Trading the Line

Waiting for a Train

I'll tell you a riddle.
You're waiting for a train…
A train that will take you far away. ..
You know where you hope this train will take you…
but you don't know for sure…
But it doesn't matter.
How can it not matter to you where that train will take you?
… Because you'll be together.

Inception (2010), Dir. Christopher Nolan

Cover Signal yesterday due to the move below 2283, and now we await the next Signal.
Strong short-covering rally off the short term support line, but the market has been significantly weakened.

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Disclaimer: This is the diary of a personal trading system, its methodology and the signals that it is producing. You are welcome to follow along but please understand that the information presented here is for educational purposes only. No recommendations are being made to buy, or sell stocks, options or futures contracts. Please consult your own financial advisor before making any investment decisions.

Steve Rushton January 31, 2017No Comments

S&P500 intraday update S&P500 signal

Cover at 2083

No Sell Signal today but failure to recover back beyond 2083 is a cover Signal.
Although the market did rally into the close significant damage was done today and so we await the next signal.

Steve Rushton January 30, 2017No Comments

S&P500 intraday update

Echo high indeed

A lovely start to the week with a drop down to potential support at 2274, inline with the Echo High and a gap down lower suggesting that we did see the end of the major arm of the T structure

Watch out for a short term bounce here, but at the moment those highs look a bit lonely like an island reversal.

Steve Rushton January 30, 2017No Comments

FREE REPORTS

Are we there yet?

A good question and one that many will be asking as the Dow finds itself above 20k and the S&Ps near 2300.
And so now is a good time to check the major T structure.

As you can see there was an expectation to move into a peak around the 24-25 January but because of the choppy behaviour in mid January and the movement through and below the important rising gann line from the low, it seemed a long time coming and uncertain.

Looking at the previous bull run off the 'Brexit' low a similar thing happened just after the major arm (from the previous major peak) of the T structure expired. On that occasion, the market attempted to recover and then subsequently collapsed. A kiss good bye of the rising line, if you will.

Unfortunately the T volume oscillator seems to be struggling at a similar juncture, leading me to think that we may be about to see a similar pattern of behaviour, and further weakness in price and/or the oscillator would give that more credence.

Of course we still have a final projection for the T structure for late February and the oscillator drop from the peak (at +80) is steep and linear, indicating consistent selling at that time. That would suggest a linear move into the late February peak.

Whether we get a significant drop here or not remains to be seen, and that will determine whether the final peak is a higher high or a lower high.

We watch the oscillator for clues, but we use price as the leading indicator.

Be prepared for whatever comes next.

For more detailed ongoing analysis of the developments in the S&P500 index on a daily basis, please Sign up for daily Alerts & Observations – includes access to Members Area and Explanatory Notes.

Steve Rushton January 29, 2017No Comments

S&P500 daily update

Echo high?

Battle to hold 2295 as market takes a little bit of a breather, and looking like we are close to another major turn on (or near to) the Echo high.

Steve Rushton January 28, 2017No Comments

S&P500 daily update

Pause to digest

“… how important it is in life not necessarily to be strong but to feel strong,
to measure yourself at least once, to find yourself at least once…”
– Primo Levi

A pause to digest the recent move to new highs and make a decision whether to continue higher or to re-visit the previous range first.
Strong resistance just above and scheduled highs to negociate.

Steve Rushton January 27, 2017No Comments

S&P500 daily update

Gap and go

A lovely gap open and rally into the close. Lots of cheers for Dow at 20k and S&Ps at 2299.

Very close to the underneath of the rising line so any failure here has the potential to be a kiss good bye, and also very close to the long term rising trend line from April and August of 2016.

That being said the market looks in great shape with a powerful squeeze underway and the T structure very much alive.

We will keep alert for signs of a turn.

Enjoy your slice of Trump pie while it lasts.

Steve Rushton January 26, 2017No Comments

S&P500 daily update S&P500 signal

Way to go

S/T Buy Signal re-confirmed with move out of the chopshop and congestion of the past few days, and the rise in the T volume oscillator confirms the possibility of a small T with potential into the end of the month.

The conflict of course is the arm of the larger T structure that expired yesterday, and a cluster of scheduled highs today into Friday, and so it remains to be seen whether this has a major or minor effect – a turnaround or a choppy grind higher.

Steve Rushton January 25, 2017No Comments

S&P500 daily update

Chopshop

Straight back down and playing with the Sell Signal level, for another bounce, maybe short term.

We've been here before and this is what seems to happen when the short term channel combines with the the mid-channel area – the market forces become too stable and therefore directionless, lets call this phenomenon Chopshop.

Of course, this phenomenon is also a squeeze in the making.

So watch out for an exit from the mid-channel sometime soon – above 2277 or below 2255 for signs of a strong directional move.

Steve Rushton January 24, 2017No Comments

S&P500 daily update S&P500 signal

Weak Buy Signal

Buy Signal triggered in early trade at 2274, but quickly under threat from descending resistance.
Held above important support but triangulating now, outsized move coming up soon.

There is the possibilty of some follow through into several scheduled peaks early next week, but it does seem likely that there is a significant correction coming soon.

SKEW remains elevated indicating the prescence of fear and possibility of an unexpected event, a black swan.
I suspect that this is related to comments regarding the strength of the dollar.
Keep an eye on this – it is flashing a big red warning.

Steve Rushton January 20, 2017No Comments

“Simplicity is the ultimate sophistication.”
Leonardo da Vinci

“Imagination is more important than knowledge”
Albert Einstein

“All of our days are numbered. We can not afford to be idle. To act on a bad idea is better than to not act at all because the worth of the idea never becomes apparent until you do it. Sometimes this idea can be the smallest thing in the world; a little flame that you hunch over and cup with your hand and pray will not be extinguished by all the storm that howls about it. If you can hold on to that flame, great things can be constructed around it; things that are massive and powerful and world changing. All held up by the tiniest of ideas.”
Nick Cave, 20,000 days on Earth

2026 Positions

(All numbers refer to SPX)

S/T BUY Signal at 7413 on 30 July

...

S/T SELL Signal active below 7462 st 7440 on 26 July

COVER Signal below 7522 at 7440 on 17 July

S/T BUY Signal at 7398 on 29 June

S/T SELL Signal active below 7344 on 26 June

COVER Short Signal above 7361 on 25 June

S/T SELL Signal below 7422 on 23 June

COVER Signal below 7452 at 7365 on 23 June

S/T BUY Signal at 7500 on 18 June

COVER Short Signal at 7500 on 18 June

S/T SELL Signal at 7424 on 17 June

COVER Signal at 7454 on 17 June

S/T BUY Signal at 7404 on 11 June

COVER Short Signal at 7337 on 10 June

S/T SELL Signal at 7462 on 05 June

COVER Signal at 7553 on 05 June

S/T BUY Signal at 7586 on 04 June

COVER Signal at 7554 on 03 June

S/T BUY Signal at 7413 on 20 May

COVER Signal at 7411 on 15 May

S/T BUY Signal at 6457 on 31 Mar

COVER Short Signal above 6398 on 31 Mar

S/T SELL Signal at 6543 on 26 Mar

S/T BUY Signal above 6600 at 6620 on 25 Mar

COVER Short Signal above 6567 on 25 Mar

S/T SELL Signal below 6554 on 24 Mar

COVER Short Signal above 6581 on 24 Mar

S/T SELL Signal below 6554 on 24 Mar

COVER Short Signal above 6581 on 24 Mar

S/T SELL Signal below 6554 on 24 Mar

COVER Signal at 6590 on 23 Mar

S/T BUY Signal at 6623 on 23 Mar

COVER Short Signal above 6563 at 6600 on 23 Mar

S/T SELL Signal at 6666 on 18 Mar

COVER Signal at 6693 on 18 Mar

S/T BUY Signal at 6729 on 16 Mar

COVER Short Signal above 6668 at 6698 on 16 Mar

S/T SELL Signal at 6756 on 11 Mar

S/T BUY Signal above 6826 on 10 Mar

COVER Short Signal above 6792 on 10 Mar

S/T SELL Signal at 6765 on 10 Mar

COVER Short Signal above 6772 on 09 Mar

S/T SELL Signal below 6810 on 06 Mar

COVER Short Signal above 6822 on 05 Mar

S/T SELL Signal below 6822 on 05 Mar

COVER Signal below 6849 on 05 Mar

S/T BUY Signal at 6882 on 04 Mar

COVER Short Signal above 6849 on 04 Mar

S/T SELL Signal below 6845 on 03 Mar

COVER Short Signal above 6877 on 02 Mar

S/T SELL Signal below 6850 on 02 Mar

COVER Short Signal above 6857 on 27 Feb

S/T SELL Signal at 6857 on 27 Feb

COVER Signal below 6884 at 6857 on 27 Feb

S/T BUY Signal at 6884 on 23 Feb

COVER Short Signal at 6850 on 23 Feb

S/T SELL Signal at 6837 on 23 Feb

COVER Signal at 6864 on 23 Feb

S/T BUY Signal at 6883 on 18 Feb

COVER Short Signal at 6834 on 17 Feb

S/T SELL Signal at 6888 on 12 Feb

COVER Signal at 6915 on 12 Feb

S/T BUY Signal at 6899 on 06 Feb

COVER Short Signal at 6938 on 06 Feb

S/T SELL Signal at 6901 on 04 Feb

COVER Short Signal at 6915 on 03 Feb

S/T SELL Signal at 6915 on 03 Feb

COVER Signal at 6942 on 03 Feb

S/T BUY Signal at 6968 on 02 Feb

COVER Short Signal at 6938 on 30 Jan

S/T SELL Signal at 6910 on 30 Jan

COVER Signal at 6940 on 30 Jan

S/T BUY Signal at 6934 on 29 Jan

S/T SELL Signal at 6907 on 29 Jan

COVER Signal at 6934 on 29 Jan

S/T BUY Signal above 6905 at 6923 on 22 Jan

COVER Signal at 6849 on 21 Jan

S/T SELL Signal below 6894 at 6843 on 20 Jan

COVER Signal below 6925 at 6843 on 20 Jan

S/T BUY Signal at 6961 on 15 Jan

COVER Signal below 6934 at 6925 on 14 Jan

S/T BUY Signal above 6890 at 6900 on 05 Jan

COVER Short Signal at 6864 on 02 Jan

S/T SELL Signal at 6837 on 02 Jan

Mission

It has been my Mission to create a simple but effective method for investing in the stock market, so that I would always know what to do regardless of the circumstances.

The result is a rigorous system which allows the market to tell you what to do, when to Buy, when to Hold, when to Cover, and when to Sell, and it removes the need for you to have any opinion whatsoever.

And so, I present to you the diary of my personal trading system, and a record of the signals that it is producing. You are welcome to follow me along but please understand that the information posted here is for entertainment purposes only. No recommendations are being made to buy, or sell stocks, options or futures contracts. Please consult your own financial advisor before making any investment decisions.

Please sign up for my occasional FREE REPORTS and if you would like to find out more and receive my email alerts and more detailed observations, please SIGN UP HERE

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With new commentary and Insights on the life and times of Jesse Livermore Reminiscences of a Stock Operator is the fictionalized biography of perhaps the most famous financial speculator of all time–Jesse Livermore. This annotated edition bridges the gap between Edwin Lefevre′s fictionalized account of Livermore′s life and the actual, historical events, places, and people that populate the book. It also describes the variety of trading approaches Livermore used throughout his life and analyzes his psychological development as a trader and the lessons gained through hard experiences.

“In the end, I’m not interested in that which I fully understand. The words I have written over the years are just a veneer. There are truths that lie beneath the surface of the words... truths that rise up without warning, like the humps of a sea monster and then disappear. What performance and song is to me is finding a way to tempt the monster to the surface, to create a space, where the creature can break through what is real and what is known to us. This shimmering space where imagination and reality intersect... this is where all love and tears and joy exist. This is the place. This is where we live.”
Nick Cave 20,000 days on Earth

“If you're going to try, go all the way. Otherwise, don't even start. This could mean losing girlfriends, wives, relatives and maybe even your mind. It could mean not eating for three or four days. It could mean freezing on a park bench. It could mean jail. It could mean derision. It could mean mockery--isolation. Isolation is the gift. All the others are a test of your endurance, of how much you really want to do it. And, you'll do it, despite rejection and the worst odds. And it will be better than anything else you can imagine. If you're going to try, go all the way. There is no other feeling like that. You will be alone with the gods, and the nights will flame with fire. You will ride life straight to perfect laughter. It's the only good fight there is.”
Charles Bukowski, Factotum, 1975

>“The mind is a glass floor.
The mind is the spirit’s tear.
The mind is our prior and subsequent ghost.
The mind is the Bullion Express and the blood on the tracks.
The mind is a stone door.
The silver on the backs of mirrors.
The wave that defines the coast.
It’s what the drunk grave robbers couldn’t stuff in their sacks.
The mind is the sum of all and more.
The spasm between one and zero in the Calendar of Black-Hole Years.
The contract between the lash and the whipping post.
A quilt of dreams stitched with facts.
A meaningless argument among whores.
Rain that keeps falling when the sky clears.
A masquerade party, guest and host.
A candlelit landscape of puddled wax.
The mind is what thought is for.
The parking lot at the Mall of Fears.
The fire-pit for the piggy roast.
What the soul surrendered and won’t take back.
The mind is neither either nor or.
The real center of an empty sphere.”
Jim Dodge, Stone Junction, 1990

“The war is not meant to be won, it is meant to be continuous. Hierarchical society is only possible on the basis of poverty and ignorance. This new version is the past and no different past can ever have existed. In principle the war effort is always planned to keep society on the brink of starvation. The war is waged by the ruling group against its own subjects and its object is not the victory over either Eurasia or East Asia, but to keep the very structure of society intact.”
George Orwell

“There was a student... just the other day... who said that my problem, if one's nature is a problem, rather than just problematic, is that I see things in terms of victory or death, and not just victory but total victory. And it's true: I always have. It's either victory, or don't bother. The only thing worth doing is the impossible. Everything else is gray. You're born... as a man... with the nerves of a soldier, the apprehension of an angel, to lift a phrase, but there is no use for it. Here? Where's the use for it? You're set up to be a philosopher or a king or Shakespeare, and this is all they give you? This? Twenty- odd years of school which is all instruction in how to be ordinary... or they'll fucking kill you, they fucking will, and then it's a career, which is not the same thing as existence... I want unlimited things. I want everything. A real love. A real house. A real thing to do... every day. I'd rather die if I don't get it.”
The Gambler (2014), Dir. Rupert Wyatt