Posts Tagged ‘leveraged assets’

RYDEX MARKET TIMERS ARE BECOMING MORE BEARISH

RYDEX MARKET TIMERS ARE BECOMING MORE BEARISH

Courtesy of The Pragmatic Capitalist

The following comes to us courtesy of The Technical Take:

Figure 1 is a daily chart of the S&P500. The indicator in the lower panel measures the ratio of the amount of assets in the Rydex bullish and leveraged funds relative to those funds that are bearish and leveraged.

Figure 1. S&P500/ daily/ Rydex Bullish and Leveraged v. Bearish and Leveraged

fig+1 RYDEX MARKET TIMERS ARE BECOMING MORE BEARISH

The current value of the indicator stands at 1.02 suggesting that the Rydex market timers are becoming more bearish, and this is a bullish signal.

How bullish? Let’s design a study with the following rules:

1) entry signal: when the ratio of the Rydex bullish and leveraged assets to the Rydex bearish and leveraged assets is less than or equal to 1 and when the S&P500 is above its 200 day moving average

2) exit signal: when the ratio of the Rydex bullish and leveraged assets to the Rydex bearish and leveraged assets is greater than 1

3) all trade signals are executed at the open of the day following the signal as this mimics exactly how I receive the Rydex data (i.e., the night before)

4) commissions and slippage are not considered.

Of note, some of the buy and sell signals are shown in figure 1.

The strategy was back tested on the S&P500 with the first trade beginning on April 15, 2003. This strategy generated 529 S&P500 points; since April 15, 2003, buy and hold has generated 170 S&P500 points. There were 35 trades, and 31 of these were profitable. This strategy had a streak of 19 consecutive winning trades. Amazingly, this strategy was only in the market 7% of the time over the past 7 years. The average winning trade lasted 6 trading days with the average loser lasting 3 trading days. There was only one outlier trade which accounted for about 10% of the profits, and the profit factor (i.e., gross profit to gross loss) was a sizzling 23 to 1.

The equity curve for the strategy is shown in figure 2.

Figure 2. Equity Curve

fig+2 RYDEX MARKET TIMERS ARE BECOMING MORE BEARISH
 
 
Figure 3 is a the maximum adverse excursion graph (MAE) for this strategy. MAE assesses each trade from the strategy and determines how much a trade had to lose in percentage terms before being closed out for a winner or loser. You


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Zero Hedge

Are The Underlying Mechanics Of The Largest Gold ETF A Cause For Concern

Courtesy of ZeroHedge View original post here.

Submitted by Jan Nieuwenhuijs from Voima Insights,

Are the underlying mechanics of the largest gold ETF a cause for concern?

Exchange-Traded Funds (ETFs) are an important element in the global gold market. The largest gold ETF is the “SPDR Gold Trust,” which is traded on the New York Stock Exchange Arca (NYSE Arca) under th...



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The Technical Traders

The Wuhan Wipeout - Could It Happen?

Courtesy of Technical Traders

News is traveling fast about the Corona Virus that originated in Wuhan, China. Two new confirmed cases in the US, one in Europe and hundreds in China. As we learn more about thispotential pandemic outbreak, we are learning that China did very little to contain this problem from the start. Now, quarantining two cities and trying to control the potential
outbreak, may become a futile effort.

In most of Asia, the Chinese New Year is already in full swing.  Hong Kong, China, Singapore, Malaysia, India and a host of other countries are already starting to celebrate the 7 to 10 day long New Year.  Millions of people have already traveled hundreds of thousands of miles to visit family...



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Phil's Favorites

Wuhan coronavirus: we still haven't learned the lessons from SARS

 

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Wuhan coronavirus: we still haven't learned the lessons from SARS

Courtesy of Diana Bell, University of East Anglia

The SARS outbreak in 2002-2003 was the first global pandemic of the 21st century. There were 8,422 reported cases and 11% of those infected with the virus died. Its cause was a newly identified coronavirus (a type of virus that causes respiratory infections): SARS Co-V. Early cases were linked to wildlife markets and...



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Kimble Charting Solutions

Bad News For Crude Oil Should Come From This Pattern, Says Joe Friday

Courtesy of Chris Kimble

It’s a good idea for investors to be aware of key indicators and inter-market relationships.

Perhaps it’s watching the US Dollar as an indicator for precious metals or emerging markets. Or watching interest rates for the economy. Experience, history, and relationships matter. And it’s good to simply add these to our tool-kit.

Today, we look at another relationship that has signaled numerous stock market tops and bottoms over the years, and especially the past several months, Crude Oil.

When crude oil tops or bottoms, it seems that ...



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Insider Scoop

5 Software-Application Stocks Moving In Thursday's After-Market Session

Courtesy of Benzinga

Gainers

Atlassian Corporation, Inc. (NASDAQ:TEAM) stock surged 9.7% to $145.50 during Thursday's after-market session. According to the most recent rating by Morgan Stanley, on January 13, the current rating is at Overweight.

Diebold Nixdorf, Inc. (NYSE:DBD) shares increased by 8.1% to $11.48. The most recent rating by DA Davidson, on December 13, is at Buy, with a price target of $17.00.

Telaria, Inc. (NYSE:TLRA) stock rose 4...



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Biotech

Snakes could be the original source of the new coronavirus outbreak in China

Reminder: We are available to chat with Members, comments are found below each post.

 

Snakes could be the original source of the new coronavirus outbreak in China

Chinese cobra (Naja atra) with hood spread. Briston/Wikimedia, CC BY-SA

Haitao Guo, University of Pittsburgh; Guangxiang “George” Luo, Univers...



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Chart School

RTT browsing latest..

Courtesy of Read the Ticker

Please review a collection of WWW browsing results. The information here is delayed by a few months, members get the most recent content.



Date Found: Monday, 16 September 2019, 05:22:48 PM

Click for popup. Clear your browser cache if image is not showing.


Comment: This chart says SP500 should go back to 2016 levels (overshoot will occur of course)



Date Found: Tuesday, 17 September 2019, 01:53:30 AM

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Comment: This would be HUGE...got gold!


...

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Members' Corner

The War on All Fact People

 

David Brin shares an excerpt from his new book on the relentless war against democracy and how we can fight back. You can also read the first, second and final chapters of Polemical Judo at David's blog Contrary Brin.

The War on All Fact People 

Excerpted from David Brin's new book, the beginning of chapter 5, Polemical Judo: Memes...



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Lee's Free Thinking

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

 

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

Courtesy of  

The repo market problem isn’t the problem. It’s a sideshow, a diversion, and a joke. It’s a symptom of the problem.

Today, I got a note from Liquidity Trader subscriber David, a professional investor, and it got me to thinking. Here’s what David wrote:

Lee,

The ‘experts’ I hear from keep saying that once 300B more in reserves have ...



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Digital Currencies

Cryptos Have Surged Since Soleimani Death, Bitcoin Tops $8,000

Courtesy of ZeroHedge View original post here.

Bitcoin is up over 15% since the assassination of Iran General Soleimani...

Source: Bloomberg

...topping $8,000 for the first time since before Thanksgiving...

Source: Bloomberg

Testing its key 100-day moving-average for the first time since October...

...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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