Posted by blorrilliere on 6th of May 2015 at 01:52 pm
This has nothing to do with the SPY systems. All it means
is that market behavior is at an extreme based on historical
data. The last couple times we lost Xticks, the market
continued down. As Steve pointed out, this is pretty
much the last support until 2048 or so on the SPX.
I really meant to say if Spy system "may" take a trade and
potentially any signal to go long, then is this down move at
oversold area is
limited?
maybe, I am trying to read too much in to things ( I
undersatnd x-tick is a momentum indicator)
the SPY systems are reversion to mean systems, they attempt to
buy pullbacks when prices are above long term MA's, which they
still are for now anyway. There are a lot of filters in place
to attempt to delay trades and try not to buy too early into
pullbacks that turn into much larger pullbacks, however you can't
account for everything- where the systems can get caught is
buying too early on a pullback that becomes a much larger
correction. This is also why I use all 3 SPY systems, to try
and have some diversification - for example today only 2 of the
systems will go long accounting for 58% of the combined - this
leaves room for the systems to average in at lower prices should we
go lower.
In order to exit the systems will do so on a bounce, the hope is
that even if this correction turns into something much deeper, the
market will have oversold bounces that will allow them to exit on a
bounce - for example the systems only need SPY to close over the 8
or 9 SMA's to exit - that's not much. And currently we are
quite oversold, today the NYMO is likely to close below the lower
BB for a second day. Also the daily SPX and BPT MA Deluxe are
now very close to the ATR but still above it
The systems can also take shorts when price is over long term
MA's, but they are rare - these are called Exhaustion shorts and a
60 Stochastic short reversal off 80%. Here's a couple
examples of those - actually the market was close to getting one,
but we needed one up day to get the 60 Stochastic closer to 80%
2 Xticks at this level on SPX
Posted by blorrilliere on 6th of May 2015 at 01:40 pm
spy system
Posted by ship on 6th of May 2015 at 01:45 pm
I'm new to the spy system- So if you had some signal that it may go long! Is that an indication that this move down is temporary? Or ?
This has nothing to do
Posted by blorrilliere on 6th of May 2015 at 01:52 pm
This has nothing to do with the SPY systems. All it means is that market behavior is at an extreme based on historical data. The last couple times we lost Xticks, the market continued down. As Steve pointed out, this is pretty much the last support until 2048 or so on the SPX.
totally un-related - the SPY
Posted by matt on 6th of May 2015 at 02:07 pm
totally un-related - the SPY systems are their own beast, and there's 3 of them, each independent of the other
I really meant to say
Posted by ship on 6th of May 2015 at 02:13 pm
I really meant to say if Spy system "may" take a trade and potentially any signal to go long, then is this down move at oversold area is limited? maybe, I am trying to read too much in to things ( I undersatnd x-tick is a momentum indicator)
the SPY systems are reversion
Posted by matt on 6th of May 2015 at 02:36 pm
the SPY systems are reversion to mean systems, they attempt to buy pullbacks when prices are above long term MA's, which they still are for now anyway. There are a lot of filters in place to attempt to delay trades and try not to buy too early into pullbacks that turn into much larger pullbacks, however you can't account for everything- where the systems can get caught is buying too early on a pullback that becomes a much larger correction. This is also why I use all 3 SPY systems, to try and have some diversification - for example today only 2 of the systems will go long accounting for 58% of the combined - this leaves room for the systems to average in at lower prices should we go lower.
In order to exit the systems will do so on a bounce, the hope is that even if this correction turns into something much deeper, the market will have oversold bounces that will allow them to exit on a bounce - for example the systems only need SPY to close over the 8 or 9 SMA's to exit - that's not much. And currently we are quite oversold, today the NYMO is likely to close below the lower BB for a second day. Also the daily SPX and BPT MA Deluxe are now very close to the ATR but still above it
The systems can also take shorts when price is over long term MA's, but they are rare - these are called Exhaustion shorts and a 60 Stochastic short reversal off 80%. Here's a couple examples of those - actually the market was close to getting one, but we needed one up day to get the 60 Stochastic closer to 80%
thank you Matt!
Posted by ship on 6th of May 2015 at 02:40 pm
thank you Matt!
Thank You
Posted by ship on 6th of May 2015 at 01:57 pm
Thank You