One Year To Nowhere

[Expat1 971]

I like this article. Good for "fire and forget" dollar cost averaging and something to think about when the market is over/undervalued

http://www.talkmarkets.com/content/us-markets/5-investing-myths-that-will-hurt-you?post=80919&page=3

I agree when he says that the "dollar cost averaging" advice is to keep every cent of your money invested to maximize fee generation. I believe that is true.

[OriZ 3,157]

Good article. I liked that they used moving averages(I do it all the time with my technical work) although it was very clear that they did not add any other filters to the chart(which they mentioned, as well) like I do in my work because there was alot of selling and alot of buying going on in that chart(number 5).

Let me clarify something(and I'm not saying that is necessarily what you were referring to), in my earlier post when I mentioned budgeting amounts - I didn't call it dollar cost averaging for a reason - because it's not exactly the same. With dollar cost averaging most people basically invest when they have the money, whereas my tactic is to split it into a few separate amounts ahead of time, and determine ahead of time and on a purely technical basis in what price exactly you add that exact amount.

Anyway right now I think that the market should see perhaps another short term bounce to perhaps the 1960-1970 area again. Wouldn't be surprised if that happens this week although right now it seems that it is hard for it to hold on to any rally - which is a trademark of bear markets. Those fizzle quickly just like declines or corrections fizzle quickly in a bull market and price keeps pushing higher.

[OriZ 3,157]

My target atm on the S&P500 is 1900, and then we'll see. Remember my post about bollinger bands before? Although that post was using a monthly chart it works the same in all time frames. Right now on the daily we're sliding out of the lower band which sits at 1970 - price right now is 1946. This WILL require a return to the "Scene of the crime"(ie 1970ish) however it doesn't have to happen right away, we could definitely see more downside first. Normally, once price is out of the lower band it will actually act as resistance for a while and price could actually accelerate and move further away from it. But then once it's back in a revisit is all but certain.

Well, hit the target today, in fact the low was 1901.10, after which the market started rallying to a high of 1930, so as far as assessing things now - I see 1800 as a strong possibility even this month, which means a break of the Aug/Sep lows, but like I said would not be surprised to see a small rally first. However this is not a requirement - merely a possibility. I'm in a short position and I don't change a long term position for short term possibilities. So whether it rallies or not matters not at all to me - that is what I have my shorter time frame system(3, 5, 15, 30 and 60 min charts) for - To enjoy those moves.

Guess where this morning's rally hit resistance(1935 was the high) before turning towards 1901(and then back to 1930)? You guessed right. Lower band.

I also marked a few other things at the bottom of the chart which are only part of why I believe a bounce is due. Under 1900 - we'll revisit August intraday low at 1867. Above today's high at 1935 = we'll see 1970.

Let 'em play, boys, Let 'em play.

Edited January 11, 2016 by OriZ

[X Factor 1,112]

Anyway right now I think that the market should see perhaps another short term bounce to perhaps the 1960-1970 area again. Wouldn't be surprised if that happens this week although right now it seems that it is hard for it to hold on to any rally - which is a trademark of bear markets. Those fizzle quickly just like declines or corrections fizzle quickly in a bull market and price keeps pushing higher.

I agree. If it opens up higher then there will be a bounce since it is oversold. I sold some SPX 1 standard deviation Condors $10 wide wings for 2.55 credit on Friday. I am looking for volatility to come down just a bit and will exit at around 1.15 per Iron Condor. Expiration is Friday. Here is the order on TOS - IRON CONDOR SPX 100 JAN 16 2020/2030/1900/1890 CALL/PUT @2.55.

This strategy is to take advantage of the very high market volatility by selling it. If target price isn't achieved by Thursday I will get out at market price.

Edited January 12, 2016 by X Factor

[OriZ 3,157]

I agree. If it opens up higher then there will be a bounce since it is oversold. I sold some SPX 1 standard deviation Condors $10 wide wings for 2.55 credit on Friday. I am looking for volatility to come down just a bit and will exit at around 1.15 per Iron Condor. Expiration is Friday. Here is the order on TOS - IRON CONDOR SPX 100 JAN 16 2020/2030/1900/1890 CALL/PUT @2.55.

This strategy is to take advantage of the very high market volatility by selling it. If target price isn't achieved by Thursday I will get out at market price.

Yes, Friday was the perfect time to sell volatility. The VIX has been signaling it is tired since probably even Thursday. Today even at a point where the SPX was down over 1% the VIX didn't want to rise.

I learned from experience ignoring what the VIX is telling you is NOT a good idea.

[X Factor 1,112]

Yes, Friday was the perfect time to sell volatility. The VIX has been signaling it is tired since probably even Thursday. Today even at a point where the SPX was down over 1% the VIX didn't want to rise.

I learned from experience ignoring what the VIX is telling you is NOT a good idea.

The same here. The vix futures /vx is one of my favorite intra day indicators. And on the daily chart on Friday it had 2 closes above the bollinger bands and over 20% above its 10 SMA.

[X Factor 1,112]

I agree. If it opens up higher then there will be a bounce since it is oversold. I sold some SPX 1 standard deviation Condors $10 wide wings for 2.55 credit on Friday. I am looking for volatility to come down just a bit and will exit at around 1.15 per Iron Condor. Expiration is Friday. Here is the order on TOS - IRON CONDOR SPX 100 JAN 16 2020/2030/1900/1890 CALL/PUT @2.55.

This strategy is to take advantage of the very high market volatility by selling it. If target price isn't achieved by Thursday I will get out at market price.

Bought Back the Iron Condors at the open this morning for 1.15 getting nearly 55% profit as the vix dropped sharply

[Expat1 971]

Let me clarify something(and I'm not saying that is necessarily what you were referring to), in my earlier post when I mentioned budgeting amounts - I didn't call it dollar cost averaging for a reason - because it's not exactly the same. With dollar cost averaging most people basically invest when they have the money, whereas my tactic is to split it into a few separate amounts ahead of time, and determine ahead of time and on a purely technical basis in what price exactly you add that exact amount.

Anyway right now I think that the market should see perhaps another short term bounce to perhaps the 1960-1970 area again. Wouldn't be surprised if that happens this week although right now it seems that it is hard for it to hold on to any rally - which is a trademark of bear markets. Those fizzle quickly just like declines or corrections fizzle quickly in a bull market and price keeps pushing higher.

Incidentally I caught that and want to note that there is a big difference between dip buying, which is what I understood you to be referring to and what I was doing in increments in August, and dollar cost averaging.

Dollar cost averaging was referenced from the post very early in this thread, and I was trying to demonstrate, from that article, that depending on where most of your capital starts and stops in a date range you could actually have a significant portion of your capital invested in 1998 and if you just left it alone, it would have done almost nothing for you over an 18-yr period. 150% return over 18 years is nothing.

Noticed that outflows, which really jumped on bond ETFs last quarter (while stock ETFs saw a huge jump of inflows in Nov), are finally jumping on stock ETFs.

(Thank you ETF buyers for buying me out)

Whoever advised their investors to buy ETFs in Nov/Dec is a full bore idiot but the herd is doing what the herd does best, running from one fence to the other and there's no gate on the bond side.

I think there might be enough gas in the tank for the S&P to break 2000 one more time, as high as 2015-2020 in the next couple of week or so (touch the upper trendline) but then it's going to test or maybe break through the August lows.

The VIX? Will probably be screaming by the end of the month. Too much money moved too quickly in Oct/Nov/Dec for it to be long-term wait and see investing and panic dumping / panic buying then is going to turn into panic dumping very soon.

I would be surprised if there is support for the August lows. The current steep trendline down is what I believe we will see until the market bottoms.

Spring! Still my call - LOL

[OriZ 3,157]

Bought Back the Iron Condors at the open this morning for 1.15 getting nearly 55% profit as the vix dropped sharply

Nicely done. But what I was referring to was not only the fact it was above the upper band(which, as I've mentioned can actually lead to a few days of a violent move in the same direction, prior to going back into them), but mainly because it wasn't confirming what the market was doing. In previous weeks 1% down in the S&P would have been at least a 10% rise in the VIX but yet yesterday the VIX was falling together with the market. When it does that(or when it rises while the market rises) you know something is off. And we saw the result today. And I think we'll see a little more of it.

Incidentally I caught that and want to note that there is a big difference between dip buying, which is what I understood you to be referring to and what I was doing in increments in August, and dollar cost averaging.

Dollar cost averaging was referenced from the post very early in this thread, and I was trying to demonstrate, from that article, that depending on where most of your capital starts and stops in a date range you could actually have a significant portion of your capital invested in 1998 and if you just left it alone, it would have done almost nothing for you over an 18-yr period. 150% return over 18 years is nothing.

Noticed that outflows, which really jumped on bond ETFs last quarter (while stock ETFs saw a huge jump of inflows in Nov), are finally jumping on stock ETFs.

(Thank you ETF buyers for buying me out)

Whoever advised their investors to buy ETFs in Nov/Dec is a full bore idiot but the herd is doing what the herd does best, running from one fence to the other and there's no gate on the bond side.

I think there might be enough gas in the tank for the S&P to break 2000 one more time, as high as 2015-2020 in the next couple of week or so (touch the upper trendline) but then it's going to test or maybe break through the August lows.

The VIX? Will probably be screaming by the end of the month. Too much money moved too quickly in Oct/Nov/Dec for it to be long-term wait and see investing and panic dumping / panic buying then is going to turn into panic dumping very soon.

I would be surprised if there is support for the August lows. The current steep trendline down is what I believe we will see until the market bottoms.

Spring! Still my call - LOL

I still think around half the move will be done by late spring/early summer, but not all of it

End of 2016 to mid 2017 is my call.

Watching Obama's SOTU...what a clown. He made some funnies about the economy. Will post some select quotes later. Here's proof that being the president doesn't mean you can't be completely clueless about where the economy of your country is going LOL

Edited January 13, 2016 by OriZ

[OriZ 3,157]

"We’re in the middle of the longest streak of private-sector job creation in history" - no, we're actually at the END of it man.

"Anyone claiming that America’s economy is in decline is peddling fiction. " - in fact Mr. Obama you are peddling fiction, this country is about to go into another recession and you will end up with some serious egg on your face.

"That’s the way we make the new economy work better for everyone." - new economy? I think I've heard that before.....

AHA!

The new economy is the result of the transition from a manufacturing-based economy to a service-based economy. This particular use of the term was popular during the dot-com bubble of the late 1990s. The high growth, low inflation and high employment of this period led to overly optimistic predictions and many flawed business plans

"Gas under two bucks a gallon ain’t bad, either." - because you're the reason, right? eedjet. I bet I knew it was going there before you did.

"I told you earlier all the talk of America’s economic decline is political hot air. " - You are political hot air.

"Economic headwinds blow from a Chinese economy in transition." - and it of course has absolutely nothing to do with the FED's recklessness, encouraged by the US Government.

Edited January 13, 2016 by OriZ

[OriZ 3,157]

One more thing I almost forgot; Just like the VIX told us this was coming(among other things), NYAD and NYUD in the last two days closed negative despite a positive close on the S&P500. This tells us this is nothing but an upward correction.

[Expat1 971]

One more thing I almost forgot; Just like the VIX told us this was coming(among other things), NYAD and NYUD in the last two days closed negative despite a positive close on the S&P500. This tells us this is nothing but an upward correction.

I believe the S&P will brush that upper trendline, around 2025, then it's taking a hard fall to August. Whether it holds there is anybody's guess but i think it will break and set a new negative trend line.

[OriZ 3,157]

I believe the S&P will brush that upper trendline, around 2025, then it's taking a hard fall to August. Whether it holds there is anybody's guess but i think it will break and set a new negative trend line.

It could go that high, maybe even a little higher, but I'm not sure it will. I think August lows will be taken out this winter. They were already taken out on many indexes(including the equal weighted S&P500) so I don't see a reason why the cap weighted indexes won't follow.

[Expat1 971]

It could go that high, maybe even a little higher, but I'm not sure it will. I think August lows will be taken out this winter. They were already taken out on many indexes(including the equal weighted S&P500) so I don't see a reason why the cap weighted indexes won't follow.

I'm pretty cynical about the fundamentals, but even I thought this market had a little more support than it appears to have.

It's being dumped again today. Utilities and gold? What's that saying?

Edited January 13, 2016 by Expat1

[OriZ 3,157]

One more thing I almost forgot; Just like the VIX told us this was coming(among other things), NYAD and NYUD in the last two days closed negative despite a positive close on the S&P500. This tells us this is nothing but an upward correction.

I'm pretty cynical about the fundamentals, but even I thought this market had a little more support than it appears to have.

It's being dumped again today. Utilities and gold? What's that saying?

Negative breadth on two consecutive positive closes is not a joke.