END OF DAY SUMMARY The amazing "BALL"nails another with the Dow up over 105 pts at the high. Dow closes +67
Tues. 9/26 1:25pm Dow+49 A very casual Rennick strolls in with todays local newspaper folded under arm. Wearing his blue swimming boxers, sandals, hawaiian shirt and a pork pie hat he gives the wife a wink and approaches that mighty "Crystal Ball". He takes a quick look, then another and walks to podium. Now at the mic, heeeeerrrrreeees Rennick!!! "If you keep that up I'm going to find a new announcer"... "umm ok sorry guys I had a little housekeeping to take care of, The mystical Orb remains NEUTRAL calling for FLAT Market action this afternoon. Expect the Averages to roughly maintain current levels. This would be a good day to turn off the computers and enjoy the rest of the day doing something else." With that the Amazing One exits the room stopping off in the kitchen on the way to the deck. There Mrs.Rennick hands him an incredible frozen Don Julio Margarita, and yes it does have one of those paper umbrellas hanging out. Rennick out
I just discovered and read through this interesting journal today, and I simply had to determine the profitability of Rennick's ball calls. Since I only have access to 20-day long intraday charts, the stats I compiled are only for the predictions made from August29th to Sept 26, regarding a total of 20 afternoon calls. Although the inital afternoon forecasts are said to occur at about 1:05 pm, the time I was concerned with, was the moment William's post appeared on ET(as everyone knows each post has a time-stamp included with each post)--between 1:20 and 2:00pm.-- In otherwords, I've ignored the outcome of any trades based on primary source timed-trading and instead focused on the outcome of real time trades made shortly after Mr. Rennick's calls appeared to the ET public. FLAT: 6 of the 20 DOW calls made were for afternoon flatness: -with all six flat calls, the DOW stayed within a range of 40pts from the approximate moment of the posting. -with five out of the six calls, the DOW closed at less then 25 pts away from the approx. moment of the main posting. -However, for futures traders and others who don't view a 40 point DOW move to be considered "flatness": 3 of the 6 times the market did afterwards, in fact, move pretty damn close to 40 points in one direction or the other. Regardless, the 'flat" calls emanating from the crystal ball are not intended to make money, but rather I guess to save one money. DIRECTIONAL CALLS: --in those 20 trading days, 14 calls were made for willing DOW traders to either go "long" or "short." If your investments followed and were made shortly after the postings appeared on ET, you would have closed out 8 winning trades, and 6 losing trades (57% winning trades). -- one of the losing trades failure, was afterwards atributed to an "event": "the 2 pm release of the Fed's Beige Book." Overall you would have made money, the rest of the statistics will show how many DOW points you would have accumulated and lost over the 20 trading days, also the average winning trades should have made more points then you should have lost on the average losing ones. HERE's a look at approximately how many points you would have lost and gained, depending on your exit strategy: LOSING TRADES: --- if you exited ALL directional trades at the *end of day*, you would have lost approximately a combined total of 130 DOW points from all the 6 losing trades (with a 21.6 average points lost per losing trade). BUT You would have also had deeper unrealized losses before reaching the EOD, due to some late 10 to 30 point reversals. --- if you exited all losing trades at a 22 point STOP-OUT drawdown below entry level, ELSE: exiting EOD when STOP not triggered, you would have lost about a total of 122 points from all the 6 losing trades. ---if you exited all losing trades at a 30 point drawdown below entry level, ELSE: exiting EOD when STOP not triggered, you would have lost about 140 points from the 6 losing trades. ---if you exited all losing trades at a 40 point drawdown below entry level, ELSE: exiting EOD when STOP not triggered, you would have lost about 140 points from the 6 losing trades. WINNING TRADES: --- if you exited ALL directional trades at the *end of day*, the 8 winning trades would have made you about a combined total of 220 DOW points (with 27.5 average points gained per winning trade) --- if you exited all winning trades when the DOW gained 50 points in desired/profit-making direction, ELSE: exiting EOD whenever 50 point profit increase is NOT reached, you would have gained about a total of 230 points from the combined 8 winning trades. --- if you exited all trades when the DOW gained 40 points in desired/profit-making direction, ELSE: exiting EOD whenever 40 point profit increase is NOT reached, you would have gained about a total of 220 points from the combined 8 winning trades. --- if you exited all trades when the DOW gained 30 points in desired/profit-making direction, ELSE: exiting EOD whenever 30 point profit increase is NOT reached, you would have gained about a total of 160 points from the combined 8 winning trades. --- if you exited all trades when the DOW gained 20 points in desired/profit-making direction, ELSE: exiting EOD whenever 30 point profit increase is NOT reached, you would have gained about a total of 154 points from the combined 8 winning trades. Hope this analysis helps anyone who is contemplating investing in the predictions provided from a seemingly successful crystal ball utilizing prognosticator. I imagine some people will interpret the statistics here as inefficient evidence of any profitable edge (57% winning rate, not improved enough from a 50/50 chance bet? OR thought the after-call win:loss ratio would have came out significantly better based on what I read? Being misled?). While some others will see success in the calls (more wins then losses! bet prompt 1:05 market forecasts produce even far more impresive stats! Can't a winning strategy have more lossing trades then gainers and still be profitable? the winning trades noteworthingly produce bigger profit-points in your pocket then the losing trades suck out !) --------- P.S: Here are the dates of the successful directional calls, failed directional calls, and flat calls --- (A = August, S = September) (8 profit making calls): A29, s7, s8, s12, s15, s18, s21, s25 (6 unprofitable calls) : s1, s5, s6, s11, s14, s19 (6 calls for market flatness) : A30, A31, s13, s20, s22, s26
Don't lose hope, your simple test demonstrated eight methods that don't work. Keep searching for the answer to the right question and you'll figure out how to get results. What am I seeing? Are they any recurring patterns? How can I use this to make money? Are there any other indicators I can use in combination with "the ball" to make money? It can be used to make money, keep searching.... "Long live the Ball! Long live Rennick!" P.S. 85% + win rates are attainable.
Dear HGTRADER, First off I'd like to say thanks for your analysis of the "Balls" calls. I truely found it most interesting. Your conclusions though don't jibe with reality. I guess just like everything else in life it's all how you spin it. The main reason I think you conclusion of 57% accuracy is way off base is that you are making assumptions of profitability by looking at the chart. Profitabilty is based on many things, most importantly on a traders skill. There are many of those Bullseye calls which may not be profitable, but it doesn't mean the "Ball" didn't nail the call. The "Ball" has proven here on ET in front of 1000's in real time that it can nail the direction with a high degree of accuracy. However the magnitude of a trend, which largely determines profitabilty of a trend is almost impossible to predict. That's why my trading style is to go for a base hit, and never a homer. And that's the main reason your conclusion doesnt hold water. It is a rare day that I don't get my base hit when the "Ball" gives a directional call. If the "Ball" scores a rare miss my money management plan stops me out with a minimal loss. A factor that you could not calculate is that the "Ball" has a 9:40 am morning call which often confirms the afternoon call and has you already into a trade from a better entry point. However, those calls can't be factored in here since they arent being posted here. Another problem is that judging accuracy of the calls is very subjective and relative. Today for instance, the "Ball" called for FLAT this afternoon,. Well that would definately seem like it should have been STRONG. Thats true maybe if you trade the dow futures, however a qqq trader, or russell trader would have made zilch making a directional trade this afternoon. So for me the FLAT call was spot on. That's the reason you really can't make profitability assumptions. One thing I try to do is be very transparant with the calls, and post a chart at the end of the day so anyone can see how the call went. To argue profitability by looking at a yahoo chart makes less sense than pro ball players argueing balls and strikes with the ump, which is why they don't allow it.The ultimate measure is how a traders numbers look, and I know mine are way above what your 57% profitability assumption would produce. It's my contention that even if some traders could read tomorrows financial page today, that they would still lose their ass. Unfortunately we don't have 'Back to the Future" time travel yet, until then I'll keep using that damned Amazing Crystal Ball. A now tired Rennick out ps. BTW, of the 20 calls you reviewed in my opinion only 3 were misses, and 2 of those were negatively influenced by "breaking news". Also you threw out the FLAT calls, which should be included. So by my count the "Balls" record for the 20 days you reviewed should be 16-4, vs. your tally of 8-6-6. But really all those calls don't matter, it's only the next call that counts.
That analysis is misleading. I, too, am a subscriber to the ball, have been for many months now. I don't use it to actually make trading decisions, just as a decision support tool. And as a sort of general guide, I think it's great. There are 2 important factors your analysis fails to mention - 1) no "ball" can predict the impact of news on the markets if/when the news is a *SURPRISE* (an unnanounced or unscheduled news event) or when the news/report is significantly different than expectations. I have personally witnessed this in action, and yes, when those events happen you can throw the ball out the proverbial window. I guarantee you that a good number of the calls you named "misses" were due to just that. 2) The calls are not intended to just be used to blindly enter a position when issued. There is a strategy that is recommended, and from my own personal observations, following the suggested entering methods would produce remarkable results. Like I said, I don't use the "ball" to actually enter trades, but from experience I can tell you that your analysis really misses the mark by a country mile. I would doubt you could find very many unhappy "ball" users that utilize it in the proper context... Rennick, thanks for a great journal - keep up the good work! W