ETF Prophet

Markets continued their volatile sideways trading theme, this time leaving the S&P 500 (SPY) down five consecutive days to finish Week 30 -3.9% for an approximate -2.0% loss on the month of July.  Broad oversold conditions in the Price Index columns and a VIX stretched nearly 25% above its short-term moving average suggest that we [...]

It is possible to make minor adjustments to strategies that can both improve their backtest performance, but also reduce the real costs of trading. The trend-follower  will always pay more to enter a trade due to the increased slippage and market impact costs. A further “tax” in the modern era across all markets is the [...]

This was a week when an oversold market became more oversold into month end.  There had being a lot of focus late in the week on the budget deal but perhaps not enough attention is paid to the downshifting economy and also the European debt crisis as borrowing cost and CDS set new highs.  With [...]

The VIX is back on the rise, but price remains above it’s up-sloping VWAP.  Internals are negative in spite of the vote rumor rebound part two.  Like yesterday, watch that VWAP closely….

The market is already short-term oversold and now SPY is gapping down large this morning. I looked at other times there were 4 lower lows followed by a gap down below the previous day’s low. Below are results looking back to 2006.

Not a ton of in…

Some midday optimism over a potential debt-ceiling deal produced an anticipated bounce but worries over the USA debt downgrade and the gridlock between Congress and Senate gave the bulls excuse to take profit into this first bounce.  European Debt crisis continues to simmer with the bond yields on the PIIGS continuing to rise.  It is [...]

As we slide into the close on new VIX highs (now outside ‘typical’ Bollinger band levels), I thought I would share a ‘next support’ chart from last night’s ETF Rewind newsletter. Effectively, we look next to the Mid-July 18th lows (just about there as I hit ‘post’), then the 200-day respective Moving Averages, then the [...]

Internals have been decent even though we are on a sustained Advance – Decline PSAR sell at the mid-day (possibly ready to flip as price nears the Pivot).  Obviously the market could swing hard on expectations of the ‘vote’ this evening at any point in the PM session.

Question – Can you use volatility In DVB scores to modulate the indicators usage? Historically, mean reversion type indicators have performed better in volatile conditions compared to trend following conditions (when the price does not pull back). Instead of using…

As Greece edge closer to selective default and banks in U.K. and Italy comes under closer scrutiny, the confidence shown by the bulls after President Obama’s gloomy debt speech yesterday vanished.  The internal divergences finally caught up to the market and the slowing economy caught traders by surprise.   The action today was truly ugly [...]

Mid day and the NYAD has been uber bearish at .11 for the past 2 hours.  TLT had been hugging the zero mark but has now broken down to the S1 pivot and looks poised to fall further (S2 is $ .42 down).  GDX, XLB and SMH are all getting hit hard with the VIX [...]

Maybe too horrid, as price appears to be basing at the mid-day as economic problems and budget delays finally come home to roost.  I’m actually skeptical of the basing, and watching action at the VWAP very closely.  Next Fib support is in the low SPY $131s, we’ll see.

Despite the bleak debt-ceiling negotiations conveyed by President Obama last night, the market held up fairly well today with technology leading. Again the close was weak and breadth was much poorer than the indices indicated for the second day in a row.  The breadth deterioration has to be a concern for the bulls.  While the [...]

An hourly chart of the Lazy Man 5 illustrates the pervasive chop in SPY and the other LM components.  90 minutes before the close and some modest positive momentum is evident although the NYAD is only .72 and the DOW is -45. Trade Alert noted this morning’s TLT option activity at 12,000 puts and 6646 [...]

Price is oscillating around the as yet rising five-day moving average (magenta dashed line).  Accumulative tick is positive, but other internals are flat or net negative.

I have been away for a while.  When I’m away subscriber services continue pretty much as normal but blog posts tend to suffer.  I’m back and will have a couple of posts this week and then get back to the 3 or so per week starting next wee…