View RSS Feed

JTH

The trend has changed direction.

Rating: 2 votes, 5.00 average.
Sunday, May 17, 2009

Good morning everyone.

I hope you enjoy my first blog, feel free to chime in. My trading strategy is simple.

1. Know the trend direction. The trend is always right, until proven wrong.
2. Stay humble. It doesn’t matter if you’re wrong, it matters how long you are wrong.
3. To determine trend direction & strength I use Fibonacci levels, Simple Moving averages, On Balance Volume, & Slow Stochastics.

I’m cranking this out early because I’m sleeping at a sleep clinic tonight and may not be back online until Monday mid-morning. Bottom line…Unless you’re shorting this market, there really isn’t much to be optimistic about. Most of the bloggers are in Bear mode and there are very few (if any) bulls to be found.

From 8-15 May’s High & low we’ve dropped 50.43 points in 5 trading days. At that rate we could theoretically be back to 666 by the 1st week of June. I don’t think that’s going to happen, but I am drawing in new trend lines, so I can get a feel for the market’s rate of decent.

863-874 has a lot of support, on the 60 minute chart and it is also a 23.6% Fibonacci level. If we fall through this level, then I’d fully expect us to fall to the 38.2% Fibonacci level of 829-833. Beyond and below that, if we fall through 800, than it’s 768, 721, 666, 596, & 566.

Attachment 11402



As far as moving averages are concerned, we did manage to close above the 20 SMA on the daily charts, but on the 60 minute charts the 20 SMA already crossed under the 50 SMA on 13 May. I also like to follow the number of S&P 500 stocks above their 50, 150, & 200 MAs. If you look at those three histograms, you can see that we’ve had our first significant drop since the March climb.

Explain Please-2-png



For you short-term enthusiast. For price performance (price pays) EFA is in the lead for the month, but AGG is the only one in a current uptrend.

Explain Please-3-png



For this month, I chose to be in the I-Fund because after the 1st week, it was in the lead, and the dollar is getting weaker. While the CNBC talking heads always seem to be saying that inflation is a long way down the road, I happen to think it’s always one news headline from being at our front door.

Explain Please-4-png



This weeks IFT winner is Coolhand. Although he saw the writing on the wall, he took some risk by exiting the Seven Sentinels System 1 day before it gave its official sell signal. It turned out to be the right decision and he managed to make an exit on a relatively flat day (-0.10%) Where in contrast, the following day was down (-2.69%) When you consider how difficult it is to deal with end of day closes, it just doesn’t get any better than that.

Submit "The trend has changed direction." to Digg Submit "The trend has changed direction." to del.icio.us Submit "The trend has changed direction." to StumbleUpon Submit "The trend has changed direction." to Google

Categories
Uncategorized

Comments

  1. tsptalk's Avatar
    Nice job JTH!

S&P500 (C Fund) (delayed)

(Stockcharts.com Real-time)
DWCPF (S Fund) (delayed)

(Stockcharts.com Real-time)
EFA (I Fund) (delayed)

(Stockcharts.com Real-time)
BND (F Fund) (delayed)

(Stockcharts.com Real-time)

Yahoo Finance Realtime TSP Fund Tracking Index Quotes