04/26/12 – Posting My Trades??? © ™
WHAT’S HAPPENING?
I have been asked about posting my trades on the blog and I think that could be confusing because I make multiple trades using Walter Bressert’s “Money Management” system of trading (see Money Management in the GLOSSARY). In the Bressert method, there are 4 trades involved in one transaction, one initial opening trade and 3 closing trades. Because of the multiple trades it would be confusing to list all that I do.
I am a firm believer in the quip, “THERE ARE RICH TRADERS AND OLD TRADERS, BUT THERE ARE NO RICH, OLD TRADERS.”. I have a lifetime of trading and I know that this quote is true. If followed faithfully, Walter Bressert’s money management has the methodology to force one to trade long term and that’s a good feature.
It takes a long time to write my blog because the blog is my thinking place. The blog is where I try to convince myself about a belief that I harbor and it usually crystallizes and clarifies my thinking. Clarity of thought is something we all need in the stock market to avoid emotional decisions.
Because of my failure to alert all to what was happening beginning on Monday, I think I should try to post short messages that tell what’s on my mind at the moment. We’ll have to wait and see how that works out.
WHAT’S ON MY MIND?
Letting those profits run from my Tuesday trade.
Wednesday, Apple accounted for 5.13 points of the Standard & Poor’s 19-point gain. That was about 26% of the S&P daily gain. That’s a lot of influence for one stock.
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The next three charts show a Fibonacci line that might be in play at the moment. After the market closed the futures began a correction. We’ll see if this correction is finished by 8:30 EDT tomorrow morning.
The first chart was updated a couple of minutes before I published this update.
04-26-12 SP FUTURES 1 MINUTE BARS
04-26-12 SP FUTURES 15 MINUTE BARS
04-26-12 SP FUTURES 30 MINUTE BARS
Here’s something that John Murphy pointed out today, an island reversal in the NASDAQ. That’s a positive formation.
04-26-12 COMPQ 30 MINUTE BARS
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Stock-Market-Observations 
April 28, 2012 at 2:18 PM
Hi,
I think the FED will do nothing unless something SEVERE takes place (in the future). They have hands off for now as they believe the economy is strong enough to propel itself. Don’t look to the FED for any help in the stock market, at least not for awhile, next year at the earliest.
In addition to watching the junk bond sentiment ratio, it pays to watch the actual price level of the junk bond fund. Junk is highly susceptible to the economy. I call it the canary in the coal mind for the economy. I think you have to watch both the junk price and the junk sentiment ratio.
Create your own sentiment junk bond ratio using different numerators (leave VUSTX in the denominator), use JNK, PRHYX, and $MUT. Compare all of these with the fagix/vustx chart and see if any of them had an earlier turning point, etc. Look as long term as possible for these indicators. JNK and TLT are the newest kids on the block. Let me know what you found.
I have a blog update coming soon.
Bob
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April 28, 2012 at 12:48 AM
Hi Bob,
I’m new to T Theory(2years) and Cycle work. Sometimes I just like to keep it simple. The one thing I did learn from Terry is to follow the VUSTX/FAGIX relationship. The FAGIX fund, which is a risk on fund, has now made a triple top at 9.24. http://stockcharts.com/h-sc/ui?s=FAGIX&p=D&yr=0&mn=8&dy=0&id=p74518738434. The last 2 months it has basically stayed flat.If the fund breaks up in the next week or so I think Terry might have to change his forecast but if it is a triple top and the fund turns lower I think we will finally have a sizable correction.
The only question I have is what will the Fed do? Will it give the market more QE after June 12? And that brings me to a question for you -how does the Fed’s intervention effect Cycles?
Thanks for your great work, you have been correct since I have followed you.
Michael
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April 27, 2012 at 11:23 PM
Hi Michael,
VERY, VERY BEARISH. But he has a broad time horizon for his expectations. Time for both of us to be right (or not).
It also sounds to me like Terry might be adopting the Hurst cycles methodology. I had several email conversations with Parker several months ago about Hurst, which was then followed by Terry mentioning in his audio update about spending a lot of money for a cycle’s “course” or “software”. Not sure which, but I think he might have said the course because I had sent Parker a course chapter about FLD lines.
I like the Hurst software that was developed by David Hickson from South Africa. I’m lazy and the software is easy to use but it’s really CPU intensive. It takes awhile to run 65+ years through the software. I use long time frames because I’m very interested in the long cycles (they are the most powerful). I only use the software to show the cycle bottoms, but it has ALL of the Hurst theory built-in. David spent an unbelievable amount of time (7 years I think) developing the software. During development I heard what David was doing, wrote to him and became a small part of his beta testing program. The only real contribution I made was warning him about the litigious society in America, where no one takes responsibility for anything. His original work made no mention of disclaimers and I knew I had to warn him immediately. He implemented the advice quickly and started making very long and through disclaimers. I wish him luck as he deserves it for all his hard work. I always plug his product whenever I show the cycles in my blog. It’s the least I can do, hopefully somebody will become a user after reading the blog.
Shame on me for believing Tom McClellan’s GDP indicator. Of course I know first hand that things don’t always work right so I’m not really complaining. It’s the nature of the business.
Bob
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April 27, 2012 at 4:24 PM
Hi Bob just listened to Terry ‘s Friday review he’s really bearish.
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