At the start of the new year, the Exodus level by which an oversold reading would register was around 2.44. Due to the severity of the decline and the unprecedented nature of the fall, the algorithms had a hard time nailing the bottom.
I explained to members that the algos would intuitively learn the new levels, as that’s how we built it, leading to greater success throughout 2016.
Very shortly afterwards, markets began to plunge and the overall hybrid score, which is a master reading of both fundamental and technical factors for all stocks in the system, was below the previous threshold that triggered an oversold signal in the beginning of the new year. But because the system had adjusted to a highly stressed market, it did not register an oversold signal right away. Instead, it waited for even greater declines and then promptly alerted members of the new oversold condition, with alacrity.
My basis for three individual purchases of SPY is $185. These are 10 days holds from the purchase date, win, lose or draw.
As predicted, risk assets, readily defined by TWDFM (these will definitely fuck me: TWTR, WYNN, DB, FCX, M) are soaring again. If you want risk and are unsure as to which stocks to own, look no further than TWDFM. However, just know, when the rally ends, they will fuck you.
In short, we are in extreme rally mode. Le Fly is up for the year. The ark is docked (for now). And Exodus wins again.
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Well done as always, good Sir (extra tip of the topped hat)
At some point I will retire from this job and trade full time and when I do I will happily pay an annual fee for Exodus. It really seems like a quality system.
I guess it’s time to take some profits as the shorts cover!
Well done. It was really interesting watching it unfold in real time on Exodus.
Thanks
I have to get Exodus too – still working an an old Apple computer – time to buy. SPY can’t rally tomorrow too? Are you continuing to hold?
I will start to sell spy next week
Great call. Can’t believe I just sat and watched FCX all the way from $5.
Nice job. But I don’t understand why you build a big powerful shiny stock-pickin’ machine and then use it to buy an index. That’s like buying a Ferrari and driving it at 20 mph.
Shouldn’t Exodus give one the comfort to buy individual stocks with greater reward potential?
I’ll take a stab at that and say the unprecedented circumstances of the past two months (Yellin’s gaffes, etc) guide to cautious trading and investing.
Exodus does have OS/OB signals for individual equities too. You could use it for that. Not my cup of tea, but then, I like trading SPY.
It should, but sometimes individual stocks don’t behave well. One of the things about playing SPY (or other broad market ETFs) is that you can look for mean (or trend) reversion as a norm. Individual stocks have salmonella, fraud, lawsuits, patent cliffs, dividend cuts, etc.
Don’t get me wrong, Exodus is a great tool for individual stocks (especially some of the trend charts you can run), But I’d only use OBOS as one tool among many. For SPY, I reckon you could only use OBOS and do pretty well. That’s Dr. Fly’s trading experiment, I think.
It does for every stock what it does for broader markets. Give us a shot.
Did they “intuitively” adapt or did you get in there and make manual adjustments?
Always intuitively, using moving averages.
2016 so far framed by, “on the Ark”, “off the Ark”, “on the Ark”, “off the Ark”, “on the Ark”, “off the Ark” … not worth unpacking (no homo).