49 replies to this topic

[spielchekr]

I'm glad that over these past several months, Don has persistently pointed out the significance of the 13 month period. I admittedly didn't assign much significance to it until I recently began exploring it more thoroughly. And I can now see the validity of it.

Here's another chart. It compares the acceleration and deceleration between two 13-month moving averages: exponential and "par-trend". The par-trend ma is a proprietary, equal-weighted ma of a certain derivative I compile. It moves and turns faster and deeper than the exponential ma for the same time frame. The polarity comparison between the two ma's is ignored; one can be positive-sloped while the other is still negative-sloped. This removes polarity-bias lag time as the ema always completes its roll after the par-trend ma. What's relevant is the ROC comparison between the two at any polarity. That ROC threshold is then shown as a simple binary ("buy/sell") indicator, for which I've shaded the par-trend deceleration periods.

I plugged in the month-end price for July that would flip the accel/decel indicator positive, and was suprised to discover that it is exactly at the 13-month ema flatline/crossover point... 986.5. This would be a line in the sand for this indicator, and perhaps the 13-month period in general. I think that while it's testworthy and attainable, it's not exceedable under current conditions as Don states. FWIW.

[TMN]

what will they do next?

buy everything on the cheap in a declining mkt?

[skott]

this thread makes me feel like a

[Cirrus]

I keep trying to find a way to explain the concept that bull markets come off of a base- a period of preperation to sustain higher prices.

Sound reasoning.
And man has never jumped off the ground and not immediately come back down.
That's why many doubted the Wright brothers.
However, inject unusual energy and physics, and pigs can fly.
Tornadoes, explosions, jet engines do it to objects all the time.

My question is, and I don't think anyone knows the answer, what effect will the government intervention have on a scale never seen before?
None of the charts above have input this energy's effect, have they?
And it is all being operated by unknown forces, as billions are handed out in secret to unknown parties.

We might as well throw away our historic charts and go short term at best.
And besides, isn't that the purpose of stops anyway?
We may be right long term but go broke short term.

This is not a "normal" bear market. Pigs do fly.
imho


PS: I am expecting some seasonal weakness beginning here.
Even flying pigs need to occasionally roll in the mud to stay cool.

LOL Roger...similar thing happenned with the F-4. Put enought thrust on just about any airframe and off it goes. IYB and the sentinnels have been money through the years here. The one thing I perceive (and the perception could be wrong) is that IYB seems to have a bias for the first time that I've noticed since I have been on the board (since very early 2000s).

I agree with IYB that some sort of base for a bull move is an odds on bet. However, it doesn't have to be that way and these are unusual times. The decline was way out of statistical norms and gov't actions/Fed actions/liquidity are too. The macro environment warrants out of the box thinking more than ever. The NDX is in a bull market according to IYBs own 50pema rule with a positive NH/NL divergence recently. There are a few other indexes that are reasonably close.

What I'm trying to say is we're in no man's land here. The investment trend is still down IMO but on the verge of flipping up while the trading trend is up (was on the verge of flipping down) but the recent move last week (July OPEX so caution warranted) solidified the trading trend for the bulls. It's very difficult to fight off bias because recency of experience (past dozen years) and the news environment says "get short here" but the trading trend is still up with some areas in the market in bull mode by most measures.

Tricky market indeed....

[da_cheif]

this thread makes me feel like a

the platform created by the double bottoms of 2002 2009 is the launching pad for the epicenter of primary wave 3 up carrying to well above 20000 on the dow much sooner than most realize.......the dow divisor is a double edged sword.....the divisor is now the afterburner for whats coming......

[Cirrus]

I'm glad that over these past several months, Don has persistently pointed out the significance of the 13 month period. I admittedly didn't assign much significance to it until I recently began exploring it more thoroughly. And I can now see the validity of it.

Here's another chart. It compares the acceleration and deceleration between two 13-month moving averages: exponential and "par-trend". The par-trend ma is a proprietary, equal-weighted ma of a certain derivative I compile. It moves and turns faster and deeper than the exponential ma for the same time frame. The polarity comparison between the two ma's is ignored; one can be positive-sloped while the other is still negative-sloped. This removes polarity-bias lag time as the ema always completes its roll after the par-trend ma. What's relevant is the ROC comparison between the two at any polarity. That ROC threshold is then shown as a simple binary ("buy/sell") indicator, for which I've shaded the par-trend deceleration periods.

I plugged in the month-end price for July that would flip the accel/decel indicator positive, and was suprised to discover that it is exactly at the 13-month ema flatline/crossover point... 986.5. This would be a line in the sand for this indicator, and perhaps the 13-month period in general. I think that while it's testworthy and attainable, it's not exceedable under current conditions as Don states. FWIW.

Great post...interesting. I see TA stuff on here that's well above anything I've ever concocted. I've really simplified my tool set the past couple of years and sticking just to the basics and KISS. My little bean head can handle much....


For me it's kinda been like Luke Skywalker and the Death Star! Use the basic skills effectively and push the complicated stuff aside and stay nimble.

"Use the force, Luke"......'and stops'

Edited by Cirrus, 19 July 2009 - 01:55 PM.

[IYB]

Great post...interesting. I see TA stuff on here that's well above anything I've ever concocted. I've really simplified my tool set the past couple of years and sticking just to the basics and KISS. My little bean head can handle much....


For me it's kinda been like Luke Skywalker and the Death Star! Use the basic skills effectively and push the complicated stuff aside and stay nimble.

"Use the force, Luke"......'and stops'

We are in total agreement there Cirrus. All I'm saying is "when in a bear market, use bear market rules". Context is everything. Regards, D

Edited by IYB, 19 July 2009 - 02:10 PM.

[da_cheif]

I'm glad that over these past several months, Don has persistently pointed out the significance of the 13 month period. I admittedly didn't assign much significance to it until I recently began exploring it more thoroughly. And I can now see the validity of it.

Here's another chart. It compares the acceleration and deceleration between two 13-month moving averages: exponential and "par-trend". The par-trend ma is a proprietary, equal-weighted ma of a certain derivative I compile. It moves and turns faster and deeper than the exponential ma for the same time frame. The polarity comparison between the two ma's is ignored; one can be positive-sloped while the other is still negative-sloped. This removes polarity-bias lag time as the ema always completes its roll after the par-trend ma. What's relevant is the ROC comparison between the two at any polarity. That ROC threshold is then shown as a simple binary ("buy/sell") indicator, for which I've shaded the par-trend deceleration periods.

I plugged in the month-end price for July that would flip the accel/decel indicator positive, and was suprised to discover that it is exactly at the 13-month ema flatline/crossover point... 986.5. This would be a line in the sand for this indicator, and perhaps the 13-month period in general. I think that while it's testworthy and attainable, it's not exceedable under current conditions as Don states. FWIW.

Great post...interesting. I see TA stuff on here that's well above anything I've ever concocted. I've really simplified my tool set the past couple of years and sticking just to the basics and KISS. My little bean head can handle much....


For me it's kinda been like Luke Skywalker and the Death Star! Use the basic skills effectively and push the complicated stuff aside and stay nimble.

"Use the force, Luke"......'and stops'

"I see TA stuff on here that's well above anything I've ever concocted".....i guess you aint seen the REAL stuff yet

[milbank]

I agree with Roger's take but, even in the short-term, the low volitility mixed with not knowing how far the Powers The Be and their black boxes will take it up before they do their next sweep to the short side has been frustrating for me. VST trading is what I'm comfortable with as long as there is volitility which there has not been. My results for the last two weeks, which have not been good, reflect that. I havent covered as I know I will eventually make a profit on the three lots I have out there which are all underwater right now.

Long-term, even with the algo, black boxes, I think that, as Benjamin Graham said in "The Intelligent Investor," "In the short run, the market is a voting machine,
but in the long run it is a weighing machine." still applies. Eventually, all that free money that has been used as honey to attract other insects to the money will run out and then the trap will be sprung and the chasers will be swept away. The 2 trillion pumped into the world's economy is still a very small amount against the 67 trillion in debt destruction and there will be a price to be paid by the taxpayer for the printing of that 2 trillion as well as all the toxic paper that left the institutions' balance sheets and entered the taxpayers' balance sheet. There is still a second act to the mortgage resetting and while unemployment is not rising monthly at the pace it was, it's still rising. The powers that control and sustain the system have been bailed out as GS and JPM's quarterly just showed but, that bailout money was not used and those profits were not made from prudent, profitable lending.

To think this is a one act play and the epilogue has begun is foolish. We will see a second act to this tragedy. It will be to the downside with a long-tedious third to follow before we get to the epilogue.

[Cirrus]

Don...agreed. The market as defined by the SPX and a couple other industries is still in bear mode. There are segments whose trend as turned bullish by my measures. Sometimes we all have to take a step back and realizes we are applying 'digital' techniques to define a wildly 'analog' market...if you will. The market is like a person in so many respects. Now a-days especially, we have to watch out for basing things too heavily on historically based indicators and methods. Yes, they are definitely useful but most use them these days. Also, we are in a-historical times. This definitely warrants all of us staying on our toes and asking ourselves each trading day and hour to remains objective and unbiased. Overall, you are correct on context...mostly a bear market by our 'digital' indicators....and you and I use many of the same indicators for our definitiions.