Forex Calls Recap for 1/5/12
Another day in 2012, another winner, and this one is still going. See EURUSD below. New calls and Chat tonight. Here's the US Dollar Index intraday with our market directional lines:
EURUSD:
Triggered short at A but gave you all the way until B to take it without stopping out, hit first target at C, lowered stop twice in the morning and currently carrying the second half short with a stop at D:
Forex Calls Recap for 1/5/12
Another day in 2012, another winner, and this one is still going. See EURUSD below. New calls and Chat tonight. Here's the US Dollar Index intraday with our market directional lines:
EURUSD:
Triggered short at A but gave you all the way until B to take it without stopping out, hit first target at C, lowered stop twice in the morning and currently carrying the second half short with a stop at D:
Tradesight Technology Outlook 2012
Once or twice a year, I write a report (now we call them Blogs) about technology and what I'm using and what my trading computer systems look like.
Since 2012 just started and I hadn't written one in a while, I thought I would. But let's be clear. This isn't about trading, and here's why. I think the next great leap in trading systems is a year or two away. Right now, frankly, you still need a computer or laptop and more than one screen to do it all correctly unless you are just trading Forex. I'm going to pause briefly here and talk about my trading computer technology and also give a brief comment about what I think is coming. But the reality is that right now is not an evolutionary moment for trading. But it IS an evolutionary moment for mobility, business management, and even secondary trade management. I have done quite a bit of trading from mobile apps in the last few months, and I rather like it.
Let me also say that we are in the process of helping iVocalize (the software that powers our Trading Lab) create mobile versions of their software through HTML 5.0, which will mean that you can listen to us and view charts while on the move. Frankly, I get now why this is so important. While it might not be clear in the Lab each day, over the last six months, I have spent a great deal of time "managing" trades from my Android tablet and not from my computer midday. I still have to be in front of my machine for the first 90 minutes or so to see everything that is going on. e-Signal is NOT on the verge of solid iPad/Android 4.0 apps. But in the middle of the day, once you have positions on or are focused on some key entries and stops, trading from mobile apps such as what MB Trading offers is plenty good.
So a quick note on technology. We are in the process of moving to e-Signal 11.3. This is not something that we take lightly. We are big e-Signal fans, but the fact remains that 11 got launched before it was ready, and it is just now getting there. Expect an update later this year to all of our EFS scripts for 11.3. What's nice about 11.3? On a 64-bit OS, the pages are seamless and fast. You can flip between them easily. There's no slowdown at all. The charts are steady and clean. What's not to like? Some ease-of-use features are gone, although most of them are things like screen capturing and stuff that we use for Tradesight, not for trading.
My home trading machine remains an i7 processor with 16 GB fast RAM and a 128 GB solid state hard drive backed up with a 1 TB regular hard drive. I have dual SLI video cards that aren't the latest at the moment, and I run two 24" monitors. In reality, I expect to replace this machine once Windows 8 comes out, which looks to be a gigantic shift in Operating Systems. I'll be looking at a bigger Solid State hard drive, more RAM, and stuff like USB 3.0 ports, but that is for later in 2012 assuming the world doesn't end.
I also have a laptop for trading on the go. Currently, that has an i7 chip as well with 12 GB fast RAM, Windows 7 64-bit Ultimate (just like the other); INSERT INTO `wp_posts` (`ID`, `post_author`, `post_date`, `post_date_gmt`, `post_content`, `post_title`, `post_category`, `post_excerpt`, `post_status`, `comment_status`, `ping_status`, `post_password`, `post_name`, `to_ping`, `pinged`, `post_modified`, `post_modified_gmt`, `post_content_filtered`, `post_parent`, `guid`, `menu_order`, `post_type`, `post_mime_type`, `comment_count`) VALUES and a 256 GB solid state drive, which is now almost two years old with no issues. I have a second monitor that attaches to this machine when I need it.
So from a trading machine perspective, even though I typically update every year, these machines are both about 18 months old (same as when I last described them); INSERT INTO `wp_posts` (`ID`, `post_author`, `post_date`, `post_date_gmt`, `post_content`, `post_title`, `post_category`, `post_excerpt`, `post_status`, `comment_status`, `ping_status`, `post_password`, `post_name`, `to_ping`, `pinged`, `post_modified`, `post_modified_gmt`, `post_content_filtered`, `post_parent`, `guid`, `menu_order`, `post_type`, `post_mime_type`, `comment_count`) VALUES and I expect to update them later this year.
But the reality is that e-Signal isn't out ahead of this tech and probably won't be, so we're good. I expect e-Signal 11 to get better and then I'll get new machines with Windows 8 and more RAM and bigger SSD drives, but that might be the end of that. In 2-3 years, I'm thinking tablet to do everything along with Twitter.
So what else am I doing right now from a technology perspective.
If you know me at all, you know that I hate Apple and all things iPhone and iPad. I did buy the original iPad just to see if I would like the form factor because it was the only thing on the market, but I sold it once other options came along and haven't regretted it at all.
From a tech perspective, my phone is an HTC EVO 3D on Sprint, although I am in the process of dropping my Sprint account and moving to Verizon with most likely an HTC Rezound. That or the Galaxy Nexus are simply the best phones on the market right now. One (Nexus) is pure Google, so it ships with the stellar Google 4.0 Operating System (also known as Ice Cream Sandwich); INSERT INTO `wp_posts` (`ID`, `post_author`, `post_date`, `post_date_gmt`, `post_content`, `post_title`, `post_category`, `post_excerpt`, `post_status`, `comment_status`, `ping_status`, `post_password`, `post_name`, `to_ping`, `pinged`, `post_modified`, `post_modified_gmt`, `post_content_filtered`, `post_parent`, `guid`, `menu_order`, `post_type`, `post_mime_type`, `comment_count`) VALUES while the other has been specs but has HTC's Sense overlay, so it will be a little delayed in getting Android 4.0.
I also recently got myself a 64 GB Motorola Droid Xyboard tablet, which is a 10-inch tablet thinner than the iPad that will shortly have the Android 4.0 update and is a simply superb device. I got this on the Verizon 4G network with a data contract, and I have been moving my world into this device since mid-December. It is truly remarkable.
So from a trading machine perspective, there's nothing new to update. From a trading software perspective, expect to hear a lot about e-Signal 11.3 in the next few months. From a Tradesight perspective, we're going to be shifting to Twitter for content delivery, which is going to be amazing once you see it.
But if you are like me and like to push the envelope, here are a few things that I suggest from a tech perspective right now.
1) Get the Xyboard from Motorola or the Transformer Prime from Asus (Wi-fi only). The Xyboard on a 4G contract from Verizon gets amazing download speeds away from the house but flips to wi-fi when you come home.
2) There are apps that can change your life. Here's a few: Springpad, Dropbox, Amazon Kindle Reader, QuickOffice Pro HD. Let's discuss those.
Springpad is a great app for organizing your life. Switch your computer browser to Chrome and you can easily sync everything you need from events and calendars to shopping lists over your phone. Runner-ups in this category are Evernote and Wunderlist, but Springpad is the king at the moment and it can literally change your world once you get used to it.
Dropbox is my friend. I can't live without it. From a business perspective, I did a bunch of stuff in line for rides at Disneyland that previously I could barely have done from the office, much less home. It's a killer app that cloud-saves your work and works brilliantly on Android phones. Depending on your needs, you should check out box.net and sugarsync.com, but the reality is that Dropbox is still the best for most people.
Forget the Nook and anything Barnes and Noble throws your way. Amazon has been content by far, and the Amazon Kindle Fire is great for a dumbed down tablet experience (both my kids and my wife have them, which isn't supposed to be a reflection on them). If you read books, the process has never been better than over the Kindle app. Read a few pages on your phone waiting in a parking lot, and your tablet or actual Kindle knows where you left off when you turn it on. Great stuff.
QuickOffice Pro HD (for Android tablets) gives you 80% of the power of Microsoft Office on your Android phone or tablet, and frankly it is amazing. I've edited Powerpoint slides and Word docs and then shared them back via Dropbox a few minutes later with others. Great stuff.
While this isn't business related, check out HBO GO and Hulu Plus as well.
The shift to Android 4.0 is a seismic leap in tablet Operating Systems. Apple is losing the battle, and more people are registering Android devices, as I always figured. They are more flexible and people can write better apps for them, in my opinion. While I can't run my TRADING through a tablet, I do believe that 2012 is the year that I can run my BUSINESS through my tablet. Expect trading to follow by the end of 2013, which will come despite the Mayan calendar's prediction.
Can you do most of this for now also on an Apple device such as iPad 2 or an iPhone? You can. But I don't expect it to last, and the numbers are better for Google. I'll show you that chart later, because charts don't lie, people do.
For now, consider this your tech update for the start of 2012.
Tradesight Market Preview for 1/5/12
The ES ended the day up one handle. The chart still has the open gap from the holiday but today’s close was above the open. Price remains above all the major MA’s.
NQ futures were much stronger than the broad market, gaining 13 on the day. Price settled right at Tuesday’s high which now is an important break level. The CCI is getting a little extended but not yet overbought.
The VIX was again notably lower on the day. Keep looking at the VIX as a near-term directional indicator.
The BKX was the best performing major sector on the day. The area to watch is where the 200dma will converge with the October high. This should be the initial trade to target and formidable resistance if reached.
The XAU posted a measuring day, consolidating Tuesday’s big move. Alarm a break over today’s high for a continuation to the 50dma.
The SOX did very little and is currently trapped between the 10 and 50 period moving averages.
The oil-services stocks were held in check by the 4/8 Gann level. There is a perfect double top in place this week to use as a point of reference. Set an alarm for 226.
The BTK was the last laggard. Keep in mind that there is a fresh 9 bar upside run in place that may need more time recharge.
Gold was higher on the day. Expect decent resistance at 1625 where the 200dma lines up with the 2/8 Gann level.
Oil measured off yesterday’s gain but held pretty strong making a new high close. A break over the current 2 day high puts the +2/8 level in play.
Tradesight Market Preview for 1/5/12
The ES ended the day up one handle. The chart still has the open gap from the holiday but today’s close was above the open. Price remains above all the major MA’s.
NQ futures were much stronger than the broad market, gaining 13 on the day. Price settled right at Tuesday’s high which now is an important break level. The CCI is getting a little extended but not yet overbought.
The VIX was again notably lower on the day. Keep looking at the VIX as a near-term directional indicator.
The BKX was the best performing major sector on the day. The area to watch is where the 200dma will converge with the October high. This should be the initial trade to target and formidable resistance if reached.
The XAU posted a measuring day, consolidating Tuesday’s big move. Alarm a break over today’s high for a continuation to the 50dma.
The SOX did very little and is currently trapped between the 10 and 50 period moving averages.
The oil-services stocks were held in check by the 4/8 Gann level. There is a perfect double top in place this week to use as a point of reference. Set an alarm for 226.
The BTK was the last laggard. Keep in mind that there is a fresh 9 bar upside run in place that may need more time recharge.
Gold was higher on the day. Expect decent resistance at 1625 where the 200dma lines up with the 2/8 Gann level.
Oil measured off yesterday’s gain but held pretty strong making a new high close. A break over the current 2 day high puts the +2/8 level in play.
Forex Calls Recap for 1/4/12
Another nice trade in 2012. See EURUSD below. We stopped out of the last piece of the prior day's trade for a win as well.
Here's the US Dollar Index intraday with our market directional lines:
New calls and Chat tonight.
EURUSD:
Stopped final piece of prior day's long for about 75 pips at A. Triggered short at B, hit first target at C, lowered stop twice and stopped final piece at D for another 80 pips:
Tradesight Market Preview for 1/4/12
The ES gained 20 handles on the day all of which came on the weekend gap. Keep in mind that there was one negative feature to the day’s action because the futures settled below the open. Not really an impressive performance with triple inside candles last week.
The NQ futures were higher by 42 on the day making all of the gain on the opening gap. Note that price has jumped above all the major moving averages but remains contained within the broader triangle pattern.
The cash VIX is in a well defined downtrend. Target the 0/8 Gann level for key support.
The SOX closed near the low of the day and remains below the 50dma.
The OSX was one of the strongest sectors on the day, closing right at the 50dma and the 4/8 Gann level. Keep in mind that the Seeker 13 exhaustion signal is still active.
The BKX showed relative strength and closed right at the 8/8 level. Expect real resistance at the +2/8 level.
The BTK is now 9 days up in the seeker count. Note the proximity of the 8/8 level.
Oil exploded higher and closed at a multi month high. This is a fresh price flip on the Seeker.
Gold was much stronger on the day, fueled by the weaker dollar. The next major level is the 4/8 Gann level.
Tradesight Market Preview for 1/4/12
The ES gained 20 handles on the day all of which came on the weekend gap. Keep in mind that there was one negative feature to the day’s action because the futures settled below the open. Not really an impressive performance with triple inside candles last week.
The NQ futures were higher by 42 on the day making all of the gain on the opening gap. Note that price has jumped above all the major moving averages but remains contained within the broader triangle pattern.
The cash VIX is in a well defined downtrend. Target the 0/8 Gann level for key support.
The SOX closed near the low of the day and remains below the 50dma.
The OSX was one of the strongest sectors on the day, closing right at the 50dma and the 4/8 Gann level. Keep in mind that the Seeker 13 exhaustion signal is still active.
The BKX showed relative strength and closed right at the 8/8 level. Expect real resistance at the +2/8 level.
The BTK is now 9 days up in the seeker count. Note the proximity of the 8/8 level.
Oil exploded higher and closed at a multi month high. This is a fresh price flip on the Seeker.
Gold was much stronger on the day, fueled by the weaker dollar. The next major level is the 4/8 Gann level.
Stock Picks Recap for 1/3/12
With each stock's recap, we will include a (with market support) or (without market support) tag, designating whether the trade triggered with or without market directional support at the time. Anything in the first five minutes will be considered WITHOUT market support because market direction cannot be determined that early.
From the report, TSCO triggered short (with market support) and worked:
In the Messenger, Rich's FAS triggered long (with market support) and worked:
His GS triggered long (with market support) and worked:
His GOOG triggered long (without market support) and didn't work:
His JPM triggered long (with market support) and went enough for a partial):
AMZN triggered long (with market support) and worked:
In total, that's 5 trades triggering with market support, all 5 of them worked, nice start to 2012.
Tradesight Stock End of 2011 Summary
Tradesight has been around for 10 years now. Amazing.
Before Tradesight was a website and subscription service, it was an email newsletter to my managed money clients as early at 1997. Each year since 1997, I write a summary report about the markets so we can all look back and remember what the year was like from a trading perspective. In prior years, I have made a single report covering the Forex, Futures, and Equity markets. This year, with much of our non-trade call stuff going into the Market Blog on the site and with a stronger split between Forex and Equity traders, I've broken the report up into two. This is the Equity/Futures review here.
Ten years ago, at the end of 2001, my end of year report stated that I felt that we were in for a Lost Decade, as Japan had seen in the prior 10 years. I took a lot of flak for that comment. Remember, we were just coming off of the Internet bubble bursting and the Y2K liquidity run-up wasn't too far behind either. Everyone else thought the bottom was in and we were good to go. Interest rates were low. Etc.
Well, keep some of those thoughts in mind as we review not only 2011's market action, but we look back at the last 10 years in the key indices.
Note that on these charts, I've drawn horizontal black lines from the opening of the chart to the end, so if you're looking at a daily chart on the S&P for 2011, the black line is an easy way to see if the index was up or down for the year. If you're looking at a 10-year weekly chart, well, you'll see.
Let's start with a look at the major indices and how they fared in 2011.
The flagship is, of course, the S&P 500, and this is pretty amazing. It closed 2010 at 1257.64 and closed 2011 at 1257.60. It's hard enough for an index of 500 stocks to be "unch" (unchanged) for a day, but wow, lost 0.04 points for the year, amazing:
NDX did a little better, actually gaining about 30 points:
Biotechs were up:
Banks were down (the old expression is that Banks and Biotechs heading in one direction lead the market, but clearly they weren't in sync this year, so the market did nothing):
Semiconductors were down:
Perhaps the most disappointing action was in the Russell 2000, which is an important index for me because I love to play the sub-$10 liquid stocks when they are jumping a couple of points a week, but that didn't happen either. Note that the Russell 2000 usually gains the most from October to April, and it's been stuck since August:
Every day, we analyze the volume in the market after the first 30 and 60 minutes of trading. The reason is simple. When you have good volume, trading works better. Our threshold is that we like to see numbers that typically project out to over 2 billion NASDAQ shares on a day to be "above average," and those are typically the days where trading is solid. Let's take a look at the day-by-day NASDAQ volume data for 2009 to give us a starting point in this conversation:
See how most of the days, volume was over 2 billion? Granted, you always get the volume drop-off for the last two weeks of the year because of the Holidays and end of year tax junk, but 2009 was solid for having trading volume over 2 billion shares most of the time.
How about 2010? Here it is:
Remember that? The first half of the year was great, then summer hit, which sometimes brings us a drop in volume, but it never really came back. We had just as many days under 2 billion NASDAQ shares as over from June until the end of the year, with the usual drop again the last two weeks.
So, how was 2011 then?
Ouch. Except for a spike for a few days at the start of August when the European situation looked bleakest, volume was pretty bad all year. I'd say less than 33% of the days over 2 billion NASDAQ shares. And December was horrible completely.
This is significant. We ended up having a great trading year, and I'll cover some of the numbers in a bit, but we did it without the usual factor that drives good trading: good volume. Interesting.
We always have certain stocks that we play over and over. That's because they are solid movers and good technical traders. However, it is important in trading not to get attached to a symbol and not notice when it's better trading days are behind it. We lost a few favorites this year, so let's have a look.
RIMM dropped off the list. Let me know when it loses marginability too:
GS was in a steady decline all year too and isn't the trader it used to be:
NFLX was a favorite of mine in 2010 and early 2011, but they shot themselves in the foot and probably aren't going to regain the glory days of trading:
What still works? AAPL, despite the passing of Steve Jobs, was up:
GOOG was great:
AMZN closed red but is still a strong trading stock:
We will be adding new common traders to the group in 2012 for sure.
Gold continued its climb this year (here's the last decade) but came back a bit in the back end of the year, the biggest drop it has seen in a while on a percentage basis:
Bonds made new highs this year as well:
Here's 10 years on oil with a clear trendline (even if it has been all over the board during the decade):
Speaking of trendlines, the weekly charts of the S&P and NDX show that we broke multi-year uptrends late in 2011. Here's the S&P:
And NDX:
Finally, as I alluded to at the top of this report, let's have a look at the last decade on the S&P and NDX. These are actually 11-year weekly charts, but I've drawn horizontal lines showing the last 10 and 11 years of action on each.
Here's the S&P 500. 11 years = down 30 points or so. 10 years = up 50 or so:
Here's the NDX. 11 years = unchanged. 10 years = up a few hundred at least:
I would call that a Lost Decade. Class dismissed.
This year, we posted our daily stock trading picks...every single one that triggered...into the Market Blog on the site. You can read them all here. From that, I actually tracked our results.
We averaged just under 5 trades per day that triggered with market support at the time. That's 1238 triggers. 32% of them lost. 36% of them worked enough for a partial and that was it (basically washes out the losers); INSERT INTO `wp_posts` (`ID`, `post_author`, `post_date`, `post_date_gmt`, `post_content`, `post_title`, `post_category`, `post_excerpt`, `post_status`, `comment_status`, `ping_status`, `post_password`, `post_name`, `to_ping`, `pinged`, `post_modified`, `post_modified_gmt`, `post_content_filtered`, `post_parent`, `guid`, `menu_order`, `post_type`, `post_mime_type`, `comment_count`) VALUES and the rest were all bigger winners. Not a bad result at all. That's how we teach people to trade. You don't need to run 50 trades a day, and if you do trade management right, you don't need to win 80% of your trades (because no one does) to have a solid year. Obviously, the better volume periods are the better trading periods, and this year was a little lighter on those days, but it didn't have a serious impact.
I'm not going to do forward projections about the indices here. That's for another article. This one was just about recapping 2011 and putting it to rest. It was a solid year for Tradesight again. No complaints.