Current Position: Long from 1465.16
Next Action: Stop at 1449.97
Score (0-10): 10+=Bullish=Trend Score + Turn Score=10+2
We are at a stage where I would normally rant and rave about how the market is built on a house of cards, wall street is being bailed out at the expense of main street and the debt elephant in the room is being ignored to keep the wealth transfer going until the final stroke of midnight. Like many, I have ideas for solutions that involve some short-term pain, but I don't think any of them have even the slimmest chance of fruition without a revolution, crisis or possibly another generated war. OK. So, that's not exactly rant-free, but it is rant-less if you know what I mean.
The bottom line is that ubiquitous economic and political opinions and market projections like mine have virtually zero benefit for short-term trading, and often are a detriment. GIGO (Garbage In, Garbage Out). Therefore, I commit to not watching any TV business or political news and not reading any economic or political opinion articles for the next full week through Sunday dinner. That includes trading-related and market-related articles and charts. That may sound easy but I often keep CNBC, MSNBC or other such news TV on in the background, and I usually fill my free time surfing such articles and channels. In one week, I'll let you know if I met my commitment and how it affected me. Possibly, I will extend the embargo or set limits. We'll see how it goes.
I can personally attest after 7 years of active short-term trading that you need an objective backtested system with decisive entry and exit levels to consistently succeed as a trader. That alone would force you to truly adhere to many of the industry's trite sayings: keep losses small, let winners run, the trend is your friend, don't catch a falling knife etc etc. The System is designed to do all of those things.
The only System subjectivity lies in the ability to take 25% profit at any point and the ability to set a stop up to 1% beyond hourly candle s/r when the Score has not reversed against the trade. In my experience, the former has negligible impact on overall profits while reducing risk and increasing mental stick-to-it-iveness and the latter can be useful to avoid typical stop-runs while staying with the trend.
The overall System Score is very bullish with the Trend Score having been bullish for 2+ months. The Turn Score is actually leaning towards the bullish side right now but has been occasionally very bearish turning the overall Score neutral for brief periods. As I stated last week, the Score is not likely to turn neutral or bearish until SPX either rallies to a new 1475+ high or turns 1440 into resistance with a drop 'n pop. Until then, the System will remain long or awaiting a long entry. That's just what the objective data tells me. Sure, things always turn at some point, but 2+ months and 150pts is a lot to fight the trend since 1329 so, as much as I suspect things are going to fall apart in Sep/Oct, we'll continue to wait to go short until the System Score aligns. Good luck.
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