GDX Robot Reverses To A Long Position - March 26, 2012

[Billy]

The EOD GDX robot will cover its short position and buy a new long position at the open today. The initial stop for the long position will be set 5.65% below the entry price. Another protection is active if the Money Flow closes the day below the average MF (currently -0.47%) minus porosity (-0.089%).

The RT GDX model has already reached another protective stage since the buy-from-oversold signal on 3/14. This protection is triggered because the Money Flow traded over the 0% + porosity (0.089%) intraday last Friday. A short trade would be initiated if it drops below the 0% line minus porosity (-0.089%) intraday this Monday.

After a trend day like Friday, we expect the most frequent occurrence of a range day (bounded by Daily R1 and S1) the following trading day. This expectation would be negated if GDX trades above Daily R1 (50.27) or below Daily S1 (49.04).

Among the technical signs of bullishness we will notice that GDX closed just above Friday’s VWAP (49.71), 5-day VWAP (49.60) and the new Weekly pivot (49.57), The support clusters are building strength and are overpowering the resistance clusters by a total strength ratio of 13:10.
The IWM robot is still in cash.
Billy

[manucastle]

The EOD GDX robot will cover its short position and buy a new long position at the open today. The initial stop for the long position will be set 5.65% below the entry price. Another protection is active if the Money Flow closes the day below the average MF (currently -0.47%) minus porosity (-0.089%).

The RT GDX model has already reached another protective stage since the buy-from-oversold signal on 3/14. This protection is triggered because the Money Flow traded over the 0% + porosity (0.089%) intraday last Friday. A short trade would be initiated if it drops below the 0% line minus porosity (-0.089%) intraday this Monday.

After a trend day like Friday, we expect the most frequent occurrence of a range day (bounded by Daily R1 and S1) the following trading day. This expectation would be negated if GDX trades above Daily R1 (50.27) or below Daily S1 (49.04).

Among the technical signs of bullishness we will notice that GDX closed just above Friday’s VWAP (49.71), 5-day VWAP (49.60) and the new Weekly pivot (49.57), The support clusters are building strength and are overpowering the resistance clusters by a total strength ratio of 13:10.
The IWM robot is still in cash.
Billy

Attachment 13586
Attachment 13587

Billy,

The RT short dignal has just tripped has it not ?

Trev

[Billy]

Billy,

The RT short dignal has just tripped has it not ?

Trev

Yes, the RT model is now officially short.
David, about gap adjustments for porosity, how would you do it?
Billy

[davidallison@gmail.com]

Thanks Billy, Will this make you smile? http://www.wimp.com/dadipad/

[Billy]

Thanks Billy, Will this make you smile? http://www.wimp.com/dadipad/

Very funny! So let's put our RT model in the dishwasher for a change!
Billy

[davidallison@gmail.com]

Pascal,

Thank you for posting the trades. Looking at the track record for the RT system, it makes one a little nervous being aggressively long. Had we not spent that brief moment on Friday above +0.10% the RT stop would be Average MF minus porosity, and RT would still be long, correct?

Thank you for being so generous with your time.

Dave

[Billy]

Pascal,

Thank you for posting the trades. Looking at the track record for the RT system, it makes one a little nervous being aggressively long. Had we not spent that brief moment on Friday above +0.10% the RT stop would be Average MF minus porosity, and RT would still be long, correct?

Thank you for being so generous with your time.

Dave

Yes Dave, you are right. FYI, both Pascal and I are still long and trading the EOD signals. If this is a major bottom in formation as everything is suggesting, it's better to be flexible and give less weight to intraday zigs and zags.
Billy

[Pascal]

Yes Dave, you are right. FYI, both Pascal and I are still long and trading the EOD signals. If this is a major bottom in formation as everything is suggesting, it's better to be flexible and give less weight to intraday zigs and zags.
Billy

I am indeed still long because I am looking at the RT system in the context of a back-tested EOD system.
The RT system can have many "jumps" as we all have noted and lead to whipsaws.

What is clear to me is that there is another protection level below the average. This will be triggered for the EOD.
As of now (Today,) even if gold is attractive, we cannot witness money moving back into gold miners. That could be an issue, but I know that the trade is protected by a short/Sell signal just below the average. So I'll keep the position for now.

Also, note that unless otherwise stated, the messages are related to the EOD position. The reason for this is that the GDX Robot relies on the GDX MF for its signal and hence the system tunes to the EOD situation. For us to see the RT signal, we'd have to force feed it with the RT position.


Pascal

[davidallison@gmail.com]

It strikes me the porosity level should not only be adjusted for volatility, it should be adjusted for gaps. To me it's normal with the gap up, it would be sold off slightly. Had we gapped down this morning I bet we wouldn't have seen the MF go below zero. IMHO

Dave

[Pascal]

It strikes me the porosity level should not only be adjusted for volatility, it should be adjusted for gaps. To me it's normal with the gap up, it would be sold off slightly. Had we gapped down this morning I bet we wouldn't have seen the MF go below zero. IMHO

Dave

This indeed could be an inde for further improvements.
As of now, the GDX RT has turned to a short position and will revert to a long if/when we revert above the + porosity level.

I will post the trades track record in a few minutes.



Pascal