A novel Idea

Been mulling this around for quite awhile and maybe its time for you folks to have a say.

Here is an Hourly chart of TZA:




Nice combination of 10% or better wins with few whipsaws and not too many trades. Longer or shorter time frames work equally well, but the hourly by its very design means you can hop onto a large percentage move relatively quickly and yet not be completely glued to the screen every tick.

My idea is to post this chart soon after every new signal.

Vote Yea, Nea, or I've-got-a-better-idea, with your Comments.


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Not short yet, but we're getting there

By now, those who have been trying to learn something here and in so doing, realize how pieces of the puzzle are put together, will appreciate the Fibonacci, False Bar Stochastic and Momentum Divergences that are appearing on these stock index charts.

SPX

RUT


VLE

NDX

Now, the one exception to the Fibonacci Retracement umbrella, the DJIA making a new high for the entire 2009 rally today. Is it a leader, for a lagging follower?

DJIA

The 5 waves up, oscillator divergence and false bar stochastic all say, "lagging follower."

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Sont des mots qui vont très bien ensemble

I have a number of charts for viewing this weekend, but without a doubt, these next two are my most important, so let's get right to it:


The market topped on October 21. It declined from 1101 to a low of 1029 on November 2. That 72 point SPX decline is in the process of being re-traced in a news-riveted suckers rally, retracing about 55% of the original decline so far. Here is the same chart, with Advanced GET's suggested wave count:



For context and perspective, a Weekly chart:



Below, a close up of the past 10 months on the Weekly:



Now another view, look through the perspective of the Daily chart:


As you can see, Advanced GET has already detected the beginning of a five wave decline from the October 21st top. Yes, those are ATR & BWT Buy Signals as of the close Friday. It happens.

Earlier in the day on Friday, the 90 minute chart flipped LONG:


Thursday BWT triggered LONG at 1046.41. On Friday, ATR triggered LONG at 1059.25. With the SPX closing at 1069.30 on Friday, both of those trend signals netted nice gains.

(Please recognize how you cannot rely on occasional charts from Allan to short-term trade, you have to be him to do that and there is only room for one of me, at least with the current level of civilization's technology).

That brings us to the last chart for this post, the 15 minute SPX:


Once again, the most prominent feature of this pattern is the set-up of an Advanced GET Mechanical Sell Signal. As you may have noticed, some of these trades have worked beautifully, some have outright failed. I have been trading this set-up since 1995. At the time, Tom Joseph, who developed Advanced GET told be about 67% of these set-ups work, 33% fail. (Since I had gone to Akron to personally meet him and buy the software, he spent about two hours giving me a personal tutorial on his labor of love, Advanced GET.)

My point is that in the 15 years of trading this pattern, I can attest that about 1/3 of the set-ups fail, 2/3 work as designed. That doesn't mean you abandon the system upon one or two failures. It means you take every one, as though it will work, because both statistically and real time history says the probability is that it will work.

The Oscillator in the bottom window has retraced to the zero line, the stochastic is about into overbought territory and once ATR and/or BWT trigger SHORT, the trade is on. Joseph uses the trend regression channel break for his triggers, but since I have so much faith in ATR and BWT, I use those for my triggers. For Monday, those triggers are 1066.86 for BWT & 1066.00 for ATR.


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GS update

Back on October 15 I posted these charts of GS, suggesting a break of 180 would turn GS down and maybe the market with it. Let's see how it turned out.

Daily

Break down through regression channel and triggering of Sell Signals


240 minute

Pending Mechanical Sell Signal


Weekly

Bigger picture break-down and Sell Signal

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Setting up for Friday

90 minute

Nice looking set-up for a Mechanical Sell, if triggered


30 Minute

If 30 minute triggers SHORT, early indication that 90 minute will trigger

5 Minute

But nothing doing as long as 5 minute remains LONG

This is how I think. Although anxious to take the 90 minute Mechanical Sell, first the 5 and then the 30 minute charts have to turn down. That's why I get so aggravated when someone posts that I have been "Short" for seven months. On what planet? Holding a trading position against even a 5 minute uptrend is financial suicide.

With the right tools and rules, you can be dead wrong in your forecasting and still make money trading. I know some of you get it. As for you others, keep trying, persistence is half the battle.

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Russell 2000 Perspectives

Monthly


Weekly


90 minute

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Reason to believe

RUT 60



SPX 60


NDX 60

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