Tuesday, August 3, 2010

Signal Change: LCR Change Timer is now LONG

Here's the dashboard:

Our price index increased +1.9% on Monday, ending the day at $25.92.  Volume was within range of average, with 2.4M shares indicated, or -8% below average.  I would have liked to see above-average volume on a day where prices jumped so strongly, so I'm somewhat cautious of this.

The Long-Cash Ratio moved upward strongly, jumping +17% to 1.789.  1649 stocks are in some form of long status and 922 stocks are in some form of cash status.  All of the LCR EMAs are pointing upward, and are properly aligned (13d > 21d > 34d > 55d), so the intermediate term trend is confirmed upward (this occurred with Friday's close but I failed to mention it yesterday.  You can see it in the figure above under "LCR EMAs", the grouping of 4 indicators closer to the right).

Strength moved upward impressively from 0.618 to 0.781.  We are now above the not-so-scientific level of 0.7, and when we are above this level, the chances of a pullback increase.


Short-term LCR Change Timer

With the jump in LCR the LCR Change Timer transitioned from CASH-LONG (0) to LONG (+1).  Correspondingly, I picked up single positions in DDM, QID, and UWM just prior to the close.  MANY of the ultra ETFs are not above their 200d MA, so pickings are slim.  Here is the latest list to choose from:

The ones in green and yellow are good candidates if they continue higher; I would not pick them up unless the market shows movement upward across the board.  Remember, as the signal becomes older these become more risky, so be careful if you move on these later this week.


Intermediate-Term Elder Timer

Due to a clerical error on my part I jumped on some stocks yesterday that are suspect.  Specifically, I had entered the close of the prices in my worksheet, not the previous day's highs, so when these errant stocks move higher above their close, my triggers indicated I should pick up these stocks.  Oh well.  Glad I caught it before the damage became too great.

Overall, the intermediate-term portfolio is above water, up 2.7%.  Four positions were added yesterday:
  • ARUN, up +1.14%
  • CCE, down -0.24%
  • F, down -0.37%
  • NLC, down -0.69%
These are not equal weighted, as the position sizes were adjusted using ATR(20).

GMCR, another one of my holdings, is looking attractive for adding to the position, as the Elder 13d FI is up, the 2d FI is down, yet all the EMA lines, including slope, are in proper alignment.

Here are my Elder candidates for today:

I will add positions that are "in the green", or pehaps "yellow", if they show individual strength in today's action.


Trading Plan for Tuesday

As I bang this out, futures are falling, so today looks to be a day of consolidation.  I'll add to my short-term timer ETF candidates as long as they are not falling at the time of entry.

On an intermediate scale, my Elder list is above. 

60% of my powder is dry right now, so I have lots to fuel opportunity, should it arise.


Remember, you are responsible for your own trading decisions, not me.  Please do your own diligence.