A Week Too Long

BarroMetrics Views: A Week Too Long

It has only been a week, but seems much longer. To those who sent emails enquiring about my health, a big ‘Thank You’. I am well.

The blog went into hibernation for a week because I had flown to Singapore to give a series of presentations, and to attend a series of business meetings. I also wanted to catch up with my friends. In this regard I was not successful – meeting up with too few. Amazing how the older I get, the less time I seem to have to do all I want.

I had fully intended to continue the blog, if only with ‘skeleton’ posts. You’ll be amazed on how many readers can be lost by an unannounced ‘rest’. Unfortunately, with trading, presentations and meetings, the blog suffered.

So, the second order of business is to apologise for not letting you know what was happening with me. (The first order was the ‘thank you’ to those who enquired after me).

Turning to the market, they are certainly in an interesting state:

  • Will the S&P trigger an Upthrust Change in Trend?
  • Will the 30-Year Bonds trigger a Normal Change in Trend?
  • The rally in Crude, an opportunity to sell? Or have we seen the bottom?
  • Gold – signs of a new bull market?

I’ll look at all these next week.

In the meantime, we have Non-Farm. The consensus is 230K with the range 215k to 275K. This has been one of the narrowest ranges we have seen in a long time.

Given Obama’s problems, I expect to see a number that is at least at the upper end of the range – say 250K.  That said, it is worrying that the range is so narrow – contrarian theory says we are likely to see an extreme number – upside or downside. Anyway, we’ll see at 8:30 EST tonight. (For new readers, I hold a theory that ‘critical BLS’ numbers come out in favour of the administration; unfavourable ones tend to come out in non-critical periods. So far, this idea has worked for me).

If the upper end does come in, we should see a rise the USD, rise in Gold, interest rate yields up (prices down).

The S&P? Not sure. ‘Good numbers’ ought to produce a rally, but ‘good numbers’ also place the June interest hike back on the table. Technically, I  am looking for a rally to challenge the 2087 to 2094 zone, with a minimum target being 2075. The rally off Monday’s 1982 low has shown volume and range suggesting continuation (both exhibited volume and range within mean to mean +1 std).

The attached chart was last updated on Feb 3.  Updating the chart:

  • Feb 4 saw a small range down night;
  • Feb 5 saw a move to 2064 on reduced range and volume when compared to Feb 3 but still with ‘normal’ bounds.

Let’s see what tonight brings.

sp-5-d.png

S&P 5-day Swing

4 thoughts on “A Week Too Long”

  1. Hi Ray, I sincerely hope your in good health so as to be able to enjoy your success. Which brings me to my question, to obtain the knowledge that you have, to be at the top of your game and trade in a discretionary manner, do you feel your health has suffered in the process? Could mechanical trading be more healthy than discretionary? Its a fairly broad question i suppose.
    cheers baz

  2. Hi Baz

    I have been a professional, successful trader since 1987. And, my health has never been better.

    In fact at my last check-up, the doc said but for my weight, I had the qualities of a 40-year old.

    So, I bought myself a Fitbit, and now walk everywhere.

    I have dropped from 212 to 187.

    No doubt the Chinese New Year will see my weight get to around 194. But, I’ll resume my healthy eating habits after CNY, and expect to be at my target weight of `175 by end June 2015.

    Turning to your question. I don’t think the type of system plays a major role in our health.

    How we exercise, the foods we eat, how we handle stress and anxiety, are better indicators.

    I read an implication in your question that mechanical trading is less stressful than discretionary; if so, I disagree.

    For me, it all depends on a trader’s personality.

    I can’t think of anything more stressful than asking me to take a mechanical trade when my neocortex is screaming ‘No! NO…OOOO!’

    Yet, other traders I respect take these trades as matter of course.

    If we adopt a trading approach that goes against our personality – that’s a whole different story. That would be stressful..!!

  3. Hi Ray, Glad to read that your in good health.
    I wasnt referring so much to stress but having the time to exercise. I thought maybe mechanical allows more time versus the time demands of a discretion system. Over the years Ive read your articles and i think to myself, you must work in a very well organised manner, how do you find the time to read and analyse all that stuff. Its a staggering body of work. Then i think if you have devoted that amount of time and energy acquiring the necessary knowledge then what hope is there for a newbie.
    Maybe a topic for another day on how you organize your time or an example of a typical day in your life. cheers baz

  4. Hi Baz

    Thank you.

    I see. Sorry I misunderstood.

    I like to think that being a full-time end-of-trader allows more time than most folks. And, leaving in the east means I don’t have to worry about the household chores that most Westerners have to deal with. And, having no kids also helps….

    If we meet happy to discuss my time management with you. As for writing about it, unless there are comments to the contrary, I doubt if many readers would be interested. Thanks for the idea, though.

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