Weak Fridays Tend to Lead to Weak Mondays
1/17/2010 7:23:25 PM
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But was the weakness on Friday the start of a larger move lower?
Stock Barometer Analysis
The barometer remains in Sell Mode.
The Stock Barometer is my proprietary market timing system. The direction, slope and level of the Stock Barometer determine our outlook. For example, if the barometer line is moving down, we are in Sell Mode. A Buy or Sell Signal is triggered when the indicator clearly changes direction. Trend and support can override the barometer signals.
Money Management & Stops
To trade this system, there are a few things you need to know and address to control your risk:
- This system targets intermediate term moves, of which even in the best years, there are usually only up to 7 profitable intermediate term moves. The rest of the year will be consolidating moves where this system will experience small losses and gains that offset each other.
- This system will usually result in losing trades more than 50% of the time, even in our best years. The key is being positioned properly for longer term moves when they come.
- Therefore it is vitally important that you apply some form of money management to protect your capital.
- Trading a leveraged index fund will result in more risk, since you cannot set stops and you cannot get out intraday.
- Make sure you set your stops so that you can lose no more than 2% per trade (based on the QQQQ if you're trading leveraged funds and options with our trading service).
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Use Options to Target Consistent & Conservative Profits - over 80% annualized in 2009 with only one loss of -2.5%!
Potential Cycle Reversal Dates
2010 Potential Reversal Dates: 1/19, 1/28. We publish dates up to 2 months in advance.
Since we are in Sell Mode, we'll target the next reversal date as a bottom. But that only gives us until next Tuesday for the 19th. We'd need to see some sharp weakness to do enough to set a bottom by that date. So I'm leaning towards more weakness into the 28th. But every day gives us another clue in the puzzle we call the market.
My Additional timing work is based on numerous cycles and has resulted in the above potential reversal dates. These are not to be confused with the barometer signals or cycle times. However, due to their past accuracy I post the dates here.
2009 Published Reversal Dates: 1/20, 2/11, 3/7, 3/15, 4/8, 4/16, 4/27, 5/7, 6/8, 7/2, 7/17, 9/14, 10/10, 10/24, 11/12, 11/30, 12/9, 12/21, 12/29. 2008 Potential Reversal Dates: 12/31, 1/11, 2/1, 2/13, 3/6, 4/5, 4/22, 5/23, 6/6, 6/27, 7/13, 9/2, 10/3, 10/22, 11/10, 12/11. 2007 Potential Reversal Dates: 1/10, 1/14, 1/27, 1/31, 2/3, 2/17, 3/10, 3/24, 4/21, 5/6, 6/15, 8/29, 10/19, 11/29, 12/13, 12/23, 12/31, 1/11/08. 2006 potential reversal dates: 1/16, 1/30, 2/25, 3/19, 4/8, 5/8, 5/19, 6/6(20), 7/24, 8/20, 8/29, 9/15, 10/11, 11/28. 2005 Potential reversal dates: 12/27, 1/25, 2/16, 3/4, 3/14, 3/29, 4/5, 4/19, 5/2, 6/3, 6/10, 7/13, 7/28, 8/12, 8/30-31, 9/22, 10/4, 11/15, 11/20, 12/16.
The J.E.D.I. Trader
Stocks, Options and Options on futures advisory service (up over 100% in 2008).
Use the following spread/momentum indicators to assist in your trading of the QQQQ, GLD, USD, USO and TLT. They are tuned to deliver signals in line with the Stock Barometer and we use them only in determining our overall outlook for the market and for pinpointing market reversals. The level, direction, and position to the zero line are keys in these indicators. For example, direction determines mode and a buy signal 'above zero' is more bullish than a buy signal 'below zero'.
QQQQ Spread Indicator (NASDAQ:QQQQ)
The QQQQ Spread Indicator will yield its own buy and sell signals that may be different from the Stock Barometer. It's meant to give us an idea of the next turn in the market.
Gold Spread Indicator (AMEX:GLD)
Want to trade Gold? Use our signals with the Gold ETF AMEX:GLD. Gold gives us a general gage to the overall health of the US Economy and the markets.
The Advantage Report
Market timing advice for only $10.95/month
US Dollar Index Spread Indicator (INDEX:DXY)
Want to trade the US Dollar? Use our signals with the Power Shares AMEX:UUP: US Dollar Index Bullish Fund and AMEX:UDN: US Dollar Index Bearish Fund.
Bonds Spread Indicator (AMEX:TLT)
Want to trade Bonds? Use our signals with Lehman's 20 year ETF AMEX:TLT. The direction of bonds has an impact on the stock market. Normally, as bonds go down, stocks will go up and as bonds go up, stocks will go down.
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OIL Spread Indicator (AMEX:USO)
Want to trade OIL? Use our signals with AMEX:USO, the OIL ETF. We look at the price of oil as its level and direction has an impact on the stock market.
Supporting Secondary Indicator
We daily monitor hundreds of popular and proprietary technical indicators that break down market internals, sentiment and money flow to give us unique insight into the market. We feature at least one here each day in support of our current outlook.
The McMillan Letter ($8.95/Month)
Join Analyst Mark McMillan as he explores and identifies current market opportunities
Summary of Daily Outlook
We remain in Sell Mode, looking for a move lower into the end of the month - unless we get sharp weakness into Tuesday or Wednesday, then we could see a short term bottom and a rally into month's end. This is an important week for this next larger move.
We have some new exciting changes here at the Stock Barometer. First and foremost, we now provide a service where you can get all our research, roughly 150+ market timing indicators, updated every singly week.
Miss your favorite chart here? There are two ways you can participate in this service. Simply by having an annual subscription to any of the following services you will get this service thrown in for no additional cost!
Jay DeVincentis' Daily
Jeff Neal's Stock Trader
Bill West's Fat Pitch ETF Advisory
Mark McMillan's - The McMillan Portfolio
Angelo Campione's Advantage Credit Spreads
Lynn T's 1-2-3 Plus Alert
Patrice v. Johnson's The JEDI Way
Stock Options Speculator
Covered Call Alert
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If you're not interested in an annual subscription (where you save 20% off the monthly price) and just want our indicators and charts - you can sign up for this service directly by clicking here.
What else is happening? Well, we're now offering a Covered Call Alert service with 50 top covered call plays for the Nasdaq 100, Russell 2000, S&P500, Index ETFs and the overall market. That's 50 Covered Call plays for you to sort through to meet your needs.
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