This morning @PsychTrader was kind enough to mention Quantifiable Edges and the TICK TomOscillator on StockTwits.
The blog post he linked to was this one from May 13, 2011.
In light of this I thought I would share the study that was discussed in …
Thursday the SPY managed to close at a 5-day low after 16 days without doing so. This triggered the study below, which I last showed on the blog May 25th.
Results here suggest a moderate upside edge. As I have said before, persistent u…
It is notable that the VIX spiked up 16% on Monday and closed at the highest level since June. In the past when it has closed at a high level on a strong move there has been a tendency for the SPX to bounce over the next few days. This can be see…
The first October night saw a big drop, as ES gapped down 11 points Wednesday morning. October has a general reputation for being a volatile and difficult month. I decided to examine the overnight performance. The chart below looks at all nights since 2000 following days that closed in October. As you can see, there …
I took a look this morning to see how the market has typically reacted when faced with a big gap down on a Monday morning. Results below examine all gaps of 0.75% or more and measure the performance from the 9:30 open to the 4pm close.
In “The Quantifiable Edges Guide to Fed Days” I discussed Fed Days that close at new highs. The basic finding was that when the market closed at a short-term high on a Fed Day, then it was likely to pull back over the next few days. But when it closed at a long-term high, then the rally was likely to continue. Below is a study from the Guide that last appeared in the 9/14/12 blog.
This suggests further upside is likely over the next 1-2 weeks.
Today’s movement will largely be due to the market’s reaction to the Fed. But I thought I would share a study that triggered yesterday that would perhaps have a bit more influence on a non-news day. It looks at days like Tuesday where the market gaps higher, never fills, and moves higher from open to close without making a higher high.
Implications here appear somewhat bearish, with most of the damage occurring on day 1. Traders may want to keep this pattern in mind for the future.
I am seeing a mix of short-term evidence at the moment. Having not shown anything bearish lately, I decided to share the study below, which triggered at the close on Monday and hints of a downside edge. It looks at times during long-term up…
Monday started out with quite a bit of excitement for the market, as ES gapped up over 1% (the largest gap up since July 11) and hit new all-time highs. Whether it closes at new highs is still in question, but if it does the following study will trigger. As you can see, it has …
Thursday’s moderately lower close triggered the following study that examines pullbacks after multi-day runs higher.
Initially there appears to be a moderate inclination for a move higher. Once you get out 9-10 days the upside edge appears solid. The idea behind this study is that strong moves higher tend to weaken before they roll over. The five days up suggest the move is strong. Since they rarely turn on a dime, this 1st dip is not likely the end of the up move.
When the market starts to get short-term overbought we often see studies pop up that suggest a downside edge. But when the overbought condition gets very strongly overbought, then those downside edges often disappear. And rather than streng…
Big intraday rallies like we saw on Wednesday that have been followed by tight, low volume consolidations like Thursday have often seen the market roll over. The study below looks at this setup. I last discussed it in in the 8/11/09 Subscri…
Labor Day according to Wikipedia is a holiday “dedicated to the social and economic achievements of workers”. So I was thinking this past weekend about some of the hardest working traders I know. People that not only trade for a living, but as I do, offer products designed to help traders find their way. I made a list of “Real Deal” guys. To qualify for the list you need to meet some very specific, rigid, and somewhat unfair criteria.
1) You must actually be a trader (and make money doing it).
2) You must have a product that I am familiar with and I truly think is valuable to others.
3) I am able to verify 1 & 2 through personally knowing the person. This means we have either met in person, or at a bare minimum, have had several long phone conversations over an extended period of time. If I don’t know you, you aren’t on this list (that’s the unfair part).
4) You are not part of a large organization. I started writing this with Labor Day in mind. I know how hard it is to run a small operation and have to wear so many hats. Everyone on the list is similar in that they are either solo or have at most a handful of people working with them.
So these are all people I feel I know to some degree and who I believe have something valuable to offer. I also think they are upstanding folks who I am comfortable recommending. Of course I think Quantifiable Edges & Overnight Edges are the greatest services out there, but they don’t match everyone’s style, and they don’t cover everything. So here are some other Real Deals to check out (in alphabetical order).
Scott Andrews (www.masterthegap.com) – “The Gap Guy”. Scott’s quantitative testing is similar to mine, but is focused on gap fading, and some intraday breakout analysis. I think he provides solid information for daytraders, I like his style, and he has become a friend over the years.
Charles Kirk(http://www.kirkreport.com/) – At $100/year a Kirk Report subscription should be a no-brainer for nearly every trader. His screens, analysis, links, and experience make this a resource well worth checking out. The Kirk Report turned 10-years old this week, showing that this “real deal” (and all-around good guy) has had some staying power.
Dave Landry (http://www.davelandry.com/)– Dave’s been around a long time. I’ve always liked his work and his ability to keep things simple. Dave’s sense of humor always seems to shine through as well. He’s tough not to like.
Bill Luby (http://vixandmore.blogspot.com/) – VIX & More is a terrific blog. And traders with an eye on volatility should check out Bill’s subscription products as well. He is an incredible resource and a real authority on volatility and ways to take advantage of it. When it comes to the VIX, Bill is THE real deal.
Tom McClellan (http://www.mcoscillator.com/) – Tom is one of the most interesting analysts I know. His liquidity wave approach and price pattern analogs never cease to grab my attention. I’ve also incorporated some of his work & ideas into Quantifiable Edges (such as the TICK TomOscillator). His knowledge also goes far beyond stocks. I’ve met Tom a number of times, and have learned something new about science or history every time.
Jeff Pietsch (http://etfprophet.com/etf-rewind-pro/)– Jeff does not blog as much anymore, but his ETF Rewind product is a great tool for ETF traders. It puts the ETF universe in a neat, sortable, format and makes it easier for traders to find opportunities based on a number of technical criteria.
Corey Rosenbloom (http://www.afraidtotrade.com/) – The last hard worker on this alphabetical list is also the youngest of the group. But he does not lack for wisdom (or enthusiasm for his own work). Corey takes a solid approach to daytrading and is certainly worth checking out.
That’s it. Seven Real Deal people whose work I admire. Check ‘em out when you get a chance.
The Friday before Labor Day has long been a strong seasonal day for the market. The study below is one I also showed last year. The stats table based on buying the Thursday before Labor Day and selling the close on Friday.
With 71% of …
The market got smacked overnight on Monday, and ES opened Tuesday morning down 16.25 points. This is the largest gap down since June. A 16.25 point gap down is pretty large in most environments, but when you are talking about the largest gap down in over two months, then that is even more noteworthy. Traders …
Volatility levels have jumped some in the last few days as the market has sold off. This morning the VIX managed to make a new 20 day high, but it is now down on the day. I decided to look back at other instances where the VIX made a 20-day intraday high and then closed …
Overnight Edges yesterday I noted that there was a strong bullish overnight
edge when ES had made at least three consecutive lower highs, lows, and closes.
I’ve also discussed in the past that Tuesdays
are known for their turnaround capabilities. The study below uses SPY and
it looks at swing-term implications of the 3+ days of lower highs, lower lows,
and lower closes when today is Monday.