Hind Sight is Not a Strategy

I had expected (hoped actually) that Friday would have been the day we'd see some positive action following two down days, but it looks like I was one day off. But when I get a sell signal (last Thursday) I can't wait around for a trading day that suits me. So I follow the system for better or worse. It's the long term I'm interested in, so one day's action is meaningless for all intents and purposes, and hind sight in not a strategy.

I did not expect to see a buy signal too quick and felt the earliest we'd see one is next week (week of 5 Oct). That's my best guess and nothing more. I simply feel that bearishness rises too quick for a sell signal to last more than a month, and they haven't even been taking that long. But what I expect to happen is not necessarily what will happen, and that's where the Seven Sentinels system comes in.

So did we get a signal today? No, we did not. Not yet anyway. Take a look:

Of the first four signals only NAMO came close to a buy, and it's borderline.

TRIN and TRINQ are back to buy territory, but BPCOMPQ is not.

So we only have 2 buy signals, one borderline signal, and 4 sell signals. It doesn't matter whether I call the borderline signal a buy or not as we need all seven to be in buy mode and they were not. So the Seven Sentinels remains on a sell.

I noted that today's volume on the S&P was very light. That is not what I'd expect to see on a decisive reversal, so the caution flag should still be waving.

 

[JTH]

Ahh that's too funny, with all our talk about whipsaws, I'm glad to see the system didn't let 1 day's action flip it over.

 

[coolhand]

Ahh that's too funny, with all our talk about whipsaws, I'm glad to see the system didn't let 1 day's action flip it over.

I think BPCOMPQ will be the toughest to push back into buy territory without significant follow-thru in the short term.

 

[matrix54]

Global oil demand will collapse next year and commodities will not return to the highs they reached this summer in the foreseeable future, two authoritative reports said on Tuesday as they forecast a long and painful worldwide recession.
The stark conclusions came as the World Bank's chief economist predicted that the world faced "the worst recession since the Great Depression".
The US energy department said global oil demand will fall this year and next, marking the first two consecutive years' decline in 30 years.
"The increasing likelihood of a prolonged global economic downturn continues to dominate market perceptions, putting downward pressure on oil prices," it said, forecasting that demand would drop 50,000 barrels a day this year and a hefty 450,000 b/d in 2009. US oil demand will drop next year to the lowest level in 11 years.
Meanwhile, the World Bank's Global Economic Prospects report said the commodities boom of the past five years - which drove up prices 130 per cent - had "come to an end".


Read more at: http://www.huffingtonpost.com/2008/12/09/world-bank-chief-economis_n_149759.html