if the market struggles between spx 1730 to 1740 and does not break 1740 the corrective wave count still holds although slightly altered.
the corrective abc wave count is still in effect but the expected “abc” zig zag has morphed into an “abc” flat. the long awaited “c” wave down to my longer term target of spx 1560.33 to 1569.80 has been altered to a low of spx 1640 to be followed by a renewed and invigorated rally to new yearly highs of at least 1800 by year end. i expect to be 100% long in the 1640-1660 area on a bounce off the expected lows. even if the lows don’t touch 1640, the market is tired and needs a pullback; i will be buying on the expected bounce after the pullback
FRIDAY’S MARKET UPDATE, 2013/09/19, FOR MONDAY’S TRADING
(read sections A., F. and section G. first for a quick synopsis)
Unchanged today: 41.25% invested, 6.25% short , (6.25% of shorts are in double leveraged $uvxy (i am short volatility to take advantage of a potential spx rally). 35% long into close: 5% long allocation of AAPL purchased 2013/09/19, and 10% long in each of 3 long term folios: big cap, small cap and small cap B folio. multiple stock folios will remain fully invested but $UVXY longs will be purchased as necessary if the spx decline renews itself. i am in effect about 47.5% net long if the double leverage in market inverse uvxy shorts are taken into account .
see section F or blog comments’ section or outside of daily market update body for any of today’s trade details.
B. SHORT TERM INDICATORS/SYSTEMS:
1. elliott PSTT: ON A BUY SIGNAL @ SPX 1656 ON MORNING OF THURSDAY, 2013/09/05.
prior sell was as of the thursday, 2013/08/15, on the close below spx 1682.10.
previous buy signal was from friday, 2013/07/05, when we closed above 1627 spx.
prior signal was a SELL @ spx 1607 on, 2013/06/20, thursday morning.
the PSTT is the most heavily weighted indicator for signaling a change in weekly to monthly wave counts and trend changes.
2. qqq indicator: on a BUY signal at mkt. close on monday, 2013/19/09. reading today is at +7, down 2.
prior short was friday, 2013/08/09. prior BUY signal on 2013/08/02. prior signal was a sell on monday, 2013/07/29.
prior BUY signal was on fri., 2013/07/05.
on a scale of -10 to +10 , we need a 0 to sell and -6 to short. +6 is a buy and remains a buy until 0 is triggered; 0 is neutral. indicator heavily weighs momentum in unison with smart buyer activity.
a negative 6 (-6) remains a short until a neutral 0 is triggered).
3. smart money indicator: -2, DOWN 4 points, still on a SELL as of 2013/07/25, prior buy was thursday’s close on 2013/06/06 . prior signal was a neutral on 2013/04/17. prior BUY signal was on wed., 2013/04/09.
a -8, once triggered is usually a sell and remains so until a +7 is triggered.
C. TODAY’S BENCHMARKS: $SPY -1.18%, $IWM -0.36%, $SPX range (h,l,c): 1729.85, 1720.20, 1722.24. $UVXY +3.34% @ 30.36, $NUGT 17.10% @ 55.11, $AAPL -1.04% @ 467.41.
1. JULY monthly 2faced longs: closed 2013/08/15, in cash.
2. JULY monthly 2faced shorts: closed 2013/08/15, in cash.
3. weekly 2faced longs: folio is in cash for next few weeks.
system holds longs for a full week to 2 weeks.
4. weekly 2faced shorts: folio is in cash for the next few weeks.
system holds longs for a full week to 2 weeks.
i also use the weekly 2faced stocks as day trading candidates.
5. large cap folio of 49 stocks: -1.37% today. +20.18% since 2013/03/05 vs. $SPY bench mark +10.51%.
6. nano cap folio of 18 stocks: closed, in cash since 2013/07/11 when spx closed at 1675.05 and iwm closed at 102.47. +18.79% since March 15, 2013 vs. benchmark $iwm +10.34%.
7. small cap folio of 44 stocks: -0.24% today. +37.16% since 2013/03/05 vs. $IWM bench mark +16.64%
8. small cap B folio of 49 stocks: +0.65% today. +26.24% since 2013/03/10 vs. $IWM bench mark +13.72%
9. large cap B folio of 10 stocks: closed, in cash since 2013/07/19 when spx closed at 1692.09. +10.47% since March 29, 2013, vs. $spy bench mark +7.98%.
E. LONG TERM INDICATORS:
1. heaven/hell crash indicator: friday , 2013/09/20 reading, unchanged at +6, a mildly bullish reading. prior week’s reading was at +6.
NO CRASH IN SIGHT until we see a reading of -10.
next signal update will be on 2013/09/27.
a rare -10 signals a 2008 type of crash. currently there are no signs of an upcoming crash. an extremely bullish +10 is very positive for the next several days to weeks for the stock market.
this indicator is more valuable as a crash indicator; i make sure i am heavily short at a -10.
2. early warning intermediate to long term two stage indicator for hedging : ACTIVE, ADD SHORTS AT SPX 1543.
all other long term indicators remain on a BUY.
F. MISCELLANEOUS DAILY COMMENTS:
patience is one of the most difficult but most rewarding parts of trading if you learn this discipline..
uvxy trades will be moved to the closed trades section once the remaining 6.25% short allocation is closed.
stopped out of a 5% allocation of nugt longs from 61.55 on 2013/09/18 today, 2013/19/20, at 61.55.
if we falter at $SPX 1730 to 1740 then $SPX 1640 is a high probability.
THE PLAN FOR MONDAY:
1.stop on remaining 6.25% allocation of uvxy shorts will remain 33.54.
on 2013/09/03 a 25% allocation was shorted at 44.45.
buying a 40% allocation of $uvxy longs at SPX 1694 or uvxy 33.55 which ever occurs first. If filled I will be using an spx stop of 1730.
2.in AAPL the sell stop on the 5% allocation of longs from 473.04 on 2013/09/20 will be 460.99.
3. NUGT: shorting a 5% allocation at 53.53
CURRENT NON FOLIO HOLDINGS:
1. on thursday, 2013/09/19, 5% long allocation of AAPL was purchased at 473.04.
2. on tuesday, 2013/09/03, a 25% allocation of uvxy shorts from 44.45. since then allocation has been reduced through profit taking to 6.25%.
the aapl and nugt, systems are have been changed to a shorter time frame which should result in more trades , smaller gains but smaller losses..
G. RECENT CLOSED TRADES:
AAPL: on 2013/09/19: Stopped out of a 1% allocation of $AAPL shorts from 466.20 at 471.01for a 1.02% loss
NUGT: on 2013/09/20: stopped out of a 5% allocation from 61.55 at 61.55 for a break even trade.
on 2013/09/18: stopped out of a 1% allocation of shorts from 67.45 shorted on 2013/09/10 at 61.55 for a 8.7% profit.
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some of Friday’s twitter tweets:
• 1730 to 1740 spx definitely not broken, be patient for the big wave c break to 1640-30. 2 days ago
• Lowering stop on $uvxy shorts to 31.95. 2 days ago
• #Apple, stop new aapl long will be 460.98. 3 days ago