This thing is flip-flopping more than the GOP Presidential Candidates.
It closed its open long trade at the close on Tuesday, December 20th and opened a short position. The long position was closed for a miniscule loss.
The short trade is showing a small loss at this point.
The arrows show the short and long trades.
More information on this indicator can be found here.
(laughter) are you even going to vote this election cycle, Wood?
I’m thinking I’ll just not waste my time on the Presidential ticket this year, and stick to the local elections and House/Senate stuff.
Cain, I HATE the candidates. I will vote, because the alternative (more Obama) is untenable, but I’m not sure that any of these candidates can make any meaningful changes to fix what ails this country, let alone restore my faith in American gov’t.
Definitely very important to work local. I think more lasting change can be effected there.
Yep I agree. The only problem I have with voting in a GOP president now is that they’ll start to own the economy, and I just don’t think that there’s anything other than time that will get us out of this.
Proper conservatism should be about avoiding the types of decisions that lead us to this point (high debt, extensive obligations, lethargic and bloated infrastructure, etc.); you can’t expect a president to correct these kinds of problems in four years, but people do anyway.
I’d almost rather see Obama stay just so that he and the Democrats can get crushed. I’d rather have the GOP come to power after the hard processing has taken place, that’d give them more of a clean slab to start slimming down these social programs and more room to breathe with unpopular decisions.
Cain, I have pondered that myself, re., letting Democrats stay in and process the hard decisions that have to be made. There is always the chance though that no changes will be made (GOP may not make changes either) and the result will be awful for the country. If the Democrats start making the meaningful changes to social programs, they could literally be heroes, much like the liberals in Canada’s gov’t that did the same thing in the late 90s. I don’t think they will make any changes. I think they will let Rome burn and continue to build their constituencies by buying votes with gov’t handouts.
So we need to keep the House to stonewall all legislation. I’d rather we keep the bare minimum and let Rome smolder out than send the worst-of-class in to try and combat the flames.
Agreud.
You guys are missing the point. If we keep the House, it will all be blamed on us anyway.
Not how, despite all the good ideas coming up from the House and getting stonewalled by the Senate and Obama, the Reps get blamed for anything the liberal press can hang on them.
The Senate is trying to extend a tax break FOR TWO MONTHS and the Reps are being made out as “dah bad guy” becuase they are saying that’s ridiculous.
In other words, not even common sense can will out when you’ve got the leftist press in your back pocket.
No, you NEED the bully pulpit, because only that can pierce the Dems’ media cover.
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I can’t help but blame the Republicans for the tax issue. They should just jump on board; it won’t make a difference, it’s two months, and it will take the breath right out of the Democratic Party’s lungs. The media aside, if the Republicans were more thoughtful about picking their battles, it wouldn’t matter, because even the most bias of journalists wouldn’t be able to point to anything concrete.
Based on that group of sods the GOP has trotted out, you probably know how the Dems felt back in 2004.
Might be interesting to see if the times this indicator flips has anything to do with bullish or bearish. I remember when you first posted about this indicator you noted that it flips a good bit before settling on a trend. I guess what I’m asking is if there’s a number, above which it indicates certain things.
Hmmm. Maybe I require SPY to be trading beneath the 200DMA and see how many trades it makes. Most of the flip-flopping should occur in bearish environments.
From the chart in the Oct. 20 article, it switched 13 times in 1994, and then once in the beginning of ’95, going long for years until the end of 2000 (where it went short). It switched 7 times in 2002-2003, going long in July, which was not too long after a bottom had been put in.
If there’s a pattern here, to me it looks like frequent switching indicates the market will put in a sustainable bottom within the next 6 months to a year. An alternative interpretation (which derives from not having 50 years of data), and which I hope isn’t the case, is the market is putting in a huge top.
Bozo, thanks for the help! It looks like it does tend to flip a lot during market weakness/bear markets, which makes sense. The only way the ROC5 will be higher than the ROC252 is when the ROC252 has been falling and nearing zero. Simply put, that won’t happen during a bull market.
I can run it over much more data with $SPX, but the short side doesn’t work nearly as well once we get into the 70s and 80s.
Perhaps we should go long 2x levered, but only 1x on the short side? Or is this just adding complexity?
My biggest fear is the market looks like Japan’s did. Anything to avoid that.
Bozo, I would not want to be stuck long or short with a 2x levered product. The volatility kills you over the long term. However, perhaps when the SPY is beneath the 200 day moving average, we could use a levered product. If the system went long and then SPY broke above its moving averages, we could close the levered product and open a 1x position. Interesting thinking there Bozo. I like it.
Short both TNA and TZA in equal dollar amounts and make about 10%/year off the decay.
http://www.youtube.com/watch?v=Xbt30UnzRWw
Merry Christmas Wood, ~<(;-)