Posts Tagged ‘Rob Hanna’

Revisiting Short-term Performance After FTD’s

Revisting Short-term Performance After FTD’s

Courtesy of Rob Hanna at Quantifiable Edges 

With the markets rising more than 1% on higher volume exactly 4 days after a potential bottom, Thursday can be labeled a Follow Through Day (FTD). As I mentioned last night I did an extensive study of FTD’s on the blog back in 2008. A summary page with links may be found here:

http://quantifiableedges.blogspot.com/2008/07/follow-through-days-quantified.html

Among the links found on that page, traders might be especially interested in the study of short-term implications from Feb 1, 2008. In that post I point out that while intermediate-term traders often view the FTD with bullish optimism, swing traders may see it as a short setup since the market is now “overbought in a downtrend”. We’ve seen many, many times before that overbought doesn’t necessarily mean a downside edge and oversold doesn’t’ necessarily mean an upside edge. This is why two lines are incorporated in the Aggregator and why confirmation is needed with both lines before a position is taken. So below I’ve updated the stats showing SPX performance in the days following a FTD.

Results are solidly, though not overwhelmingly, bullish. In any case the edge appears to be to the upside and it is certainly an environment that you typically want to be cautious if trying to short.

 


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Thoughts On Recent Gap Activity

This is an interesting analysis by Rob Hanna who has studied and quantified the gap activity Phil mentioned in his double week review.  He came to a similar conclusion – very odd market behavior.  – Ilene  

Thoughts On Recent Gap Activity

Courtesy of Rob Hanna at Quantifiable Edges

A trader I know pointed out the unusually large gap activity lately. I track the 10-day absolute average gap over the 100-day absolute average gap on the charts page in the members section of the site. Meanwhile I observed the average true range is still below normal. I’ve copied the two charts from the website to illustrate.

 

The real odd behavior here is with the average gap size. Such gappy behavior is unusual with the market near new highs. It’s also unusual when there isn’t also a substantial increase in the intraday range. I looked at this a number of different ways last night. The 10/100 Absolute Avg Gap is 1.38 (meaning the 10ma is 38% larger than the 100ma of the overnight gap size). I looked at other instances where similar levels were approached and the market was near a new high. It’s been fairly unusual over the last 15 years and results were inconclusive.

I then look at comparing the size of the average gap to the size of the average intraday range (not the true range as shown above). Here again I found we are at very high levels but past history was choppy and inconclusive.

Lastly I looked at times where the 10-day average gap was well above normal and the 10-day average intraday range was well below normal. Again I could find nothing suggesting a significant directional edge.

So is this activity suggestive of anything? Perhaps. While the readings themselves don’t seem to help greatly in predicting direction, they do indicate some unusual behavior. My take is that the market is being influenced more by outside forces than is customary. It’s been noted by many that the dollar has been leading everything by the nose lately. Outside influences like Dubai debt have also had an overnight influence lately. This would seem to explain why such a large percentage of action is occurring overnight.

So what should we do about it as traders? Two things come to mind – 1) Be more cognizant


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The 2009 Rally – Breadth Without Compare

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Rob Hanna follows up on his previous article, "Never Have So Many Stocks Been So Stretched Above …," showing that the number of stocks trading at prices two standard deviations above their 200ma was at an all time high. – Ilene

The 2009 Rally – Breadth Without Compare

Courtesy of Rob Hanna at Quantifiable Edges

Yesterday I looked at Worden Bros. T21111, which measures the number of stocks trading at least 2 standard deviations above their 200ma. As you’ll recall, it was hitting an all-time high. (Data goes back to 1986.)

With Wednesday’s big rally, we are now seeing even more extraordinary numbers. Not only is T2111 up to 58.51%, but T2112, which measures the % of stocks trade at least 2 standard deviation above their 40-DAY moving average, is also in record territory. It is showing that a remarkable 57.19% of stocks are now stretched far above their 40-ma’s.

The action in T2112 truly exemplifies the uniqueness of the rally since March. Below is a long-term look at the indicator. Note that from 1986 through 2008 the highest reading this indicator ever registered was 37.22% in November of 2004. That record has been blown away repeatedly over the last 6 months.


 

Let’s now zoom in on this year to better see what I’m saying.

There simply is no comparison over the last 23 years to what we are seeing in this recent rally. There have now 5 distinct periods in the last 6 months where T2112 has rallied through the old high. And now we’re seeing the most extreme breadth numbers of all.

 


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Zero Hedge

"Mega Find" - 5,000 Classic Motorcycles Stashed In Barns 

Courtesy of ZeroHedge View original post here.

The Federal Reserve's quantitative easing and Treasury's fiscal stimulus have resulted in the greatest monetary experiment of all time. The result of trillions of dollars pumped into the economy has lifted prices of all assets, everything from the stock market to homes to baseball cards to crypto to classic cars and motorcycles. 

Last week, readers were one of the first to know about a rare 1955 Porsche 550 Spyder found in an ol...



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Phil's Favorites

Pandemic recovery will take more than soaring growth - to fuel a more equitable economy, countries need to measure the well-being of people, too

 

Pandemic recovery will take more than soaring growth – to fuel a more equitable economy, countries need to measure the well-being of people, too

Researchers have long been searching for a more comprehensive way to assess national progress than GDP. erhui1979 via Getty Images

Courtesy of Bas van Bavel, Utrecht University and Auke Rijpma, Utrecht University

...

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Digital Currencies

"You'd Have To Shut Down The Internet" To Ban Bitcoin, Says SEC's Hester Peirce

Courtesy of ZeroHedge

Any government efforts to ban Bitcoin would be “foolish,” said Hester Peirce (aka “Crypto Mom”), a very Bitcoin-friendly commissioner at the U.S. Securities and Exchange Commission (SEC), during a MarketWatch virtual conference earlier this week, according to Cryptoslate reporter Liam Frost.

"I think we were past that point very early on because you’d have to shut down the Internet,” Peirce said, adding, “I don’t see how you could ban it. Y...



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Chart School

Gold Gann Angle Update

Courtesy of Read the Ticker

The Biden Yellen team have made their play, and it is not US dollar friendly.

Janet Yellen speech named "International Priorities — Remarks to The Chicago Council on Global Affairs" (here) can be summed to (via Luke Gromen) :


The US is accelerating a move away from "subjugating the US middle and working class to support the USD", to "subjugating the USD to support the US middle and working classes".



Well the above is true, but as we all know large US deficits and the trend of the US dollar are joined at the hip, and that trend is down '...

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ValueWalk

2021 Sohn Investment Conference Featuring Einhorn, O'Shaughnessy And More

By Jacob Wolinsky. Originally published at ValueWalk.

The 2021 Sohn Investment Conference will be held virtually on May 12, 2021 and Valuewalk will be covering the event. Stay tuned for our in-depth coverage!

Q4 2020 hedge fund letters, conferences and more

Check out our coverage of the 2020 Sohn Hong Kong Conferences here.

All proceeds from The 2021 Sohn Investment Conference will be directed to Rockefeller University, which will provide unrestricted funding for scientists working on some of the highest-risk, highest-reward projects primed to advance the treatment of pediatric...



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Biotech/COVID-19

How worried should you be about coronavirus variants? A virologist explains his concerns

 

How worried should you be about coronavirus variants? A virologist explains his concerns

A COVID-19 patient in an ICU unit in a hospital in Capetown, South Africa, in December 2020. A variant emerged in South Africa that has since spread to other parts of the world. Other new variants could emerge elsewhere. Rodger Bosch/AFP via Getty Images

Courtesy of Paulo Verardi, University of Connecticut

Spring has sprung, and there is a sense of relief in the air. After one year of lockdowns and social distancing, mor...



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Politics

For autocrats like Vladimir Putin, ruthless repression is often a winning way to stay in power

 

For autocrats like Vladimir Putin, ruthless repression is often a winning way to stay in power

Russian police officers beat people protesting the jailing of opposition leader Alexei Navalny, Jan. 23, 2021 in Moscow. Mikhail Svetlov/Getty Images)

Courtesy of Shelley Inglis, University of Dayton

Russian dissident Alexei Navalny, sick with a cough and ...



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Kimble Charting Solutions

Gold; Load Up The Truck Upon Hitting This Level

Courtesy of Chris Kimble

Gold has created lower highs since peaking last summer. Is Gold near a low? Where would a nice entry point come into play?

This chart looks at Gold ETF (GLD) on a weekly basis over the past few years. GLD hit the top of this rising channel at (1) last summer, as it was above moving averages and relative strength was hitting lofty levels.

The decline over the past 7-months has GLD creating a death cross. Warren Buffett sold his Gold holding before this death cross took place!

Where would one want to pick up some GLD at a nice risk/reward price point?

If GLD reaches rising channel support at (2), w...



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Mapping The Market

Suez Canal: Critical Waterway Comes to a Halt

 

Suez Canal: Critical Waterway Comes to a Halt

Courtesy of Marcus Lu, Visual Capitalist

The Suez Canal: A Critical Waterway Comes to a Halt

On March 23, 2021, a massive ship named Ever Given became lodged in the Suez Canal, completely blocking traffic in both directions. According to the Suez Canal Authority, the 1,312 foot long (400 m) container ship ran aground during a sandstorm that caused low visibility, impacting the ship’s navigation. The vessel is owned by Taiwanese shipping firm, Evergreen Marine.

With over 2...



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Promotions

Phil's Stock World's Weekly Webinar - March 10, 2021

Don't miss our latest weekly webinar! 

Join us at PSW for LIVE Webinars every Wednesday afternoon at 1:00 PM EST.

Phil's Stock World's Weekly Webinar – March 10, 2021

 

Major Topics:

00:00:01 - EIA Petroleum Status Report
00:04:42 - Crude Oil WTI
00:12:52 - COVID-19 Update
00:22:08 - Bonds and Borrowed Funds | S&P 500
00:45:28 - COVID-19 Vaccination
00:48:32 - Trading Techniques
00:50:34 - PBR
00:50:43 - LYG
00:50:48 - More Trading Techniques
00:52:59 - Chinese Hacks Microsoft's E...



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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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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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Ilene is editor and affiliate program coordinator for PSW. Contact Ilene to learn about our affiliate and content sharing programs.