Trailing stops did their job last week, taking out all 11 remaining older picks on the short side with profits on 9 of the 11. Unfortunately, the 2 new picks are still festering, and I’ll excise them as of the open this morning.
Technical Trader subscribers click here to download the complete report.
Non-subscribers click here for access.
As of Friday, September 9, there were 89 charts with second or third buy signals on the last two days of the week. There were 10 charts with second or third sell signals to end the week, but all 10 were inverse ETFs, so they were also sell signals. Thus the final score was 99 to nothing on the buy side. I don’t care what sport it is, that’s quite a shutout. On Friday alone there were 122 buy signals and just 2 sell signals (that weren’t inverse ETFs). Non-subscribers click here for access.
I guess the question is whether this signals a new bull market, or overdone hysteria on the buy side, the possible result of a massive bull raid on short positions that triggered squeezes across a broad spectrum of stocks. I’ll guess the latter, but that doesn’t mean it can’t persist for a few weeks. But it also doesn’t mean that it’s a high percentage trade opportunity. Non-subscribers click here for access.
After visual review of this week’s screen results, I chose exactly zero charts to add to the buy list, and there weren’t any shorts to even look at. I just can’t buy this rally. To do so would be with unclean hands. So we will go through this week empty handed, rather than dirty handed. 😄
Yes, there were multiple short term buy signals, but the trend structures sucked. Virtually every chart was trading just below a thicket of resistance. I have no desire to get caught in a churn and burn meat grinder, so I’ll sit this one out for the time being. Non-subscribers click here for access.
The screen results come from a universe of approximately 1200-1500 stocks daily that meet the criteria of trading above $6.00, and with average volume greater than a million shares per day. I start the weekly process by screening for daily buys and sells from the previous Friday through Thursday. I then rescreen that output, for additional signals in the progression on Thursday and Friday. Non-subscribers click here for access.
The percentage gain is based on 100% cash positions, with no margin and no use of leverage or options. Non-subscribers click here for access.
Last week 11 picks were stopped out. All were shorts. 9 of the 11 were closed out with profits and two with fractional losses. The average was a gain of 4.3% on an average holding period of 13 calendar days. Non-subscribers click here for access.
The two picks added last week will be dropped from the list using the opening price on Monday. They currently have an average loss of 8.8% on a 6 day holding period. Non-subscribers click here for access.
9/5/22 16 picks were closed out in August. The average gain was 3.4% with an average holding period of 2 weeks. Since last November, when I last tweaked the screening and selection methodology, 108 picks were closed out with an average gain of 2.9% and an average holding period of 17 calendar days. Non-subscribers click here for access.
8/1/22 July had been a narrowly rangebound meatgrinder market until last week. Only two picks were closed out during the month for an average loss of 2.6%. Non-subscribers click here for access.
7/4/22 Picks closed out in June averaged a gain of 10.1% on an average holding period of 17 calendar days. That works out to an average of 4.1% per week. There were 12 closed picks. The win rate was 75%. I would hope to continue that, but it is by no means a given. Non-subscribers click here for access.
June’s performance is not something we should expect to duplicate too often, if at all. The average weekly gain since I tweaked the methodology in mid January is just 1.29%, while trending upward lately. Non-subscribers click here for access.
6/6/22 Picks closed out in May averaged a gain of 3% on an average holding period of 2 weeks. That worked out to an average of 1.5% per week. There were 28 closed picks. 25 were shorts. Non-subscribers click here for access.
5/9/22 April was a challenging month. The final tally of closed picks in April had an average loss of 0.4% with an average holding period of 11 calendar days. My system does not do well when the average low to low cycle duration drops below 4 weeks. Non-subscribers click here for access.
March was better. Picks closed in March had an average gain of 4% with an average holding period of 23 calendar days. Non-subscribers click here for access.
The strategy and tactics opinions expressed in this report illustrate one particular approach to trading. No representation is made that it is the best approach, or even suitable for any particular investor. This is a developmental and experimental exercise, for the purpose of providing experienced chart traders with ideas and concepts to use or not use as they see fit.
Nothing in this letter is meant as individual investment advice and you should not construe it as such. These picks are illustrative and theoretical. The method behind these picks is experimental, and may change over time. I may trade my own account, and may buy, sell, sell short or cover short, or have positions in any of the stocks on the list at any time, based on a particular trading style that is unique to me. My entry and close out levels are likely to differ from those published due to the exigencies of my trading style and time constraints. I post these items in good faith for informational and educational purposes, and do not take positions in opposition to those which are published. All chart picks are actively traded stocks, and I assume that no subscriber to these reports, nor the total of all subscribers taking positions, would do so in a size that would influence the market price.
Performance tracking assumes 100% cash basis, no margin, no options. You should not assume that recent performance as reported can or will be repeated in the future. Trading involves risk of loss. In the case of options, the loss can be 100% of the amount invested. When leverage is used the loss can exceed the account equity under certain conditions.
The opinions expressed here assume that readers are experienced investors or are working with an investment advisor.
