JTH's Account Talk

​Good morning

From the Top-600 perspective, 6% of you are outperforming the C-Fund. Id estimate those numbers are impressive when you consider the limited fund options along with the 2-IFT limit. Frankly, I just don't think many fund managers could do much better (given those circumstances).

Quarter 4 is here, which traditionally provides the best opportunities of the year. BLOG:
STATS FOR Q4
20231008-001.png
 
Good morning (some speculation)

If I were to guess what the market thinks... I’d look at the 200-SMA & the 50% yearly low/high retracement at 4207 to provide support. If support breaks, then we might expect to test the next lower yearly Fibonacci level at 4113.

From Friday’s close it would cost us -4.52% to test this 4113 level. At this stage of the game, we would have then breached -10% from the top, and thus it would be termed a correction. And with that correction perhaps it may bring a fresh news cycle where the world is ending and sellers get flushed out. This could be the pruning we need before we can go higher.

Conversely, a 2.16% move higher would fill the overhead gap, but given the market’s lower swing high/low conditions, I’d view that more as a short-term opportunity, and look for the markets to sell-off after the gap-fill.
20231008-001.png

We are 5 trading days into the MTD statistical range. At this early stage of the chart, the previous 21-years (trading day 5) was up 13 times, closing the month up 10 times. The monthly closing average of those 10 years was 5.14%. Of the other 3 times October closed down, the average was -2.24%
20231008-MTD.png

From last week, little has changed on the DoW Chart. The last 13 Monday’s have closed up, while Tue-Fri continue to underperform. Perhaps this Monday, we can finally break the Monday win streak…
20231009-DoW.png
 
Good morning (Terrible Tuesday)

Monday was one of those rare occasions where both SPX gapped down at the open, and the 12-Noon IFT-Deadline was down, yet SPX closed the day up. In 2023, SPX gapped down & closed the day up 32 of 193 times (about 16.5%). From those 32 times the next day’s win ratio was 41%

Looking at today, the last 5 Tuesdays have closed down, the last 11 have an 18% win ratio, and the last 27 have a 33% win ratio. The chart below shows the win ratios for our days of the week on the YTD timeframe. Here we can see (thus far) Tuesday has been the weakest day of the week.
20231009-002.png

MTD we are up 1.11%, from the previous 63 Octobers the average monthly close was 1.09%
20231009-001.png
 
Opening gaps

If I were to guess... Trading IFTs based on gaps is more reliable when the market is trending vs. oscillating. At some point in time, I'd like to develop a method to identify and assign statistics based on those two conditions.

Anyways, when the S&P 500 gaps at the open, the stronger the gap, the higher the probability the index closes is the gap's direction. As an example, (left column) in 2023 the S&P 500 gaped < -.30% 40 times with a win ratio of 18%

20231011-001.png
 
Good info. Sounds like day trading ETFs may work well with this.

My experience is to wait for a fade of the opening gap in the first 30 minutes. So using your data, and as an example, if QQQ gaps up $3.00, wait for it to come down to +2.25 for the day in that first half hour (fill some of that gap), then buy it. Then sell at the close.
 
Good info. Sounds like day trading ETFs may work well with this.

My experience is to wait for a fade of the opening gap in the first 30 minutes. So using your data, and as an example, if QQQ gaps up $3.00, wait for it to come down to +2.25 for the day in that first half hour (fill some of that gap), then buy it. Then sell at the close.

Great points, I should do this more often, I don't tend to day trade much but I do think a gap trading strategy is one of the better methods, especially if you can be finished trading in the first 30 minutes of the day :)
 
Daily Gaps

Good morning (more on opening gaps)

The previous chart posted was for daily opening gaps in 2023. One of the things I like about these gaps is how the data remains consistent throughout various timeframes. Case in point, the chart below shows us 27 each of the various gap ranges. The overall theme remains the same, the stronger the gap, the more likely we close in the direction of the gap.
20231012-001.png

Below, we have the same theme over the past 21-years. Perhaps as important (on this timeframe, from the IFT viewpoint), when you are buying you want the average-of-losses to be greater than the average-of-gains. This way, if the trade goes wrong, you want to increase the likelihood the damage will be minimal. The same hold true for selling, you want the average-of-gains to be greater than the average-of-losses. Given our IFT limitations, this is about as good as a statistical chart can get.
20231012-002.png
As an example from the above chart in the far right column: For an IFT, if I want to sell when the S&P 500 gaps up .30% (historically) there was an 82% chance of an average-gain of 1.50% or an 18% chance of an average-loss of -.86%
 
Interesting price action today.

The S&P 500 Gaped up .10% at the open and was up .18% at the IFT-Deadline. Typically this would make for a textbook up day, we even made a slightly higher high, but now have a made a lower low. For whatever reason, we seem to be unwilling to fill the gap...

20231012-003.png
 
Yeah...... pretty fast sell-off there. I wonder who said what, or what data was released (or manipulated)???
That's the type of price action that just keeps me on the sidelines. It just happens so fast like that, and in some cases much, much worse.

01.PNG

 
Yeah...... pretty fast sell-off there. I wonder who said what, or what data was released (or manipulated)???
That's the type of price action that just keeps me on the sidelines. It just happens so fast like that, and in some cases much, much worse.

Another weak midday bond auction sent yields up.

Yea, it's getting dangerous out in the Bond world. On the Monthly Chart: The leverage 3X 20-Year Bond ETF TMF has been tanking. I started taking a position in October, I'll look to recoup sometime next year (perhaps as early as May) when/if the Fed begins to drop the interest rates. I'm still digging into the position, by the EoY, it will be about 4% of the long-term portfolio. Once it drops into the $3 range, we might expect a reverse split, leveraged ETFs are dangerous! Either ways, I'd rather put some risk on early, than too late, we'll see how it works out :smile:
20231012-004.png
 
Good morning

Having burned the first IFT early in the month, it's too early for me to start fading this mini-rally and risk getting left behind (should we re-attack the highs). In a perfect scenario (Plan A) I'd exit above the highest 70G/30C IFT early next month, then re-enter on the next swing low. Plan B, would be a partial exit above the open gap around 4418. At one time the C-Fund was outperforming me by 12%, now it's < 6% it will be difficult to make up the difference, and easy to make it worse :rolleyes:
20231013-1.png

Also, on the 21-Year-October Trading Day chart, we've entered Day-10 where we have an 8-Day run of higher than average win ratios. For myself, 21 years is not statistically meaningful, but it is the most recent trend. We could go back and use 63 years of data, but on the daily scale, all it would do is smooth out the peaks & dips, making everything look the same.
20231013-2.png
 
Sunday

Good morning

Last week the S&P 500 gained .45%, our Top-600 lost -.16% and our Top-50 gained .10% . Allocation wise little has changed for the Top-600, but the Top-50 did shift 16% into the CSI funds.
001.png

We are now 10 trading days into the MTD statistical range. At this stage of the chart, the previous 21-years (trading day 10) was up 10 of 12 times. The monthly closing average of those 10 years was 5.51%. Of the other 2 times October closed down, the average was -2.37%
002.png

On the Day of Week chart, the last 14 Mondays have closed up. Going back to 1959 (For Monday) this is the 1st time we’ve hit 14 straight. Thus far in 2023, the Monday win ratio is 80%, in 2022 it was 33%. However, over the previous 21 Years, Monday’s Win ratio was 52% over 991 sessions.
003.png
 
Re: Sunday

Good morning

I've finished my 4th mini-vacation since September, while I enjoy traveling, I'm glad to be back home watching the pre-markets from a front row seat. :smile:

BLOG: Preview Into November
 
I want my -10% correction!

Good morning...I want my -10% correction!

As we’ve seen for much of 2023, the S&P 500’s Top-10 weighted stocks have provided the bulk of the lifting. In theory, If we were to remove only the Top 4 market-cap weighted stocks, the S&P 500’s 11.42% YTD gain would be erased.


At this time, the Top-50 have an index weight of 56.7% with 32% above their 50-SMA & 66% above their 200-SMA. So while the short-medium term has taken damage, the long-term view is still in the green.

20231020-0.png

As for the 11 SPDR Sectors, YTD if you remove the two best performing sectors (Tech & Comm Services) the S&P 500 would be flat for the year. On the Momentum columns we can see the damage where the weighted scores are very low.

20231020-1.png

Looking at the Yearly historical averages (Monthly Chart) we are still above the 63-Year 8.15% average, so it’s not as bad as it could be. But we have “almost” tagged the 12-Month-SMA @ 4211, for me, that’s an important caution flag. It’s also the same general area both the 200/500 Daily SMA reside at. A break below those levels could just be the catalyst we need for some genuine capitulation.

20231020-3.png
 
Re: Daily Gaps

Good morning

Finishing out the week, our Top-600 lost -.47% MTD while the Top-50 gained .20% (thanks to the rise of G-Funders). Allocation wise across the tracker there was little movement, with only .4% adding to the G/F funds.
20231023-AT.png

On the MTD Statistical range, we’ve now finished trading Day 15. From the previous 21-years at this stage of the chart we were down 8 times on trading day 15, closing the month down 5 of those 8 times. From this limited data, we could estimate 62% odds of closing the month down an estimated -3%.
20231023-MTD.png

For some context, October’s close has one the widest percentage range of gains & losses (when compared to the other months). The Averages-of-losses sits at -4.05% or SPX 4114. This is also a 61.8% Fibonacci retracement from the Mar-23 Low to the July-23 High. From Friday's close this is only -2.62% below us.
20231023-MTD1.png

For myself, this SPX 4114 level might be just the spot I’d love to plant that 2nd IFT, kicking in the last 10% of G into C. Truth be told, I’d be just as happy to get that last IFT in at any level lower than the previous, so we’ll see how it works out.
20231023-jth.png


Lots of earnings this week. it should be fun to watch :D
These 4 companies make up just over 16% of the S&P 500.
Tuesday - Microsoft/Google
Wednesday - Facebook (Meta)
Thursday - Amazon
 
Last edited:
Good morning

Do we have low volatility? YTD the 10-Best days have earned 17.39%, while the 10-Worst days have lost -16.11% Thus far in 2023, we’ve had 1 day > 2% and 1 day < -2%.

In contrast, in 2022 the 10-Best days earned 30.95%, while the 10-Worst days have lost -35.12%. 2022 had 23 days > 2% and 23 days < -2%.
____
Anyhow, looking at the Day Of Week chart, we have 15 consecutive positive Mondays. From 1959, across 3,129 Mondays, the highest 27-Monday win ratio was last Monday at 88.89%

For some comparisons, here’s the average 27-Monday Win ratio by decade.

1960s average was 40.73% highest was 59.26%
1970s average was 43.91% highest was 66.67%
1980s average was 50.96% highest was 70.37%
1990s average was 57.86% highest was 77.78%
2000s average was 49.30% highest was 74.07%
2010s average was 53.01% highest was 81.48%
2020s average is currently at 56.57% with the highest at 88.89%

Meanwhile, on the 27-event time-frame Tue-Fri continues to under-perform.
20231023-DoW.png

Here’s the latest gap data showing how the S&P 500 tends to close based on the opening gap’s range.
20231023-GAP.png
 
This morning the S&P 500 gaped down -.33% at the open.

The last 100 times we gaped down -.30% or less:

The win ratio was 15% (how often the day closed positive)
The Average-of-Gains was .77% (all 15 positive closes)
The Total Average was -.81% (all 100 closes)
The Average-of-losses was -1.09% (all 85 negative closes)


20231023-GAP-100.png
 
9-SEP
Good morning (some random thoughts)

SPX 4207 is a 50% retracement of the Yearly Low to High. Perhaps in October the 200-SMA can climb to this level, and provide support for a test. From current levels a test of 4207 is -5.02% below us, and -8.66% below the yearly top.
View attachment 58800

Friday was our 1st close below the 200-SMA since the March lows.
Achievement sorta unlocked....
20231023-50.png
 
Back
Top