indicator closed at -0.350962 Not ready to cover yet....waiting for a washout move to -.60382 or lower. Might get it tomorrow with the TXN move post mkt. I`m guessing the washout i`m looking for will bring me to about 126 ish. SPY still short from 129.85 +1.28% on the close Stop @ 131.65 TGt open
interesting journal - i can see the potential for buying/selling oversold/overbought for individual stocks but i am not as convinced about applying this to the s&p - correct me if i am wrong, but from my research, during swing moves there is rotation in leadership/laggardship among the individual / component stocks, and therefore as swing momentum builds and the extreme points are approached, the breadth might start to stall or roll over but the index might still continue with the momentum - in addition, s&p's market cap basis makes it more "concentrated" which presumably will further weaken its correlation with a broader based breadth measure, especially if volatility increases - these are primarily my initial guesses, basically, given that last year marked the lowest volatility in a decade, i am wondering if you have back-/forward tested for more than one year? - all the best.
Being 100% honest with you..I don't know anything about the sector rotations that occur during the swings. I`ve simply found that when most people are doing the wrong things at the same time the SPX is the best expression of those attitudes. Low volty is another concern all together. When it picks back up my calculations will become "wider" and i`ll have bigger stops and hopefully gains. Even if % gains and losses get bigger my $ risk is constant so thats not a big deal as long as it still works. I backtested only a year...and forward testing with money. I had to put all data in excel manually so it got really frustrating. Right now i`m working on another sheet that will take me back to 2000 and when i`m done i`ll use it. But for now since I have a working model I may as well try and make some coin. And anyways, I get bored easy so trading with real $ makes me pay attention to the nuances and action in it. One more thing. It was designed to take signals EOD and take SPY trades post mkt..usually 4:05pm or so while the SPY is still plenty liquid and close to the closing price. But i`m updating data here intraday for my own record keeping and testing. Basically to see of intraday extreme levels match up with EOD...and if I would be outguessing by taking the intraday one.
2nd std dev at -0.71375 on the open and indicator @ -0.739464. Still long from yesterdays stop and reverse...holding long @ 127.84 Stop 126.08 Tgt open My studies have shown me that when it gets to such an extreme level that there will be a few days of slight pain to contend with before the snap occurs. Pain is ok...thats why there are stops. Anything more than a 1.37% move against me and i`m out and waiting for a fresh signal.
move like a jelly fish, rhythm don't mean nothing, go with the flow, you don't stop. Jack Johnson The market ebbs and flows like the tide. My goal is to ride it in and out and to not get beached. Relaxing my body and thinking straight are paramount to survival. When the tide comes in I will swim. When it goes out I will wade. A flurry of action builds to a crescendo of human psychology that can almost be smelled and tasted. My natural inclination towards trading has always been trying to pick turns. When I fight this inclination I lose money. "They" always say "the trend is your friend". What if you have bucked the trends your entire life? All of a sudden you are supposed to become a peg in the gears and integrate seamlessly. Bullshit. I have read that "you must trade your own style to be successful". It only took 5 years to figure out what "they" meant. For me trend following doesn't work. Psychologically that is...and thats all there is... Not that my hit rate is that much better with ego trades. It is just an easier approach for ME.