Tuesday, June 21, 2011

6/21 Daily Commentary

I remain in cash, having sold the short ETFs and short mutual funds very near the lows.  The DJI critical M/A was broken to the upside today, confirming that the rally has several more days of life.  The daily technical composite moved down a notch to +18 from it's high of +24.  The buy signal will only be rescinded by a move to +4 (preferably +3).

The short-term timing component of I1 confirmed it's 8-day lead and this indicates that the rally will last a minimum of 3 more days and a maximum of 6 more days.  I'm betting on 5+ days because the trading rules for this component avoid going short until it declines back to +10.5 after reaching peak. The daily technical composite should get me short again at the top.

A rally of this duration will dishearten bearish intermediate traders.

In this week's Barron's in Market Watch there is an entry by Market Strategist that I believe in wholeheartedly.  The synopsis is:
"The primary trend is governed by the business cycle and fundamental conditions (SLK and major monetary policy in a fiat world).   It typically lasts for years.
Intermediate trends generally last several weeks to months.
Minor trends are the least important and last days to 2 weeks.  While I know successful investors and intermediate-term speculators, I've never met anyone who created wealth trading minor trends.  That doesn't mean such people don't exist; I just don't know any after over 30 years in the business."

My job with this blog is to use I1 and it's components to trade the intermediate trend and to move to cash at the advent of minor trend reactions.   Unfortunately the world is full of traders who feel they need to trade the minor trends, so my following tails off when I move to cash and await the minor trend to spend itself. 

I'll be moving to a subscription basis in another month, still working on the details.  Monthly cost: $10.
Feedback appreciated. Traders that want to make money will subscribe and go to cash when I do; those that want to chase the minor trends will still find value by taking counter-trend positions instead of going to cash like myself.


  1. love putting a price on it...what I would like to see is that early subscribers get locked in. Keep up the good work. BAR

  2. I'm still here Steve fwiw. Your site is one of the only ones I visit nowadays because you are one of the few patient and level headed bloggers out there. I appreciate your analysis and will pay the fee should you go subscription.


  3. What about an annual subscription for a limited time at a reduced rate? Steve, when do you plan on shorting silver again?

  4. Alesund, an annual for $100. Rates locked in for 3 years. Silver and gold turn in a few days, when "risk on" becomes "risk off".

  5. I'm good at 100 per year. BAR

  6. I'm in for $100 a year for sure Steve. Thanks!

  7. Steve
    You can count me in. I used to search out many EW blogs....concluded that much of it was just noise. I am now down to three and yours is the one I look to first and repeatedly throughout the day. Your success rate is high and your comments simply make sense. Much better than listening to noise!

  8. Steve,

    Late to the party here, but I will be a member for sure!


  9. Hello Steve,

    I think the subscription idea is great.

    I would like to see your long, intermediate and short stance (for I1) posted clearly at the site in case I do not have time to sort through the commentary on a given day.

    I would really like to get your raw I1 data (not the logic) to integrate with my own data...even if it was no more than signal flags rather than numeric values. csv file?

    Re: membership sites, I contracted with membershipace.com to build my site and would recommend that service (I know you are a programmer so maybe you enjoy that challenge).