And there was 1 trade that didn't return a profit at all, as the market just continued to go straight up. The other 6 winning trades suffered from very little or no drawdown. The 1 trade that took 9 days finally returned 5% but had a decent drawdown of about -8%. Using TZA as the trading vehicle resulted in an average return of 13.96%. Of those 8 trades, 7 of them were profitable within 1-9 days. So this is just FYI and nothing to get too excited about yet. Still, I can only come up with 8 instances using SPY in the last few years. To increase instances, I also included days when the red line exited Caution mode and popped up above zero. The 2nd consecutive sell signal while in Long Mode & in Caution Mode (red line below 0) almost always resulted in a substantial sell-off in stocks. After looking at the data for a few days, something else caught my eye. In my early testing, one rule I developed was that whenever the 21MA (green line) of the CCI is above zero, the system will only go long. There are a couple things going on in the chart below to focus in on. While I'm waiting for this short trade to pan out, I wanted to point out a potent shorting opportunity today that my CCI rules are dishing up. Then again it could also just be a headfake, which is exactly why we only use a half stop - to reduce risk. Officially I use SPY for market health, thus the SPY value to watch is 138.09 from 3/13.) If that range breaks to the downside, it would be our first red flag that a significant move down could be in the cards. (As mentioned, that occurred Friday 3/23 for TNA. Since a new high was set on 3/27, I sample the previous 10 candles to find the low end of the range. As a refresher, I use the 10-day rolling inside/outside reversal indicator to determine market health and find possible tops. Interestingly since yesterday saw new nominal highs in the indices, the stop loss on the long position would be a relatively safe and tight TNA 59.06 (the swing low from 3/23). The short position would be closed and a long position will be opened, both on the close EOD. The more we sink today, the better!Īs long as we don't see yet another intraday "buy the dip" session unfold, we are headed for a 100% TNA buy signal. Regards.Ģ:15pmET Update: Still on track for a buy signal. If we manage to blast north of 140.82, we'll continue holding shorts.
As long as SPY closes below 140.82, the system covers shorts and goes long w/ a 100% TNA position. Regardless, it's still a solid buy signal right now.
*sigh* This is not how I wanted the day to end. 3:45pm Update: Wow, I nailed the low of the day with that last post.
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