Ending last week on a selling note - no buying on Monday

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Please subscribe to this using the "Follow by Email" link to the left.  Nobody gets your email except me, and I promise that I won't email you except to communicate something concise with the system.  Note that after several years I've never emailed the entire list.  Having your email helps me see the number of folks reading this as well as ensuring you get the signals on a timely basis.

Summary

We are in the correct "zone" to buy, as prices are certainly oversold.  This being said, there is room to fall from here, so until we get some indications of internal buying, cash is king.

Cumulative Tick

We ended the week with Friday being somewhat neutral as far as the algorithmic buying/selling is concerned but the retail components certainly continued to sell, especially into the close:

Click on the image to enlarge.

The top plot shows 52-week new highs (green) and new lows (red), and you can see the net in yellow.  New lows dominate, net is negative, and the bottom line is that the markets are being sold hard here, causing stocks of the NYSE to hit these new low points.  While a bottom-feeder's paradise, I don't bottom feed, so this is not a good climate to buy stocks.

The middle plot is more/less horizontal.  This represents computerized buying/selling, and the bottom line is that we see net neutral for most of the day.  A bit higher than neutral, a but lower than netural, but more/less neutral.  Nothing remarkable here -- no sustained buying/selling as far as the programs are concerned so the markets did what they did due to manual actions.

The bottom plot is where the money is, or specifically, where it isn't.  It isn't flowing into the markets -- it's flowing out.  The net for the day was negative, showing net selling.  Furthermore, the risk of the weekend is apparent -- the markets sold into the close, which is bearish in the sort term.  Everybody was unwinding positions into the weekend, most likely to remove headline risk from their positions on Monday morning's open.

The negative slopes on all the moving averages tells you money is flowing out.  Until we see the white cross back above red from the bottom upward, it simply is not worthy of our effort to be in this market from a momentum perspective.

The chart shows a bearish cumulative tick pattern and the markets are continuing to be sold from an internal perspective (at least on they NYSE).

Per my comments last week I have moved to the sidelines and I have raised a considerable amount of cash.  Very little of my portfolio is invested -- most is in cash.

Long-Cash Ratio (LCR) Table

The following table tells me that Monday is not a buying day, despite the oversold nature of the markets:

Click on the image to enlarge.

The left side of the table shows that the long-cash ratio (LCR) value has fallen to 0.193, indicating that for every 1000 stocks that are rated in some form of "cash" (avoid)  status, that 193 are in some form of "long" (okay to hold as far as price action is concerned).  Friday's move was another 24% drop (day over day) of the LCR, and this was the 121st strongest drop since 2008.  Again, significant, and there is acceleration to the downside.  Not a good buying climate.

The middle of the table shows a sea of red.  These are the slopes of the moving averages of the long-cash ratio, and the multiple time frames tell me what is happening on a short-term, intermediate-term, and long-term basis.  In all time frames the market is contracting -- stocks are being sold -- and hence, Monday is not a good buying opportunity.  While we are nearing a floor, we haven't achieved it yet, at least from the LCR slope perspective.  The number of stocks that are falling into a "CASH" ranking continues to dominate the database of 3000+ stocks on a day-over-day basis.

Confirming this is the right side of the table.  The right side of the table shows acceleration, or slope of the slope, and the "red" on the right side indicates that there is strength into this day-over-day movement of stocks into a "CASH" ranking.  Until we see green appear on all time frames on the right side of the table we will not get green in the middle of the table.  We have *some* semblance of this possibility occurring on Friday, but not in a strength that is meaningful.

I need to see the right side of the table turn green before I will start buying this market.  This will turn the middle of the table green if it is sustained, which means prices are moving upwards on volume buying.  

Percent Longs in Database

All of this being said, I believe we are in a great spot for buying, no matter what your strategy:

Click on the image to enlarge.

The table shows the percent long-rated stocks in the database -- 16.2% -- and as you can see, when we get to these levels we are generally oversold.  The green area represents historical areas for buying, and the pink area the values where selling could be prudent.

Also note though that we're on the left-side of a downward pointing dip -- we need a bit of time to form a bottom then start moving upward.  This isn't to say that we couldn't reverse today  and start upward (futures are up as I write this Monday morning), but if history is any indication, we nee some time to really force the bulls out of the market and get some form of a capitulation.  We simply aren't there yet, and the LCR table confirms this.

Another good indicator that I have developed and used is the slope of the 8-day LCR:

 Click on the image to enlarge.

I have circled the present value of the 8-day slope of the LCR moving average.  It is pointing DOWNWARD, which means on a short time frame, we have more stocks moving to the sidelines in terms of recommendation than the opposite condition.  Until this indicator hits a bottom are reverses, I will not be buying.  There are rare exceptions to this rule but in general, you see what I see and it's not confirming any form of an entry for Monday.

Strategy:

I continue to unwind positions that are recommended as "New Cash".  Of my holdings, HCKT, LGND, LMAT, RNG, SFBS, and UVE are all flashing exit signals.

I've set my exit criteria and will be out of the positions if they hit their stops.  For those of you subscribing to the real-time alerts, you'll get automatic notification when the positions are exited.

For the non-Collective2 accounts, I will set a 1% trailing stop loss, GTC, effective after 9:45 a/ET and will forget about these positions until they either 1) reverse to a "New Long" recommendation or 2) are sold.

For the Collective2 accounts, I will set a 1% stop loss, GTC, effective after 9:45 a/ET and that will be adjusted upward (never downward) nightly until triggered.

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These recommendations are posted in a daily file that I attempt to share by the following morning with all subscribers. To review the stocks that you are holding and see how I evaluate them, you need to be a member of my Dropbox.  Send an email to pduncan [ a t} v _ t (dot] e du, fixing the address of course, with the word "DROPBOX" in the subject and I'll add your email.  I attended Virginia Tech many moons ago and it is my alumni address, so it should be easy to see how to fix the address -- simply use "vt.edu".  I also ask that you subscribe to this list using the link to the left, as it's the only way I can communicate with Dropbox users, if the need arises.

Subscribe to my twitter feed if you want intra-day observations:  grems8544

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Here's how to find me:

Stocktwits/Twitter:  grems8544

Greenfield Dividends: https://www.collective2.com/details/94780986

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New Meeting Announcement

We will be holding a face-to-face meeting on 2/13/2016 for all interested parties at the following location:

Burke Centre Library
Room: Burke Centre Meeting Room 116K
Address: 5935 Freds Oak Rd, Burke, VA 22015
Library Phone:(703) 249-1520
Time: 10:00 AM to 1:00 PM
Meeting Start Time: 10:00 AM

I will attempt to stream the meeting audio, and perhaps video, as per past meetings, via GotoMeeting.  Attendance via GotoMeeting is limited to the first 25 call-ins.  The ability to do this is completely controlled by the library and I have no say in Internet access.

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

Regards,

pgd

Confirmed Exit

With the close of markets on Thursday, January 7th, all signals are to move to the sidelines.  This signal was confirmed by the Cumulative Tick:

Click on the image for a larger version.

I wrote about this pattern yesterday, and the sustained selling on the NYSE caused the CT to cross below the longest moving average, pulling all of them downward in terms of slope.  This is a free-fall condition for my system and history indicates to get out of positions.

I've set my exit criteria and will be out of the positions if they hit their stops.  For those of you subscribing to the real-time alerts, you'll get automatic notification when the positions are exited.

For the non-Collective2 accounts, I will set a 1% trailing stop loss, GTC, effective after 9:45 a/ET and will forget about these positions until they either 1) reverse to a "New Long" recommendation or are sold.

For the Collective2 accounts, I will set a 1% stop loss, GTC, effective after 9:45 a/ET and that will be adjusted upward (never downward) nightly until triggered.

The Greenfield Dividend portfolio, which strives to maintain income at the expense of portfolio equity value, will remain invested.  Stocks that are "Cash" rated will be liquidated and that money will be deployed in new equities as soon as my LCR indicators indicate a reversal is occurring.

The Long-Cash Ratio fell hard yesterday:

Click on the image for a larger version.

As you can see on the left, the LCR fell 27% from the previous day's value, and relative to all down days tracked since 2008, was the 95th strongest down day.  This places yesterday's selling action in the top 10% of all down days, which is significant and with all my indicators, actionable.

The sea of red in the middle and right sides of the table, which are explained in previous entries, simply tell us that this is not a buying market.  Certainly, the right side of the table still shows that the "knife is falling".

Strategy for Friday, January 8th

My strategy for today is relatively simple.

1) no buying
2) closing all portfolios using a TSL or fixed stop and selling those positions that hit their stops
3) flying my family to Minneapolis for my grandmother's 91st birthday on Saturday

My next post will be Sunday.

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New Meeting Announcement

We will be holding a face-to-face meeting on 2/13/2016 for all interested parties at the following location:

Burke Centre Library
Room: Burke Centre Meeting Room 116K
Address: 5935 Freds Oak Rd, Burke, VA 22015
Library Phone:(703) 249-1520
Time: 10:00 AM to 1:00 PM
Meeting Start Time: 10:00 AM

I will attempt to stream the meeting audio, and perhaps video, as per past meetings, via GotoMeeting.  Attendance via GotoMeeting is limited to the first 25 call-ins.  The ability to do this is completely controlled by the library and I have no say in Internet access.

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

Regards,

pgd

Never attempt to catch a falling knife...

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Please subscribe to this using the "Follow by Email" link to the left.  Nobody gets your email except me, and I promise that I won't email you except to communicate something concise with the system.  Note that after several years I've never emailed the entire list.  Having your email helps me see the number of folks reading this as well as ensuring you get the signals on a timely basis.

Yesterday morning, before the markets opened, I commented that the dip was being bought.  Yesterday's action did not continue that accumulation -- the falling indexes and the market being sold were pretty much in sync throughout the day, although the selling was not nearly as ferocious as the drop in the indexes would have you believe.

Click on the image to show a larger version.

The middle plot is most telling -- the markets opened with some strong, algorithmic selling, then maintained that area well into the lunch period.  I tweeted in the late afternoon that selling had resumed -- you can see the steady selling kick in around 2:30 p/ET and continue to almost 3 pm exactly, where we saw some buyers step in within the last hour.

The Cumulative Tick is showing that this market is under pressure, with some of the CT moving averages now with a negative slope.  Obviously, if this continues, we'll cross negative and the ribbon will look like this:

Click on the image to show a larger version.

This presentation, where the white crosses the red from above, would be my exit signal and would tell me to unload anything below the water line.  This presentation shows what sustained selling across all market segments looks like and when this occurs, we generally will not have any positions unscathed.

The presentation above is the equivalent of pulling the plug in the bathtub.

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The Long-Cash Ratio continues to show solid bearishness:

Click on the image to show a larger version.

The LCR has fallen from 0.480 at the close of last year to 0.347 last evening, indicating that another 133 per 1000 stocks have fallen to the dark side (recommended CASH).  The trend, on all timescales, is down.

The middle and right side of the tables are bearish, and you can read entries from the previous three days here and catch up on what it means.

With red galore and no green appearing, I intend to keep my powder dry with no new buying.  I will not attempt to catch the falling knife.

On this thought -- the following chart shows that recent history suggests that we could continue down if the market wants to continue the exit through the doors:

Click on the image to show a larger version.

The chart shows the percent long-rated stocks in the database, and as recent as the past three months (since October 2015), we have precedence for strongly selling the markets from this position.  The blue trace is an equal-weighting of price of the stocks in the database and you can see that we are forming some sort of right-shoulder on a classic head-and-shoulder pattern.  You can also clearly see the lower highs/lower lows that were formed on the percent longs, which is not good for a longer-term market trend.  This being stated, there is a natural floor to how low things can go -- the bottom of the green zone and the right scale indicate that things can get much worse if Mr. Market wanted to get ugly.

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Obviously, my short/medium/long-term timers are indicating that caution is prudent:

Click on the image to show a larger version.

The "green" Enter signal on 12/23 was not followed by a corresponding short-term "Long" signal until 12/29 -- and this was due purely to the lack of volume over the Xmas holidays.  The delay told me that the enter signal was tenuous, and with Monday's action of "Exit", the risk models are in full force to the downside and there should be no net new buying.  

As I stated above, the CT crossing the longest moving average from above would be my personal capitulation signal and the point where I'd move aggressively to a full cash position in all accounts, including my Thrift Savings Plan account.

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Strategy Today:

1)  No buying.

2) A few positions that I own are indicating to exit:

AHS	A M N Hthcr Sv	Business Svc	New Cash
HEP	Holly Energy Lp	Petroleum	New Cash
LOPE	Grand Canyon Ed	Business Svc	New Cash
NEON	Neonode Inc	Computer	New Cash
NVDA	N V D I A Corp	Electronic	New Cash
TNET	TriNet Group	Business Svc	New Cash
URI	United Rentals	Business Svc	New Cash

I've set my exit criteria and will be out of the positions if they hit their stops.  For those of you subscribing to the real-time alerts, you'll get automatic notification when the positions are exited.

For the non-Collective2 accounts, I will set a 1% trailing stop loss, GTC, effective after 9:45 a/ET and will forget about these positions until they either 1) reverse to a "New Long" recommendation or are sold.

For the Collective2 accounts, I will set a 1% stop loss, GTC, effective after 9:45 a/ET and that will be adjusted upward (never downward) nightly until triggered.

~~~~~~~~~~~~~~~~

These recommendations are posted in a daily file that I attempt to share by the following morning with all subscribers. To review the stocks that you are holding and see how I evaluate them, you need to be a member of my Dropbox.  Send an email to pduncan [ a t} v _ t (dot] e du, fixing the address of course, with the word "DROPBOX" in the subject and I'll add your email.  I attended Virginia Tech many moons ago and it is my alumni address, so it should be easy to see how to fix the address -- simply use "vt.edu".  I also ask that you subscribe to this list using the link to the left, as it's the only way I can communicate with Dropbox users, if the need arises.

Subscribe to my twitter feed if you want intra-day observations:  grems8544 

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Here's how to find me:

Stocktwits/Twitter:  grems8544

Greenfield Dividends: https://www.collective2.com/details/94780986

Greenfield Leaders: https://www.collective2.com/details/94921209

Greenfield Low Beta:  https://www.collective2.com/details/95702992

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

New Meeting Announcement

We will be holding a face-to-face meeting on 2/13/2016 for all interested parties at the following location:

Burke Centre Library

Room: Burke Centre Meeting Room 116K

Address: 5935 Freds Oak Rd, Burke, VA 22015

Library Phone:(703) 249-1520

Time: 10:00 AM to 1:00 PM

Meeting Start Time: 10:00 AM

I will attempt to stream the meeting audio, and perhaps video, as per past meetings, via GotoMeeting.  Attendance via GotoMeeting is limited to the first 25 call-ins.  The ability to do this is completely controlled by the library and I have no say in Internet access.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

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

Regards,

pgd

Underlying markets are buying this dip

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Please subscribe to this using the "Follow by Email" link to the left.  Nobody gets your email except me, and I promise that I won't email you except to communicate something concise with the system.  Note that after several years I've never emailed the entire list.  Having your email helps me see the number of folks reading this as well as ensuring you get the signals on a timely basis.

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My trading methodology does not incorporate the Cumulative Tick (CT) behavior, but I use the CT to watch what the markets are doing (as compared to the major indexes, which I think manipulated to some degree).

The CT is showing that the markets are buying this dip:

Click on the chart to view a larger image.

Although the 52-week new lows are still outpacing the 52-week new highs (top trace), the middle and bottom traces confirm that there is significant buying of this dip occurring.  The middle trace is an algorithmic buying/selling indicator, and it shows that starting about 12:55 p/ET buying started and continued until 2:28 p/ET.  Very little net selling occurred during the day, as measured on a minute-over-minute basis.

If you are not familiar with the CT indicator you can read about it here and in previous posts of mine.  I've been using it for years, having learned about it from the group over at Effective Volume.

The big "so what?" is that although my developed indicators are still quite short-term bearish, the CT is indicating that from a value point of view, it's time to move into the markets.  Put another way, get your shopping lists ready.

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As stated above, my internal methodology is short-term bearish and long-term bullish.  Here's my Long-Cash Ratio (LCR) Table, which many of you are familiar:

Click on the chart to view a larger image.

The far left shows that as a whole, more stocks joined the "avoid" column with Monday's action than those that became "New Longs".  This means that prices of stocks continue to fall as a whole (3037 stocks presently in the database), and until price and volume pick up, the LCR will remain quite bearish.

The middle/left of the table indicates a sea of red and that on multiple time frames that the trend of the LCR is down.  Falling prices are the only thing that can cause the LCR to drop, and right now the database is indicating that on all measured time frames -- out to 143 days -- that the prices of constituent stocks are continuing to fall.

The right side of the table shows the day-over-day change of the middle/left side of the table, and this side of the table LEADS the middle/left side.  I pay particular attention to this chart on a daily basis -- - I only buy when this chart is turning green.

You can see that the right chart attempted to move positive on Monday -- perhaps there is a thawing occurring.  Your crystal ball is as good as mine.

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The Percent Longs chart that I presented yesterday is relatively unchanged.  Since the LCR fell with Monday's action, we are bit more into the "green' area (number of stocks that are "long" rated fell).

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What I'm Doing Tuesday:

Four more stocks are indicating that I exit:

ALK	Alaska Air	Transportation	New Cash
LRCX	Lam Research	Electronic	New Cash
NGHC	National Gen	Insurance	New Cash
USNA	USANA Inc	Personal	New Cash

I've set my exit criteria and will be out of the positions if they hit their stops.  For those of you subscribing to the real-time alerts, you'll get automatic notification when the positions are exited.

For the non-Collective2 accounts, I will set a 1% trailing stop loss, GTC, effective after 9:45 a/ET and will forget about these positions until they either 1) reverse to a "New Long" recommendation or are sold.

For the Collective2 accounts, I will set a 1% stop loss, GTC, effective after 9:45 a/ET and that will be adjusted upward (never downward) nightly until triggered.

This will free up some cash that can be deployed elsewhere.

I will not be buying today, although I will spend time reviewing the various stocks that pass my Greenfield Screen.

~~~~~~~~~~~~~~~~

These recommendations are posted in a daily file that I attempt to share by the following morning with all subscribers. To review the stocks that you are holding and see how I evaluate them, you need to be a member of my Dropbox.  Send an email to pduncan [ a t} v _ t (dot] e du, fixing the address of course, with the word "DROPBOX" in the subject and I'll add your email.  I attended Virginia Tech many moons ago and it is my alumni address, so it should be easy to see how to fix the address -- simply use "vt.edu".  I also ask that you subscribe to this list using the link to the left, as it's the only way I can communicate with Dropbox users, if the need arises.

Subscribe to my twitter feed if you want intra-day observations:  grems8544 

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Here's how to find me:

Stocktwits/Twitter:  grems8544

Greenfield Dividends: https://www.collective2.com/details/94780986

Greenfield Leaders: https://www.collective2.com/details/94921209

Greenfield Low Beta:  https://www.collective2.com/details/95702992

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

New Meeting Announcement

We will be holding a face-to-face meeting on 2/13/2016 for all interested parties at the following location:

Burke Centre Library

Room: Burke Centre Meeting Room 116K

Address: 5935 Freds Oak Rd, Burke, VA 22015

Library Phone:(703) 249-1520

Time: 10:00 AM to 1:00 PM

Meeting Start Time: 10:00 AM

I will attempt to stream the meeting audio, and perhaps video, as per past meetings, via GotoMeeting.  Attendance via GotoMeeting is limited to the first 25 call-ins.  The ability to do this is completely controlled by the library and I have no say in Internet access.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

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

Regards,

pgd

Silver Lining in Monday Jan 4 Action, New Meeting Announcement

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Please subscribe to this using the "Follow by Email" link to the left.  Nobody gets your email except me, and I promise that I won't email you except to communicate something concise with the system.  Note that after several years I've never emailed the entire list.  Having your email helps me see the number of folks reading this as well as ensuring you get the signals on a timely basis.

Despite the beating that the markets took yesterday, there are a number of positive indicators that are indicating that we presently may have a buying opportunity:

1. The cumulative tick continues to show a positive slope on it's moving averages, so on a multiple-day timeframe, we are still in an accumulating market.
2. The cumulative tick started a major, sustained intra-day buying reversal at exactly 11:30 a/ET and it continued largely unabated throughout the day.  
3. The major indexes all started their intraday reversal at 3:30

Let's look at each one of these.

Cumulative Tick

Click on the image to view a larger version.

I've covered the cumulative tick presentation in previous entries so read back a few to get other details.  The top plot, which is bearish on the short-term and only looks day-to-day, tells me that 52-week new lows are dominating 52-week new highs.  This is a major warning sign and shows that risk is high.

Contrasting, we have the action shown in the middle and bottom plots.  The middle plot is an algorithm indicator -- it shows me the strength of sustained buying or selling from a broad market perspective.  The day started strong and fast to the downside -- a large dumping of stocks on a minute-for-minute basis.  By 9:50 a/ET it was over -- at least until 10:33 a/ET, when it picked up and continued until 11:13 a/ET.  By 11:15 we hit our sustained selling bottom and almost to-the-minute at 11:30 we started to see sustained, continuous buying in the markets that lasted throughout the remainder of the day.  Note that this was in contrast to the indexes, which were down hard at this time.

Put another way, the markets started to buy the dip at 11:30 and as far as I can tell, never looked back.  This is why I really do not like watching the indexes -- they are not the markets, and they can be manipulated, apparently quite easily by the looks of it.

The bottom trace shows the cumulative tick and the ribbon of moving averages.  All ended the day with a positive slope -- and this is a buying environment, despite the 52-week new lows dominating the markets.  

There is nothing in the cumulative tick presentation that says "sell" -- and I am only unloading those GGT positions that are "New Cash" recommendations.  I am holding everything else.

Long-Cash Ratio Table

Click on the image to view a larger version.

The LCR table *just* turned bearish, although it has been indicating caution for the past 3 days.

The left side of the table shows the running LCR and it is presently indicating 0.405.  This means that for every 1000 stocks that are in some form of "Cash" (avoid) recommendation, 405 are in some form of a "Long" (okay to hold) recommendation.  Taken in isolation this indicates that the bears are beating the heck out of stocks and that prices of the 3037 stocks that I am tracking have been hammered.

The next column to the right shows that the drop of the LCR of -16% ranks relatively minor -- out of 955 evaluated trading days yesterday's action ranks 252 in terms of strength downward.  This was not a very strong day in general, despite the index volatility.

The Slopes of the LCR EMAs all turned negative on Monday, which is a warning sign.  While all of these slopes are negative they will be red, and this is not the time to buy, despite the indications from the cumulative tick.  As a lagging indicator it will ALWAYS be later than the bottom, and it will ALWAYS be later than the peak.  Make sure you understand this.

I'm looking for the 2d, 3d, and (at a minimum) 5d slopes to turn positive before I start getting into the markets.  We can continue downward from here -- your crystal ball is a good as mine.

The right side of the table is considered the leading indicator for the left side of the table.  Here, I have the slopes of the slopes, and for those of you with a science background, you will recognize this as the acceleration.  Here, we have the acceleration of the long-cash ratio, and as you can see, Monday's action turned everything red -- negative.

Negative acceleration is a bad climate for buying -- period.  Various analogies apply but simply, the tide is flowing out (market prices are dropping on volume) and the boats are all falling (individual prices are dropping), relative to their docks (often our buy points).  We absolutely need to see the right side of the table turn green before the left side will (make sure you understand why this is true and ask for an explanation if you don't get it), and right now, there is nothing pointing to buying en masse.

No buying for me on Tuesday, contrary to the reversal that I presented in the cumulative tick chart.  Risk is quite high at the present time.

Again, to address a few comments I've received over the past few weeks, these are all lagging indicators.  LAGGING.  Your crystal ball is as good as mine.  While the cumulative tick chart indicates that we did have a reversal, and that we are still in a buying uptrend, nothing about the chart indicates that yesterday's buying action will continue today.  The LCR table indicates that on a multiple-timeframe review that we are moving downward as a whole, so we need to be careful.

Your takeaway from the LCR table is that:

1. Short-term risk is high
2. The acceleration presentation on the left side of the table shows that as of Monday's close, more stocks were experiencing a drop downward in price than where moving upward. 
3. We need to see the right side of the table turn green, and only then will the left side turn green.  We will not have this information until at least the close of business Tuesday, at the earliest.

Percent Longs

Click on the image to view a larger version.

When we finally do get the right side of the LCR table to turn green, and eventually, in a sustained up market (across multiple days), the left side, we will be in a good location to jump back into the markets.

The chart above is the Percent Longs in the database.  Right now we are in the green zone -- and in fact, we're below 1 standard deviation, which shows that we are in a prime area for moving upward.  We've spent some time here, and if you look to the left of the chart, you can see that it's possible we can continue to spend time here.  Nevertheless, jumping in to the markets when we get a valid buy signal from this vantage point is generally a good idea, so as the LCR table (right site) matures, the Percent Longs chart tells us whether there is enough fuel to power us higher.  The answer, from above, is that historically we can travel from the green to the red area (price appreciation) more often than not, so be prepared to commit when the time comes.

Strategy

Here are my actions for the day:

1. No new buying.
2. A number of stocks triggered a sell signal to get out:

ALE	ALLETE	Utility	New Cash
AVGO	Avago Tech	Electronic	New Cash
BABY	Natus Med Inc	Healthcare	New Cash
BAK	Braskem SA	Chemical	New Cash
CATM	Cardtronics Inc	Business Svc	New Cash
CORT	Corcept Thera	Drug	New Cash
CTRN	Citi Trends	Retail	New Cash
DHI	D R Horton Inc	Building	New Cash
GOOGL	Google Class A	Internet	New Cash
LXFT	Luxoft Holding	Software	New Cash
MO	Altria Group	Personal	New Cash
NTES	Netease.com	Internet	New Cash
PRAH	PRA HealthSci	Business Svc	New Cash
RMTI	Rockwell Med	Healthcare	New Cash
SCHW	Schwab Chas	Financial	New Cash
TFSL	TFS Financial	Financial	New Cash
THRM	Gentherm	Auto & Truck	New Cash
TRIP	TripAdvisor	Internet	New Cash
TW	Towers Watson	Business Svc	New Cash
VA	Virgin America	Transportation	New Cash
VLRS	Controladora	Transportation	New Cash
WOOF	V C A Antech	Healthcare	New Cash

For the non-Collective2 accounts, I will set a 1% trailing stop loss, GTC, effective after 9:45 a/ET and will forget about these positions until they either 1) reverse to a "New Long" recommendation or are sold.

For the Collective2 accounts, I will set a 1% stop loss, GTC, effective after 9:45 a/ET and that will be adjusted upward (never downward) nightly until triggered.

Despite the cumulative tick, which is a ray of sunshine on yesterday's markets, it is prudent to unload positions as the system rules dictate.

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These recommendations are posted in a daily file that I attempt to share by the following morning with all subscribers. To review the stocks that you are holding and see how I evaluate them, you need to be a member of my Dropbox.  Send an email to pduncan [ a t} v _ t (dot] e du, fixing the address of course, with the word "DROPBOX" in the subject and I'll add your email.  I attended Virginia Tech many moons ago and it is my alumni address, so it should be easy to see how to fix the address -- simply use "vt.edu".  I also ask that you subscribe to this list using the link to the left, as it's the only way I can communicate with Dropbox users, if the need arises.

Subscribe to my twitter feed if you want intra-day observations:  grems8544 

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Here's how to find me:

Stocktwits/Twitter:  grems8544

Greenfield Dividends: https://www.collective2.com/details/94780986

Greenfield Leaders: https://www.collective2.com/details/94921209

Greenfield Low Beta:  https://www.collective2.com/details/95702992

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New Meeting Announcement

We will be holding a face-to-face meeting on 2/13/2016 for all interested parties at the following location:

Burke Centre Library

Room: Burke Centre Meeting Room 116K

Address: 5935 Freds Oak Rd, Burke, VA 22015

Library Phone:(703) 249-1520

Time: 10:00 AM to 1:00 PM

Meeting Start Time: 10:00 AM

I will attempt to stream the meeting audio, and perhaps video, as per past meetings, via GotoMeeting.  Attendance via GotoMeeting is limited to the first 25 call-ins.  The ability to do this is completely controlled by the library and I have no say in Internet access.

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

Regards,

pgd

Initial Buy Signal, December 23rd

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Please subscribe to this using the "Follow by Email" link to the left.  Nobody gets your email except me, and I promise that I won't email you except to communicate something concise with the system.  Note that after several years I've never emailed the entire list so you're safe.  Having your email helps me see the number of folks reading this as well as ensuring you get the signals on a timely basis.

My trusty LCR table continues to show signs of strength, specifically on the left side where we have the 5d slope of the Long-Cash Ratio transitioning to a positive value:

Click on the image to enlarge.

The right side of the table is a sea of green, indicating that acceleration to the upside for the entire database is picking up.  This is a necessary condition to get the left side to turn green.

The cumulative tick is showing strength too:

Click on the image to enlarge.

The number of stocks on the NYSE that are hitting new 52-week highs equaled the number that were hitting 52-week new lows, so we're moving in the right direction.

The middle plot shows 2 days of sustained buying in the markets -- the big boys leave big tracks.

The bottom plot shows that there was no weakness yesterday -- sustained buying has provided us a nice upward/right movement of the cumulative tick.

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Now, all of this being said, this is an early signal.  I intend to commit fully, but I also intend to put some stops in place -- about 3% below my entry.  I am going to commit fully because we are in prime buying area on this cycle:

Click on the image to enlarge.

We are below 1 standard deviation where the markets typically turn  upward -- some would call it "oversold" in terms of placement -- I simply call it a high probability location for price increases for the overall database.

Markets are prone to failure around light volume periods, so have a plan -- have protection.

I buy strength -- period.  I set my order to a BUY STOP that is 0.1% higher than the previous day's high, timed to be effective after 9:45 a/ET, good-til-canceled.  If it doesn't fill and the stock still looks good I will lower it the following day.

My perfect setup is multiple days of decreasing volatility and today's action rocketing upward, both in price and volume that takes out at least the volume of the previous 10 days.

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Shopping Lists

We are in prime shopping territory.  I have my lists ready, and they are comprised of quality stocks.  Some lists are better than others.

To view the lists (and individual stocks), you need to be a member of my Dropbox.  Send an email to pduncan [ a t} v _ t (dot] e du, fixing the address of course, with the word "DROPBOX" in the subject and I'll add your email.  I attended Virginia Tech many moons ago and it is my alumni address, so it should be easy to see how to fix the address -- simply use "vt.edu".  I also ask that you subscribe to this list using the link to the left, as it's the only way I can communicate with Dropbox users.

Subscribe to my twitter feed if you want intra-day observations:  grems8544

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Here's how to find me:

Stocktwits/Twitter:  grems8544

Greenfield Dividends: https://www.collective2.com/details/94780986
Greenfield Leaders: https://www.collective2.com/details/94921209
Greenfield Low Beta:  https://www.collective2.com/details/95702992

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

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

Regards,

pgd

Closer to a buy signal, Dec 22 Close data

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From my perspective, yesterday was a healthy day.  I think we're seeing the start of the Santa Claus rally:

Click on the image to enlarge.

The Cumulative Tick chart above shows that buying kicked in yesterday.  This is only Day One, but it is constructive.  The middle plot, which shows algorithmic, sustained buying, was fairly steady all day.  The big boyz are taking year-end positions.

On the bottom plot the instantaneous (white) cumulative tick is above the moving averages and is pulling all of them upward.  Although we certainly can fail at this point, this too is constructive and is a necessary indicator for me.

I'm going through my watch lists.

Click on the image to enlarge.

My other primary indicator is the LCR table above.  We see green on the left side, and lots of green on the right side, so the right-side acceleration is starting to cause the left side to turn positive.  This too is a necessary conditions for the markets to improve.

As you can see though, the indicator can show that the market is prone to failure right here.  I am looking for continued buying, which will drive the 5d and 8d slope of the LCR EMAs (left side of the table) to turn positive (green).  This will indicate that the tide is starting to flow back in, lifting all boats, and triggering me to buy.

Again, get your shopping lists ready.

Shopping Lists

We are in prime shopping territory.  I have my lists ready, and they are comprised of quality stocks.  Some lists are better than others.

To view the lists (and individual stocks), you need to be a member of my Dropbox.  Send an email to pduncan [ a t} v _ t (dot] e du, fixing the address of course, with the word "DROPBOX" in the subject and I'll add your email.  I attended Virginia Tech many moons ago and it is my alumni address, so it should be easy to see how to fix the address -- simply use "vt.edu".  I also ask that you subscribe to this list using the link to the left, as it's the only way I can communicate with Dropbox users.

Subscribe to my twitter feed if you want intra-day observations:  grems8544

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Here's how to find me:

Stocktwits/Twitter:  grems8544

Greenfield Dividends: https://www.collective2.com/details/94780986
Greenfield Leaders: https://www.collective2.com/details/94921209
Greenfield Low Beta:  https://www.collective2.com/details/95702992

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

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

Regards,

pgd