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The EbbChart Trading System |
EbbChart Trading System Return:
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EbbChart |
System |
G Fund |
F Fund |
C Fund |
S Fund |
I Fund |
20% Each |
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2011 Totals |
+1.52% |
+1.02% |
+2.31% |
+7.21% |
+8.05% |
+6.64% |
+5.05% |
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Thru |
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L INC |
L 2020 |
L 2030 |
L 2040 |
L 2050 |
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05/06/11 |
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+2.37% |
+4.70% |
+5.53% |
+6.17% |
+4.71% |
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EbbChart Trading System Commentary |
Developed by ebbnflow
Spinchart (horizontal view)
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Day:
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C, S, I Ebbtracker |
Daily Signal* |
TSP System Allocation** |
| Friday, 05/06 |
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= 100% I Fund |
100% I Fund |
| Monday, 05/09 |
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= 100% I Fund |
100% I Fund |
| Tuesday, 05/10 |
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= 100% F Fund |
100% I Fund |
| Wednesday, 05/11 |
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= 100% I Fund |
100% I Fund |
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* These are the old signals used before the TSP transfer
limits were put in place. They are geared toward active
ETF Traders
** For the TSP allocation, I will be using
either the the G or F-funds as a safe haven, and a usually a 50/50 split between the S and the I-funds for buy signals,
but not always. The original
daily signals will still be given for those trading outside of the TSP.
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c = Contrarian signal
3 = pattern 3 (double 3's usually indicates a flip flop coming)
5
= pattern 5 (buy)
7 = pattern 7 (sell)
H = Holiday
TBD = To be determined
u - up | d - down - repeating pattern |
Updated - 05/09/11
For the TSP: Back in equities (I-fund 100%).
For stocks and ETFs: I'll be checking on the ebbchart.
Rumors of Greece leaving the euro zone caused another surge in the dollar. Greece called the rumor "completely untrue" over the weekend. US futures are looking bright and green at the moment. At the same time, the dollar is shedding some of its recent hefty gains. TSP funds rebound (F +0.05%, C +0.39%, S +0.42%, I +0.42%). For the I-fund, Thursday's FV (fair value) buffer of +0.98% was added to Friday's final
MSCI EAFE of +0.02% (a gain of +1.00%). But due to another rise in the dollar and late market movements to the downside, a new FV of -0.58% got tacked on to the I-fund's price. So today, the I-funders will have a buffer of +0.58% at the get-go. Links: Economic Calendar, Asia: Nikkei 225/300), Europe, U.S. Futures, Dollar Index.
Note: The two patterns with the highest 4 yr. win-loss percentages (ebbtally total: Patterns 5 CSI 241/388 62% and 8 CSI 232/394 59%) continue to lead the pack this year. Pattern 5 18/24 75%; Pat. 8 31/42 74%; Pat. 1 21/30 70%; Pat. 7 19/33 58%; Pat. 2 23/41 56%; Pat. 4 14/27 52%; Pat. 3 12/12 50%; Pat. 6 17/39 44%.
Happy Mother's Day to all.
Below is the updated chart for the funds (F-fund/AGG, I-fund/EFA, C-fund/SPY, S-fund/VXF). This chart provides a new perspective on monitoring the trend of the patterns. Last year's results were not compounded (the percentages were just added up), but it will be for this year.
Today (Pattern 2); Tuesday (Pattern 7); Wednesday (Pattern 8); Thursday (Pattern 2); Friday (Pattern 6); Monday (Pattern 8).
The ebbchart has been updated. For tomorrow (Tuesday), we have pattern 7 (C-red, S-green, I-green) on tap. Negative trending. EbbTally 2011: 6/11 with a loss of -1.89% in the S-fund. Good luck all!
Warning: Timing the market with earnings reports is extremely risky. Due to the outcome of these reports, the volatility involved is at its maximum. Remember to pick your battles and trade only on days you're comfortable with.
View the Final April 2011 EbbChart
This is the up-to-date ebbtally total compiled since 2007. Notice how patterns with 2 or more red signals (bearish sentiment) -- 5 (62%), 8 (59%), 3 (53%) and 6 (53%) -- have a higher win-loss percentage than patterns with 2 or more green signals (bullish sentiment) -- 1 (51%), 7 (52%), 4 (53%) and 2 (53%). That's the contrarian trading strategy at work -- markets tend to go up when sentiment is bearish and down when sentiment is bullish. I didn't think the ebbtally total would result in 8 of 8 patterns hitting it right on target because the odds are against it. The chances of that happening are 1 in 256 (0.5 ^ 8), so it all boils down to having the right data collected (by the ebbtracker database) daily. Note: When following the long-term indicators (triple patterns), one should look at triple patterns 5 and 8 for entry and triple patterns 1 and 7 for exit. But when following the short-term indicators (single patterns), only pattern 5 is used for entry and pattern 1 for exit. Triple-pattern signals show up once or twice a year, so two patterns with the highest or lowest win-loss percentage can be used successfully as entry or exit signals. Triple-pattern appearances: bearish pattern 1-1-1 (Apr. 16, 2007); bearish pattern 7-7-7 (Feb. 22, 2008 and Nov. 07, 2008); bullish pattern 5-5-5 (Apr. 20, 2009 and Jun. 29, 2010); bullish pattern 8-8-8 (none so far).
Here is the updated tally for each pattern (1-8) on the ebbchart for May 05, 2011. The ebbchart has two sets of patterns: One set goes to stocks (C/S/I-fund) and the other set goes to safe haven (G). Each cell contains the number of times the pattern was right and it's total gain or loss saved while using the C-fund (1st row), the S-fund (2nd row) or the I-fund (3rd row).
Tuesday's pattern (red-green-green/short):
-- Pattern 7 (6/11or 55%); total loss (-1.89%) in the S-fund. Bearish.
-- Lost iin 5 of its last 10 outings in the S-fund. Negative trend.
Today's pattern (green-green-red/buy):
-- Pattern 2 (7/13 or 54%); total gain (+2.38%) in the I-fund. Bullish.
-- Won iin 7 of its last 10 outings in the I-fund. Positive trend.
Yesterday's pattern (red-green-red/buy)):
-- Pattern 8: I-fund up (+0.42%); S-fund up (+0.42%); C-fund up (+0.39%).
-- (10/13 to 11/14); total gain (+5.04% to +5.48%) in the I-fund. Greece limited gains.
Note: A day with no gain or loss for a fund won't be counted on the ebbtally. Tallies are compounded.
Fixed: The ebbtally fractions will now show how the pattern did, not what I think it's supposed to.
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Now that the new system tracks stocks and funds with the ebbchart patterns daily (using a spreadsheet program), we can see how dynamic the stocks and funds are with the constant change in trends. Some of the stats became obsolete or unnecessary, so I'm doing some cleanup to try and keep this page simple.
-- ebb
Prior EbbCharts:
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About the system's author:::ont>> |
I've worked in the Post Office for many years. I owned a lot of computers way back then (Apple II, C-64, C-128) and wrote lots of personal programs and games for it, so you can say that I'm a bit of a computer geek.
With the TSP account I have accumulated, I decided to create a system that can maximize my returns in the shortest time possible. I wanted a system that can compare past historical patterns with today's market patterns, so I can have short-term entry and exit points. Since I have already amassed tons of the proper data needed for my database (ebbtracker), I began backtesting in late 2005. I had great results from that and started using it in 2006. I've only been tracking the I-fund at this point, but on January 16, 2007, I decided to incorporate the C and S-fund with the I-fund for tracking. Soon after, I released the ebbchart to show how the ebbtracker is tracking the C, S and I-fund. The thing I've noticed about the ebbtracker/ebbchart is the consistency of gains I've been seeing. By using the ebbchart (Jan. 16 thru Jun. 01), I would have been exposed to stocks only 55% of the time. Think about that the next time we're in a bear market!
About the System:
At first, the system started out tracking only the I-fund. The ebbchart came about after incorporating the C and S-fund into the mix. This created 8 possible patterns to track each market day's result. So as not to be confused, please disregard the individual green and red signals of the patterns. These signals are generated by the ebbtracker database. And try to look at any pattern as a whole.
The ebbchart is a contrarian system, although it didn't start out that way. Years of tracking the patterns shows that to be the case. Pattern 5 (red-red-red) has the highest win-loss percentage (82/123 67% in the S-fund since 2007) among the patterns. And it's no coincidence that pattern 1 (green-green-green) holds the lowest win-loss percentage (68/143 48% C-fund). Pattern 5's all-red signal (bearish sentiment) and pattern 1's all green signal (bullish sentiment) are perfect setups for a contrarian strategy. That's because markets tend to go up when sentiment is bearish and down when it's bullish.
The daily ebbchart or spinchart signals are mostly based on the current trend of the patterns (see ebbtally chart). We don't have the luxury of acting on every signal anymore with our 2 IFT limit. But this is where the long-term indicators (triple patterns 1-1-1/exit and 5-5-5/entry) come in. Both patterns were able to "see" the impending bear market crash and subsequent bull market rally. Read more about its appearances in the ebbtally
total chart section. Short-term patterns (single patterns
1/exit and 5/entry) will have to take a backseat to the long-term
indicators this year. It will be followed only for short
periods (a week or less).
- ebbnflow
The preceding information is for educational purposes only and any mention of a stock, ETF or fund, should never be construed as a recommendation to buy or sell. The % allocations are broad based opinions of the EbbChart Trading System and are not specific for any individual. Risk tolerance and time horizon may vary and subscribers should consult their personal advisors to develop a plan, custom tailored for their unique situation. Timing the market with earnings reports is extremely risky. Due to the outcome of these reports, the volatility involved is at its maximum. Investors should always gather further information prior to making any investments.
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