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Kevin Wilde
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Kevin Wilde is the chief trading strategist at alphaking.com and a Marketocracy.com Master. Investors can follow his trading advisories via his Daily AK newsletter, or have their money run for them via Marketocracy.com money management services, where Kevin's trades will be automatically entered.
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  • Lip-Smacking Time For Stock Market Bears

    The trend momentum power rating is reasonably strong 60% BEAR.

    The trend remains down, confirmed with the negative stance of the hedging indicator - thus I continue to hold TTZA with 10% of portfolio value - while the contrarian indicators remain above the oversold extreme line (yellow line is the most important contrarian indicator at this juncture,) while the trend trading indicator near the bottom of the chart remains close to the low risk- entry - line (for short positions.)

    No drastic change in allocation is expected till one or more of these indicators change to trigger a new trade.

    The first expected change of the AK indicators remains the shorter term ones, which I will show and discuss tomorrow. They also currently remain above the oversold extreme buy line, thus too early for pruning short positions and inverse ETFs until they move into the buy position.

    Note the dotted red line in the chart below represents the point where the NASDAQ would need to cross to confirm the next Great Bear has begun. Note also the ADX continues to trend down, and the bears are unlikely to score that big win till the ADX turns up while the trend is down.

    That doesn't mean it won't turn up, or the stock market crash in the non-too-distant future. Just that the ADX hasn't yet turned up to set such a potential crash run in progress.

    The overall allocation is 150% short the QQQ via a 75% investment in the leveraged inverse ETF, QID, in addition to the TZA mentioned above.

    Any rally from this position should be seen as a gift to the bulls to lighten up on long positions, while the bears should be smacking their lips as they increase the amount of short exposure.

    The selling flood-gates should open for real once the current rally falters and reverses to take out recent lows.

    If you would like to track updates on the chart shown below sign up at alphaking.com, click on the verification email, and get THREE months free access to my on-line newsletter.

    -Kevin

    (click to enlarge)

    Disclosure: I am long QID, TZA.

    Tags: QQQ, TZA, QID
    Apr 16 7:53 AM | Link | Comment!
  • Bull/Bear Cycle Makes The Bear Turn...

    The bull/bear cycle indicator turned down Monday for the first time since mid-2011 while in the high risk blow off bull position.

    That usually indicates the end of the bull and the start of the next extreme risk - MAJOR bear market - phase.

    2011 was a rare missed call in that regards, and so too 1998, though all other instances of the bull/bear cycle turning down landed prior to the worst bear markets in history beginning. I'm talking 1929, 1973, 1987, 2000, 2007 type of bear turns from the Bull/Bear Cycle indicator. And while both 2011 and 1998 proved to be missed bear calls, both suffered major corrective events near the frightening end of the fear spectrum.

    So far the other indicators I use in trading are all a mish-mash of confliction that leaves me 100% invested though hedged, which is conservative exposure for me.

    If the rally continues I expect to remove that hedge as the hedging indicator turns up, though exposure is unlikely to go beyond 100% long since the short term indicators remain north of the oversold extreme line, and investor sentiment remains extremely complacent and optimism, which is what one sees at tops not bottoms.

    So I'm cautiously following the bulls as we pick up the last of the pennies ahead of the steam roller, though the turn of bull/bear cycle says we are backing up to a major cliff as we focus on those pennies.

    If you would like to track updates on the chart shown below sign up at alphaking.com, click on the verification email, and get THREE months free access to my on-line newsletter.

    -Kevin

    (click to enlarge)

    Disclosure: I am long QQQ, TZA.

    Tags: QQQ, TZA, DIA, IWM, SPY
    Apr 02 12:06 PM | Link | Comment!
  • Calm VIX Says This Sell-Off Is Different

    The S&P500 has moved into a very dangerous position of its prior breakout level, highlighted by the dotted red line in the chart below.

    An air pocket resides below that level, and very hard selling is likely to appear in a hurry if that level is breached in earnest, which is likely due to the stance of the short term indicators.

    Note how calm the VIX is behaving as the S&P500 challenges that critically important level (white line near bottom of chart)?

    Bottoms are made when the VIX spikes come in pairs, highlighted by the twin blue arrows and circles, with the second triggering the actual buy.

    A couple of weeks ago we got the first cross of the VIX above the Bollinger Band (detrended in the chart below the dotted red line,) and the pullback as stocks tried to recover landed on cue. Also, right on cue, most stock indexes are making lower lows than we saw on the first VIX spike (dotted blue arrow and circle.)

    This time around, the VIX is remaining very calm, and showing little sign so far that it wants to explode across the BB.

    That is a big problem for the bulls has bottoms are made in fear, which the set-up below says has still to come. That says the S&P500 is likely to land into that air pocket beneath the prior breakout level, setting up a potential hard and fast plunge has traders react to the breakdown from the failed breakout.

    I plan to add more long exposure on the expected plunge once these indicators show it is safe to do so - so long as the trend remains up by the time the all clear is issued - though till that second VIX spike comes my QQQ long position remains hedged with TZA and getting ready to flip and trade short if the plunge into the air pocket is deep enough to trigger a change in trend.

    If you would like to track updates on the chart shown below sign up at alphaking.com, click on the verification email, and get THREE months free access to my on-line newsletter.

    -Kevin

    (click to enlarge)

    Disclosure: I am long QQQ, TZA.

    Mar 27 11:52 AM | Link | Comment!
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