29 Feb 2008 0704 CST Today marks the beginning of a new format for my journal. Per my 2007 journal, I stated that I was considering a change in format from my rapid fire, real-time posting of trades to a more laid back approach. If you recall, we had some memorable seconds before and after major 0730 CST report trades. I get a rush just thinking about it now, and therein lies the problem. My new format will probably be no more than daily posts on where I see a small handful of issues trading. I'll be looking primarily at the following: 30 year CBOT interest rate ZB (CBOT 30 year T Bond futures) DIA EWZ RIO DRYS GLD I'm open to looking at additional items. Note that unless I say otherwise, a sell in a stock for me is simply a warning from my system to tighten stops, or exit with profit. I won't short stocks in this journal. I'll play the short ETF's for that. The technique I've perfected for this longer term (minimum of 1 day hold but more than likely several days to several weeks), is to look at the following: 1) Recent turning points in the chart. Where is the peak and valley at various time frames: Yearly, Quarterly, Monthly, Weekly. Similar to pivots but based on my own neural network calculations. 2) A 50% median line of the above. I found this as a tip from a trading author who uses a pivot point method of trading. 3) Ehler's cycle research. Where are we in the cycle? 4) WGSR - My tongue-in-cheek acronym which stands for "Working Group Support/Resistance". This is a discovery I made last year that a certain amount of "work" is performed at certain levels. These levels represent lines in the sand that if crossed indicate a change in trend. There is a lot more to this, and I hesitate to share much as I can honestly say that this whole course of study has given me a definite edge. The greatest benefit to this is intraday. I use the 1 hour chart to find these levels. There are probably some items I'm leaving out but we can include those if and when they come up. I continue my neural network and data mining research, and I've made some interesting findings (see items 1 - 4), but unfortunately my number one finding is that some discretion is required. The holy grail for me is automated trading with no human intervention. I suspect that this will be a long ways off. 30 year yield We were above my weekly dynamic peak / valley channel. The long signal came on 29 Jan 2008. We just received a sell signal yesterday, 28 Feb 2008. Note that a sell signal in the 30 year yield is in fact a buy signal for the ZB futures contract. ZB The hourly ZB has a very important WGSR at 116 02. Two other numbers of interest, but not WGSR numbers are 118 08 and 117 24. On the 0730 hourly bar, ZB showed its stuff. The ZB shot through my upper dynamic channel and hasn't looked back since. You had another chance to buy at 1330 hrs. Now I would be cautiously long, looking to buy dips. Remember we've moved over 3 points from a recent low, and on an intraday basis the ZB could come back for a breather. Long term, I think the ZB will head higher. GLD Gold gave a buy signal on 21 Dec 20007, and didn't trigger a sell signal until 05 Feb 2008. Unfortunately there was a bit of chop until 15 Feb 2008 where we received a definite buy signal. Another interesting note is that GLD just broke through my upper level cycle high resistance line and this is almost always a signal for a major up move. The chart is phenomenally bullish. My best guess would be that we will hit 100 USD on the GLD ETF with no problem. DRYS Dryships gave a buy signal on 24 Jan 2008 and a confirmation buy signal on 28 January 2008. DRYS stalled on 15 Feb 2008, but continued above my dynamic peak/valley channel and signaled an add on buy on 20 Feb 2007. Unfortunately, price action on 26-28 Feb 2008 is negative, and a sell signal was generated on 28 Feb 2008. Originally on 28 Jan 2008, my thoughts were that DRYS had entered a new phase and that we would continue higher. By that I meant, certainly above 90 a share. This didn't happen. After reading this article on Forbes, http://www.forbes.com/global/2008/0310/032.html , I think I will stand aside for now and simply trade the cycles on DRYS rather than accumulating it for a long term (years) hold. RIO RIO gave a buy signal on 29 Jan 2008, and hasn't looked back since. This has been my best and most stress free performer this year. On a very interesting note, all of Brazil appears to be doing very well. Take a look at EWZ. EWZ EWZ (the Brazil ETF) gave a buy on 29 Jan 2008, a sell on 05 Feb 2008, followed by a buy on 07 Feb 2008 and hasn't looked back since.