Up trend or dead cat?
Moderator: Aitrus
- jlozano042
- Posts: 836
- Joined: Tue Apr 04, 2017 12:37 pm
Re: Up trend or dead cat?
I feel your anguish Jamters .... the only thing that is soothing my mind and thoughts is that in some universe .. somewhere out there; there are cats that bounce and never come back down - they just go straight up into space.
Re: Up trend or dead cat?
ronh227 wrote:The seasonal strategy does make some sense to me but not sure it's working in this volatile climate. Everything appears reactionary. Trump makes a tweet or Jerome Powell opens his mouth and the markets either dive or climb based on whether or not the tweet/statement is negative or positive.
What I've been doing lately is just following the market news as closely as I can to see which way the wind is blowing. After Trump tweeted about China tariffs in early May the market took a dive I moved to G, stayed there as the news got worse about Mexico tariffs (now the news is coming out that the Mexico tariff was settled weeks ago). Then early this month a reversal on the rhetoric about Mexico (and now maybe even China) and got out of G.
With our limited monthly IFT moves, as someone earlier stated, it's like Russian Roulette. Thankfully we have the ability to move to safety (G) at any time after our 2 IFT moves in the same month. But it's scary.
Exactly. Market volatility is always reactionary to rumors/promises (likely empty), which often triggers very short term swings that only last a few days or weeks before reverting to the mean. Over the next few months through the end of the year, the total market sentiment is lower (highs) and deeper lows.
However, I am taking advantage of the very short term spike by rotation back to equities (C & I, S is already overbought)--but very much ready to shift to G and F on a day's notice.
Anger and intolerance are the enemies of correct understanding.
― Mahatma Gandhi
If it's a choice between a difficult truth and a simple lie, people will take the lie every time. Even if it kills them.
― Paul Murray
― Mahatma Gandhi
If it's a choice between a difficult truth and a simple lie, people will take the lie every time. Even if it kills them.
― Paul Murray
- Tomanyiron
- Posts: 4973
- Joined: Mon Apr 26, 2010 6:39 am
Re: Up trend or dead cat?
Something I read recently.
Perfection Does Not Exist
"Uncertainty is a powerful emotion that can weaken the resolve of even the best of market timers. Some things you need to remember are:
1. At no point in time will all indicators be in agreement. That's just the nature of technical analysis. You are following a timing strategy that makes money over time. It is not always right, but it is profitable and it outperforms the market. That is what you need to focus on. Perfection does not exist in market timing or trading.
2. The obvious or logical buy or sell signal is not always the profitable trade. Sometimes the market is easy to read, such as during a long trending bull market, but sometimes its true nature is completely hidden.
3. All actions in the market happen for a reason. We may not always understand the cause, but we really do not need to! All we need to do is execute the trades and the profits will follow.
4. There is NO tested and proven timing system that is perfectly accurate. As for the consequences of being wrong, that's why you are using the strategy in the first place. Use a timing strategy designed to NEVER allow losses to accumulate.
Then Again, What If The Signal Is Right?
The next time you feel uncertainty sapping at your will power, read the below sentences. Print them out and tape them to your computer monitor if it will help....
1. The timing signal says one thing, but this other indicator I have says another... However, the market timing strategy has a proven success rate over time, and not all indicators will be accurate at all times. So, I will execute this buy or sell signal based on the historical success rate of the timing strategy.
2. There is absolutely no reason the market should move in that direction. I have to trade what the market is doing rather than what I think it should be doing, even if the reason is not clear.
3. What if the signal is wrong? What are the consequences? Then again, what if the signal is right? What are the results if this trade is successful. Remember that no one knows ahead of time when the next trend will begin. If they did, the trend would already have started.
Pulling the trigger may be the toughest thing to do, but it's also crucial to successful market timing. It's better to take action, than it is to sit back and let the market pass you by. The trade you do not take, will likely be the trade that makes most of the profits for the entire year."
Perfection Does Not Exist
"Uncertainty is a powerful emotion that can weaken the resolve of even the best of market timers. Some things you need to remember are:
1. At no point in time will all indicators be in agreement. That's just the nature of technical analysis. You are following a timing strategy that makes money over time. It is not always right, but it is profitable and it outperforms the market. That is what you need to focus on. Perfection does not exist in market timing or trading.
2. The obvious or logical buy or sell signal is not always the profitable trade. Sometimes the market is easy to read, such as during a long trending bull market, but sometimes its true nature is completely hidden.
3. All actions in the market happen for a reason. We may not always understand the cause, but we really do not need to! All we need to do is execute the trades and the profits will follow.
4. There is NO tested and proven timing system that is perfectly accurate. As for the consequences of being wrong, that's why you are using the strategy in the first place. Use a timing strategy designed to NEVER allow losses to accumulate.
Then Again, What If The Signal Is Right?
The next time you feel uncertainty sapping at your will power, read the below sentences. Print them out and tape them to your computer monitor if it will help....
1. The timing signal says one thing, but this other indicator I have says another... However, the market timing strategy has a proven success rate over time, and not all indicators will be accurate at all times. So, I will execute this buy or sell signal based on the historical success rate of the timing strategy.
2. There is absolutely no reason the market should move in that direction. I have to trade what the market is doing rather than what I think it should be doing, even if the reason is not clear.
3. What if the signal is wrong? What are the consequences? Then again, what if the signal is right? What are the results if this trade is successful. Remember that no one knows ahead of time when the next trend will begin. If they did, the trend would already have started.
Pulling the trigger may be the toughest thing to do, but it's also crucial to successful market timing. It's better to take action, than it is to sit back and let the market pass you by. The trade you do not take, will likely be the trade that makes most of the profits for the entire year."
Last edited by Tomanyiron on Fri Jun 14, 2019 5:34 am, edited 1 time in total.
"A good decision is based on knowledge and not on numbers." Plato
"Perfect numbers like perfect men are very rare." Rene Descartes
"Perfect numbers like perfect men are very rare." Rene Descartes
Re: Up trend or dead cat?
New strategy. Get my 1.5, 2% gain for the month and run back to G. Like an investment assassin!
Re: Up trend or dead cat?
PhilJohn wrote:New strategy. Get my 1.5, 2% gain for the month and run back to G. Like an investment assassin!
Good safe bet if you're a couple years to retirement, or already there.
But if you're younger, why not take advantage of the WELL-KNOWN COLLECTIVE IRRATIONALITY of greedy and/or misinformed investors and traders? As irrational as they behave they exhibit some patterns that can are somewhat predictable
Anger and intolerance are the enemies of correct understanding.
― Mahatma Gandhi
If it's a choice between a difficult truth and a simple lie, people will take the lie every time. Even if it kills them.
― Paul Murray
― Mahatma Gandhi
If it's a choice between a difficult truth and a simple lie, people will take the lie every time. Even if it kills them.
― Paul Murray
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- Posts: 259
- Joined: Tue Jun 19, 2012 2:14 pm
Re: Up trend or dead cat?
Nice graphic jlozano042!jlozano042 wrote:
I'm thinking more "Witches Hat" than "dead cat"...
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- Posts: 17
- Joined: Sat Sep 17, 2016 6:03 pm
Re: Up trend or dead cat?
Tomanyiron, Thank you for the post.
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- Posts: 259
- Joined: Tue Jun 19, 2012 2:14 pm
Re: Up trend or dead cat?
As much as I like greed, I have to side with getting one and a half to 2% per month and running for the G. Anytime you can solidify at 18 to 24% a year, that is a pattern to go with.bloobs wrote:PhilJohn wrote:New strategy. Get my 1.5, 2% gain for the month and run back to G. Like an investment assassin!
Good safe bet if you're a couple years to retirement, or already there.
But if you're younger, why not take advantage of the WELL-KNOWN COLLECTIVE IRRATIONALITY of greedy and/or misinformed investors and traders? As irrational as they behave they exhibit some patterns that can are somewhat predictable
- jlozano042
- Posts: 836
- Joined: Tue Apr 04, 2017 12:37 pm
Re: Up trend or dead cat?
I'm with you TSPBuilder ... I did try this strategy for a bit but found some issues, more because I wasn't very disciplined I think. Some months I lost more than 2% or maybe a little less ... so I tried to catch up the month after. Sometimes I got my 2% and then went to G, but the month went higher .. so I could have acquired more. Sometimes I felt like I was all over the place .... just needed to be more disciplined. Maybe I should have looked at it just within a month and not a year-outlook. Meaning whatever happened in a month should not have dictated what my next month should be.TSPBuilder wrote: As much as I like greed, I have to side with getting one and a half to 2% per month and running for the G. Anytime you can solidify at 18 to 24% a year, that is a pattern to go with.
Anyways ... I couldn't find a really good Witch's Hat gif for you bud. but did find this one!
Re: Up trend or dead cat?
And wouldn’t you know. The day I buy in and the markets are negative. Not the start I was hoping for!
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- Posts: 259
- Joined: Tue Jun 19, 2012 2:14 pm
Re: Up trend or dead cat?
Many thanks, jlozano042! Your efforts brought a smile to my face. Take an extra percent off the market tomorrow and spend it any way you want, with my complimentsjlozano042 wrote:I'm with you TSPBuilder ... I did try this strategy for a bit but found some issues, more because I wasn't very disciplined I think. Some months I lost more than 2% or maybe a little less ... so I tried to catch up the month after. Sometimes I got my 2% and then went to G, but the month went higher .. so I could have acquired more. Sometimes I felt like I was all over the place .... just needed to be more disciplined. Maybe I should have looked at it just within a month and not a year-outlook. Meaning whatever happened in a month should not have dictated what my next month should be.TSPBuilder wrote: As much as I like greed, I have to side with getting one and a half to 2% per month and running for the G. Anytime you can solidify at 18 to 24% a year, that is a pattern to go with.
Anyways ... I couldn't find a really good Witch's Hat gif for you bud. but did find this one!
- Tomanyiron
- Posts: 4973
- Joined: Mon Apr 26, 2010 6:39 am
Re: Up trend or dead cat?
Seems like a lot pessimism going on around here, but: "When the S&P 500 crosses over its 50-day moving average, stocks almost always keep moving higher. That has happened 10 times since 2009."
https://www.cnbc.com/2019/06/11/since-2 ... -next.html
https://www.cnbc.com/2019/06/11/since-2 ... -next.html
"A good decision is based on knowledge and not on numbers." Plato
"Perfect numbers like perfect men are very rare." Rene Descartes
"Perfect numbers like perfect men are very rare." Rene Descartes
Re: Up trend or dead cat?
The volatility is so high, I think a lot of us are wary of normal indicators. That paired with the trade wars and tariffs (threatened or implemented), massive flooding in the Midwest that is preventing planting and is going to slam agricultural commodities, and fears that the market only bounced on rumors of a Fed rate cut (which would be bad for the market in the long run) are keeping us all on edge.Tomanyiron wrote:Seems like a lot pessimism going on around here, but: "When the S&P 500 crosses over its 50-day moving average, stocks almost always keep moving higher. That has happened 10 times since 2009."
https://www.cnbc.com/2019/06/11/since-2 ... -next.html
I personally was hoping it was going to go a little higher before I jumped back into the safety of G/F but today is not boosting my hopes. My biggest fear is that there is hope priced in to the market that China will make moves towards a trade deal at the G20 in Japan at the end of the month, and if it doesn't (and we don't get a rate cut), we'll get a huge drop. If we get a rate cut instead, I think we'll get a big bounce, but the market will not be based on anything but a sugar high.
NorthmanTrader has been pretty pessimistic, but it's sounding a lot like realistic to me: https://northmantrader.com/2019/06/13/curious-charts/
I'm just debating whether I stay in for the ill-advised rate cut, or get out in anticipation of a bigger drop. Watch my profile because I'm guaranteed to pick the wrong one.
Re: Up trend or dead cat?
IWM and Transports are below all the moving averages and they are leading indicators. Markets should have more downside to come!
Fund Prices2024-03-27
Fund | Price | Day | YTD |
G | $18.14 | 0.01% | 1.00% |
F | $19.09 | 0.26% | -0.68% |
C | $82.11 | 0.87% | 10.42% |
S | $82.19 | 1.48% | 6.61% |
I | $42.68 | 0.56% | 6.21% |
L2065 | $16.38 | 0.84% | 8.36% |
L2060 | $16.38 | 0.84% | 8.36% |
L2055 | $16.39 | 0.84% | 8.36% |
L2050 | $32.73 | 0.71% | 6.94% |
L2045 | $14.91 | 0.67% | 6.56% |
L2040 | $54.37 | 0.63% | 6.20% |
L2035 | $14.34 | 0.58% | 5.77% |
L2030 | $47.66 | 0.53% | 5.35% |
L2025 | $13.14 | 0.31% | 3.40% |
Linc | $25.60 | 0.24% | 2.79% |