Monday, January 22, 2018

#Stock Review General Electric #GE

Stock Review
Those that view the message of the market on daily basis are likely confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority which, in turn, contributes to their role as bagholders of trend transitions.

GE's overall trend, revealed by trends of price, leverage, and time, are defined and discussed in the The Matrix for subscribers.

Subscriber Comments

GE has been in triple downside alignment alignment (please review) since 2/17 (nearly a year). BrST, a standardized statistic that defines the cycle of TIME for the bears, is 0.3. This standard Z-Score defines a maturing trend just past its cycle mean.

DEFINING THE TREND

Tripe downside alignment clearly states that bears control the trend. Bulls following opinion rather than the tape are looking to lose money.

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These trends are defined in The Matrix for subscribers.

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Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.

Sunday, January 21, 2018

#Bitcoin Review $GBTC

Bitcoin Review
Those that view the message of the market on daily basis are likely confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority which, in turn, contributes to their role as bagholders of trend transitions.

Bitcoin's overall trend, revealed by trends of price, leverage, and time, are defined and discussed in the The Matrix for subscribers.

Subscriber Comments

Daily downside alignment (please review) that began on 12/28 enters its sixth day.  BrST, a standardized statistic that defines the cycle of TIME for the bears, is -0.5. This standard Z-Score defines a relatively young trend.

DEFINING THE TREND

Disagreement between the daily (downside aligned) and weekly (upside aligned) tend suggests misalignment that defines consolidation. In more simple terms, the bears control the daily trend, while the bulls control the weekly. Smart money reduced risk on the long side once BTC's trend fell out of triple alignment on 12/28.

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These trends are defined in The Matrix for subscribers.

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Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.

Friday, January 19, 2018

#Sentiment Review $SPX

Sentiment
The old American idiom of a day late and dollar short is an phrase easily applied to majority's ability to time (buy or sell) US stocks. The majority, influenced more by instinctual behavioral tendency of the individual to seek acceptance of an emotionally-driven crowd than act independently in the minority, views rising and falling stocks prices as bullish and bearish. This tendency that drives them chase when probabilities favor fading relegates the majority as the consistent bagholders of history's panics and trend changes.

Bull markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria.”, John Templeton

Subscriber Comments

The sentiment model's current impulse has generated 37%, 37%, 0% annualized, maximum and minimum annualized returns since its inception on 9/14 (see The Matrix). The 0% minimum defines a no loss (zero drawdown) impulse.

The computer's ongoing 'concern' is rising concentration of optimism towards stocks. Early in 2017, I suggested that pessimism would transition to optimism as prices rallied. That has happened. Expect this trend to continue until optimism turns HOT (optimism), likely sometime in 2018. The computer defines HOT as WASo readings above 1.0; Doubter of the cycle of greed and fear should take notice, WASo = 1.07 (see The Matrix).

Hot optimism may seem like a sell signal, but it's not. The flow of sentiment from pessimism and optimism and vice versa is defined by direction. The long term sentiment oscillator (LTSO) defines direction (chart 1 and 2). The bulls control the trend as long as LTSO remains positive (green box).

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These trends are defined in The Matrix for subscribers.

Chart 1


Chart 2


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Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.

 

Thursday, January 18, 2018

#VIX Review $VXX

VIX Review
Those that view the message of the market on daily basis are likely confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority which, in turn, contributes to their role as bagholders of trend transitions.

VIX's overall trend, revealed by trends of price, leverage, and time, are defined and discussed in the The Matrix for subscribers.

Subscriber Comments

Experts following their bias have been talking this market up or down for months. The TAPE or message of the market is the only opinion that matters.

Smart money, a term used to define a very small minority of traders and investors, follows (or trades) VIX alignment to anticipate unexpected rallies or declines.

The VIX has been in triple alignment since mid December. It fell out of triple alignment on 1/16 when the daily trend fell out of alignment and entered consolidation. Consolidation is a subtle signal that trouble could be brewing. If daily consolidation transitions to daily downside alignment, it intensifies the warning.  If daily downside alignment pushes the weekly trend out of alignment, it intensifies the warning.

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Chart


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Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.

Wednesday, January 17, 2018

#Gold Review $GLD

Gold Review
Those that view the message of the market on daily basis are likely confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority which, in turn, contributes to their role as bagholders of trend transitions.

Gold's overall trend, revealed by trends of price, leverage, and time, are defined and discussed in the The Matrix for subscribers.

Subscriber Comments

Primary trend (LeadM) alignment defines a power multi-month rally since 5/1/2016 (see The Matrix). Traders follow these trends as long as alignment and TIME permit.

The cycle of TIME, a comparisons of alignment (upside or downside) against all previous impulses in the form of Z-Scores, adjusts the risk of the trade. BuST readings above 1.96, for example, suggests that the impulse is longer than 95% of all past observations. Traders buying or selling when BuST or BrST climbs 2 are betting on the greater fool theory, a poor long-term trading/investment strategy.

DEFINING THE TREND

Daily (Tertiary) Trend = Upside Alignment, The cycle of TIME = 0.1
Weekly (Secondary) Trend = Consolidation
Monthly (Primary) Trend = Upside Alignment, The cycle of TIME = -2.3

The best rallies or declines come when the daily, weekly, and monthly trends agree or align. This setup is called triple alignment.

Gold, a trend transitioning from cause building to mark up, is nearing triple upside alignment. Bulls buy triple upside alignment.

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These trends are defined in The Matrix for subscribers.

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Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.

Tuesday, January 16, 2018

#NaturalGas Review $UNG

Natural Gas Review
Those that view the message of the market on daily basis are likely confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority which, in turn, contributes to their role as bagholders of trend transitions.

Natural gas's overall trend, revealed by trends of price, leverage, and time, are defined and discussed in the The Matrix for subscribers.

Subscriber Comments

Primary trend (LeadM) alignment defines a power multi-month rally since 5/1/2016 (see The Matrix). Traders follow these trends as long as alignment and TIME permit.

The cycle of TIME, a comparisons of alignment (upside or downside) against all previous impulses in the form of Z-Scores, adjusts the risk of the trade. BuST readings above 1.96, for example, suggests that the impulse is longer than 95% of all past observations. Traders buying or selling when BuST or BrST climbs 2 are betting on the greater fool theory, a poor long-term trading/investment strategy.

DEFINING THE TREND

Daily (Tertiary) Trend = Upside Alignment, The cycle of TIME = -0.3
Weekly (Secondary) Trend = Downside Alignment, The cycle of TIME = 0.1
Monthly (Primary) Trend = Downside Alignment, The cycle of TIME = -0.3

The best rallies or declines come when the daily, weekly, and monthly trends agree or align. This setup is called triple alignment.

The cycle of TIME suggests cause building. Cause building the precursor to mark down (decline phase) and mark up (rally phase). The direction of alignment decides the outcome.

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These trends are defined in The Matrix for subscribers.

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Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.

Sunday, January 14, 2018

S&P 500 Review $SPX $SPY

SP 500 Chart
Those that view the message of the market on daily basis are likely confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority which, in turn, contributes to their role as bagholders of trend transitions.

S&P500's overall trend, revealed by trends of price, leverage, and time, defined and are discussed in The Matrix for subscribers.

Subscriber Comments

Primary trend (LeadM) alignment defines a power multi-month rally since 5/1/2016 (see The Matrix). Traders follow these trends as long as alignment and TIME permit.

The cycle of TIME, a comparisons of alignment (upside or downside) against all previous impulses in the form of Z-Scores, adjusts the risk of the trade. BuST readings above 1.96, for example, suggests that the impulse is longer than 95% of all past observations. Traders buying or selling when BuST or BrST climbs 2 are betting on the greater fool theory, a poor long-term trading/investment strategy.

DEFINING THE TREND

Daily (Tertiary) Trend = Downside Alignment, The cycle of TIME = 4.1
Weekly (Secondary) Trend = Upside Alignment, The cycle of TIME = 2.9
Monthly (Primary) Trend = Upside Alignment, The cycle of TIME = -0.2

While the bulls are snorting and romping with the herd, they're missing extreme concentration of TIME within the tertiary and secondary trend. Standardized concentration above 1.96 are rare and concerning. Readings above 3 and 4, unbelievably rare, favor the onset of cause building or misalignment soon. I plain English, the bullish should be reducing risk, hedging, or playing younger trends defined in the Matrix.

While 85 days of upside alignment is pushing the limits of TIME, it's certainly not the highest.  The market generated upside alignment for 88 and 114 days in 1980 and 1971.  US stocks like exceeded these limits several times between 1925-1929, though reliable daily volume data is needed to prove or disprove this assumption.

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These trends are defined in The Matrix for subscribers.

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Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.