Like most, I’m watching the market for signs of a turn North as a buying signal. I haven’t seen anything that would cause me to decide yet, we’ll see what tomorrow brings. However, I do know that one of my first ports of call for a shopping list will be my IntersectioNx watchlist. Maybe I should have started Monday, as the average of the current IntersectioNx for this week from Monday’s open is 5.4% — and it shouldn’t be lost on you that the broader markets are actually slightly to the positive too.
In the July bounce I found that VectorVest’s MTI and the equity graph of my IBD50 portfolio to be good reversal indicators. They both indicated a small turn today but there is nothing to make me jump in yet. But, as we see from our IntersectioNx watchlist, there is money to be made — witness JAZZ and BIDU!
In the past I have used Marketclub’s weekly trade triangles for managing longer term positions with some success. If you are looking for a faster indicator attached to quality issues like those in our IntersectioNx list, you may wish to consider their daily trade triangles. Marketclub has a decent trial membership program so you could effectively get a free look for a few weeks. I’ve posted the current JAZZ chart from Marketclub below so that you can get some sort of feel for how they work.
In the broader sense, though, I am nowhere near calling a bottom to this market yet, either long term or short term. See my post on the Nearly Death Cross. More on the watchlists at the weekend.
I’m used to these charts…. I nearly forgot. The daily trade triangles are the small indicators, red for out, green for in. They are Marketclub’s fastest indicators.
Folks, I think it goes without saying that you know I like Marketclub as a “stock service”. I use them myself, and by the way, I paid exactly the same price you would for a membership. I use Marketclub as a filter for ANY long or short purchase. For example, I set up a real portfolio last night based on the IBD50 portfolio I have modeled here for a couple of months. I actually removed two stocks from the original pick of ten and replaced them with two alternates based on my Marketclub screen.
But most importantly, Marketclub forms the foundation of my capital protection plan. In short, I use the trade triangles as a primer to tell me I should either be exiting a position or seriously watching it. You can see examples of how this works in practice in the model portfolios we follow on this blog.
Another very useful thing about Marketclub is the breadth of its coverage. Not just stocks but indices, futures, commodities and mutual funds. I use Marketclub to manage my 401(k) portfolio of mutual funds — and that’s something most people just don’t do.
OK, long story short — Marketclub has just introduced a series of DAILY UPDATE VIDEOS that run on Marketclub and on Livestream. If you would rather view them on Marketclub click on the daily blog. If you click on the first hyperlink you will go to Marketclub ‘s page on Livestream where you will be able to view both daily updates and the weekly Marketclub TV show (which could use a bit of polish but the content’s very strong).
This is very timely, as personally, I am watching the market like a hawk in the run-up to the end of QE2.
If you like what you see I strongly suggest you try a free two-week trial . Unlike just about every other “free trial” I have come across it doesn’t require a credit card number.
I hope you find the Marketclub videos helpful. They are free to watch any time and very instructive — and timely.
We had a great day in the market today. Dow up 109 points with the NASDAQ up over 1% and the S&P up 0.58%. But, gains aren’t being spread evenly throughout the market, and, I’m not sure one day’s reversal is going to break the negative trend we’re in at the moment.
I had two red weekly trade triangles hit today from Marketclub. One in KOL (Market Vectors Coal ETF) and another in EEM (iShares MCSI Emerging Market ETF) KOL left me with a 7% loss since 1/13, so it’s definitely time to get out of this position for now. William O’Neil (the publisher of Investors’ Business Daily) has it right when he says that your stops on new positions should be HARD at 7-8% to the downside. Let’s remember that part of our Paladin philosophy is to limit losses so they don’t outweigh our gains. So, I’ve set up limit orders on KOL and EEM to sell at the open. I will replace KOL when market conditions look right, EEM too.
I also had a repeat red weekly in IWM ( iShares Russel 2000 Index ETF). Actually this trade triangle first popped up on 1/20, don’t know how I did but I missed the alert. As today’s close was above the trade triangle alert price I’ll just be keeping an eye on this ETF. I have to say the MACD is not looking too encouraging and I may just set a Trade Trigger to sell at the trade triangle price on TDAmeritrade. I’m sitting on a nice profit in IWM and I don’t want to see it whittled away.
OK, so Marketclub is slinging some red trade triangles my way. What’s Vectorvest’s point of view? VV is also calling for caution. Their composite price on the stocks they track is down over the last week, so as VV puts it, the primary wave is down.
What does this mean to you? Even if you don’t use stock services like Marketclub or Vectorvest, you should be seriously thinking about your stop positions to protect profits or limit losses. If you’re not sure how stops work, we’ll review them in an upcoming post.
If you know your rule of 72, the answer’s easy, but just to put things into perspective here’s a simple chart showing how much our portfolio rolls up at compound rates of 5, 10, 15 and 20 percent a year:
So, over 14 years to double at 5%, 7.2 at 10%, 4.8 at 15% and 3.6 at 20%.
I point this out to you not to encourage you to seek gains by adopting risk that doesn’t fit your profile, but to point out that you can’t afford to ride extended downtrends in a buy-and-hold strategy if you mean to make your money grow. This is one of the reasons we use Marketclub’s trade triangles in our model portfolios and in a lot of our examples — they keep you out of trouble. If you trade the weeklies like me, you might end up with a few losing trades, but you won’t be in the market when it falls off a cliff like it did in 2008. Continue reading