Saturday, October 31, 2020

Daily Dashboard (based on previous business day)

 Daily Time Frame Trading

AEX  533,88 (AEX Daily Chart)
Trend: bearishdowntrending; S/D-S/R: 529,78-575,71 and 8 day EMA resistance; JCS/SS/8EMA: long legged doji/-/-; no bullish trigger signs.
Trade actual: none.

SPX @ 3.269,96 (SPX Daily Chart)
Trend: neutraldowntrending; S/D-S/R: 3.209,45-3.549,85 and 8 day EMA resistance; JCS/SS/8EMA: hammer/-/-; no bullish trigger signs.
Trade actual: none.

COMPQ @ 10.911,59 (COMPQ Daily Chart)
Trend: neutraldowntrending; S/D-S/R: 10.519,49-11.965,54 and 8 day EMA resistance; JCS/SS/8EMA: bullish harami/-/-; no bullish trigger signs.
Trade actual: none.

XEU @ 116,58 (XEU Daily Chart)
Trend: neutraldowntrending; S/D-S/R: 116,13-118,81 and 8 day EMA resistance; JCS/SS/8EMA: doji/-/-; no bullish trigger signs.
Trade actual: none.

BTCUSD @ 13.529,85 (BTCUSD Daily Chart)
Trend: bullishuptrending; S/D-S/R: 8.955,68-13.826,76 and 8 day EMA support; JCS/SS/8EMA: doji/+/+; bullish trigger signs on 24-09-2020.
Trade actual: bought longs on 24-09-2020, stoploss at 8.955,68.

GOLD @ 1.879,90 (GOLD Daily Chart)
Trend: neutraldowntrending; S/D-S/R: 1.851-1.983,80 and 8 day EMA resistance; JCS/SS/8EMA: doji/-/-; no bullish trigger signs.
Trade actual: none.

UST @ 138,11 (UST Daily Chart)
Trend: neutraluptrending; S/D-S/R: 137,30-139,17 and 8 day EMA resistance; JCS/SS/8EMA: ?/-/-; no bullish trigger signs.
Trade actual: none.

Trend is defined by the position of price vis-a-vis the 8 day EMA and 200 day SMA. Trendiness is defined by position of price vis-a-vis the 8 day EMA.

S/D-S/R abbreviates static and dynamic support/resistance levels.

EMA and SMA stand for exponential and simple moving average respectively.

I only consider very clean Japanese Candlestick signals (JCS) in the direction of the trend preferably from an oversold or overbought Slow Stochastic (SS). 8EMA is the position of price versus the 8 day EMA.

Stoplosses are on a closing basis.

For actual trading I use capped futures (limited downside risk) and options.

For an explanation of the Trend Trade & Investment Strategies, its abbreviations and its usage see the bottom of this blog. Please also read the disclaimer there.

Wednesday, October 28, 2020

Blood in the Streets

"Buy when there is blood in the streets, even when it's your own" (Baron Rothschild).

"Be fearful when others are greedy, and greedy when others are fearful" (Warren Buffett).

These quotes seem to be applicable now. So is this a good time to be buying stocks? Maybe not immediately! But a timely consideration of the below mentioned might benefit you.

If markets consolidate, correct or enter bear market territory it is usually a good idea to start thinking about the levels at which you want to add to the stocks that are part of your core portfolio. The one you hold for the long term.

For great investors the sun always shines. If markets go up they become more wealthy, if markets go down they are able to buy good stuff more cheaply. So see declines less as a threat and more as an opportunity.

Hopefully this helps to ease the pain and anxiety associated with loss of existing value. 

I do not trade or invest according to these views. For that purpose I only use the Trend Trade & Investment Strategies which are explained at the bottom of this blog. Please also read the disclaimer there.

Monday, October 26, 2020

Buy the Dip (minder-grinder)

Buy the dip. At least in stock markets. But why?

This advice is certainly not sound all the time but has some merit to it.

Markets go up, 75% in time, way more often than they go down, 25% in time.

Governments and Central Banks have a stake in the markets (wealth effect & inflation). They will do everything in their power (monetary and fiscal policies) to either stabilize markets or propel them higher. And people in general are naturally more inclined to optimism (greed or fear of missing out) than to pessimism (fear of loss). And of course one of humanity's main endeavours is to increase wealth (market capital & dividends).

Also bears (swift, violent and erratic) are much more difficult to ride than bulls (slow, mild and grinding).

So it pays to be bullish more often than not. I normally stay bullish as long as the main indexes remain above the 8 day EMA. Below the 8 day EMA and above the 200 day SMA I'm neutral. I only turn bearish when we go below both the 8 day EMA and 200 day SMA, and I remain so, until the indexes move above the 8 day EMA again. This means I'm currently neutral.

If markets consolidate, correct or enter bear market territory it is usually a good idea to start thinking about the levels at which you want to add to the stocks that are already part of your core portfolio. The one you hold for the long term.

For great investors the sun always shines. If markets go up they become more wealthy, if markets go down they are able to buy good stuff more cheaply. So see declines less as a threat and more as an opportunity.

Hopefully this helps to ease the pain and anxiety associated with loss of existing value. 

Furthermore it may make sense to invest a very, very, very small part of your total investment portfolio in gold or bitcoin (for me that is about 1%). See it as an insurance premium for when things really go wrong, and you want to be covered for the consequences of serious currency depreciation and/or financial system reorganisation (general debt rescheduling).

I do not trade or invest according to these views. For that purpose I only use the Trend Trade & Investment Strategies which are explained at the bottom of this blog. Please also read the disclaimer there.