Mav is it just me or is Gold acting like a risk instrument lately? I.e rallying the same time as the S&P etc, or is this how Gold normally acts?
Gold goes though a lot of changes so it's hard to peg down exactly what is going on outside the number lines.
Do you find that Copper holds better reliability for "risk on" environments? The only reason why I am asking is that I don´t have enough data to verify this. Do you think the reason why instruments such as Copper can lead rallies is due in part to lower levels of liquidity? Obviously it takes Copper less order flow to rally in comparison to the SPY or Dow etc .
China ruined the fun for everybody. Copper use to be very reliable. Now China is a market maker in the product. LOL.
I bet you could make a good case for using WFM as a risk stock. One of the first things people stop doing when they get worried about the economy is stop buying homegrown completely purified organic milk from the mountains of New Zealand for $14 a gallon. But I'll be damned if they don't run back there and load up again the second we catch a bid in the market. LOL.
I understand your thinking but the data does not agree, at least not currently - unless its lagging the market which in that case makes it a good buy right now.
Understood, so on that premise we it would be best to focus on what institutions would start buying when they are optimistic on the market. I am yet to test this but I want to start weeding out those stocks as you describe below, with the idea of using them for "tells". So if the indexes are flat yet my basket of hot stocks starts rallying it could be used as an early indication for an oncoming rally.
The best indication I have found is still the number lines. I posted on this very thread the second I felt the change. It was a number per se like a confirmation but rather a change in pattern, it really stuck out to me. I started seeing really weak number lines firm quickly. These are the best tells because the charts were not showing anything. I have yet in the last 20 years to ever find something with as much "forward" predicting power as the number lines and that is why they continue to be the basis of everything I do.
Thanks Mav, that really makes a whole lot of sense. I also believe thats why its important not to set a fixed limit of 2 +9 days for a confirmation. On a deeply red number line it can take a long time to get that confirmation and by the time you do confirm the meat of the move is over. Pretty certain MF mentioned that when he sees a number line firming quickly its worth paying attention to.