Thread: DreamboatAnnie's Account Talk

Here are some WEEKLY charts..past 2 years, just for perspective.

DWCPF -daily.png

SPX now.png

Trying to figure out whether to move to lilypad. Volatility Index (VIX) is up at 30 from 22 last week. NAAIM dropped from 112 to 83. C and S both appear to have fallen out of their trading channel and were at all time highs. Am I correct that neither is embedded (above 80) Slo Stochastics anymore? All those are signals to get out and wait for indicators to move back into positive areas...

Originally Posted by flalaw97

Trying to figure out whether to move to lilypad. Volatility Index (VIX) is up at 30 from 22 last week. NAAIM dropped from 112 to 83. C and S both appear to have fallen out of their trading channel and were at all time highs. Am I correct that neither is embedded (above 80) Slo Stochastics anymore? All those are signals to get out and wait for indicators to move back into positive areas...

Those all sound like good reasons to justify an exit to the lily pad. I myself made the move to G on Wednesday based on a simple rule I created for myself. That is when the days closing price falls below the 10 SMA (simple moving average) that is my self imposed stop/loss point. No thinking about it, procrastinating or wondering what if, I just do it. Yep, stop/loss works for me.

Originally Posted by ravensfan

Those all sound like good reasons to justify an exit to the lily pad. I myself made the move to G on Wednesday based on a simple rule I created for myself. That is when the days closing price falls below the 10 SMA (simple moving average) that is my self imposed stop/loss point. No thinking about it, procrastinating or wondering what if, I just do it. Yep, stop/loss works for me.

I think we can blame this all on Tom had he not allowed himself to go golfing today things might have been different. You know cats away mice will play thing.

Hi Flalaw97, Was not able to answer your question Friday as I was out of town. So, I am very glad that RF answered your question! Very good response.

You asked if Stochastic is no longer embedded. Embedded is something Ira Epstein refers to in his teaching. He defines it as when both lines of Stochastic (K% and D%) are at or above 80 for 3 days. As soon as one line drops below 80, it is no longer embedded unless it re-embeds within one day/or other chart timeframe. The S and C fund have been embedded for quite some time. Both the S and C fund lost the embedded reading on Wednesday 1/27 by mid-day. See my posts 3301.

Regarding exits, its important to always have an exit plan, whether you’re a swing or longer-term trader. Some believe you should just stay in and ride a market drop down and back up since we are in a “bull” market. I am not of that opinion.

Market can drop 10% and still be considered a “normal” downturn by pros, and overall market’s not considered to enter a Bear market until it drops 20%+. That doesn’t happen in a few days…or at least it hasn’t. With increased rapid transaction trading and more individuals trading, I think that remains to be seen.

My 2021 Strategy is to TRY to make sure I have fully exited when the daily 13 EMA drops below the daily 20 SMA (also shown as Mid-point of Bollinger band=dotted pink line between upper and lower dotted gray bands on my charts). However, if you wait that long, you may LOSE quite a bit IF you did not enter the buy when the 13 EMA crossed above the 20 MA the last time it occurred. So, that is why you will see that I usually start to reduce exposure before that point (to pocket some gains)…plus fear has stopped me from entering when 13 EMA first crosses over 20 SMA. This bearish crossover occurred on Friday for both C and S funds. So, if I had still been in market that would be a firm exit for me under my current strategy.

I start to REDUCE exposure when I see trendline formations that are bearish (e.g. rising bearish wedge that formed over the past week or so), or bearish candlesticks/or formations COUPLED with Stochastic K% line (black) crossing below the 80 line (losing embedded reading), or MACD crossing below its signal line or bearish divergence forming (in price candlesticks in comparison to Stochastics, MACD, RSI or VIX).

The divergences are something I just recently started observing more frequently. On 19th I exited 80% due to RSI dropping below 70 And MACD starting to cross below its signal line.
I exited my remaining 20% on that date. See my post 3300 where I mention the bearish wedge formation and marked the divergence on charts. Notice that the Stochastics were still embedded at that point (see numbers on Stochastics part of the charts...all above 80.) But by post 3301, charts two days later, the Stochastics no longer embedded due to market drop.

Originally Posted by DreamboatAnnie

Regarding exits, its important to always have an exit plan, whether you’re a swing or longer-term trader. Some believe you should just stay in and ride a market drop down and back up since we are in a “bull” market. I am not of that opinion.

The reason I came looking to TSPTalk last year was that I was uncomfortable with the buy and hold approach. It seems like getting out when the big dips happen is something that in the long run will help your botom line. I know that the buy and holders insist that you will miss the upturn and that is what hurts your bottom line. So my approach has been to try to get out when it is headed down, wait to see the numbers start to stabilize or look up and then get in and stay in when it is generally going up. So I missed the best exit when the Stochastics showed the S and C were no longer embedded and most of my January gains were lost. But I am going to sit on the lilypad for a little to see what happens next. I won't sit on the sidelines for too long - I have a few years to weather some downturns and want to be in when, like last year, the market decides to gain more than 30% in a single year.

Thanks for the very detailed explanation. I will continue to try to study these and watch for more signs. Your explanation is very helpful! And thanks to RF for answering up. There were too many factors saying get out to hang around. Best of luck!

Your welcome Flalaw,
I have searched for a strategy that keeps me in market longer, while avoiding buy and hold. For me, the13/20 crossover seems okay, but lose too much on exit so looking for replacement (maybe 17/35 crossover or 5/10). Years ago, I read about a method that has been tested and supposedly best cross over (13/48.5 daily EMA). I have some charts based on this and look at them, for reference at times but do not post them... but you or others might like taking a look for consideration in your own trading strategies or as reference indicators.

This crossover is mentioned in a 2015 Yahoo Finance article.
https://finance.yahoo.com/news/study...195042216.html

Here is link contained in that article to more about The underlying study/findings. Very Interesting!
Golden Cross – Which is the best? – ETF HQ

This would have one in market for very extended periods.

Best wishes to you and everyone*!

I am entering 50%...S fund down 5%. Will buy a little and see....hummmm hope it doesn't bite me.

So this morning I am doing a risky buy in at 50% to S fund. Risky because 13 EMA below 20, but see 20 Stochastic hit below 20 and starting to rise; though MACD not yet gone up. This might be premature buyin. Will see.. Best wishes to you all!

Attachment 48353

Trying to upload again...other one apparently has bad link... chart from earlier today.
DWCPF -daily.jpg

DBA I missed my exit last week so hanging in there and looking like I may be áble to recover by staying in.


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