GLD

GLD been down 4 days in a row and if it gaps down tomorrow morning I will buy some GLD for potential turnaround.

Positives

• Near 15-WMA.
• Down 4 days in a row.

Negatives

• Might be catching a falling knife.
• Not heavily oversold.

“You can’t tell till you bet.”

That is the line from the “Reminiscences of a Stock Operator.” Which is exactly what I did today when the market gapped down. This was based on my research, and should end the month in green. I bought SSO & ISL today, and covered my PFGC.

Finding an Edge

I was going through three indexs tonight and found something worth writing down.

Dow Jones Composite Index

• Slow Stochastic indicator dipped below 80 on the monthly chart. I found two other occasions when the market bounced off this level and found out the percentage drop from it’s recent peak to the low.
• From January 1994 high to December 1994 low: -17.14%
• From July 1998 high to September 1998 low: -21.23%
• From July 2007 high to January 2008 low: -17.57%

Dow Jones Industrial Average Index

• Slow Stochastic indicator stayed above the mid level since 1950 on the quarterly chart.
• 15 period moving average is the support on the quarterly chart.

Standard & Poors Dep Rec

• The last time the SPY was in a bear market, SPY went down initially 4 months in a row before moving up on the 5th month.
• Market went up 10.49% after being down 4 months in a row from September 2000 to December 2000.
• Currently, the SPY is down 4 months in a row, and I expect it will move higher to about 139.

Watchlist

Greed Kills

Had a huge drawdown on my portfolio after I got very greedy. I noticed I was top 10 on Covestor.com and emotion took over and did some serious damage to my account. I’ve decided no longer to update on Covestor.com as I keep looking at the ranks. I like to be best at what I do, and when I don’t I make stupid mistakes. Bright side is that my account is still above $10,000.