytics to the good folks at iBankCoin Exodus.

BONUS: When I have a conviction bias, I let it be known on snapchat.  For these updates, follow me.  My user name is VCali.

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Tomorrow Bulls Will Be Treated To The ‘Gap-N-Trap’

victor-myguy

There was something perverted about the way we sold off into the bell today. It was slow, methodical, distribution.  It almost felt German.  Not too much pressure because one mustn’t startle the herd.  But someone was cashing up.

Perhaps their signals read like mine.  The Exodus Overbought reading 9 days back performed sublime, adhering to it’s historical standards.  But it’s opportunity is complete, and now a more sinister model, one forged on a pile of painful lessons, fuck ups, and enlightenment is coming alive.  Like Victor Frankenstein, I watch my monster start to twitch and quiver.

IT’S ALIVEE!

I wish my conviction was rock hard, but I have three contingencies working against me.

  1. We printed a weak high today on the NASDAQ at 4532
  2. Swing high happened during Globex which usually doesn’t stick
  3. the tape is slow, like really freaking s l o w

We are at an inflection point in either direction.  Good money will be made over the next few days.  The key is being on the right side of the tape.  My models say down, so I must be methodical and bet the down move.

Godspeed.

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The Markings of An Inflection Point

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Quick note on what I am seeing.

First, last Friday we printed a normal day.  Normal days are anything but ‘normal’ …they only occur 6.36% of the time, according to my last study.  A normal day sets a large initial balance then never breaks it.  They tend to show up at-or-near inflection points.

Next, we had an extreme spike on the NAS100 TRIN Monday morning–a spike higher than any level seen since 12/31/2015:

NAS100-TRIN-06062016

We also printed a neutral day yesterday.  Another low probability day type, though not quite as rare–occurring 23.32% of the time according to past stats.

I am looking for slightly higher prices before I book a few longs and initiate shorts.  I may be playing it too slow, but I will begin working the short side up around 4538.50 /NQ_F

 

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Closing Out The Month of May Clueless

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The 79th edition of Exodus Strategy Session has been completed, and after reviewing all the data, there is not much to go on.  Models are coming back neutral.  The only standout context heading into next week is what we saw in market rotations last week–investors abandoned safe haven sectors in exchange for allocations slightly higher up the risk profile, check it out:

05222016-Sector-Performance-iBankCoin

There are a few other nuances that may tip the market’s hand next week.  They’re covered in the Strategy Session.  I elaborate on it a bit more, but basically we can also watch the NASDAQ transportation index, which has been a decent tell in the past.

You can also attend this week’s Boot Camp because we’re all going to put our minds together and hash out exactly what’s going on inside the market during the week-long seminar.  Here’s the link if you haven’t signed up yet:

http://ibankcoin.com/bootcamp/

If you decide to roll solo, taking the markets on via your own device, I understand.  Be sure to check in with my morning reports.  We’ll take it one day at a time.

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Mother’s Day Analysis Reveals A Chill Market With One Twist That Could Send Investors Running

malificent

News items, earnings, economic numbers, prevailing sentiment.  There is so much information available to the investor.  Every day you can choose to be inundated with as much [or as little] as you like.  I read every word written on iBankCoin daily, for example, while also enjoying CNBC during lunch.  I have the hots for Kayla Tausche mainly, but I also like a dose of the station’s content.  However, I live by the following motto:

“Objective judgement, now at this very moment

Unselfish actions, now at this very moment

Willing acceptance, now at this very moment, for all external events

That is all you need.” – Marcus Aurelius

Thus I prepare a detailed analysis every Sunday because data is cold, dead, and logical.  It allows me to wipe my lenses clean and take a look at what’s going on inside the market.  I do this every week and share my findings with the members of Exodus.  My 77th edition of the Strategy Session has been published.  Non-members can access today’s report free, because we have trials going on until midnight New York.  Here’s a link. Don’t miss out on this: https://exodus.ibankcoin.com/free-trial/

Ah yes, the twist, I almost forgot.  We have a Friday the 13th this week, so stay sharp 0_o

Happy Mother’s Day everyone!  Be good to the Moms in your life.  Prepare them foods, embellish the home with floral arrangements, and celebrate their being moms and stuff.

UPDATE: a cantankerous lad on Stocktwits provided Friday the 13th stats on the SPX.  I haven’t verified his findings, but allegedly (and I have no idea the sample size) Friday the 13th is green 60.5% of the time with a median return of +0.24%.  So any superstition associate with the day/date is ‘pretty stupid’.

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