AI

The hypothesis that a double top pattern in the daily RSI (Relative Strength Index) above 70 often leads to a near-term pullback has some support in technical analysis literature. Several sources provide insight into the behavior of RSI in overbought conditions and its implications for potential pullbacks.

1. RSI Overbought Conditions: When the RSI exceeds 70, it indicates that an asset is overbought, suggesting that a pullback may be imminent. Historical data shows that selling signals triggered when the RSI crosses below 70 after being above this level often correlate with short-term price declines ( Quantified Strategies) ( TradingSim).

2. Double Top Pattern in RSI: The double top pattern in RSI, where the RSI hits above 70 twice before pulling back, is considered a bearish signal. This pattern indicates that momentum is weakening, even though the price may be reaching new highs. It often precedes a price reversal or pullback ( Quantified Strategies) ( Quantified Strategies).

3. Backtesting Results: Backtesting of RSI-based strategies generally shows that signals from overbought conditions (RSI > 70) can be profitable. For example, a study of the S&P 500 using a range-momentum trading strategy based on RSI showed that while such strategies do not generate frequent signals, the ones they do produce are often profitable. This implies that overbought conditions, particularly with confirming patterns like a double top, can indeed lead to significant pullbacks ( Quantified Strategies).

Can Matt or Steve weigh in on this?   I closed out my SLV.    Now if I trade SLV again and take a loss, it will not "count" to reduce my income as it will be called a wash sale.   Its really quite shameful the law is like this. 

for stock technical trading I hypothesize that when the wilders RSI 14 daily does a double top about 70, there is a large chance for at least a near term pullback.   Can you find stats to prove or disprove or assign odds at least

My conspiracy theory is that 60% of the totally unaccountable money we send to "Ukraine" gets returned to leftist organizations and foundations in the USA as US stocks transferred in kind.   Prove me wrong.

I closed out my SLV, I had a large position, my biggest net profit of last 2 years, nice.    No joke, can buy a house in Japan with that. 

Also closed the SPY proxy for the /MES breakout long, LOL pays Matts fee for the year.

Silver, perfect backtest, and measured move still points to 40+

oh my, check the wording on the right

I took the long using SPY as not setup for futures, put stop at 522.45, I see previous high at 524.61 which is just 1.4 points away from the close today.  

Any thoughts?   Stop too tight?   My entry was 520.65

Boot Barn!?

Seems risky to chase at this time.   RSI14 daily is high, although the "measured move" off the IHS or cup and handle seems to have more room.   I wonder what Demark would peg this as?   Is there an easy way to get a Demark labelling?

We appreciate you doing it.

Wow, had no idea that Reddit was listed, so of course they are "mainstream", Mahalo!

You got me!   I am familiar with Reddit, which I consider mostly "normie types" who have some brains but live inside the Overton Window.   I was surprised that they as a group actually game some tickers enough to move them enough strike my stops....damn them.    I tried for 3 hours to get AI to make a reasonable One Line Electrical Diagram because I detest doing those....complete and abject failure.   Big Aloha Digi, you have good contributions.    LOL after I "wrote" this, I had Carvana send me an email, first time.  

I got Paypal credit, and they also have scammy type stuff in line.   Need to call and cancel.

LOL, I prefer head intact!

In the context of stock trading, "WSB" typically refers to "WallStreetBets," which is a popular subreddit (online community) on Reddit where participants discuss stock and option trading. It's well-known for its aggressive trading strategies and its role in driving the prices of certain stocks, often those with high short interest or those considered highly speculative, such as Carvana.

The mention of "high visibility in the WSB world" implies that Carvana has been a topic of significant interest among the members of WallStreetBets. This can lead to increased volatility and trading volume as members of the subreddit may engage in coordinated buying or selling based on shared strategies or sentiments. As such, any stock that gains attention on WallStreetBets is considered to have a potentially higher risk and reward profile due to the possible influence of speculative trading driven by the community's discussions.

In the other 6 months, it looks like they are doing a bit better lately

LOL Gap Fest!

If you really want to go down the rabbit hole, consider that it is 90% completely intentional, and I am amazed it is working "so well"

I knew that was a blow off top, asked wifey in Japan to convert all USD to JPY, 158

Getting destroyed after hours.....it's tough trading whilst in Hawaii, I just can't do that 3AM thing anymore.    

LOL "FURU"