etfmsolutions: The M3 View and Jim Altucher's Advice....7.5.2014

Saturday, July 5, 2014

The M3 View and Jim Altucher's Advice....7.5.2014

The DIA finally got to 170 as XIV hit another new high and, although the markets are technically overbought, the TrendX sidebar indicators for both SPY and XIV still show good upside potential on the daily bars. The markets keep discounting any bad news ( Ukraine, Iraq, Syria, etc) and the rosy employment numbers provided some juice for Thursday's continued rally mode.
With DOW now at 17K it is technically ahead of SPY in momentum so if SPY can maintain traction to catch up vis-a-vis relative strength then the much anticipated SPY 200 is decidedly in the cards.

Short term (1-3 days) M3 's ALERT has crossed to STOPPED status while the rankings remain aligned in optimum relations...XIV,SSO,SPY. I've talked about this before and its really a matter of risk tolerance whether to follow the ALERTS graphics or the AUTOSTOP rankings (or your gut, or something else).
Note also the position of the Pair A chart (SPY vs. XIV). The divergence between SPY and XIV is approaching exhaustion levels and on each occasion that has happened (on the 30 day charts) the equity curve has suffered...going either flat or negative. Its now coming up fast so I'm looking to the cautious side.

Speaking of making trading decisions, here's an excellent piece by Jim Altucher, arguably one of the greatest no BS, walk the talk traders that every lived. I've read several of his books and each one has provided numerous nuggets of trading wisdom that I have incorporated into my trading mindset....with no regrets.

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