Now Reading
Mid Year Momo Update
200

Mid Year Momo Update

by The MoleJune 29, 2017

We’re half way through the year and the upcoming 4th of July weekend officially marks the beginning of the long awaited vacation season. Since most of you will be either mentally or physically absent tomorrow let’s devote whatever remains of our collective attention span to a comprehensive perspective on where we are on the momo front.

By the way there’s another reason why I think it’s important to remind ourselves where we are in the ongoing market cycle. Wherever I poke my nose these days I see nothing but bearish sentiment, for a whole host of reasons. Since I’ve been in this racket for quite a while now I have accumulated all sorts of newsletters I somehow found myself subscribed to – or unsubscribed from over the years without much success. Bottom line: quite a few of them are expecting *the big one* once again and that soon.

2017-06-29_irrational_exuberance

As it’s my job (and yours as well) to only consider verifiable technical evidence with a positive track record I thus consulted my own momo charts and see what’s going on. I think nothing expresses the current situation better than this simple long term VIX chart. I have highlighted the periods during which the VIX oscillated below the 11 mark for more than a day or two over the past decade.

And the verdict: Yes, eventually we should expect a medium term or even a long term correction. Eventually. Which means perhaps sometime this year if we get (un)lucky. Markets don’t turn on a dime and especially markets enabled by quantitive easing.

2017-06-29_Vol_VIX

You may recall this chart from last month – I call it ‘VIX easy time’ in that the green areas show us long opportunities after a volatility spike in the VIX (i.e. realized vol of implied vol). And apparently we’ve just come out of a green range which was followed by a very brief yellow range. From here it can take a LONG time until we even get close to a meaningful correction – weeks most likely, perhaps even months.

2017-06-29_VXV_SKEW

The one exception is the VXV (i.e. quarterly IV) versus the SKEW index which in theory is supposed to alert us to long tail risk (which it really doesn’t). The ratio however is working very well for me on the long side, however on the short side it’s a bit more spotty. You may note that in 2014 (all the way on the left of the chart) we had a similar occurrence of short signals which remained unheeded. What followed was a pretty nice correction a month or two later but it was comparatively mild – not ‘the big one’ by any measure.

Now if you think everything is hunky dory then you’re actually mistaken. Please step into my lair for further perspectives:

evil_separator

It's not too late - learn how to consistently bank coin without news, drama, and all the misinformation. If you are interested in becoming a subscriber then don't waste time and sign up here. The Zero indicator service also offers access to all Gold posts, so you actually get double the bang for your buck.

Please login or subscribe here to see the remainder of this post.

independence_day

Happy Independence Day!!!

This will be my last post until July 5th (next Wednesday) – so no update tomorrow morning (Friday). Of course all systems and services will run as usual but if you experience any issues simply send me an email to admin@ and I’ll sort you out within a 24 hour period. Happy Independence Day!


About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.
  • ridingwaves

    the system was turned over to ABM now for summer..automatic bull momentum bots…
    Thanks for write up…
    FIRE sector is such a big component of spx and is now the proxy for movement be it bullish or bearish…

  • ridingwaves

    wonder why Europe is so red today….hiccup?

  • OJuice

    My position, which I have absolutely no data to support, is that I would like to see a summer spaz move so I can grab some longs at /ES 2300. Fingers crossed and two months to go!

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    speaking of systems..

    http://jamesclear.com/goals-systems

    I gave up on goals a long time ago. Systems however, I’m plugging away.
    If a taxi driver practices 10,000 times, he’s still a taxi driver. But a very damn good one I might add. 😉

    Happy 4th, rats.

  • ridingwaves

    best thing for us rats is were not in retail stocks…..they are just getting brow beat daily…

    Fred’s stock plunges 23% to pace Nasdaq decliners
    Rite Aid’s stock plummets 24% to pace NYSE decline

  • ridingwaves

    do you mean Uber driver? what is this taxi thing?
    Happy 4th to you and your family….stay coooooooooool

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    isn’t that the truth.

    The Uber cars around here have roof mounted radar!
    now, if they only had missiles, Skynet would be complete.

    https://tctechcrunch2011.files.wordpress.com/2016/12/uber-atg-volvo.jpg

  • OJuice

    Good stuff Gerb, thanks for posting that.

    I recently made the change from goal to system so the timing of reading this article is funny for me. I found that the goals were getting in the way of my day to day/week to week execution. The personal solution I stumbled into was I built an excel model and macro with past trading data, but, only for trades where I followed my system/rules exactly. I ran 1000 simulations on 100 consecutive trades to get a rough probability distribution of performance after 100 trades. I used the data to tweak my risk tolerance on entries and my profit taking in certain circumstances and now I am in the process of attempting to stick to the system, understanding that the end goal is unknown but likely falls somewhere in the model results, and I’m ok with that.

  • ridingwaves

    the new Volvo’s have sold well and bringing back the Volvo safest car meme, kind of like the comeback Jaguar made…

  • ridingwaves

    I’m trying to tweak my system to sectors as it’s momo based..
    doesn’t seem to apply evenly across the sector landscape…

  • OJuice

    With all the BS in Uber’s executive branch I’ve decided to go full Lyft. Also, I listened to an NPR podcast called “How I Built This” with the Lyft CEO and he seemed like a pretty stand up guy.

    Recommend “How I Built This” to anyone who hasn’t stumbled on it. The Air B and B one is good, as well as the Patagonia one.

  • OJuice

    Amen to that.

  • Tomcat

    I recently switched ti Lyft as well too after hearing multiple Uber drivers complain how bad their cut is. Seems like Lyft provides a much more acceptable package. And from a customer perspective I couldnt care less since I am paying roughly the same.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • OJuice

    It has been a while since we have seen a monster gap around a US holiday…

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    it’s gonna be nuts IMHO. you’ve got that whole August Eclipse going on. 😉

    The 4th is on a tuesday, so it becomes an unofficial 4 day, instead of 3 day weekend.

    trade the plan.

  • Mary

    It seems like the only useful goal is to follow your system impeccably.

  • BobbyLow

    Right on all accounts. However setting personal goals might not be the same as establishing a mission statement. I mean why am I doing this stuff? Is it to become rich? Fuck no. The markets forced me to give up on these foolish thoughts years ago. There are a few rats here who are able to earn more than a decent living working the markets and I give them “a tip of the cap”.

    A more reasonable mission for me is to make enough money to offset real inflation, to out perform most mutual funds, and to do these things while keeping my mind exercised to help avoid potential mental slippage of advanced aging. So I guess one might say that my mission and my goal is one and the same.

  • BobbyLow

    There’s No Mo like MOMO! :)

  • Mark Shinnick

    Yes, a soundly modeled system is the only way to maintain personal order and control in an environment optimized to maximize widespread psychosis and paralysis.

  • ridingwaves

    a mission statement is perfect as long as it’s not static and it can be adapted weekly…I see companies holding on to mission statements when they should adapt them to disruptive changes all around us..

  • ridingwaves

    I rented a bitchin home up in Bend, OR with 4 other couples as this is the last one I’ll be able to catch before becoming dust in the wind…
    we are doing a hike that morning, some sage burning probably other things too..

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    GOOG, will go down for the count, but not this week. IMHO.
    have to fill that gap.

    https://uploads.disquscdn.com/images/a4fa0ccc652b467120b56fc5a115b9e242c379be5a04c13119001d0837f46db3.png

  • OJuice

    Sounds like a great party.

  • OzarkHillBilly

    Nice post, Mole. Right now I tend to believe that most uber bears are wandering around in some sort of self inflicted apocalyptic wasteland. We’ll need a pretty nice decline to get them back in the game. Maybe a multi week move down? And then off to new highs, once we have gotten a solid shake out with lots of headlines to scare investors out of positions. Who knows? These junctures can be frustrating, but I tend to enjoy them, as nimble ninjas can eventually bank some coin no matter the resolution.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    agreed.

    It’s so easy, now-days.
    http://cmorse.org/missiongen/

    Our objective is to collaboratively analyze timely paradigms as well as continue to professionally monetize interdependent deliverables.

  • Mark Shinnick

    ..and OurManMole :)

  • BobbyLow

    “Speaking of Systems”, I got caught inbetween adjustments this morning. I’ve been trading Miners and Bonds. After a shit load of back testing, I ended up running two different types of trailing stops with the miners having a more discretionary stop than Bonds. Yesterday, I reworked the type of trailing stop on the miners to be in line with bonds. This would also help limit confusion during the heat of battle.

    Due to the upcoming long WE, I had planned to close both positions by the COB today. At the COB yesterday, NUGT was down about -.15 R and TMV was up about +.5 R. Under my revised stop, I should have closed NUGT out. But it was still viable under my old method so I decided to take a gamble and hold NUGT one more day. I mean what could go wrong right?

    So Boom! NUGT gaps down this morning and I got hit with the full 1 R Loss instead of the .15 Loss that I would have taken if I had closed it out yesterday. So what’s the point? The point is that I had decided going forward that I would use my revised stop but was reluctant to take the small .15 Loss based on my older form of stop. This was a pure case of loss aversion because I knew that my revised type of stop was more sound yet I decided to see if I could get lucky one more day. This cost me an additional loss of -.85 R.

    I managed to close out my short bond TMV for +1R so all in all instead of ending up with a positive week, I acheived a nothing burger instead. Playing luck is for suckers.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    QQQ’s red? Muwahaha.
    Burn baby burn.

    The extreme temps last week followed by Summer wildfires. Status Quo.
    http://abcnews.go.com/US/wireStory/wind-fans-flames-utah-fire-burned-13-homes-48320012

    I have a coworker who’s Mother had to evacuate to Phoenix.
    He now has combined 6 dogs and 3 cats at his house. Joy!

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Loss Aversion – I can relate.
    After a while, you know the feeling. that feeling. you JUST KNOW.

    I run a MACD histogram, the crossover is always dangerous, and most profitable.

    ..The lines are about to cross, and intraday they may even show crossed.
    then surprise! instead of a cross-over, the cycle fails and trend continues. (red arrow)

    https://uploads.disquscdn.com/images/ad14d4ff3f3772d4e773e851db66e769b8e7fcb3898f6a638ea955d985fc548c.png

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    EDIT: if you rally want to play it safe. which I doubt because NUGT is a leveraged ETF. go with the flow of the BP Miners chart.

    http://stockcharts.com/h-sc/ui?s=%24BPGDM&p=D&yr=1&mn=0&dy=0&id=p47841332825
    😉

  • almez

    In the past hour, the /ES has actually looked much weaker than /NQ. Some rotation is occurring back into /NQ. Not calling a bottom until the zero goes positive.

  • BobbyLow

    Thanks. This was also a case where the MOMO (on my 195 Minute Chart) was still positive as of yesterday but my ATR Trail would have said to get out on Tues. We all have indicators and patterns that fit our personalities and systems. ATR has proven itself to be best fit for me over time. This sector has been a little rough over the past month and I tried something a little different on this trade. What I found was what looked great on paper was much more difficult to manage with real money (which is often the case). Another thing I like about using ATR is that I have less discretion, therefore, less pressure and fewer errors.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    ..and he doesn’t post an ATR chart.
    {face palm}

  • http://evilspeculator.com Sir Mole III

    Apparently the Fed is unable to jawbone equities higher today.

  • http://evilspeculator.com Sir Mole III

    Lesson learned I take it? 😉

    Tell us more about your stop logic if you will.

  • OzarkHillBilly

    Not to mention end of the quarter as well.

  • http://evilspeculator.com Sir Mole III

    Very good points – again it all depends on your trading horizon and the types of systems that work best for you. I do like swing trading but do get cautious when I see spurious directional changes that practically come out of nowhere (based on my lens of course – maybe my lens is wrong).

  • ridingwaves

    SPY 238.50 would find me a long buyer…would rather see a stop run under 240 then just up from here…240 support, so far

  • http://evilspeculator.com Sir Mole III
  • ridingwaves

    L vix instruments day to shine….though I would be long gone with profit but alas I was taking apart the laptop….HP=horrible product

  • Mark Shinnick

    Yes, lots of problems with HP myself.

  • http://evilspeculator.com Sir Mole III

    We don’t get either over here in Spain and many other parts in Europe because of the fucking EU being worried about us dirty Americans screwing up the taxi business. Europe is never going to get it – all they have is entrenched industry and only marginal entrepreneurism.

  • http://evilspeculator.com Sir Mole III

    And the EUR/USD just keeps on climbing. Nasty for my exchange rate :-(

  • Mark Shinnick

    Excellent reminder Mole.

  • http://evilspeculator.com Sir Mole III

    I aim to please 😉

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    If I needed to cover a dollar short position, now is looking good.

    I’m getting too old for this.

    [UUP]
    https://uploads.disquscdn.com/images/87851aebd131907b6a16b2ac4301ee762ec447bc0288e47a9b1fc0bfc0859864.png

  • OzarkHillBilly

    This is pretty close to my thinking as well. Of course, these things rarely work out ideally. We are right in the zone that I was targeting, and since I’m playing with fire (options), I’m watching closely in order to take some profits and possibly play the other side. Great time to make the lottery tickets pay off.

  • http://evilspeculator.com Sir Mole III

    Nicely played.

  • Mark Shinnick

    Yes….happens to agree with my models, but hold out so long as the shortest term models keep trending for at least the day.

  • http://evilspeculator.com Sir Mole III

    You guys better be right or I’ll have to double subscription fees :-)

  • BobbyLow

    No I didn’t. I use a different ATR Multiple for Miners than for Bonds. The amount of ATR also varies widely between time frames with position sizes adjusted accordingly for R. Another thing is that ATR adjusts for volatility. So if I use a 10 Period ATR and someone else uses a 5 Period ATR, the results will be different. Not wrong but different. I’ve also been using 195 Minute Charts so I can get two candles per day. This is faster than the daily and slower than the hourly. When my houry candles can’t find a sustainable direction, I need to filter out as much noise as possible without going back to the daily. I try not to trade the daily now because it’s too slow and the ATR too wide. If I adjust the ATR too small, it’s whipsaw city.

    Basically what this all means is that I don’t expect my chart to mean squat to anyone else unless they’re using the same exact lens that I use. On the reverse side, someone elses chart using other indicators and different time frames doesn’t mean anything to me and in some cases can be distracting. JMHO

    Lastly, I’m not sure if any of the trading platforms beside TOS will actually allow you to adjust a trailing stop and then have it plotted out automatically as the chart moves forward. However, this can be done manually albeit a bit cumbersome.

  • Mark Shinnick

    BTW, some volatility right here at my objective.

  • OJuice

    I better put on a hedge.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    LOL.

  • ridingwaves

    congrats on your trade…..
    this has been a banner month…my new system is to take 1-3 week electronic free vacations more frequently….my market tuning is excellent right now

  • ridingwaves

    24 screws, some tricky part disassembly-easily crack plastic..just to change ram…stupid…

  • BobbyLow

    I hope so Mole. Doing what I did is one of the most difficult things to stop doing.

    My stop logic is tied to multiples of ATR used in a trailing stop and is as I tried to explain to GG down below. I think you’ve used it in years past. It’s a difficult thing to try to explain because it can vary so much depending upon the time frame being traded and the type of price movement within each period on any given chart. I think it’s also something a person might not see or understand the value of right away. For example, I’ve seen people incuding yourself use it many years ago yet I didn’t begin using it until about 3 years ago. But the more I used it the more I liked it especially because it helps correct my achilles heel in trading which is self discipline.

  • http://evilspeculator.com Sir Mole III

    hehe :-)

  • http://evilspeculator.com Sir Mole III

    Hey, am i getting some kudos here? 😉

  • Mark Shinnick

    Really isn’t cool design…infected Toshiba as well, total common sense those loads can’t be borne by that plastic.

  • http://evilspeculator.com Sir Mole III

    Hate to quote myself, but before the open today: ‘the $VIX has no business being below 13 or even 14’

  • http://evilspeculator.com Sir Mole III
  • ridingwaves

    kudos…

  • Mark Shinnick

    LOL…That’s therapeutic :)

  • ridingwaves

    looking back over the year, a long candle like this usually ends full on daily…and has a second spike next day, down or up
    https://s13.postimg.org/sr35zea53/vix_daily_6-29-17.png

  • OJuice

    In tomorrows post can you put something about /GC having no business trading below 1260 or even 1280? Thanks in advance…

  • Mark Shinnick

    …I just wonder, being conditioned with more frequent BTFD outcomes that tend to force covering, whether during any normal market session we will actually get the legitimate opportunity to go short when it really counts.

  • http://evilspeculator.com Sir Mole III

    hehe

  • OzarkHillBilly

    Thanks, and congrats to you!. Since I started trading again a few weeks ago, I’ve also done very well ….. which now tends to make me nervous. Mostly it’s been very short term stuff, but the past two weeks has been a transition over to holding (and building upon) my short term winners. Although my trading is discretionary, I do a decent job of staying disciplined with the reality of my particular situation. I’ll be staying focused on that moving forward.

  • Mark Shinnick

    To those who have coded for anything similar, its EZ to follow what your saying. Stops logic is immensely fascinating and really has to be responsive to both market conditions and time frames to bring mathematical simplicity into times of raging market psychosis.

  • ridingwaves

    risk-reward not bad on L volatility if it can get over 12.50

  • Ronebadger

    Volatility is …well, volatile today…that’s some range
    http://stockcharts.com/public/1092905/chartbook/428507379;

  • Mark Shinnick

    That’s another thing too… it needs to be covered with exactness….will we be allowed the chance to do so….or will the markets get closed on us in that form of fuckery that evaporates the mood. (I’ve obviously become pessimistic about leveraged shorting…..maybe that’s an intended effect of the fuckery too.)

  • BobbyLow

    Here’s an unsettling fact. On March 9th 2008, the Dow Jones Average closed at 6,547.

    At last print the Dow was at 21,310. This is over a 325% increase over the past 9 years. And in simple terms 36% per year. Using a value of money Rule of 72, at 36% a sum would double every 2 years so there would have been 4.5 Doubles over the past 9 years. If you began with $ 100,000, you would have (1) 100 x 2 = 200 (2) 200 x 2 = 400 (3) 400 x 2 = 800 (4) 800 x 2.5 = $2,000,000 (Please correct me if my math is wrong in a big way)

    Now I understand that monetizing the entire Dow average is out of reach for most but perhaps there were some closed ended funds that did exactly that.

    Where does it go from here? 30,000? 40,000? Or maybe, back to 6,547?

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Thumbs up. Laptops, no good.

    I used to be a LaserJet repair specialist. Great printers back in the day.
    http://www.360tech.com/images/33440A.GIF

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    too much maths, where is my tequila!?..

  • Mark Shinnick

    Go 4 the Gold…..Golden Mean, that is, could help the estimate.

  • BobbyLow

    He, he. :)

    You and I were here in March 2009, and none of us could have imagined what was going to happen. We were all looking for Pee 3 back then.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    You are correct. But it wasn’t a total loss.
    I figured after the headfake in Summer 2010, and it just won’t die in Fall 2011, I should take some long positions.

    No regrets there. as I’ve said a few times: “Zimbabwe B!tches”.

  • Mark Shinnick

    Hey BTFD’ers…. wear this….show your monster trading skills stuff :)
    https://uploads.disquscdn.com/images/0b0c86fd9e07a665a6eef7d8616ce4c44aef265d9a40c8980b7d1b07044ded2f.jpg

  • Ronebadger
  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Ronebadger

    It looks like it closed at 11.46, just over the upper BB

  • Mark Shinnick

    Yeah, inside joke might be we only meant pips.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    have you heard of snipper? it’s included with Windows.

    https://cds.technorms.com/wp-content/uploads/2011/12/Snipping-Tool-Capture-Options.jpg

  • Ronebadger

    I’m on Firefox mostly. How do I find this snipping tool in Windows or Internet Explorer?

  • ZigZag

    Well the fact is, it is account suicide to go home short when there are central bankers in time zones around the world who can open their mouths to jawbone. As long as this is the case, there will be big bounces into closes.

  • Mark Shinnick

    Yes….its been the perfect Sheeple conditioning….while the central bankers have now been given the green light to unload. This apparent “transfer of the bag” we are privy to be seeing here is truly amazing.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    judging from your full windows screenshot.
    Do you have a Windows Key on your keyboard? hit that, and type in snip. Hit enter, and magic. it should appear.

  • Ronebadger

    one must search for snipping tool…then it comes up…thanks

  • ridingwaves

    word…

  • ridingwaves
  • Scott Phillips

    I’ve started doing some emails/youtube videos in preparation for eventually releasing a tape reading course and maybe selling one or more of my systems (not sure yet)

    Anyway, I did a video on todays price action. I’m interested in your thoughts, or whatever else you might want to see in videos. I really don’t know what I’m doing so open to ideas.

    https://www.youtube.com/watch?v=yZTch70kjj4&feature=youtu.be

  • Mary

    Thank you Scott. Very informative. I would think that since each market is a continuous tug of war with no end in sight, each moment is unique. How to package that into a course? That will be a challenge. If you posted a video like this every day for a year you would probably never produce the same content twice.

    It seems like tape reading would be more of a mindset than memorization of cause and effect.

    That being said, I learned and enjoyed. Thanks again.

  • ridingwaves

    Scott, Nice video, my only idea would be to cut it down to 2-4 minutes, almost like market in a minute kind of theme, people tend to be limited on time and believe their time is sacred though usually not the case. I just think you will get more traction with quick hitting videos though you will have to leave some info out to keep it quick..but that is there issue not yours….its hard to squeeze some viewership with all the distractions people have….
    my 2 cents

  • kudra

    QQQ looked like it wanted to bounce this morning, but seems to be having a difficult time getting fully aroused.

  • ridingwaves

    vix little nervous at end of the month heading into 4 day weekend…nice comeback off initial push down today..

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    easy come, easy go

  • ridingwaves

    maybe a couple more houses will go up for sale in my neck of the woods….
    chinese phantom money was given free ride to come in and scoop up properties in the US by the bammer admin….fake money screwing Americans out of housing choices..
    https://www.youtube.com/watch?v=NBh895KdXAU

  • OzarkHillBilly

    Good stuff, but previously when I read your advice, in my head I had you sounding like Lord Humungus. Kind of like when we read Morgan Freeman quotes.

    I started to watch your first video as well, so I’ll have a better idea of what you’re aiming for in the future. Seems like your audience would need a basic understanding of candlesticks, which you probably cover at some juncture, and more importantly (at least to me), how you got to the point you are now and why you use such and such particular tools. Seems like you’re addressing that in the first video.

    Ridingwaves brought up the video duration, which is a valid point. I’d bet that once you are a bit more focused and practiced on what you want to convey with each video, they’ll naturally get a little slicker and shorter without missing any info. I imagine that the videos you have will vary in length accordingly to their purpose; instructions on core concepts that you want to drill into someone’s brain can take longer than something like a daily market update. The video above tends to fall in between. You’re calling attention to a rare event with lots of potentials, so even if it was part of something you were doing on a daily basis, it’s worth spending the extra time. I’ll keep an eye on your YouTube channel.

  • Mark Shinnick

    Looks like it all snapped-back into the appearance that “nothing ever really happened”, yet the central bank selling green light is handing the bag over under the radar of this volatility illusion. I think its just going to be a sinkhole we all wake up to one morning, so I’m not so sure anymore about trading volatility.

  • Mary

    A friend of mine produced many big ticket training videos for industry.

    He said that course design must happen before the individual lessons are produced.

    1. Make a list of everything the trainee needs to know
    2 Arrange the list in a logical order based on prerequisites
    3. Produce the individual lessons.

    For each lesson:

    1. Tell them what they’re gonna learn
    2. Teach the lesson (keep it short and focused to allow digestion like a song on the radio)
    3. Tell them what they just just learned

  • Mark Shinnick

    Serious market students need to hear and re-hear everything you said; it’s all important, and rich in dense understanding. Personally, I think the length is OK for the reason of its quality…it should not be relegated to a convenient time span of attention in competition with lessor market understanding density videos. A serious market student already accepts wide variation of personal communication styles and simply wants to join in your natural headspace of aware observation and control over market information. If you become a regular at this you will naturally evolve a even better conciseness.

  • ridingwaves

    yes, much less stressful trades..
    oil picking up bid today before long holiday….possible drawdown next week after all that traffic?

  • ridingwaves

    simple and sweet…

  • ridingwaves

    funny Puerto Rico is a little bit smaller debt disaster than Greece but Greece is more newsworthy..
    https://www.thenation.com/article/bankers-behind-puerto-ricos-debt-crisis/

  • Mark Shinnick

    Yeah… with unatural low rates to wildly expand the global debt bubble feeding to gross private and public irresponsibility ….what could possibly go wrong?

  • ridingwaves

    bankers…they eat the flesh of the poor….after turning them into the walking dead…

  • HD

    Ahh, The almighty VIX… June SPX range 1.9%- sq root = 1.37 * 100 = 137 /12 = 11.48 – see what the calculation is at EOQ, EOM later today. Not a predictive tool IMO.

  • HD

    Nice read, my take – SPX started the week w a 10 handle up, Friday same. Rolled over. Symmetry in rallies off 2419 & 2406. Very technical. June opened 2415.65. Just 10 handles from today’s balance.
    A near perfect ABC elliot wave this week from 2450-2406 JMHO

  • Wave_surfer

    21,300 is a little over 3x of 6,547
    therefore
    if you started with $100,000 you would have a little more than $300,000, not $2M

    I am not sure, but is the problem in the math that when you got the 36% annual rate you did that by simple division of 325% by 9
    But then when you recalculated your return, you used compounding interest.

    If Dow has returned 325% in 9 years then your return would be 325%.
    Also, it was a growth of 225%. 225% growth on top of your 100% investment.

    Taking the 9th root of 3.25 gives me average growth of 14%. Of course much of that growth was in the first 6 months.

    The 9 months before March 2009 was a bigger decline than normal, so the snap back for the next 9 months was bigger than normal. Those were ‘special’ years. Too see what the environment has really been like lately, you could look at the last 7 years.
    I wonder what the average annual return from June 2010 to June 2017 would be. Probably not that insanely high for the last 7 years.

  • Mark Shinnick

    Fidelity’s website is down….. this reminds me that when it comes time to manage selling, shutting down sites is one of the creative tools. Our most leveraged tools would never exist without technology….which I’m not so sure we will be able to rely upon.

  • Ronebadger

    My Fidelity Active Trader Pro seems to be working.

  • Mark Shinnick

    Yeah, someone else made that report… I just really want to make to point that we need to be thinking on a more robust level than we have adapted to in relative good times. No doubt the broadest stability and perception of confidence will be necessary to unload the bags…but once that happens I think leveraged instruments get new risk.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    mine is broke. IT U.S. maintenance before a big weekend? genius.

    Good chance the UK has their own special site mate.
    😉

  • Tomcat

    In terms of length RW is right to the point that depends on your target audience. So say, if the bulk of your audience is in their 20s, they can hardly keep a “hard-on” longer than 3-5 mins. Personally what I liked about the video, was your hesitation while speaking, bc it made it clear that you were not going based off some script, but rather your experience/logic. Most folks with common sense will appreciate that.

  • Tomcat

    if you are looking for some equity exposure rather than messing with these sideways BS, consider an option plan on $CSCO, they report in August, and if you are neutral or bullish nazzy, this is something you should look into. Similar to NKE, I expect a blow out of the very low expectations for this quarter.

  • Tomcat

    I say option play, bc options are very cheap in this name.

  • ridingwaves

    oil is still getting some action…short week tightens everything up next week, resistance right at 46.30-40

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Scott Phillips

    Thanks Tomcat. I think the thing for me to do is check the stats on when people stopped watching.

    I’m just new at this and I really have no idea what kind of content people want.

  • Scott Phillips

    Thanks Mark. I’m just learning at this, the only thing I had in mind is that the net is completely overflowing with content for the beginning trader (most of it shit), but there isn’t a lot for the expert trader.

    My experience is that I became a complete pro in all aspects somewhere in 2015, but by 2013 I was actually pretty good (and by 2011 I was profitable).

    Leaping that chasm from “pretty good, but still not making big coin” to actually making a living was actually a good trick.

    That is the kind of transformation I’d like to document. BobbyLow did it, Dudeplunger did it (also from this blog back in the day), a few others have done it.

  • Scott Phillips

    Thanks Mary

  • Scott Phillips

    I’m actually kind of softly spoken in real life, videos don’t come naturally to me.

  • Scott Phillips

    Thanks RW – In 24 hrs a google report is available I’ll check when people started to drop off.

  • Scott Phillips

    I think thats the essence of what I’m trying to convey. A single bar of price action can completely change the game. So long term predictions can be negated by a single bar

  • Mark Shinnick

    That kind of transformation really is some of the stuff of life…exciting as can be if you can open that sort of window, seems like your off to a great start.

  • Scott Phillips

    The way it happened for me, is I nearly blew up and had an epiphany.

    That professional trading was finite. There were certain things that once you are doing them, you are as good as anyone in the world.

    1) Have a system, with an edge
    2) Trade that system with almost no mistakes
    3) Keep accurate records (not trade statements)
    4) Review those records regularly to monitor both system performance and personal performance.

    If you are doing all those things, you are killing it.

    If you aren’t doing any one of those things, there is probably some psychological impediment to doing so. So we ask the hard questions

    – Why do I get a strong feeling of shame when I open up my trade logs
    – Why don’t I want to review my losing trades for learning lessons?
    – Why do I resist having a system, despite trading for years?
    – Why do I resist testing the technical analysis I rely on, am I scared that if I really tested it, maybe it wouldn’t be an edge?

  • Mark Shinnick

    Scott, Way to go man… nobody can go wrong with this :)

  • hellbent

    Very good oil

    https://uploads.disquscdn.com/images/895a3aae440f935fc19faa5d570422adef1d1cf95e8a5b6ff6bd7ecea79882ab.jpg

    sad ‘great face for radio’ doesn’t apply to Australians. muahaha

  • OzarkHillBilly

    I’d call that a plus and not a minus for this, as too much polish can come across as being fake, at least to me. I appreciate your transparency, authenticity, and sincere desire to help, which all comes across in the videos.

  • OzarkHillBilly

    Does the data show if someone started to watch, dropped off, but finished it later?

  • Scott Phillips

    I fell from the ugly tree. Hit many branches on the way down!

  • Scott Phillips

    A video I did about a setup on beans on Friday, with a setup tomorrow in the emini

    Interested in constructive suggestions :)
    https://www.youtube.com/watch?v=Gcq-s7i09Dw&feature=youtu.be

  • TerpFan

    Scott,

    Video won’t play. Screen says “This video is private”.

  • Scott Phillips

    Oops, thank you!

    I fixed it, my bad

  • BobbyLow

    Excellent Scott.

    I think the length was fine. Six Minutes fourty eight seconds in not a long time to learn something of value. The early context and backgound builds evidence for your conclusion of possible outcome.

  • ZigZag

    I had some of that I think early in the year – was holding it for the $9 buyout price, until I thought “holy crap – this is all downside risk” Sold it literally the day before it started plunging. Better to be lucky than good.

  • ZigZag

    I like it – I haven’t come across many (if any) places that discuss bar by bar tape reading. The weekends or after market hours are good times to post in-depth videos. Otherwise people aren’t going to have time to concentrate on them.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    The night is young, but the dollar continues to stay positive.

    it’s a Good Thing, Mole won’t have to double the rates.
    😉

    https://uploads.disquscdn.com/images/2b603390a873dd56901af3b66a43287efe3c6cf39b765037b4521ae71f0b4a8a.png

  • Mark Shinnick

    Yeah, that added almost too much risk to the trade:)

  • http://evilspeculator.com Sir Mole III

    We’re almost at 1.15 – if it pushes beyond that then it has the potential to go quite a bit higher. Not sure what the ECB is thinking though as this is going to put quite a damper on exports over here.

  • Tomcat
  • TerpFan

    Zero not working for me today. Anyone else?

  • http://evilspeculator.com Sir Mole III

    Just checked it – working perfectly.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    The PnF says 1210.
    fools rush in..

  • TerpFan

    Shut down my browser and restarted. Now working fine. “If I only had a brain!”

  • Tomcat

    Do you have any evidence that I am no fool?

  • http://evilspeculator.com Sir Mole III

    What are you using? NCSA Mosaic? 😉

  • TerpFan

    OPERA. Been working fine forever. Today just an outlier.

  • TerpFan

    But, I do remember Mosaic!

  • BobbyLow

    Market closing early today at 1 PM ET.

    Gold and Bonds tanking this morning. Would have worked out to hold over the weekend but these long weekends with a half day inbetween are like tip toeing through a mine field.

  • ridingwaves

    gold was taken out again by huge block order on thinly traded market….in fact, no trader would have pushed the button to sell in such a way to guarantee a bigger loss

  • http://evilspeculator.com Sir Mole III

    Then you’re an old dog just like me :-)

  • ridingwaves

    http://www.marketwatch.com/story/us-car-sales-fall-sharply-in-june-as-prices-rise-2017-07-03

    Edmunds.com reported that the average monthly payment on a car or truck has soared above $500, forcing buyers to stretch more than ever to obtain a new set of wheels. The firm estimates the average auto-loan length reached a record 69.3 months in June, with the average amount of financing reaching $30,945, up $631 from May.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Not at this time Your Honor.
    https://i.ytimg.com/vi/ZnuJVWdQk9w/maxresdefault.jpg
    😉

  • http://evilspeculator.com Sir Mole III

    That’s simply insane – absolutely not sustainable. I never understood the stigma of driving an older car. You can pick up a perfectly functioning five year old Toyota with about 70k miles for a little over half its original sticker price:

    https://www.cargurus.com/Cars/2012-Toyota-Camry-Price-c23116

    You can pay at least half down in cash and pay the rest on credit at about 5% over two years. A little over $300 – not great but it doesn’t break the bank either.

    At ~$31k and only 5% interest rate (probably doubtful if the term is so long) you are effectively paying back almost $37!! A few decades ago people used to buy family homes for that much money. THIS is almost symbolic for what is wrong with America. Wasting your life’s wages on paying off a rapid value depleting asset.

    (shakes head)

    Here in Valencia I’m driving a little moto which is perfectly adequate for getting to the gym and back, even in the rain. Costs me very little and the damn thing runs on water.

  • Tomcat

    this is another sign we are near or at the TOP of this market cycle. Car inventories are at previous bubble highs.

  • Tomcat

    Its a psychology effect, envy. Because your neighbor is pulling out of the driveway with that brand new Lexus or Mercedes and you ask yourself, if he can do it, why cant you. Munger put it best: “Envy is a really stupid sin because it’s the only one you could never possibly have any fun at. There’s a lot of pain and no fun. Why would you want to get on that trolley?”

  • ridingwaves

    The auto bubble was created by the bankers during the crisis. First they govt. rescue GMAC, GM financing arm, then change name to Ally, then introduce subprime tiered rates back into the market, wait for other captive and secondary lenders to also mimic program as they don’t want to miss a little yield while improving GDP via auto manufacturing. The auto industry has sold 85 million cars in the last 5 years….their are 218 million licensed drivers. That’s a lot of asses and in the car industry they believe their is an ass for every seat.

    the bubble has peaked, look for it to start creeping into more headlines as the car industry starts posting lower numbers.

    if you can hold out for 1-2 years before purchasing a used car you will be happy, used values might decline by 40-50%….wait for it and get a killer lease return deal….

  • ridingwaves

    see below, this is my niche…

  • Ronebadger

    Russell up 1%, NDX down .75%…can someone explain this to me? Must be something in those indexes.

  • Tomcat

    I agree in spirit, even though I wouldnt generalize it like you did. I happened to work for that company at the time and the details of the bailout are very clear to me to this day. Ally an independent company to GM for 10-15 years now, since then has diversified their business, even though they will still be brought down next car market crash. Another twist to the story is when GM saw the nice returns posted by their once blue star arm, purchased a financing arm known as…wait for it…GM financial which “specializes” in subprime car loans, which as you can imagine are mostly used cars. By the time, this poor folks end up paying for their car which in avg is about $10k (even though the car is worth no more than half that) they would have paid for a new car price $25k. Most deals avg 60-72 months with interest rates 8-to as high as 20%. Wall street believes that this is not as big as mortgage subprime mess was in 08, because most people tend to pay their cars first before they pay their mortgage. I completely disagree with this assertion. This coupled with the reigning of the balance sheet from the FED will be the main drivers of the next bear market IMO.

  • ridingwaves

    Ally is GMAC…
    https://en.wikipedia.org/wiki/Ally_Financial

    I used to buy ABS paper for a couple secondary lenders, risk was thrown out the door to achieve volume…This mis-priced risk is now coming into play with negative equity and credit overburdened consumer car buyer. The same BK customer I would buy at 18% in the 90’s was being bought at 8-10% over last 6 years….Like the Big Short, someone is already short ABS paper and waiting on a nice return…

  • BobbyLow

    I’m also seeing so-called “reputable” new car dealers allowing new cars to be bought with little or no credit again. Ads are something like “all you need is a job and $149 and on top of that we’ll pay off the loan on your old car no matter if you owe more than the car is worth”. This is encouraging disaster but apparently they don’t give a shit (again).

    BTW, I’m doing things a little differently with my cars now. In 2015 I bought a new Chevy Malibu. It was a good car but it was a little too small for me so I decided to trade it in at the beginning of 2017. I really bent over on this deal because of the first year and a half’s depreciation on the Malibu. But I bit the bullet anyway and traded it in for a 2016 Impala that had about 15,000 miles on it. The price differential wasn’t that much considering the difference in the models and quality in relative terms because the Impala had also suffered a shit load of depreciation from the cost of new. I now plan to trade this 2016 Impala in 2018 for a 2017 before my new car warranty expires. Because I’m not putting as much milage on my cars anymore, my intent is to keep rolling these cars over and basically pay for the part of the depreciation that occurs while I own these cars. I’ll let someone else take the first year’s hit (which is the worst). In the mean time, I’ll be driving a fairly new car under full warranty and swapping it out about every 18 Months.

    I understand that it would be more prudent of me to purchase a used good quality vehicle and drive it forever but fuck that. Forever ain’t that far away. :)

  • Mark Shinnick

    Yeah…I could never bring myself to buy new while knowing of what happens in the first year or so….my grandmother taught me that one….just made too much sense :)

  • Mark Shinnick

    Once a person realizes that spiritual trolley is not for him, I think all sorts of other of the genuine observations about life open up to make us less sheeple and more freedom loving. The enslavement of envy….just mind blowing.

  • Mark Shinnick

    You should see what I bomb-around LA with…. all the envy-status sheeple stay well-clear like avoiding a plague. Its a very liberated feeling to have no such care or concern whatsoever.

  • http://evilspeculator.com Sir Mole III

    Dude in L.A. I drove an old Toyota Celica – cheapest POS you can find but it’s a great stick shift, is super nimble, runs on water, and you can park it anywhere. Most of all, nobody every tried to steal anything. Meanwhile all my friends were driving cars they couldn’t afford, paying huge monthly leases and several hundred per month in insurance. What can I say, I’m a cheap old buzzard 😉

  • http://evilspeculator.com Sir Mole III

    I agree with your perspective Tomcat. It’s one thing having to give up your house and move your entire family to another district or even city – oh yeah and perhaps find a new job. It’s another to simply dump your car or let it get repossessed after you stop paying the lease. But once again everyone thinks that ‘this time it’s different’ because X. The truth is that nobody really expects things to be different but that they fully expect to be made whole courtesy of the taxpayer when the entire house of cards invariably comes crashing down on the them. Something tells me however that Trump probably would take those fuckers to task and then tell them to pound sand.

  • http://evilspeculator.com Sir Mole III

    The greatest generation – they knew how to pinch a penny. Such a bummer that they’re dying off now – they are sorely needed as the whole world is turning upside down.

  • http://evilspeculator.com Sir Mole III

    Holiday tape – don’t read too much into it.

  • http://evilspeculator.com Sir Mole III

    Great timing, two or three years from now may be just when I move back to the United States. Real estate and cars should be a lot more affordable by then.

  • Scott Phillips

    In 20 years the idea of owning your own car for most people living in cities will be ridiculous. The idea that you might want to work extra hours to get a car so people know how rich you are will seem insane.

    Once we have self driving cars who cares what sort of car it is?

  • Scott Phillips

    That is an excellent quote!

  • Scott Phillips

    Thanks Bobby. I appreciate your comments as usual. I’d like to do an interview with you sometime soon.

    I thought about it, and my core message is one of transformation. That you CAN absolutely change from a loser to a winner, and there are steps you need to take.

    You did it, and I’m sure people will be interested to hear what you did!

  • Scott Phillips

    Yep. Holding steady at average view time of 5.5 minutes, which surprises me. I thought most people would drop off at the start

  • http://evilspeculator.com Sir Mole III

    Fuck no – I don’t want a self driving car. Where’s the fun in that?

  • Scott Phillips

    In todays video I show the elements of the hammertime setup I’ve been using in my production systems since 2014

    https://youtu.be/xlXkU9EIZKo

  • Scott Phillips

    Remember Tuscany? Italians should be banned from driving worldwide. Crazy assholes!

  • Scott Phillips

    One tip, if you are doing a monte carlo simulation.

    Because of bayseian probability (and Murphys law) when your systems are good, they tend to be very very good, and when they turn bad, they are horrid.

    A better way is to scale back your size per trade in drawdown. Mole and I are doing that with scalpius and it’s working a treat. We are trading just the period of the equity curve where it’s cranking winners all the time.

  • hellbent

    More good stuff. You are coming through pretty clear by my reckoning. It’s always a challenge to be concise and being perhaps a little long would be my only criticism. But, this is offset bigtime by the deeper understanding that comes through. All sausage and no sizzle. Totally the opposite of most stuff out there. Should be well received – good luck.

  • Scott Phillips

    I honestly tried to keep it short, but I could just talk for hours and hours about this stuff 😉

  • Scott Phillips

    Thanks for the feedback, I appreciate it, and it’s important for me going forward to deliver what people want.

  • hellbent

    Just one question for you..Why Ninjatrader?
    I spent nearly two years cursing the &^$%&^ out of it and decided to give Multicharts a whirl. IMO it’s way better. I think you said as much some time back. So there must be some facet of Ninja that puts it ahead. I certainly don’t know what it is.

  • Tomcat

    When I first read Hammertime I thought was hilarious, since it reminded of this guy I fought called HammerTimeStan and I guess my friends tell me there are snippets floating around in the WWW. One of the few opponents I seriously hated (believe it or not, most fighters don’t have strong hate feelings against opponents). I happened to win that fight by arm bar, even though I must admit I got “very” lucky since I was taking a beating until then. Anyway, we happened to become good friends and still keep in touch to this day. I think Stan would find it hilarious that there is a technical setup with his nickname.

    I love the fascinating work you guys put in using TA and I am looking to learn and finding these videos very helpful. I couldnt help but notice you are using $NG, which I happen to have a limit buy at $2.9. I am very biased to the upside given the fundamentals of this commodity. With the LNG exports increasing, this thing I anticipate will hit $4 in the next 12 months or less. I may be dead wrong, but I hear that’s what makes a market.

  • http://evilspeculator.com Sir Mole III

    Agreed – self driving cars should be obligatory for Italy, Those guys are nuts. Only problem is that once they’re relieved of manual driving they’ll probably start throwing bottles and used tampons at cars they think are blocking their way.

  • Scott Phillips

    This particular setup has a win rate of 50%, so there is literally no predictive capability. What it is saying essentially is…

    It probably won’t go down, but IF it does, there is a 50% chance that it runs a long way and a 50% chance it reverses.

  • Scott Phillips

    Ninjatrader is garbage. So much so that after Mole and my 50th support call or so, they refunded our lifetime licence.

    I still use it because if I change, my mistake rate will go up for a few months. One or two mistakes a month for 3 months until I get completely proficient with new software is going to cost me $30K / so, and make me feel like a shit trader again (which I hate)

    And I have all these cool indicators that Mole programmed for me, and I also run one of Mole’s auto systems (that I designed), which is trading the house down.

    So that’s what I tell myself, but the truth is I’m just lazy, in a comfortable rut, and I’m at the stage in my trading where I don’t get upset or anxious, I just wake up every day, do my thing, and start doing my day.

    At a competent level, professional trading should be like being a lawyer or an accountant or engineer. You pay complete attention while you are at work, but you aren’t losing any sleep over anything, because it’s just a job and there are more important things in life.

    Mole’s scalpius is a thing of beauty btw, you should be using this when he releases it.

    https://uploads.disquscdn.com/images/bcdcb2c0a0d131914325cb5ec65d4a8cc39b83e5afc59dd186b5c9b9115c540b.png

  • Scott Phillips

    My wife was freaking out because Thai people are ridiculously over the top polite, and Italians pride themselves on being rude assholes.

  • hellbent

    OK, thanks, that kinda validates what I’ve found. I’m deep into system building and thus far am all spreadsheet based. MC gave me the immediate advantage of live data to Excel via RTD link. Historical export is a breeze too. Changing platforms is a setback for sure but I’m kinda pleased I bit the bullet now and not another year down the track.

  • Scott Phillips

    I constantly have to remind myself we chose ninja because it was cheap. It’s probably not fair to expect it to be as good as professional solutions.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    ok, back from fireworks.

    Here’s hoping CaptainBoom is rested and ready.

    https://www.youtube.com/watch?v=RxDz7vGc6Zc
    -GG

  • OJuice

    Thanks for the input.

  • http://evilspeculator.com Sir Mole III

    I’m finishing a new post – give me 15 😉

  • ridingwaves

    good short week for volatility to push north

  • http://evilspeculator.com Sir Mole III
  • Mark Shinnick

    Every once in a while I update my models’ thesis of what’s happening for the markets I most frequently trade. General $ strength, miners weakness remain in play.