Posted by DigiNomad on 9th of Aug 2024 at 05:12 pm
Just be CAREFUL here. Maybe wait to see if we can get above SPX
5400 and make a lower high. This is whipsaw territory and there are
bear flags galore. Everyone plays the systems differently,
but as Steve said probably less than a week ago...it's not a
great plan to buy as price is entering a supply zone....whether a
system says to buy or not.
One thing I know for a fact - there are hordes of traders
just waiting take a big shot short at 5400. It couldn't be a more
obvious level. That doesn't mean it will work out for them, but
going long 55 points below that level seems like picking up pennies
in front of a bulldozer.
The ideal scenario would be a push above 5400 that reverses
and forms a higher low at 5400. That would be an "all clear!"
signal for me.
DigiNomad - yes and no regarding Steve's comments. Yes for
folks actively following the newsletters and blog posts, and index
supply and demand zones - it is good to try and incorporate that
into decision making.
that said - there are 100's and 100's of folks here who are only
here to follow the systems, they don't look at the community, they
rarely view a newsletter, they are here to take the system trades -
and you know what, what's fine too, if that's their style, that's
just fine. Not everyone is willing to get into all the market
analysis details and try and make decisions based on those -they
want to follow system trades knowing some will be losers as that's
just part of the game.
Here's the facts: 80% of emails these days are about the
systems. They are not about supply and demand zones, some chart or
analysis in the newsletters, they are about the systems. I don't
think it's good to call someone out who bought SMH from the system
that day when the KISS system went long into a supply zone -
that guy could have been a person who is here to follow
systems, and not get into all the technical analysis etc, and
that's fine.
Also - my rant the other day, you have to be careful about
second guessing systems - I went through more than a year where I
did not of the mean reversion systems trades, and a lot of the KISS
systems - why? because I could always find a reason not to take the
trade - and you know what, sometimes I was right, but mostly I
would have done far better just taking the trades. It creates
a psychological issue where once you start second guessing system
trades, you do that with every trade and soon you do none of
them.
I think a better approach most of the time is set aside the
capital you wish to trade the systems with, maybe have it in an
entirely different brokerage account where all you do is the system
trades. And in your other account you do the discretionary trades.
I also mentioned the casino betting strategy approach for
systems where you do all the system trades so that you don't fall
into the trap of not doing any (as discussed above) but you raise
and lower the bet size. Mean reversion systems win most of the time
so it may not make sense there, but for KISS systems with maybe 60%
winning trades, you have quite a few losing trades, so if you get a
couple losing trades in a row - a big winner is likely do so
increase the bet size. And after a the KISS system catches a
big trending move, maybe lower the bet size.
Posted by skwan1940 on 11th of Aug 2024 at 09:38 am
I'm one of those here who are interested primarily in the system
trades. I rarely post. I do have my own charts that I
look at, I understand technical analysis, but I have realized over
the years that I am my own worst enemy and by following trading
systems (especially the trend), my results are much better.
While I do appreciate the community here and I end up reading
most posts at the end of the day, I don't want to be staring at a
screen for multiple hours every day. I would rather set up my
fishing rod, wait for the fish to bite, do something else, and come
back.
Posted by DigiNomad on 10th of Aug 2024 at 10:43 pm
"I don't think it's good to call someone out who bought SMH from
the system that day when the KISS system went long into a supply
zone - that guy could have been a person who is here to
follow systems, and not get into all the technical analysis etc,
and that's fine. "
Umm, you know that wasn't me that called that person out on
buying SMH into a supply zone, right? It was actually a BPT
employee (or co-owner...however you guys are structured over
there).
As far as the other comments: Search "digi" and "system on
the systems" and you'll find many many posts from me on that topic
over the years. Probably from my older user names also (the only
one I can remember for sure is "surfah"...I think I might have been
"JT" for a while and before that I cannot confirm or deny but I may
have been piggybacking with a shared password thing and didn't post
back then
). Anyway, there is no shortage of"system on or
for the systems" content posted by me over the years.
I first found out about you guys from a Hard Rock Cafe
bartender friend in Hawaii way back in the day. We used to go out
after work, party it up, chase women, often stumble into some blow
and then find ourselves trading the New York open. True story
. I taught him all I knew about options and now he
works on the trading desk at TD Ameritrade...recently became
a Schwab employee. Anyway, we would watch these videos late late at
night and he shared his password with me because I was in business
school scraping by on a GI bill and couldn't afford it. That was
probably 2006 or 2007.
Posted by macksurf on 11th of Aug 2024 at 04:52 pm
Classic story. I lived in Maui for many years and lived a very
similar lifelstyle. Bartend at night, stay up for the Market open
and maybe do a trade, then go surf the early dawn patrol session,
come home sleep the rest of the day and do it all over again
😆🤙
Again you realize for the standard KISS systems, stops are close
confirming, not intraday, you wait for a close confirmation,
not an intra day stop, so I don't know what after hrs or magic has
to do with anything
also - the way the stats have always been built for the KISS
system tables is on the day the system triggers, the tables are not
using the closing price that day - they use the opening price of
the next day! All the stats on the trades are based on executing
the trade on the next day - that is assuming most will see the KISS
system trades after hrs or in the evening and not choose to enter
in after hrs that day but instead the next morning.
remember my discussion the other day about how Greg here has
been setting a buy stop a few pennies above the previous day's high
for the next day, and he said that has saved him from entering
quite a few times when the stock wouldn't follow through the next
day - I stated that I am adding that strategy to the KISS system so
that I can test it and report back to you guys - if that happens to
be an overall positive effect on the statistics - I'll officially
add that to the KISS systems
Posted by DigiNomad on 9th of Aug 2024 at 05:30 pm
This might help illustrate my comment below. It doesn't have to
be the correct EW count, but given everything you see here and our
knowledge of TA, does it look like a high probability entry?
(Note: SPY 2 hr)
Also, if wave 4 extends (I think is likely), guess about
where the 61.8 would fall?
Posted by DigiNomad on 9th of Aug 2024 at 10:22 pm
My warning is essentially going viral at this point.
Seeing multiple videos posted like this already. Many people
seeing the same thing....so we're probably going to squeeze right
past it. Some people even pointing out that the last 6 times
have had this same bear flag look and the market simply rallied
hard without ever playing out. Money printing will do that -
I'm not going to fight it.
Here is a chart produced on Aug 8 (Source: PTIONFLYS) showing
previous bear flag patterns that set bottoms and broke to the
upside in reference to Digi's comments below.
Upon further analysis the previous bear flags seemed to complete
(roughly speaking) in 9 trading days which would be next Thursday.
Lastly, you can see a view of the recent advancing and
corrective cycles to consider (note there are other cycles that
differ including a shorter term high to high cycle posted below
from CyclesFan).
Conclusion: Only time will tell, it remains to be seen how
things unfold in the coming days. So far the decline on the
SPX is best counted as three waves down (corrective) but does it
morph into a expanding diagonal with Wave 4 currently unfolding
that would overlap Wave 1 and then reverse back down sharply?
That would be the bearish view as a part of a larger zig zag
correction whereas the bullish view would be that following the LD
and pullback the market is now in the early stages of a larger
impulse back to the upside. I will review this weekend in the
newsletter but wanted to share a few thoughts after my work the
previous few days. There are always alternatives and nothing
is absolute in the market. EW provides some guidance via
certain rules but forecasting is always subject to changes.
Avoid prognosticators and focus on your process and then make
evidenced based adjustments, that's why effective systems
work as they take an evidenced based approach and adjust along the
way. The market typically makes decisive moves based upon
stronger catalysts and we have the upcoming CPI next week then
Jackson Hole Aug 22/24 and NVDA on Aug 28th as noteworthy events on
the horizon.
"If everybody's waiting for a bounce to sell, either the market
doesn't bounce or, if it does, you shouldn't sell into it."
-- Bob Farrell
Yeah UPRO and TQQQ as
KISS systems - looks like a lot of the indexes went back long, SPY, QQQ etc
Posted by icecoldjones on 9th of Aug 2024 at 05:00 pm
Yeah UPRO and TQQQ as well! Shocked with all the volatility going on but LET'S GOOOOOOOOOO!
Just be CAREFUL here. Maybe
Posted by DigiNomad on 9th of Aug 2024 at 05:12 pm
Just be CAREFUL here. Maybe wait to see if we can get above SPX 5400 and make a lower high. This is whipsaw territory and there are bear flags galore. Everyone plays the systems differently, but as Steve said probably less than a week ago...it's not a great plan to buy as price is entering a supply zone....whether a system says to buy or not.
One thing I know for a fact - there are hordes of traders just waiting take a big shot short at 5400. It couldn't be a more obvious level. That doesn't mean it will work out for them, but going long 55 points below that level seems like picking up pennies in front of a bulldozer.
The ideal scenario would be a push above 5400 that reverses and forms a higher low at 5400. That would be an "all clear!" signal for me.
DigiNomad - yes and no
Posted by matt on 9th of Aug 2024 at 11:21 pm
DigiNomad - yes and no regarding Steve's comments. Yes for folks actively following the newsletters and blog posts, and index supply and demand zones - it is good to try and incorporate that into decision making.
that said - there are 100's and 100's of folks here who are only here to follow the systems, they don't look at the community, they rarely view a newsletter, they are here to take the system trades - and you know what, what's fine too, if that's their style, that's just fine. Not everyone is willing to get into all the market analysis details and try and make decisions based on those -they want to follow system trades knowing some will be losers as that's just part of the game.
Here's the facts: 80% of emails these days are about the systems. They are not about supply and demand zones, some chart or analysis in the newsletters, they are about the systems. I don't think it's good to call someone out who bought SMH from the system that day when the KISS system went long into a supply zone - that guy could have been a person who is here to follow systems, and not get into all the technical analysis etc, and that's fine.
Also - my rant the other day, you have to be careful about second guessing systems - I went through more than a year where I did not of the mean reversion systems trades, and a lot of the KISS systems - why? because I could always find a reason not to take the trade - and you know what, sometimes I was right, but mostly I would have done far better just taking the trades. It creates a psychological issue where once you start second guessing system trades, you do that with every trade and soon you do none of them.
I think a better approach most of the time is set aside the capital you wish to trade the systems with, maybe have it in an entirely different brokerage account where all you do is the system trades. And in your other account you do the discretionary trades. I also mentioned the casino betting strategy approach for systems where you do all the system trades so that you don't fall into the trap of not doing any (as discussed above) but you raise and lower the bet size. Mean reversion systems win most of the time so it may not make sense there, but for KISS systems with maybe 60% winning trades, you have quite a few losing trades, so if you get a couple losing trades in a row - a big winner is likely do so increase the bet size. And after a the KISS system catches a big trending move, maybe lower the bet size.
I'm one of those here
Posted by skwan1940 on 11th of Aug 2024 at 09:38 am
I'm one of those here who are interested primarily in the system trades. I rarely post. I do have my own charts that I look at, I understand technical analysis, but I have realized over the years that I am my own worst enemy and by following trading systems (especially the trend), my results are much better. While I do appreciate the community here and I end up reading most posts at the end of the day, I don't want to be staring at a screen for multiple hours every day. I would rather set up my fishing rod, wait for the fish to bite, do something else, and come back.
"I don't think it's good
Posted by DigiNomad on 10th of Aug 2024 at 10:43 pm
"I don't think it's good to call someone out who bought SMH from the system that day when the KISS system went long into a supply zone - that guy could have been a person who is here to follow systems, and not get into all the technical analysis etc, and that's fine. "
Umm, you know that wasn't me that called that person out on buying SMH into a supply zone, right? It was actually a BPT employee (or co-owner...however you guys are structured over there).
As far as the other comments: Search "digi" and "system on the systems" and you'll find many many posts from me on that topic over the years. Probably from my older user names also (the only one I can remember for sure is "surfah"...I think I might have been "JT" for a while and before that I cannot confirm or deny but I may have been piggybacking with a shared password thing and didn't post back then ). Anyway, there is no shortage of"system on or for the systems" content posted by me over the years.
I first found out about you guys from a Hard Rock Cafe bartender friend in Hawaii way back in the day. We used to go out after work, party it up, chase women, often stumble into some blow and then find ourselves trading the New York open. True story . I taught him all I knew about options and now he works on the trading desk at TD Ameritrade...recently became a Schwab employee. Anyway, we would watch these videos late late at night and he shared his password with me because I was in business school scraping by on a GI bill and couldn't afford it. That was probably 2006 or 2007.
Classic story. I lived in
Posted by macksurf on 11th of Aug 2024 at 04:52 pm
Classic story. I lived in Maui for many years and lived a very similar lifelstyle. Bartend at night, stay up for the Market open and maybe do a trade, then go surf the early dawn patrol session, come home sleep the rest of the day and do it all over again 😆🤙
Plenty of room to set
Posted by mastermind on 9th of Aug 2024 at 05:50 pm
Plenty of room to set a stop near break even, the way I see it.
How do you set a
Posted by DigiNomad on 9th of Aug 2024 at 10:30 pm
How do you set a stop near break even for names that triggered today at the close? Some type of magic you haven't shared with the rest of us?
I’m sure that was directed
Posted by mastermind on 10th of Aug 2024 at 10:22 am
I’m sure that was directed at me, and I was saying IF the S&P continues to 5400 as you were proposing it would.
Digi - is that directed
Posted by matt on 9th of Aug 2024 at 11:29 pm
Digi - is that directed at me or someone else?
Again you realize for the standard KISS systems, stops are close confirming, not intraday, you wait for a close confirmation, not an intra day stop, so I don't know what after hrs or magic has to do with anything
also - the way the stats have always been built for the KISS system tables is on the day the system triggers, the tables are not using the closing price that day - they use the opening price of the next day! All the stats on the trades are based on executing the trade on the next day - that is assuming most will see the KISS system trades after hrs or in the evening and not choose to enter in after hrs that day but instead the next morning.
remember my discussion the other day about how Greg here has been setting a buy stop a few pennies above the previous day's high for the next day, and he said that has saved him from entering quite a few times when the stock wouldn't follow through the next day - I stated that I am adding that strategy to the KISS system so that I can test it and report back to you guys - if that happens to be an overall positive effect on the statistics - I'll officially add that to the KISS systems
read Gregs Post here
https://breakpointtrades.com/blog/post/435887/
I was responding to Mastermind's
Posted by DigiNomad on 10th of Aug 2024 at 10:59 pm
I was responding to Mastermind's post
This might help illustrate my
Posted by DigiNomad on 9th of Aug 2024 at 05:30 pm
This might help illustrate my comment below. It doesn't have to be the correct EW count, but given everything you see here and our knowledge of TA, does it look like a high probability entry? (Note: SPY 2 hr)
Also, if wave 4 extends (I think is likely), guess about where the 61.8 would fall?
(it's currently at 52.15%...so it has room to go)
My warning is essentially going
Posted by DigiNomad on 9th of Aug 2024 at 10:22 pm
My warning is essentially going viral at this point. Seeing multiple videos posted like this already. Many people seeing the same thing....so we're probably going to squeeze right past it. Some people even pointing out that the last 6 times have had this same bear flag look and the market simply rallied hard without ever playing out. Money printing will do that - I'm not going to fight it.
Previous Bear Flag Patterns and Resulting Moves
Posted by steve on 10th of Aug 2024 at 11:55 am
Here is a chart produced on Aug 8 (Source: PTIONFLYS) showing previous bear flag patterns that set bottoms and broke to the upside in reference to Digi's comments below.
Upon further analysis the previous bear flags seemed to complete (roughly speaking) in 9 trading days which would be next Thursday.
Lastly, you can see a view of the recent advancing and corrective cycles to consider (note there are other cycles that differ including a shorter term high to high cycle posted below from CyclesFan).
Conclusion: Only time will tell, it remains to be seen how things unfold in the coming days. So far the decline on the SPX is best counted as three waves down (corrective) but does it morph into a expanding diagonal with Wave 4 currently unfolding that would overlap Wave 1 and then reverse back down sharply? That would be the bearish view as a part of a larger zig zag correction whereas the bullish view would be that following the LD and pullback the market is now in the early stages of a larger impulse back to the upside. I will review this weekend in the newsletter but wanted to share a few thoughts after my work the previous few days. There are always alternatives and nothing is absolute in the market. EW provides some guidance via certain rules but forecasting is always subject to changes. Avoid prognosticators and focus on your process and then make evidenced based adjustments, that's why effective systems work as they take an evidenced based approach and adjust along the way. The market typically makes decisive moves based upon stronger catalysts and we have the upcoming CPI next week then Jackson Hole Aug 22/24 and NVDA on Aug 28th as noteworthy events on the horizon.
"If everybody's waiting for a bounce to sell, either the market doesn't bounce or, if it does, you shouldn't sell into it." -- Bob Farrell
You missed the biggest bear
Posted by DigiNomad on 10th of Aug 2024 at 10:47 pm
You missed the biggest bear flag of them all - maybe in history. Right in Z middle.