Nickola et al.,

As i've said in our discussions over Skype "nobody is ever faulted for taking profits, but we certainly are faulted for not taking profits." I truly believe that profits are controlled by money management and position sizing, and taking profits in a volatile market near the close is as good as it gets to a perfect day.

I had the new entry threshholds for both Robots set today and as most here will know, our threshholds were met, resulting in multiple positions for me in -IWM, +RWM, +GDX, +NUGT, and +TZA. I had small +GDX and +NUGT positions on over the weekend, so was glad to have an "easy" opportunity (e.g., without much thought) to enter. I finished the session leaving all the unleveraged and the leveraged +NUGT positions on, but once again, I took all but 100-sh lots of TZA off the table and put them in the bank just before the close. These gains are protected and will help drive my metrics upward.

Last week was much of the same, capturing account value at the end of the day and taking minimal headline risk over night. With volatility so high right now, I feel it prudent to lower exposure in the overnight hours.

Psychologically, it's getting hard to see NUGT swing so much -- I now am feeling quite exposed in multiple accounts -- but I have several metrics aside from the Robot telling me that shorting DUST/long NUGT is exactly where to be. This is the continual battle that I wage -- while I trust the Robots, I also trust my own systems, and at the end of the day statistics do not lie, so I must swallow deeply and go with eyes wide open into increasing position size at a better price (e.g. Connor's TPS trades).

One thing giving me confidence is that I've been working on in-sample/out-sample testing using the $TICK cumulator functions and setups to enter TZA/TNA, with good results. Some of the most recent buys in testing those strategies have been during last week, so holding onto positions that backtest well takes some of the anxiety out of the equation.

Another important concept that I try to employ is that as ATR(20) goes up, position size goes down. This way all positions in the portfolio provide the same risk. The "Turtles" practiced/lived by this rule, and other authors (e.g. Conway/Behle) also use variants on that theme. Knowing that I'm not "over exposed" helps me to keep perspective and anxiety lower.

I don't think that this signal will last all week. I haven't run the GGT database numbers for today's market but the selloff today has to put us further into oversold territory, approaching August's strength and LCR values. I know that we already had broken through the price index floor of August as we went into today, so I'll need to review where the next floor is. I'm anxiously awaiting Billy's pivot level commentary for the SPY as well as Bob's ES charts to see what we're up against in terms of support vs. resistance ... THIS will drive my anxiety over the next few days.

My strategy this week will be to carry the unleveraged positions over night, all which have gains. These positions provide account buffer the next day to enter into leveraged positions (it's far easier watching the account go from a large positive value to a less positive value due to a leveraged trade moving against me than it is to watch the account go negative). I intend to take the majority of the leveraged positions off the table the next day at the end of the day, whether up or not. I also intend to close out any position that looks like it could do major damage to my overall numbers if it starts getting out of control.

Hope that this helps!

Regards,

pgd