If it's not proprietary, how are you measuring LQ?
Thanks in advance.
Hi Gumper.
Some of its proprietary but I shd be clearer, there are multiple LQ sources
- I look at Bond market (TNX/TLT) that is one potential source, under conditions where money moves out of bonds into stocks (which does not always
occur, money can move out of bonds into cash ...this is what happened near recent market top ..I explained in a post recently, about the 'bond pivot',
so when pension models see 'risk' ..they move to cash, out of bonds +stocks).
- I look at certain funds, that related to this ..and are predictive of this.e.g. VUSTX and others.
These are the longer trend LQ, off daily EOD charts.
When I talk about Short Term LQ - that is proprietary and relates to a discovery of patterns of one particular large program runs in the market i call the GSB.
Essentially - the following are the major forces up or down in market, and their sources of LQ.
Retail - buy or sell or short: LQ money market funds, margin, shifts from short to long or long to short.
Pensions( programs mostly now) - buy or sell ( a few may short): LQ monthly inflows, assets shifts cash, bonds, stocks
Hedge funds - buy, sell or short: LQ inflows/outlfows, and 'unknowns' ( I suspect black magic LOL)
GSB - BUY only program except on break of 'cascade pivot' : the program buys at certain price levels(key pivots) that are 'balance points' 50/50 ..essentially it nudges the market back up,
to entice buying by the above groups...there are THREE KEy PIVOTS on my GSB system, only if 3rd one breaks does the program SELL, then prices tend to plunge.
It essentially holds ST inventory ( bought using the ST LQ)..and sells it either to above groups, or if forced on break of cascade pivot ( recent OCt-Dec drop is an example of that).
When the GSB has enough St LQ - its enough buying power to hold the cascade pivot most of the time, to balance selling from retail, pensions, hedge funds ..BUT under certain conditions the pivots fail e.g. large sell programs by pensions or hedge fund liquidations ( likely, this is what occured OCt-Dec).
Question everything, especially what you believe you know. The foundation of science is questioning the data, not trusting the data.
I only trust fully falsified, non vested interest 'data', which is extremely rare in our world of paid framing narratives 'psy ops'.
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