iBankCoin
I turn dials and fiddle with knobs to hone in on harmonic rotations
Joined Oct 26, 2011
3,484 Blog Posts

How Exodus Strategy Session navigated the v-shaped recovery

I have been out of pocket for a few weeks.  Despite my best attempts to secure WIFI in the arctic lands of British Colombia, I failed.  Subsequently, I have not done my Sunday research in three weeks.  This must have been very nice for my enemies, who didn’t need to compete against a living legend.  But I am back inside mothership and have made the rest of my work day open for research purposes.

While I catch up on recent stock market happenings and use said happenings to form a forecast for the upcoming trading week, here are the old notes from Section III of the strategy session.  I have kept a running dialog since IndexModel fired the “Bunker Buster” signal on December 15th, 2018.  In the following notes, you will see that the systems we utilize to forecast direction stayed on the right side of the recovery.  While we did not avoid the Q3 correction, we did successfully avoid becoming bearish during the bounce, which would have been an all together painful mistake and losing endeavor.

Without further adieu, my research up unto this point:

December 16th, 2018:

The last time IndexModel signaled Bunker Buster was on 04/01/2018.    The other 2018 BB signals were 03/25 and 02/04.  The 03/25 signal and 04/01 signal fired sequentially, ultimately marking swing low for the next six months.  The February signal was successful also, but not for as long a period.

December 23rd, 2018:

The 12/19/2018 BB signal is interesting.  The timing of it into year-end and December OPEX, with the prevailing sentiment calling for a market crash, heading into the last FOMC rate decision of the year, with our contextual NASDAQ Transportation index on the verge of a breakdown, is giving me strong bullish conviction into year-end.  The look bad.  The news cycle is negative.  The holidays are distracting.  These are opportunistic conditions where the competition seems to be collectively leaning the wrong way AND distracted.

With the IndexModel back to neutral [see Section V] and Exodus still in an active hybrid oversold signal [section VII] the models are aligned for upside.

#developing

December 30th, 2018:

Everything expected above was wrong.  Now we have another Bunker Buster.  Two in close sequence has been a trait seen near swing lows historically, therefore I am skeptically bullish.  Extremely skeptical.

THOUGHT FROM FOUR WEEKS AGO:

Signs of swing low emerging.  Lots and lots of people calling it a bear market bounce.  Not many think we can v-shape back up to the highs.  In fact, I have not seen that sentiment expressed anywhere.  The prevailing sentiment is to initiate shorts into this ‘bear market rally’.

We are in yet another active Exodus hybrid oversold cycle (triggered Christmas eve) and IndexModel is neutral.  These conditions, per my 215 weeks of tracking Exodus and IndexModel statistics, favor upside.

#cautiouslybullish

January 6th, 2019:

With Exodus going hybrid overbought on Friday and the behavior of the industry performance (Section II) I am becoming more confident in the bullish case.  I expect price to work higher at an increasing velocity in the coming week.

January 13th, 2019:

The e(RCS) signal from IndexModel gives an interesting layer of context to our current recovery.  The signal has often precluded weeks where price simply drifts sideways.  With our key contextual index, the PHLX semiconductor index, coming into old support (which is likely to behave as resistance now), it makes sense to see a pause in upward action.  However, if price simply corrects by trading sideways (a time-based correction) as opposed to a return of volatility and downward selling pressure, that will bode especially well for a continued recovery.

January 20th, 2019:

Holiday shortened week, monthly OPEX out of the way, index model calling for a calm drift via the Extreme Rose Colored sunglasses signal, no major tech earnings scheduled—with these contextual pieces aligned, my primary expectation is for continued price stabilization, perhaps not as strong of movement to the upside as we saw during the week of 01/13 – 01/18 (last week).

January 27th, 2019:

Tons to digest and this is likely to accelerate the movement of prices.  But I expect little to be accomplished.  IndexModel is still showing extreme Rose Colored Sunglasses which signals an expected drift perhaps with a slight upward bias.

***

RAUL here.  I am going to be back later on this President’s day with fresh findings.  Stay tuned.  My spirit is envigorated after spending weeks underneath the largest atmospheric river North America has even seen in my 33 years on earth.  This freshness, paired with my desire to fuck up all these bush league fin-twitter personalities has me quite optimistic in my findings.

#developing

If you want some extracurricular activity, here is my blog entry from December 30th, where I first suggested a v-shape recovery was likely.

okay, now I go to work, ciao ciao kiss kiss

 

If you enjoy the content at iBankCoin, please follow us on Twitter