Sunday, September 14, 2014

Weekend Update - Sept 14 2014

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Timer Status:

Short-term timer:  CASH
Intermediate-term timer: CASH
Long-term timer: LONG
Long-Cash Ratio:  fell -19% to 0.862.  The trend is lower.

Timer Table:


Long-Cash Ratio Table:


(right click on the image to open in a new tab or window)

Cumulative Tick Chart:


(right click on the image to open in a new tab or window)

Commentary:

Big picture -- no changes.  The short-term trend is lower.

Friday was a significantly hard down day in terms of the number of stocks that transitioned to "New Cash", so their price action and possibly volume signified a move to the sidelines.  The LCR fell -19% and is now below 1.0, which means more stocks in the database are in "CASH" than are "LONG".  The actual number is 46.3% and means less than half are in some form of LONG recommendation.  Note that we hit 62.5% on 9/2, so we've dropped a good bit since the high after Labor Day.

Lots of red on the LCR table, both on the slope side (left) and the slope of the slope side (right).  Again, we need the right side to be green before we can start buying on the long side.

The Cumulative TICK chart is quite bearish.  At the top on the right the number of New Lows surpassed the number of New Highs on Friday.  Not good.

Just below that is an indicator that I developed which shows what the buying/selling algorithms are doing at the NYSE -- and the downward line almost from the open sent the tone for the rest of the day.  A steady line downward means that stocks were, on net, being sold minute after minute after minute.  Only at the end of the day do you see that this line was horizontal, meaning, nothing was occurring that was out of the norm.

Just below the algo indicator is the Cumulative TICK and EMAs, and basically, the 10d EMA on the cumulative TICK (solid red) accelerated downward on Friday because the raw CumTICK (white) was so negative throughout the day.  Simply do not buy stocks until the white is above red.  Period.

Strategy:

I'm still operating within my 50% cash level at the present time.  I presently hold the following positions across all my portfolios; the ones with " * " have some sort of sell order in place:


(right click on the image to open in a new tab or window)

Last week saw gains and losses being locked in -- I mostly sold those positions that were underwater and took 50% off the table for those positions that were above the waterline.  My equity curve improved somewhat from the previous one (see earlier blog entries):


(right click on the image to open in a new tab or window)

My next signal to dump another 25% is very close to occurring; if Monday is a down day we'll probably see a transition Monday night, so stay tuned.  As far as an "all cash" signal, we're still a bit away from that happening, at least from today's perspective, so as long as next week is "orderly" I would not expect moving completely to cash.  Of course, your crystal ball is as good as mine.

So, with the LCR falling, with the cumulative TICK still dropping, and with more New Lows than New Highs, I'm not buying.  A few GGT stocks have moved into "New Long" territory, but I'm not buying when the rest of the ocean is flowing out of the channel, to mix metaphors.

Monday will be easy.  Orders are placed to unload the remaining positions to a 50% cash/equity holding (using a 1% Trailing Stop Loss - TSL - Good 'Til Canceled -GTC ).  Let the ones moving up continue to do so, but if they reverse, get out.  The ones that are falling, well, get out, obviously.

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As with all my ramblings, you are responsible for your own decisions and I am not.  Please do your own diligence, and please take ownership for your actions.

Make it a great week.

Regards,

pgd