Friday, April 27, 2012

Update for Friday, April 27th -- Elder Force Index Timer Confirms LONG

With the close of markets on Thursday, April 26, my Elder Force Index Timer has confirmed a move to the Long side:

The hold out here was that I use two methods -- a slower simple moving average (SMA or MA) and a faster exponential moving average (EMA) to calculate the Force Index (price change * volume). Both are positive on a 13d average, so we have confirmation. 

Shorting stocks (or Contra ETFs) at this point in the market is a low-probability proposition at best. This is an intermediate-termed timer and with the long-term timer (13d / 65d crossing), the direction is up from here.

As you can see, all of my primary timer systems are long.


The combined timer historically has kept us on the right side of the market:

If you have a long(er) term view, this could be a viable methodology to know whether you should be in the markets or out. I'm targeting "in" right now with a core position in IWM.


If you read my entry yesterday on my GGT blog, you know that I was going long in IWM.

I didn't get into IWM for a couple of reasons, all mechanical. To wit:

1) I set a limit order at the previous day's close (80.94)
2) I set a timed delay (active @ 9:35 a.m.) to allow the overnight book to clear. The markets opened below the close, moved down, and by 9:35, were above my limit. They never looked back.
3) I was away from my PC so couldn't monitor that this was occurring, or I would have attempted to get in by 10:30.
4) Lunchtime is typically weak, but not yesterday. Hence, my VWAP entry never executed.

I'm still largely in cash, with a GTC limit order at 80.94 still pending. Futures are up as I write so I need to get on the bus or risk being locked out of this entry. Shoot. I hate chasing.


Shameless plug:

I will be away from my PC most of today and all weekend. I am riding over 100+ miles this weekend with disabled veterans from the Pentagon to Gettysburg, PA. Read about it here: 

Please read my personal fund-raising page here:, and if you are so inclined, please contribute to this cause. We, in America (and all around the globe -- I am a verteran and was stationed overseas), benefit from these sacrifices and this is a good cause.