Wednesday, March 28, 2018

QLD flat for Thursday...03.28.18

The market gave us a gift today by  putting QLD momentarily in the green before its day long plunge.  As a result we were able to exit our small position close to the open as green turned to red, leaving us flat for the day once again.  This little risk management strategy we've mentioned multiple times...not allowing an overnight gain to become a loss the following day...has once again saved us some coin, other than commission costs.
For Thursday the QLD signals are flat and we are in cash.  Continued weakness in Amazon...which opened down 100 well as pervasive weakness in the whole FANG gang....means we are assuming an aggressive risk trading stance for the near term.
Note that the ATR and OC volatility charts are upslope...not a good sign for the bulls or buy and holders.

Tuesday, March 27, 2018

QLD 50% Long for Wednesday....03.27.18

We're still 50% long QLD for Wednesday via the VIXEN while the PVOL model remains in cash.
Following our previously discussed risk override strategy we closed our QLD position today shortly after the open when QLD turned from green to red and as a result ended net flat for the day.  This strategy is on top of the limit stop set the day before when the positions were opened and has saved us from 5 different green open to red reversals over the past 2 months and has saved a net of 6.2% (which is not shown in the performance metrics).  We'll follow the same strategy for any new long signals although tomorrow could be extra iffy and we are only long 20% of our normal size.
The entire tech center is under extreme selling pressure and Turnaround Tuesday may just be the beginning of more pain to come for the bulls.  Amazon gave back all of yesterday's gains.
We closed our little TBT trade today for a .7% loss and will look for better odds for our next venture into this issue.

Monday, March 26, 2018

QLD 50% Long for Tuesday....03.26.18

A blowout day for our flagship VIVEN model with a nice 7.5% gain in one day.  For tomorrow we are long 50% as the more conservative price based PVOL model remains in cash. Our TBT position posted over the weekend did eek out a small gain and we are still long that position.

Saturday, March 24, 2018

QLD 50% Long for Monday...TBT Long....03.24.18

As a tactical follow up to my skittish attitude towards Thursday's 50% long signal on QLD we closed the position Friday early on as QLD crosses down from positive to the zero line, thereby putting us net flat for the day and avoiding the subsequent 5% drawdown that followed.
We'll use the same tactic going into Monday for QLD and have added a small TBT (TLT x2 inverse)  position based on the mean reversal model and the MOZ signals.
What looked like a possible early on recovery on Friday did in fact become the dreaded TRAP DOOR pattern with resultant carnage, especially in the last 45 minutes of the day when selling was in earnest and buyers were no where to be found..  Amazon again closed on the low of the day....a bad harbinger for things to come.
I've added the TBT studies back in for the weekend post as the signals have been quite reliable.
Keep in mind that Black Monday began with Black Friday so gird your loins, fasten your seat belt and be prepared to exit any falling knives in a heartbeat.  Capital preservation is job 1 !!!!.

Thursday, March 22, 2018

QLD 50% Long for Friday...03.22.18

Another day when our QLD flat signals saved our butts from a serious bruising.
For whatever the reasons the markets were freaked....maybe govt. shutdown fears, trade war with China, FED hawkish stance, etc, etc.  What started out as a slow grind down continued with a vengeance into the close with the Dow down 726 and SPY down 6.76.  Both DIA and SPY closed below the S3 pivot...weakness seen only 3 times in the last 250 trading days. Volume was slightly above the 30 day average but tomorrow's action will be a much better gauge of whether or not the markets can hold above the 100 day MA.
After hours QLD is down another .5 % but anything can happen overnight.  We're most likely to see a selling follow through at the opan and then its anybody's guess.  Amazon closed down $37...the low of the day and that's a bad sign since AMZN always recovers from daily low to some fib threshold.
Our signals for tomorrow are 50% Long and this one is a longshot from a risk perspective.  I'm personally scaling back from even that signal as the risk/reward is suspicious.  While its true that Fridays have shown a recent tendency to be bullish (in contrast to the past 10 year historical pattern), this may be the exception.  If we get  more selling then the SPY 100 day is at 260, a lower risk entry point for those that aren't afraid to catch a falling knife. 

Wednesday, March 21, 2018

QLD Flat for Thursday....03.21.18

After a volatile down, up, down day the QLD's closed for an almost 1% we were happy to be flat for the day following yesterday's signals.  I mentioned a couple weeks ago that the safest plan for FED days is to be a cash or be prepared to act VERY quickly on intraday volatility.  That was certainty the case today as VXX ATM put options went from .29 to 1.02 and then back to .29 by the close ....that's volatility.
Signals for Thursday are flat and both our models are clearly outperforming a QLD buy and hold strategy and with a whole lot less risk.

Tuesday, March 20, 2018

QLD flat for Wednesday....03.20.18

After a whippy trading day QLD kicked out a nice little gain in our 50% long position.  For tomorrow the QLD  signals are flat so we'll see how much of today's action was short covering.

Monday, March 19, 2018

QLD 50% Long for Tuesday....03.19.18

G20 decision to support internet tax toke a toll on FANG and Amazon.  Otherwise, the risk environment is heating up as the DOW hit -400 before recovering somewhat in the afternoon session.
The market did not crash into the close, which offered some encouragement for tomorrow but we'll monitor after hours action to try an get a heads up before entering any new vested positions.
Our models kept us out of today's carnage and an otherwise ugly drawdown.

Sunday, March 18, 2018

QLD Flat for Monday....03.8.18

Another good day for our QLD trade as we sat in cash while QLD eroded during Friday's session, (and closed down another .4% in after hours trading). driven largely by (surprising) Amazon weakness. What started out looking like a missed opportunity at the open turned out to be a rather precocious forecast by both the VIVEN and PVOL models.
This is both the joy and the misery of being a purely technical trader relying on derivative algorithms to trigger your trading status...vested or cash.  On the one hand it's easy to just go with the signal and believe that past performance will hold up for the near term while on the other hand it easy to fret about the signal reliability when other market metrics and technical indicators are suggesting that the current trade position is wrong. That's one reason we tend to temper the signals with a daily commentary to factor in the potential effect of these outlier dynamics like earnings, the FED, and general price manipulation either intentionally or unintentionally driven by news alerts.
For Monday the models are flat QLD while the Qs are technically oversold.

Thursday, March 15, 2018

QLD Flat for Friday....03.15.18

Both VIXEN TF and PVOL models (as well as the MR..mean regression model) are flat for Friday.
Its all about news, news, news and news...what's fake, what's real?  Pick your poison.
From a tactical viewpoint our long standing recommendation to make closing signal trades in the after hours is working out well today as QLD is up .54% after hours as we close our standing long position from yesterday.

Wednesday, March 14, 2018

QLD Long for Thursday....03.14.18

Pretty much same situation and cautionary comments as yesterday.  Downslope pivot chart is a bit worrisome and there are some clear pockets of weakness although the Qs continue to perform with the best resilience of the index generals.
Note slight upward recovery of the TrendX and Paradigm charts.
Not a time to go large.

Tuesday, March 13, 2018

QLD signals Long for Wednesday but flat override....03.13.18

A positive opening today gradually eroded throughout the day to a negative close.
As a side note: in the current volatile intraday trading environment I always immediately enter a stop at net zero went the market opens in the green. While this sometimes results in a missed opportunity in multiple +.- swing days it does prevent any losses in such volatile days. (this is a conditional order and the limit stop set at the previous close for the position is cancelled when the fixed price stop fires.)
The signals for tomorrow are long but they violate our general of not taking vested positions when the TrendX stop has violated the trend and when the pivot line is downslope.  We may be surprised to the upside tomorrow but I prefer to remain on the safe side and sit in cash for now.
Note that volatility is once ahgain on the rise in the ATR and PCL charts

Monday, March 12, 2018

QLD 50% Long for Tuesday.....03.12.18

A somewhat iffy day today had my finger on the escape button for our long QLD but we ultimately held strong and maintained a green position into the close.
For Tuesday we have a mixed signal from the VIXEN (out) and PVOL (long) so net 50% long.
Later this week we'll look at the correlation of the QLD and the VXN (Nasdaq 100 volatility index).

Sunday, March 11, 2018

QLD Long for Monday....03.11.18.

That was just a great winner on Friday and although the markets are technically overbought both the VIXEN and PVOL are once again in a vested situation.

Thursday, March 8, 2018

QLD Long for Friday....03.08.18

We're eeking out small consistent gains on QLD but the composite signal has given us a nice safety buffer so far.  For Thursday the VIXEN has flashed a Long signal, so now in sync with the PVOL.
Volatility is once again picking up although the QLD ATR and PCL charts remain down slope, which is favorable to risk management on this issue.

Wednesday, March 7, 2018

QLD 50% Long for Thursday....03.07.18

Today's wild ride was not for the timid with the Dow opening down 400+ points, only to stage a gradual day long climb back to end with a modest loss fr the day. For tomorrow the VIXEN and MOZ are flat the QLD while PVOL is long.  PVOL's win/loss ration is better than the VIXEN although both short term and total return are better for the VIXEN.

Tuesday, March 6, 2018

QLD flat for Wednesday....03.06.18

A bumpy day that looked like our signal missed a winner but after hours SPY is down 4.25 and QLD is down 3 % so our flat position was the safe and sane position after all.  Tomorrow should be a time for caution as Cohn resigned this afternoon and the fallout may be larger than initially expected.
The MOZ signal isn't all that attractive but the does provide a measure of confirmation for the VIXEN signal.  MOZ closed an active QLD position at today's close and tht timing looks dead on given after hours selling.

Monday, March 5, 2018

QLD flat for Tuesday....03.05.18

Both the VIXEN and PVOL are flat QLD going into Tuesday's session.  We may have some carry over buying in the early session but the technicals are not supportive at this time.
The VIXEN model (pure volatility metrics) is performing better than the price /volatility hybrid of the present time. Note that PVOL has a better win/loss ratio than the VIXEN.

Thursday, March 1, 2018

VIX signals for Friday....03.01.18

Missed yesterday due to medical issues but today's VIXEN and PVOL signals are flat the VIX.
It's been an ugly 3 days and Friday is a make or break situation.  We did recover from -600 readings in the Dow but we've seen this trap door before.....just before the last plunge so cautious os warranted for any equity longs.
Meanwhile, the PVOL (price pivot with a volatility filter) is performing much better than the VIXEN (price range threshold with a volatility filter) in the current volatility.