The stock market has been a rangebound mess for a month and a day. I call these periods meat grinders for obvious reasons. This kind of market environment has the potential crush swing trade strategies. I failed to recognize this one, and I got us caught in a vicious whipsaw last week. Forget post mortems. The only goal now is to make the best of a bad situation. Non-subscribers click here for access.
For the week ended October 21, there were 56 charts with second or third buy signals on Thursday and Friday, and 59 with second or third sell signals. I visually reviewed the charts, in both groups, and saw mostly rangebound whipsaw signals. I was certainly not about to add any shorts to the list. I only liked two charts on the buy side and added those as shown on the table below. Non-subscribers click here for access.
The rest of the charts with buy signals had uninspiring patterns. Non-subscribers click here for access.
All open picks are shown on the table below with charts following. Non-subscribers click here for access.
10/3/22 Looking at the scoreboard, September showed an average gain of 3.3%, on an average holding period of 13 calendar days. All of the 17 picks closed out in September have been shorts. Of the 16 picks closed in August, 11 were buys and 5 were shorts. 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 In July … 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%. 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.