Wednesday, December 10, 2008

Mid-week Update

Our mechanical trend following system a/k/a Trade Triangles flipped to a Buy on Monday, after being on a very profitable Sell since early September. The Daily NNVC system still clings to it's recent Buy from some 30% lower.

Make no mistake about this one, I DO NOT trade in and out of NNVC. When this one hits, it will be unforgiving to anyone not yet in and that is not a risk I am willing to take. Until further notice, buy on Buys and hold on Sells.

The Q's are more problematic. It was easy to be Short on the Sell signal because so much else was pointing to a hard down autumn. The current rally was strong enough to trigger the Buy (unexpected) but the patterns that I find so useful, Elliott Wave and NeoWave, are both still pointing hard down as soon as this rally peters out. When will that be? The triangles will catch it after it has built some momentum. I hope to catch it earlier and will try to post what as soon as I think this next leg down has started. Meanwhile, it's day-trading for me, which has been doing just fine, thank you.

Every December I go into the last two weeks of the month swearing to take some time off because nothing trades right around the holidays. Yet every year, I am at the helm, thinking a few decent trades are better then no decent trades and anyway, with all the stress there is no such thing as down time around the holidays. With what should be a heck of a dive coming in the indexes, this is not a time I want to be away from trading. Opportunities like those of the last three months don't come along that often and with my expectations as they are, it's no time to go bowling.

But it is time to go to a hockey game. I will be at arena Saturday night to watch the Phoenix Coyotes host the Detroit Red Wings. Last year Red Wing jerseys outnumbered Coyote jerseys about two to one. It's like going to a home game, without the snow, cold or boarded up businesses. Anyone who would like to buy me a beer, or give me a back rub, I'll be in section 116, Row T wearing a Red Wing sweat shirt......sitting next to a blond.



Anonymous said...

Thanks for the update; your input is greatly appreciated.

Anonymous said...

in my observation nnvc has always dropped in december to recover sharply in january for the past few years. i am looking to add in the .40-.50 range if it happens.

What are your thoughts on GSI and HYGS? you were strong on them a few months back...

happy holidays!!

Kat said...

Hi Allan - in an effort to be mechanical in my style, I took the Q's ATM March expiry options, when the weekly triangle turned green, with a short term stop below its 3 week lows. So, I'll be ready to be be stopped out or take it out when the triangle turns red and hopefully catch the grand leg down if it happens. I must say, it takes patience to wait for the triangle to show up while you see the markets rallying around you, knowing something's up, but holding off on pulling the trigger. As they say, the triangles aim to catch the sweet spot in the trends, leaving the bottom/top fishers and range traders to play their high stakes
games alone. I'm starting the EW subs. this week, hopefully adding to my arsenal of informed decision making techniques. Thanks Allan for this post, it helped me to understand how you are approaching the recent green triangle.

abot said...


So, a green triangle has shown. May be a very important trade, a daytrade or a buy and hold. Listen and feel the trade. Let it flow. Pay attention and do not get too distracted.
The ticker: BLND
Wish you the best.

CruiseGuy said...

Thanks for keeping us updated -


Dave said...

Allan, there's only one name that seems a fitting description....Hound Dog.

Seems a time to pay closer attention than ever.

Anonymous said...

Allan, is this the Trader Joes Blonde? wouldnt she be irritated if I gave you a back rub at the game? gary