ETF Prophet

A month into this side way correction, China tightening and Europe trouble continued to hurt the bulls at open.  It was followed by a boost from President Obama on hints of a tax deal and then weakness at the finish on a downgrade of Portuguese debt by Standard & Poor’s.  In addition to the downgrade, [...]

The S&P 500 opened down at yesterday’s lows to tag its 50-day moving average for the second day in a row. Internals remain quite weak, although a positive VWAP has held for the majority of the session. Note the original summer range Fibonacci level just under SPY $116 as next prospective support should this fail.

With the EUR/USD dropping another 100 pips overnight to a US session open this is sounding like a familiar story. At the current 130.00 an eventual drop to the 128.00 area is looking more and more likely.

A widely overlooked issue of trading stocks is how to rank multiple opportunities (entries) and select among the best ones. Woodshedder at iBankCoin analyzed various ways (link). With this post I want to introduce a dynamic approach to position ranking.

Dear Subscriber, As hoped, the S&P 500 found support right at it's fifty-day moving average (also today's S2), leaving the SPY to finish slightly in the green (the mismatched Friday close caused a different result for index).  I know many are looking to today's lows to have marked a short-term technical turning point on the [...]

The importance of common sense macroeconomic factors is something that all traders agree upon. What is less obvious is how to take this information and convert it into an actionable trading strategy. From my experience in system/algorithm design, starting with simple strategies that are long/short and always in the market is always the most effective [...]

The S&P 500 managed to trade below its 50-day simple moving average for a brief period since September.  We held where we needed to but how long can we keep probing the lower boundary?  Europe is hurting the bulls while some better economic numbers are helping to hold us up.  The range will eventually resolve [...]

Plumbing the depths of recent support just above the SPY $118.00 level today right on top of the 50-day moving average and the daily S2. However, internals are very weak and these key levels would appear to be at risk with immediate positive holiday seasonality behind us and a run to the US Dollar.

It’s been awhile but we saw a perfect storm in the EUR overnight, accompanied by clear Dipper and Little Dipper entry signals and subsequent triple digit returns. The Dipper produced 100 pips and the LittleDipper produced 50 pips as we took out the sweet spot of the EUR slide from 133.00 to 131.00 . . another [...]

(Click Image to Enlarge/ ETF Rewind Glossary) Although Small- and Mid-Cap Style stocks held their own for a positive close,  it was a negative week for Large-Cap Value stocks on a strong US Dollar rebound and heavy distribution within the Financial Sector. All in all, the holiday shortened week left the S&P 500 (SPY) about [...]

Dear Subscriber, An "inability to follow-through" last Friday would be an understatement.  However, I hate to give too much weight to half-day sessions, and, while news risk seems higher than normal and multiple near-term time frames are now negatively trending, we otherwise have a positive reversion expectation for Monday's trade.  With respect to risk, if [...]

Market neutrality is one of those buzz words thrown around quite a lot in finance; several hedge funds claim their strategies as being market neutral and use it as their main marketing tool. Some quantitative strategies are also oriented towards that goal; pairs trading is a prime example, but one can also include segments of [...]

Up and down volatility continued today and often precedes a change in trend.  European debt crisis came to the front page again with Portugal and Spain in the headlines.  Traders simply weren’t willing to hold onto positions over the weekend when there is a chance of more poor news out of Europe and more Korean [...]

 The one thing I love about trading the EUR is that it’s so much more predictable that the equities markets.  Case in point . . . today’s overnight action where we saw a repeat of Wednesday’s perfect storm that produced a 100 pip drop down to 133.00, but in this case the EUR dropped to [...]

Dear Subscriber, "Good enough" economic news featuring a better than expected Jobless Claims report and positive seasonality were sufficient to support a very nice indicated reversion trade.  Mixed signals for tomorrow's half-day session leave me with a neutral technical outlook, but — short of a news surprise — I otherwise expect a slight bullish carryover [...]

We have much to be grateful for in this uncertain world.  Please stop to ponder your abundance today and consider the predicament of many less fortunate who, for no fault of their own, have fallen on bad times and could sorely use your helping hand.