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May
22: Closing Read
see
prior post.
May
22: 2:30pm Exit Short Signal Confirmed at SPY 89.67
The
short signal did not achieve its profit target (missed by 8 cents)
and was covered out at 2:30pm at SPY 89.67 when the exit short signal
confirmed for a loss of .59 cents . The
last loss by the model came on March 20th (see Archive Section). The
trading model is now neutral. No long signal can be generated
because the Secondary is down and will only confirm short signals.
For
the week, 1 winner-1 loser. Have a nice long weekend...I'm
outta here!
May
22: 2pm Early Exit Short / Early Slope Change up signal
issued
The
early exit short signal has been issued that will confirm at 2:30pm
if signal weight is greater than +480. The trading model is
still short and will not cover the position until exactly 2:30pm.
If users are still holding their short positions, at 2:25pm
if the signal weight is greater than +480 and you are assured of
confirmation, be prepared to cover the short position at 2:30.
May
22: 1:30pm
An early
exit short / early slope change up signal may be issued this bar
if signal weight is greater than +1235. If not this bar then
most likely the 2pm bar confirming at 2:30pm.
May
22: 1pm
Signal
weight is +945, the Change +61 and the Slope -69. An early
exit short / early slope change up signal is likely at 1:30pm with
a confirmation at 2pm.
May
22: 12pm
Positive
signal weight continues although it has moderated somewhat to +815,
the Change +76, Slope -192. An early slope change signal is
still 2.5 bars away, an exit signal another bar past that...maybe.
A slope change isn't a slope change until it's a slope change.
The trading model is still short and if the target hasn't been
achieved by the time of the early exit signal, the position will
be terminated only upon the confirmation of the exit short/slope
change up signal.
May
22: 11:30am
Signal
weight continues strongly positive at +1109. The numbers are
shown below. An early exit short /early slope change signal
is expected in 2.57 bars at this level of signal weight.
May
22: 11am
Strongly
positive signal weight remains at +1133, the Change +113, the Slope
-347. A slope change is now expected in 3 bars.
May
22: 10:30am
Signal
weight has turned more positive at +777, the Change +111, Slope
-475. We can now project an early exit short/ early slope change
up signal to be generated in 4.28 bars (Slope/Change=# of bars).
May
22: 10:18am
Signal
weight has turned moderately positive at +741, the Change +126
May
22: 10am
The
positive signal weight at the opening quickly faded and is now flat
at +1, the Change +91. To test the lows of yesterday, strongly
negative signal weight (greater than -1000) will be needed.
May
22: Opening Read
Positive
signal weight of +925 at the opening has the Change strongly positive
at +147. However, the Slope is still quite large and it will
take some time before an early slope change / early exit short signal
can be issued. For the Secondary to turn back up today, positive
signal weight of +2120 is needed. The trading model is still short SPY at 89.08 with a GTC limit cover at 88.18. Watching
signal weight NOT PRICE is important this morning.
May
21: Closing Read
The
trading model is short SPY at 89.08 with a GTC cover at 88.18. The
low in price following the signal has been 88.26. Extremely
strong negative signal weight has been present all day. Closing
at -1912 we also now see the Change is +1.32. With the Change
now positive, we know that the Slope value is at its maximum.
Strongly negative signal weight will be needed tomorrow else
the Primary will begin to change slope back up. One half of
this cycle is over when the Change reaches zero. The Primary
will continue to decline as the Slope value is large and price will
continue to resolve in the direction of the Primary as long as signal
weight remains negative or weakly positive tomorrow.
With
respect to secondary trades, there was only 1 opportunity during
the next 3 bars following the signal. The range at that time
only 40 cents (89.35-88.75 the prior low) a bit too tight for me.
Seeing .70-1.25 makes better trades. Now that the Change
number is near zero, such trades carry more risk to the direction
of the Primary.
May
21: 2:30pm
Signal
weight remains extremely negative at -2254, the Change -32 and the
value of the Primary now at +5495 declining by 800 ticks per bar.
Price moved up briefly to the 89.30+- area then resolved back
down making new lows on the day. The trading model is still
short SPY at 89.08 with a cover at 88.18.
May
21: 12:30pm
Signal
weight remains extremely negative at -1954, the Change now -57.
This is the last post until around 2:30pm.
May
21: 12:00pm
Signal
weight remains very strongly negative at -1806, the Change -76.
The trading model is short SPY at 89.08 with a GTC cover at
88.18. At the beginning of the noon hour SPY is trading up
somewhat from the lows of the day and should retest the lows again
later in the day.
May
21: 11am
The
trading model is short SPY at 89.08 with a GTC cover at 88.18 (plus
1%). Signal weight remains extremely negative at -2227, the
Change -116. Any attempt by price to move higher will resolve
back to the lows of the day (lead balloon) as long as the Change
remains strongly negative allowing for secondary trades for the
more experienced users. And...notice where the next double
chevron up is???
BTW,
on your program there is a button to stop the alarm sounds when
they're ringing...look for the 'stop alarm sound' on the Trade Window.
Those
shuttle astronauts are still up there waiting for tomorrow's trip
back to our little mudball. You can watch
here NasaTV..great views of the Earth from space.
May
21: 10:30am Enter Short Signal confirmed at SPY 89.08
As expected
and described below, the Enter Short signal has confirmed at 10:30
at SPY 89.08. The trading model is short at that price with
a GTC cover limit of 88.18 (plus .90 cents). Any move in price
back near the highs of the day, 89.65+- will allow a secondary trade
back to near the lows of the day. For those not experienced
in this or new to the trading model, please just stick to the model.
Signal
weight is extremely negative at -2110, the Change -133. We
can expect this down cycle to last 2-3 days and the value of the
Primary to go from +10,710 to zero at least but more likely somewhere
near -8000.
May
21: 10:15am
With
signal weight at -1617 and the Slope -170, it should be obvious
to all users that the Enter Short signal will confirm at 10:30.
The trading model will go short SPY at 10:30 BY THE BOOK.
If you're following the model, you should be prepared to enter
your short position on SPY at exactly 10:30am such that your price
will be as close to the model as possible.
May
21: 10am EXIT LONG CONFIRMED, SLOPE CHANGE CONFIRMED,
EARLY ENTER SHORT SIGNAL ISSUED
As expected,
the Exit Long/Slope Change signal has confirmed at 10am. An
Early Enter Short signal has also been issued that will confirm
at 10:30am if signal weight is less than +196.
Very
strongly negative signal weight of -1686 has the Change at -133.
While the Change is greater than -50. any move up in price
will resolve back near the lows of the day affording additional
trading opportunities IF such range is large enough (at least 50
cents) to adequately provide a reasonable profit level (which you
need to define for yourself).
ps...my
program locked up and may have not sent out all the emails.
May
21: 9:50 am Exit Long signal will
confirm at 10am
Since
the trading model achieved its profit target yesterday, it is flat.
But IF it had not, then this exit signal which will confirm
at 10am would be your instruction to exit your position. This
is why stops are NOT USED...because price is not important, only
the motion of the Primary is.
With
the Change at -159, and the Slope at -42, we can project that at
10am a dual signal will be issued that will probably lock up your
Delineator software. The signals will be Exit Long, Early
Enter Short...why? Because the slope change will definitely
occur, and the value of the Slope (Deln) will be near -200 which
is obviously greater than -80.
May
21: Opening Read EARLY EXIT LONG SIGNAL ISSUED.
Negative
signal weight of -1430 has generated an Early Exit Long signal (which
of course is the same as an early slope change). Since the
Secondary has turned down (see above) an Early Enter Short signal
will be generated as soon as the Slope number exceeds -80. The
exit long/ slope change down signal will confirm at 10am if signal
weight is -860 or more.
May
20: Closing Read
Signal
weight started the day extremely positive, >+2000, the trading
model making its profit target during the first half hour of the
day. As signal weight began to moderate, the Change turned
negative during the noon bar while the value of the Primary reached
an opposite level of +11,270 from where it began the current
up cycle at -11000 (4 day cycle).
Users
should recall that on May 14, both Delineators were at opposing
points in their cycles. The Secondary had just turned over
with negative divergence showing while the Primary was just
starting an up cycle from its value of -11,000. If tomorrow,
negative signal weight is present, the Secondary and Primary Delineators
will turn down at the same time and in sync. Hence we should
expect more downside volatility than would otherwise be present.
May
20: 10:00 THE NEWMAN
MAKES ITS PROFIT TARGET
Extremely
strong positive signal weight of +2100 has the Change rising +29.
This is the only scenario that could support a further rise
in the Primary. We also know that once signal weight drops
down to more reasonable levels, the Change will be a large negative
number and at that point any rises in price will be unsustainable.
Incredibly,
the Newman middle long signal achieved its profit target of 92.49
at 9:54am. The trading model is now neutral.
May
20: Opening Read
Signal
weight opened very strongly positive at +1526, however the Change
is only +0.14. This is the 4th day of the up cycle on the
Primary and, as can be seen in the Change number, it will take extremely
strong signal weight to maintain to prevent the Primary from turning
over today. While the value of the Primary is not yet extended,
+7874, any moderation in signal weight will turn the Primary down.
The trading model is long SPY at 91.59 with an exit at 92.49.
I have
business today that will take me away from the screens. The
last post for the morning will be at 10am. The email system
will be on.
May
19: Closing Read
True
to its namesake, the Newman middle long signal (see May18th
Closing Read) has bored us to tears and sent many of us packing
to the nearest donut shop for sugar and caffeine fixes to stay awake.
Signal weight closed at +911 (down from +1500), the Change a negative
number again at -34. Ever increasing levels of positive signal
weight will be needed again tomorrow to keep the Primary rising,
otherwise it will change slope down very quickly. The trading model
is still long SPY at 91.59 with an exit limit at 92.49 still in
place. Unless the profit target is achieved, the next slope
change on the Primary will be the exit long signal (which is why
stops are not needed) used to exit the position.
I said
last week that the Secondary could flip around this week because
the cycles on the two Delineators were nearly opposite--the Secondary
beginning a new down cycle and the Primary about to turn up. Tomorrow,
with only modestly negative signal weight, the Secondary can turn
back down again and perhaps confirm a new short signal on the Primary
as well.
May
19: 3:15pm
With
signal weight now at +1591, the Change is +0.17. With signal
weight this strong, and the Primary nearing the end of its cycle,
the muted price action is consistent with the motion of the Primary.
This level of signal weight at the origination of a new cycle
would result in much greater price motion. Any moderation
in signal weight will cause the Change to turn to a strongly negative
number, and given the fact that the Slope is +296, a slope change
would happen quickly.
May
19: 2:30pm
Signal
weight has built to +1408, the Change now only -6. If signal
weight continues, and price trades through the single chevron down
at 91.89, we should get the final push higher in this cycle. The
trading model is long SPY at 91.59 with an exit GTC sell at 92.49.
May
19: 1pm
Pretty
dull.
May
19: 12:00
Signal
weight continues strongly positive at +1008 and notice the Change
is now -34. As long as signal weight remains between +500
and +1100, the Primary will slowly flatten, the Slope moving toward
zero slowly. This is the 3rd day of the current up cycle on
the Primary so for it to extend past early tomorrow, very strongly
positive signal weight will need to be present. The trading
model is long SPY at 91.59 with a GTC limit sell at 92.49.
May
19: 11:30am
No significant
changes to the numbers. The value of the Primary is now +5123.
May
19: 11am
At 11am
signal weight is +846, the Change -50, the trading model is
long SPY at 91.59 with a GTC limit sell at 92.49 (plus 1%). The
middle long signal is still active and will remain active until
the next slope change down or if it achieves its profit target,
whichever comes first. If signal weight falls below +400,
the signal will come out of confirmation as the slope of the Secondary
will turn back negative. (If this is your first read
on the day, please scroll to last night's closing read and read
up)
May
19: 10:30am ENTER LONG SIGNAL CONFIRMS AT SPY 91.59
Signal
weight has turned to +677 at the close of the 10:30 bar so the enter
long Newman middle long signal has confirmed. The trading
model is long SPY at 91.59 with a GTC limit sell at 92.49 (plus
.90--1%).
May
19: 10:00am
With
signal weight at -496, the Change -131, the slope of the Secondary
is still negative so the early enter long signal that is currently
active has not confirmed. However, if at any time during the
day signal weight closes a bar at +400 or more (and as long as the
Slope is greater than +80) an enter long signal will be issued.
Notice
that the Change is a large negative number. Users recognize
that the process of the next slope change has begun as the Slope
of the Primary is now decreasing. From a risk and trading
point of view, we want to focus our efforts during periods of time
when the Change is a strong number supporting the current direction
of the Primary. During such periods, the likelihood of a counter
trend price movement resolving back in the direction of the Primary
is ENHANCED. When the Change is moving against the Primary,
it is less likely to see price move back in the direction of the
Primary...hence risk is increased.
May
19: Opening Read
Pre-Opening:
Notice on your software Trade Window that the early enter
signal no longer shows up on the list. I'm not exactly sure
why it's not. We'll just need to wait for the opening to see
if it generates another early enter or just an enter signal depending
on signal weight.
Positive
signal weight of +400 is needed to turn the Secondary up today and
generate a Newman middle
long signal. Signal weight has opened at -222, the Change
-135, the Slope +626. If signal weight turns positive and
greater than +400 later in the day, the enter signal will be generated.
UPDATE
9:39AM: EARLY ENTER LONG SIGNAL ISSUED. Signal weight
has turned positive at +457 and an early enter long signal has been
issued. Notice on your software that with signal weight of
+457, the Change is -100. Classic Newman material but a signal
is a signal and this one will confirm at 10am if signal weight is
greater than +400. Also notice that the SCP on your trade
window is "low". SCP stands for signal confirmation
probability and measures the signal weight needed to confirm the
signal relative to the current level.
May
18: Afterthought
(hat
tip Jerry)
A "Newman" is
an enter signal that is comes very late within a Delineator
cycle, when the Slope is near its maximum level (when the Change
is zero). Tomorrow, for example, if the slope of the Secondary
is positive after the opening, an enter long signal will be issued
because the Slope on the Primary is +761 and only needs to
be +80 to confirm. As long as the Secondary is up, the signal
will be issued. From only a perceptional point of view, it's
like closing the barn door after the horses have left.
Whether
we would chose to take such a signal is, of course, your choice.
My personal record for risk aversion manifests itself in lower
profits as I traditionally avoid more profits than avoiding losses.
Following the trading model thus far this year has generated
the best returns with the least effort of time.
May
18: Closing Read
Extremely
strong signal weight was present all day. Just minutes before
the close, an Early Enter Long signal was issued as signal weight
rose to +2850, enough to turn the Secondary back up, generating
a middle early enter long. Since signals cannot be confirmed
at the close or the opening, the earliest tomorrow the signal can
confirm will be 9:45am. At the close, signal weight dropped
back to +2813 and hence the signal is already out of confirmation
as the slope of the Secondary closed negative.
Here's
another hitch: since the Primary Slope is already well past
+80 at +762, any signal weight tomorrow will confirm if the
slope of the Secondary is positive. This is yet another risk
about middle signals and even more risk with respect to the Secondary
as it can still flip back and forth.
We also
know that since signal weight of +2813 results in only +24 on the
Change, any moderation in signal weight tomorrow will force the
Change much lower and begin the process of the next slope change
on the Primary. So, as users can clearly see, compared to
a pure signal following a slope change that is confirmed by the
Secondary, middle signals like the current one are much more risky
than a typical pure signal.
May
18: 3pm
Signal
weight is close to turning the Secondary up and generating a middle
long signal. Weight is +2695 and needs 2840 to turn the Secondary
up. If it generates a middle signal, it will be a high risk signal
because +2840 is nearly excessively strong and will be difficult
to maintain.
May
18: 2:30pm
Extremely
strong signal weight continues at +2542, the Change +26 and the
value of the Primary is now +1165 rising at 700 ticks per bar. To
generate a middle long signal, positive signal weight of +2840 is
needed.
May
18: 12:00pm
No relevant
changes from the previous post; extremely strong signal weight continues
at +2235, the Change +60 and the Slope +498.
I have
some things to do this morning, the next post will be at approximately
2:30pm.
May
18: 11am
Sometimes
it's hard to ignore price, but we must. Price action tells
us nothing more than what the price is. Big price moves are
no more important than small price moves. The media loves
big up or down days because they believe price tells us something.
But we know better. Price comes as a result of investor behavior,
and is not the cause. An experienced Delinator trader can
trade with or without the Secondary if one so desires but for most
of us, sticking to the trading model produces quite reasonable returns,
especially if one considers the amount of time spent in or out of
the market.
At 11am,
signal weight continues to build and is now +2150, the Change +83,
the Primary -2957 and rising by +363 each bar.
May
18: 10:30am
Signal
weight continues to grow and is now +2049, the Change +94. The
trading model continues neutral.
May
18: 10am SLOPE CHANGE UP CONFIRMED
The
slope change up signal has confirmed. The trading model is
neutral (gray color of Primary). BTW, no early slope change
up signal was sent out by the email system as I blocked it from
doing so at the opening per my pre-opening comments today.
Very
strongly positive signal weight of +1823 is present, the value of
the Primary is -3608 and should move to at least zero and higher
during this unconfirmed up cycle. If the Secondary turns up
today or tomorrow, a middle long signal would then be issued.
May
18: Opening Read
Pre-Comment:
By definition, at the opening, signal weight is zero because
no issue has yet opened. Looking at the STATS window shows
that an early slope change up would be triggered if signal weight
is -320 or less. Since zero is less than -320 a signal may
be generated. BUT, signals cannot be triggered at the opening
or the close, so ignore any signal that is generated by the software
at 9:30am. We need to wait 15 minutes +- until nearly all
issues have opened and the "trade on opening" orders have
run their course.
Just
after the opening, positive signal weight of +1389 has the Change
+95 and the Slope +51. To get a slope change at 10am, positive
signal weight of only +360 is needed. Hence, we can see that
an early slope change UP is the correct signal and a slope change
should confirm at 10am. Since the Secondary is still down
and needs +2840 signal weight to turn up today, no long signal is
expected.
May
15: Closing Read
An early
slope change down signal was issued during the 3:30 bar that confirmed
at 3:30. Signal weight ended the day strongly negative at
-1192 but the Change only -40. An early enter short is the
next logical signal that may be issued Monday morning. For
this signal to be issued, the Slope must be -80 or more.
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