Is Void A Good Support? - August 19, 2011

[Billy]

Billy,

I am under the impression that Cum Tick is not falling apart during the last two days.

But I am not an expert.

Can you give your view on the Cum Tick of the last trading days.

Thanks,

Ernst

Ernst,

It remains the best indicator for discretionary trading. Here's a 2-week chart. Buying the positive divergence on August 10, after the Fed announcement, above the half-day average was the smartest of all moves. It also triggered around the 1:3 pivot RR entry lilit of 65.23, same as today.

Sell signals were clear on August 16 and 17 when cumulative TICK repeatedly flattened out and broke below the half-day and full-day averages. The signals also occured at the 1:3 pivot RR short entry limit of 70.81on those days.
That's all you needed to watch for making a fortune in TNA and then TZA : cum TICK and the optimal 1:3 RR entries.

Today there is no divergence or signal to cover the shorts so far. If the indicator starts rising above the averages near the close, covering the shorts and taking a long entry around 65.23 seems the right thing to do for the short term.
Billy

[Timothy Clontz]

Attachment 9952
making a fortune in TNA and then TZA

Billy

Sounds like a job for a Robot... ;-)

Looking forward to actually making money for a change. Even my best model is simply losing slower than the S&P.

A pyrrhic victory, at best...

[Billy]

Sounds like a job for a Robot... ;-)

Looking forward to actually making money for a change. Even my best model is simply losing slower than the S&P.

A pyrrhic victory, at best...

Tim,
I think it is working now because HFT cannot hide their footprints in the TICK. Also, all equities are back at record high level of correlation, which multiplies the impact on the indexes. Add the higher volatility of small caps to the elevated overall market volatility and you have an explosive cocktail for short term traders with solid guts!

In "standard" market conditions, cum Tick can help fine-tuning the timing of entries, but can not surpass 20 DMF for capturing long term trends commitments by large players.
Billy