clester's Account Talk

[clester]

New week but markets continue on same path it seems. No warnings except the C fund has a flat top. We are not overbought and sentiment is not too high. Lots of news over the weekend. I think the fed news could cause a sell off at some point. Maybe July when I was expecting the correction. At the moment, markets are down some. Probably due to rumors about the Fed. Lets see if it picks up steam this week or if dip buyers continue to hold us up.

 

[clester]

New week but markets continue on same path it seems. No warnings except the C fund has a flat top. We are not overbought and sentiment is not too high. Lots of news over the weekend. I think the fed news could cause a sell off at some point. Maybe July when I was expecting the correction. At the moment, markets are down some. Probably due to rumors about the Fed. Lets see if it picks up steam this week or if dip buyers continue to hold us up.

The bull market continues. The charts look great from my perspective. Bottom left to top right. Still not overbought. One of my system rules is to be in at least 50 % in a bull market and not try to time the top. I learned this the hard way. Wait for the market to you when to get out.

So far, my theory of the rally continuing until July is intact.

 

[clester]

The bull market continues. The charts look great from my perspective. Bottom left to top right. Still not overbought. One of my system rules is to be in at least 50 % in a bull market and not try to time the top. I learned this the hard way. Wait for the market to you when to get out.

So far, my theory of the rally continuing until July is intact.

Nice day. C fund is now in overbought territory and S fund is getting close. The thing about overbought is that it can continue a lot longer than you think. So, since we are getting overbought I will be looking for confirmation from break of trend lines or sentiment being too bullish or both. Again, I will wait for the market to give me a sell signal and not try to call the top. I am getting nervous though.

 

[RealMoneyIssues]

I am getting nervous though.

Don't worry about it... last time you were getting nervous (and I believe you also got a sell signal, but no confirmation), the market shot up to clear your nervousness.

Remember, this is Ben's market !!!

 

[clester]

Don't worry about it... last time you were getting nervous (and I believe you also got a sell signal, but no confirmation), the market shot up to clear your nervousness.

Remember, this is Ben's market !!!

It is unusual for s&p to have RSI over 70. It happened in January though and we then rallied for 6 weeks. This is a place where ,in the past, I took profits and then watched the market continue up. So, I don't try to time the top. I just find a " sell stop" price. For this strategy it means you sell on the way dwn from the top and lose the gains near the top. In my experience this works better than selling on the way up most of the time. Drops can be fast and furious in this kind of bull market because we are so far above the 50 and 200 dma. You have to be willing to sell when the time comes and not let bias or greed get in the way.

 

[jkenjohnson]

It certainly seems like you know what you are doing. I wish I had caught the wave up in November. I am kicking myself in the arse right now.

 

[Khotso]

Clester -- I just wanted to stop in quickly to say how much I enjoy and learn from the perspectives you've been sharing in your thread. I am currently doing exactly what you say you've learned to avoid doing from experience -- e.g. sitting on the sidelines during this enormous wave. I should have stayed partly invested given it's a bull market, but thought a correction was imminent and got 100% out.

From reading your posts, I've realized that a well conceived timing system has two sets of rules: one for bull and one for bear markets. Now if I can only have the discipline to apply that!

Anyway, kudos on a great personal investment thread!

 

[clester]

Clester -- I just wanted to stop in quickly to say how much I enjoy and learn from the perspectives you've been sharing in your thread. I am currently doing exactly what you say you've learned to avoid doing from experience -- e.g. sitting on the sidelines during this enormous wave. I should have stayed partly invested given it's a bull market, but thought a correction was imminent and got 100% out.

From reading your posts, I've realized that a well conceived timing system has two sets of rules: one for bull and one for bear markets. Now if I can only have the discipline to apply that!

Anyway, kudos on a great personal investment thread!

Thanks for the comment.

Glad to share my thoughts and what I have learned from "the school of hard knocks". I probably knew a lot more than I thought in the past but either followed someone else advice or tried to outsmart the market or sometimes just made emotional decisions. For some reason, the last few years I've been able to have the discipline to follow the system. Maybe, it comes with age Maybe I've just been lucky.

On the current market, I expect a day or 2 pull back any time now. With the RSI over 70 on C and S funds, we are overbought. That doesnt mean we will get a big pullback. Just a pause probably. I dont think it would be advisable to try and time it. I would just say to find yourself a good sell stop based on technicals, charts, etc and if we hit it just hit the sell. A big one I use is the 50 dma (thats a long way down now!) but I will watch the short term trend lines as well. As for my system, it calls for staying in at least 50% during a bull market. So, my first sell will probably be a 50% er.

 

[clester]

Clester -- I just wanted to stop in quickly to say how much I enjoy and learn from the perspectives you've been sharing in your thread. I am currently doing exactly what you say you've learned to avoid doing from experience -- e.g. sitting on the sidelines during this enormous wave. I should have stayed partly invested given it's a bull market, but thought a correction was imminent and got 100% out.

From reading your posts, I've realized that a well conceived timing system has two sets of rules: one for bull and one for bear markets. Now if I can only have the discipline to apply that!

Anyway, kudos on a great personal investment thread!

Thanks for the comment.

Glad to share my thoughts and what I have learned from "the school of hard knocks". I probably knew a lot more than I thought in the past but either followed someone else advice or tried to outsmart the market or sometimes just made emotional decisions. For some reason, the last few years I've been able to have the discipline to follow the system. Maybe, it comes with age Maybe I've just been lucky.

On the current market, I expect a day or 2 pull back any time now. With the RSI over 70 on C and S funds, we are overbought. That doesnt mean we will get a big pullback. Just a pause probably. I dont think it would be advisable to try and time it. I would just say to find yourself a good sell stop based on technicals, charts, etc and if we hit it just hit the sell. A big one I use is the 50 dma (thats a long way down now!) but I will watch the short term trend lines as well. As for my system, it calls for staying in at least 50% during a bull market. So, my first sell will probably be a 50% er.

edit(sorry for the double post, I don't know how to delete one of them)

 

[weatherweenie]

I too read your comments regularly. I wish I would have listened, and left some of my TSP monies in the market. Live and learn, I guess/hope.

I don't usually watch CNBC. Yesterday, on Kudlow, he had two people agreeing that the market is going higer/much higher.

I know one of the things you pay attention to is sentiment. Do you think that we are getting overly bullish, Birchtree aside?

 

[clester]

I too read your comments regularly. I wish I would have listened, and left some of my TSP monies in the market. Live and learn, I guess/hope.

I don't usually watch CNBC. Yesterday, on Kudlow, he had two people agreeing that the market is going higer/much higher.

I know one of the things you pay attention to is sentiment. Do you think that we are getting overly bullish, Birchtree aside?

It doesn't feel like it to me yet. There seems to be plenty of folks still expecting a big Pull back but sentiment is getting more positive. It will be interesting to see our survey this week. I don't have a quantitative way to gauge this just anecdotal mostly.
I do watch our survey. We are now overbought which is a concern. There are lots of TSPers still holding out for a nice pull back to get in. That's bullish.

So, at this point I'm mainly watching the trend lines and planning my stop loss targets. just to repeat, I won't try to time the top.

 

[jpcavin]

This is a place where ,in the past, I took profits and then watched the market continue up. So, I don't try to time the top. I just find a " sell stop" price. For this strategy it means you sell on the way dwn from the top and lose the gains near the top. In my experience this works better than selling on the way up most of the time. Drops can be fast and furious in this kind of bull market because we are so far above the 50 and 200 dma. You have to be willing to sell when the time comes and not let bias or greed get in the way.

This is is very good advice. Thank you for sharing.

 

[clester]

This is is very good advice. Thank you for sharing.

Experience is a good teacher.

I thought I would share my stop loss price since I've been talking about it. I'm looking at 840 on $emw (S fund). The lower trend line is there and the last swing low is also there. It's where the last down day reversed. That's almost 2% from here. Ouch. That would hurt. In my system, I don't try to time the top so I will always get out below and after the top. That's the trade off. Sell on the way up or on the way down. But no one can time the top or bottom. Some might get lucky a time or two but not consistently.

So, I just plan and expect it. That way I'm not all stressed out when we have a drop. I've planned for it.

 

[jkenjohnson]

Experience is a good teacher.

I thought I would share my stop loss price since I've been talking about it. I'm looking at 840 on $emw (S fund). The lower trend line is there and the last swing low is also there. It's where the last down day reversed. That's almost 2% from here. Ouch. That would hurt. In my system, I don't try to time the top so I will always get out below and after the top. That's the trade off. Sell on the way up or on the way down. But no one can time the top or bottom. Some might get lucky a time or two but not consistently.

So, I just plan and expect it. That way I'm not all stressed out when we have a drop. I've planned for it.

If all the economic data that is coming out today is positive, I can see another 1-2% gain in the S fund today. Still beating my head against the wall for selling too early.

 

[clester]

If all the economic data that is coming out today is positive, I can see another 1-2% gain in the S fund today. Still beating my head against the wall for selling too early.

The s&p's RSI is on its way to 80 it looks like. That's a sell signal because it will be very overbought and hardly ever stays there long. This rally looks like it did in January. That rally just kept climbing with minor down days. I'm still looking for the rally to continue into July. But the higher we go the bigger the correction.

 

[jkenjohnson]

The s&p's RSI is on its way to 80 it looks like. That's a sell signal because it will be very overbought and hardly ever stays there long. This rally looks like it did in January. That rally just kept climbing with minor down days. I'm still looking for the rally to continue into July. But the higher we go the bigger the correction.

Jobless claims just came out and are not good. Of course this market will probably shrug it off.

 

[MaStA]

Jobless claims just came out and are not good. Of course this market will probably shrug it off.

Sure seems like it...the futures are barely in the red. :notrust:

 

[jpcavin]

The s&p's RSI is on its way to 80 it looks like. That's a sell signal because it will be very overbought and hardly ever stays there long. This rally looks like it did in January. That rally just kept climbing with minor down days. I'm still looking for the rally to continue into July. But the higher we go the bigger the correction.

I know that some people use 70/30 but lets drop that variable and just go with 80/20 for the sake of this point...

Isn't it true that traders look to establish bearish positions when the RSI rises above or touches 80 and then falls back below it? Since stocks can remain overbought for sometime in a bull market, it would seem that if you sell as soon as the RSI reaches 80 that you may be selling too early. Wouln't you need to confirm the RSI with MA?

 

[Valkyrie]

I'm still looking for the rally to continue into July. But the higher we go the bigger the correction.

Money Morning



world wide crash coming, to bring a new 3 world currency into existence. G20 nations have been calling for this for a decade. Rogers has alluded to it in other articles.


thanks for all of your posts C., they are a great help.
God Bless

 

[clester]

I know that some people use 70/30 but lets drop that variable and just go with 80/20 for the sake of this point...

Isn't it true that traders look to establish bearish positions when the RSI rises above or touches 80 and then falls back below it? Since stocks can remain overbought for sometime in a bull market, it would seem that if you sell as soon as the RSI reaches 80 that you may be selling too early. Wouln't you need to confirm the RSI with MA?

Exactly right. I would look for a confirmation. It's a sell for that indicator not for the system I use. It used to be but I decided to wait for a confirmation because by itself it can give false signals. So, now I look for a break of trend or of the 50 dma to confirm it. The only automatic sell for the system right now is a drop over 20 points on the s&p. I use that just because it's a round number. It should be higher because that's just a little over 1% drop. So, I should probably revise it to 24. The reason I have this signal is from past experience a drop of that magnitude usually has follow through to continue the decline.