Market-2

 

01/02/2017:  Markets were down about 1% for the  week, as the weaker Indices are finally dropping down towards their Red Lines (50-day averages)… which should create a nice Buying Trade back up.

Many of the Leading Funds are back down in the Green Zones, and we are waiting on Buy Signals (Money Wave Closing up > 20 and out of the Green Zone).

The Semiconductor and Financials are the 2 Strongest Sectors, which usually come down the least… They should re-test the recent highs soon.

The US Dollar and Stock Markets are Way Above the Green Line. Bonds and Gold are Way Below the Green Line. Since all Investments RETURN to the Green Line, expect some weaker or negative news about Politics or the strength of the Economy early next year. We don’t use fundamental news for analysis, but many do… and are mystified by our forecasts. But we don’t predict. We let the Green Line “Tell Us”.

Please view the WATCH LIST  for pending Money Wave Buys.

Money Wave Buys Soon: AAL  AKS  AMAT  ECA  IWM  OIH  SMH  X & XLF    
Wait for Money Wave Buy Signals.  We will email you when they are ready.  

Click for  Open Positions   

Click for  Closed Positions

Alert! Market Risk HIGH (Yellow Zone). The probability of successful Short Term Trades is lower, when the S&P 500 is Way Above the Green Line. Even the Strongest Funds can get chopped up. Either take quick gains from Money Wave Pops, or STAY IN CASH & WAIT for a larger correction.

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Tell your Friend about us, and HELP ANIMALS.

 
QUESTION: Mark G. writes “I’ve been following your trades for couple of months now and so far love the system. Some of your recent analysis had Reward/Risk criteria and I wonder if you have definition of poor Reward/Risk documented somewhere on the site.”

ANSWER:  Thank you for writing, Mark.
Reward / Risk should be at least 2:1 on every trade.  If you Buy an Investment at $12, for a re-test of Highs at $14, the Reward potential could be $2, or 16.7%. If you have a Stop at $11.5, you are risking $0.50.   So Reward / Risk is $2 / $0.50 =   4:1 odds… EXCELLENT!

We will add your Question to our FAQ Page.

Related Post

– Above the Green Line Dec 26, 2016

The 4 Stages of any Investment

 

QUESTION from Dave:

“I have followed your site for some time.  My problem is my job (airline pilot) did not allow me to track daily closes and buy or sell on them due to the odd hours we work. Also, as this is a retirement account I have to play the long game and these pops and short term gains become too much of a job.  I see your long term trading concept, but cant understand how that applies as when the funds you list go to a buy, they would often lose money if you simply held the position off the buy signal until it crossed below the green line.

What am I missing?  How can I use your system with a long time horizon?

Thank you for your time and talent.  I’m happy to help and get the word out if you would like as I am all about making money and sharing info with my peers.

Cheers, Dave

ANSWER:  Thank you for writing, Dave. We follow the Stage Chart Analysis of Stan Weinstein… And you should read his book Secrets For Profiting in Bull and Bear Markets for timeless Technical Analysis (digital copy only $1.99). At least read Chapter 2.

Most Stocks and Bonds are very High historically, and are well into Stage 2  (See Chart above) of an 8 year Bull in Stocks & (Bonds might be entering Stage 3 after 35 year unbelievable BULL). There should be some nice trades back up when the Leaders like NVDA finally correct down near the Green Line.

Commodities & Inverse Funds are In Stage 4 Decline (Steel & Coal already starting up) and could Double or Triple in the next BULL, based on History.

The HERD is in Stocks & Bonds, so Money will normally flow to where they ARE NOT.

While we are waiting for Inverse Funds and Commodities to begin Stage 2 UP, we are only doing Short Term Trading…

To expect Home Depot of Boeing to Double quickly from these levels is most likely ridiculous, based on current valuations.

Eventually, Markets will DUMP again, as INSIDERS are mostly SELLING now… And we should do very well in Inverse Funds, like we did in 2008, but we must wait until they MEET THE RULES.

Good trading, and tell your friends!

Related Post

– Weekly Commentary Dec 25, 2016

 

12/25/2016:  Markets were mixed again for the  week, as the weaker Indices are slipping below the Pink Lines (10-day averages)… The Trump Rally is losing momentum, but the S&P & DOW could re-test the Highs again next week, on low “Pajama Boy” Buying. Eventually the S&P 500  should correct back down to the Red Line soon (50-day Avg.), which should create a nice Buying Trade back up.

The US Dollar and Stock Markets are Way Above the Green Line. Bonds and Gold are Way Below the Green Line. Since all Investments RETURN to the Green Line, expect some weaker or negative news about Politics or the strength of the Economy early next year. We don’t use fundamental news for analysis, but many do… and are mystified by our forecasts. But we don’t predict. We let the Green Line “Tell Us”.

 

Please view the Leader Chart List for pending Money Wave Buys & Open Positions.

Money Wave Buys Soon: BBY  HL  RSX   VALE     
We are reluctant to Buy now, with Markets Way Above the Green Line.  We will email you when they are ready.  

Click for  WATCH LIST   

Click for  Open Positions   

Click for Closed Positions

Alert! Market Risk HIGH (Red Zone). The probability of successful Short Term Trades is lower, when the S&P 500 is Way Above the Green Line. Even the Strongest Funds can get chopped up. Either take quick gains from Money Wave Pops, or STAY IN CASH & WAIT for a larger correction.

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Tell your Friend about us, and HELP ANIMALS.

QUESTION: Daniel writes “I just came across your Homepage and was fascinated by the Quality of your work. I couldn’t however not find how you calculate your relative strength factor. Obviously you Point towards SCTR. But this SCTR line gives a different figure than your RS. For instance AMZN has an SCTR of 39.9 as of 12-23, but you indicate that the stock has an RS of 75. Can you please explain?

I wish you Merry Christmas from Switzerland”.

ANSWER: Thank you Daniel! We prefer to use Relative Strength from IBD (Investor’s Business Daily) or www.etfscreen.com, as they use more of a weighted 1 year RS. SCTR is convenient, but is weighted too much to the last 90 days of trading… Our Rules explain more.

Good trading, and tell your friends!

 

Related Post

– Weekly Commentary Dec 18, 2016

 

12/18/2016:  Markets were mixed for the  week, after the FED RAISED Fed Funds Rate to 1/2%… The Trump Rally is losing momentum, as the Banks & Financials are about to go into Short Term Sell Signals. The S&P 500  should correct back down to the Red Line soon (50-day Avg.), which should create a nice Buying Trade back up.

Raising the Fed Funds Rate was Bullish, and Good NEWS for the US Dollar. But Smart Money does not Buy on Good News, they SELL… The HERD usually Buys on Good News, and regrets it, as most do when they Buy Way Above the Green Line (see US Dollar Chart). Since the US Dollar made Higher Highs, it should correct down near the Red Line, and then go back up. The FED probably won’t Raise Rates for several months, so there is plenty of time for the US Dollar to fade down towards the Green Line.

This creates an opportunity for Gold Miners, which are good value, compared to most Investments. There is Fear in GOLD and in the Miners, which means Money to BE MADE. But GOLD has corrected about 80% from the August highs which is more than the normal 62% Wave 2 decline. That means that the recovery could be slow. The Strongest Mining Index, GDXJ, has corrected about 65%, so it might survive if can get back Above the Green Line of $36.50 (when the Dollar corrects)… GDXJ is still up 60% for this year!

Please view the Leader List Charts for pending Money Wave Buys & Open Positions.

Money Wave Buys Soon: BBY  CHK  ECA  GGB  KTOS  NBR   TECK  VALE   VALE.P  &  XME     
We are reluctant to Buy now, with Markets Way Above the Green Line.  We will email you when they are ready.  

Click for  WATCH LIST   

Click for  Open Positions   

Click for Closed Positions

Alert! Market Risk HIGH (Red Zone). The probability of successful Short Term Trades is lower, when the S&P 500 is Way Above the Green Line. Even the Strongest Funds can get chopped up. Either take quick gains from Money Wave Pops, or STAY IN CASH & WAIT for a larger correction.

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Tell your Friend about us, and HELP ANIMALS.

Related Post

– Daily Commentary Dec 13, 2016

 

The Markets are made higher Highs today, and are extremely Over-Bought. The S&P could be finishing Wave 5 up of the Trump Rally that began Nov 7th.  After 5 Waves, there will normally be a correction of 1/3 to 1/2 of the Rally. We are taking profits again today, as the Bullish Sentiment is too HIGH. A normal pull-back would take the S&P 500 down near the Red Line (50-day avg.) 

Money Wave Buys soon on the Strong Steel Stocks:

ON DECK:  AKS  CLF  EXEL  GGB  KTOS  STLD  TECK  TSRO & VALE.P

WAIT for Money Waves Buys soon coming out of the Green Zones. We will email you when they are ready.  

Click for  WATCH LIST   

Click for  STOCKCHARTS LIST    

Click for  OPEN POSITIONS

Related Post

– Weekly Commentary Dec 11, 2016