MrJohnRoss' Account Talk

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Well there's a surprise.... not. My timing system moved back to a buy position. Momentum is too strong to stay away. I'll be going back into equities before the IFT deadline tomorrow morning. Will do my analysis tonight to see which fund has the best momentum, and will jump back in. Tough to miss out on today's action, but I need to follow my system through thick and thin. I fell off the wagon a few times this last year, and it cost me. +11.48 on the Auto Tracker in 2012 is good, but I would have done a lot better had I followed every move my system produced. Lesson learned.
 
Mr. John - when you make a determination as to which fund you will move to would you mind sharing that information? I value your insight, knowledge and charts. Thank you! Kevin :)
 
All the equity funds are a little overheated here, but the I Fund has the best intermediate term momentum at this time. I'm going 100% I Fund, but even a 50/50 mix of I and S wouldn't be a bad move either.
 
I wouldn't be surprised to see a flat to lower market this week. Here's why: Take a look at the ratio of the S&P compared to the VIX:


$spx$vix.png


The ratio was way below the lower Bollinger Band just four short days ago at 61.69 (circled in green). The markets have moved violently higher (and VIX violently lower) in a very short time span. Now the ratio is all the way up to the upper BB, with a value of 106.04 (circled in red). That's a 71% increase in the ratio in four days, which is just too far, too fast. The markets will likely search for equilibreum here, which means the S&P should come down, and the VIX should move higher. Don't be surprised to see a mild sell-off in the next few days, in order for the market to digest this extreme move. There are also a lot of open gaps in the market which will likely get filled as well. Eventually, I think the market will head higher from here, but it may take a few days to settle down and work off some of these excesses.

Good luck everyone!
 
One important gap in the market has been filled, and that is the I Fund. See the 60 minute chart below:


efa.png


EFA gapped 1.4% higher at the open on Jan 2 (blue rectangle). Since that time, the international markets have ground slowly lower, and that 1.4% gap up is now filled.

This is a good sign that at least some of the excesses are getting purged, and the markets can begin to move higher.

Of course, this is only one of many open gaps in the market. Nasdaq has a very large open gap that will want to eventually get filled. It may take some time for that to occur, so as I mentioned before, I'm still expecting this week to be negative for the markets.

Good luck everyone!
 
How much you wanna bet somebody made a crap load of insider trading money off that downgrade?
 
Yeah, did you happen to see the CNBC show last night about how the SEC basically looked the other way while the Banksters imploded the housing market? The CEO's and CFO's laughed in the face of Sarbanes-Oxley potential jail time, and no one did a damn thing to stop them. Meanwhile, the entire financial landscape of the globe was thrashed, and those CEO's and CFO's are now sipping pina coladas on their yachts off the coast of Tahiti. Bastards.
 
AAPL stock going to $50? This ARTICLE says so, but I think that's a bit over-blown and sensationalized. Clearly AAPL is in serious technical trouble, as seen below. As price gets squeezed by the descending triangle, I'm expecting the floor to eventually drop out, and AAPL to start trading in the $400's. This will likely lead to a huge bull/bear battle, but I think the bears will have eventual control, as AAPL struggles to impress with their quarterly earnings reports. Don't get me wrong, I think it's still a VERY strong company, with lots of rabid fans, and billions in cash, but the above article does point out a lot of truths about AAPL and the consumer electronics industry. If this plays out, it will not bode well for the NASDAQ, as AAPL is a huge part of the index. The spillover could affect other markets, so be cautious if and when AAPL finally cracks below $500.

Good luck!



aapl.png
 
that descending triangle looks nasty for sure, that's not a pretty chart for apple.

but $50 per share? not THAT bad. $350, maybe.
 
Oh my! The epic battle begins, with buyers and sellers furiously trying to be on the right side of this AAPL trade. I'm happy just to sit back and watch. Still think we're eventually going below $500, and then we could REALLY see some downside action with AAPL, which affects > NASDAQ, which affects > S&P.

aapl.png
 
After 7 straight days of the S Fund outperforming the I Fund by a total of 4.2% since Dec 31, things have turned around, and now the I Fund looks to be gaining momentum again. The graph below shows EFA (I Fund) divided by $EMW (S Fund). When the I Fund outperforms, the line moves higher. The dip in the uptrending line looked like a switch was turned off at the beginning of the year, but now things are looking very good for those of us holding the I Fund. A 50/50 mixture might also be a good position to be in. The C Fund is weaker than both of these funds, so I wouldn't be interested in C at this time.

Good luck!


efa$emw.png
 
Since my post on Jan 14, the S Fund has continued to outperform the I Fund. See graph below for my analysis:


EFA vs $EMW.png


The I Fund had a similar setback in August of last year, when it had a short term hiccup, but soon recovered. (See first blue circle). I Fund eventually began outperforming, and the Stochastics turned up in early Sept. (See first blue box).

This time, things seemed to have a similar pattern, but now the I Fund continues to underperform, and does not look like it's going to break the 50 day moving average (see second blue circle). Also notice the Stochastics indicator is not turning up like it did last summer. Instead, it's turned back down, and is showing persistent weakness.

Based on this analysis, I will be using my second IFT for the month to move from I to S.

Good luck everyone!
 
MrJohn, if you had no ITFs left in Jan... would you move your I Fund holdings to G or F or do you think I Fund will recover to make enough modest gains to hold it for a week or two? I'm been holding 20% I for a week or so...

Thanks for the past, current, and future insight!
Danny
 
Danny said:
MrJohn, if you had no ITFs left in Jan... would you move your I Fund holdings to G or F or do you think I Fund will recover to make enough modest gains to hold it for a week or two? I'm been holding 20% I for a week or so...

Thanks for the past, current, and future insight!
Danny
Click to expand...

This is a bull market. I'm riding it until the party's over. Hopefully that's a few weeks or even a month away. There are several things I'll be looking for to sidestep the next downturn, none of which are close to occurring yet.

Good luck to you!
 
The $VIX has dropped all the way down to 12.46. We haven't seen readings like this since 2007!

Eventually, the pendulum will swing the other way. For now, enjoy the low volatility and upside action in the markets!


$vix.png
 
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