CGTS THURSDAY; MARKET TRYING TO CORRECT BUT WHERE ARE THE SELLERS? BULLISH ON ENERGY

Dec. 22, 2017 4:04 AM ETFINL, EVEP-OLD, ERY, SPWR, SNAP, DRIP, GUSH
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Long/Short Equity, Special Situations, Currencies

Contributor Since 2009

Michael J. Clark was born and raised in Sinclair, Wyoming. He is a poet, novelist, artist, historian, and market analyst. He began investing in 1985. He read ˜The Technical Analysis of Stock Trends" by Edwards and Magee and was hooked. From 1985-1987 he made astonishing gains in the stock market; and then stocks collapsed in 1987. Since then he has been attempting to 'solve the stock market', with many failures and some successes. The system he developed, called CGTS, Clark's Gate Timining System, is algorithm-based. What this fancy word means is that he proposes a series of necessary steps based on technical analysis propositions, which, when met, trigger trading signals. His four main trading systems are up a combined 31% for 2015. From his website: INVESTMENT PHILOSOPHY Now that QE is supposedly ending, markets are already becoming more tradable, with opportunities to make money on both long and short trades at the same time. QE tended to make all boats rise, except precious metals. This made it more difficult to play the short side of the markets. Now, both sides seem to be more accessible to successful trades. This will also be more of a challenge for investors. The FED will have to eventually abandon the markets to their own destinies, and stop spending trillions to protect investors AND corporations from their mistakes. As this begins to happen (I am not sure it has happened yet), informed advice will become even more necessary for investors. Rules of Investment Rule #1: Never go against the trend. The majority is often wrong; but the minority is often wrong also. The sticky issue with this advice is at transition points, at which a Bull Market turns into a Bear Market or vice-versa. Big Money often anticipates and/or causes this transition. So pay attention to what Big Money is really doing, not what they say they are doing. Rule #2: You don’t need a broker who makes his living off of your money. Most brokerage firms buy a position in a stock quietly and slowly. When the stock has appreciated significantly they add the stock to their buy recommendations. Then they begin selling their position while they are encouraging their clients to buy the stock. Most firms never issue sell recommendations. If they do, beware: they are probably trying to buy your stock after a huge sell-off. Rule #3: Watch your own emotions because they are often signaling something. When fear turns to greed and visions of unlimited wealth, we are probably near a top in a trade and we should get ready to sell. When hope and denial turn to fear and visions of an unlimited loss, we are probably approaching a bottom in a trade. (See Rule #1 however.) Rule #4: Trade with a system to complement your gut reactions. Follow the system no matter what, even if it means taking a loss. Don’t get lazy with your money and sink into denial. Use a system to help you refrain from 'playing a hunch'. Rule #5: HEDGE YOUR PORTFOLIO AGAINST LOSSES. How does one do this? By having a balanced portfolio of long and short positions. But have a system that signals both long and short positions, and keep your portfolio balanced around 50% long and 50% short. This may seem to contradict Rule #1. It does not. When something is in a long trend, something else is in a short trend. Find what is long and what is short. If stocks are long, gold or oil may be short. Use ETFs and options to help establish this portfolio balance. Our system gives trading signals every day for both long and short positions. More information on CGTS is available at: http://home.mindspring.com/~mclark7/CGTS142.htm His fine arts portfolio can be found at the following address: http://www.hoalantrangallery.com/MJC2.htm His writing portfolio can be found at: http://www.hoalantrangallery.com/MJCwriting.htm Those interested in his book "Turn Out the Lights", a description of the metaphysical causes of the 2008 financial meltdown, can access the draft at: http://www.hoalantrangallery.com/Turnoutlights.htm Michael Clark has retired after working 30 years in academia, relocated to Hanoi, Vietnam for six years, and has returned to America in 2014.


CGTS: THE NEW SCIENCE OF INVESTING

21 DECEMBER 2017

 NOTE: I am considering tripling my subscription rate January 1, 2018.  Anyone currently a subscriber (or subscribing before 1 January 2018) will remain at the current rate.  I hope this shows how much I appreciate your early support.

Happy Winter Solstice.  This, with every nation of the world, was significant as a time of the RE-BIRTH OF THE SUN in its annual pilgrimage through the 12 houses of the zodiac (12 months).  Christianity also chose December 21 as the time of the birth of their savior, Jesus Christ -- although later church fathers sought to distance the new religion from the older religions by branding the predecessors PAGAN and attempted to camouflage Christian symbolisms (borrowed from these predecessors) to make them appear unique, divorced from the older systems.

In my system, the Winter Solstice (Midnight) is the BEGINNING OF GROWTH.  The Summer Solstice (Noon) is the END OF GROWTH -- and the beginning of Memory, the reappearance of the Moon, and the beginning of the Sun's fall.

2019 is an overlay of the Winter Solstice on the 36-Year Cycle, as was 1983, 1947, 1911 -- the beginning of Growth.  2001 is an overlay of the Summer Solstice, as was 1965 and 1929.

We have been looking at Energy Stocks.  Every Noon Hour in my system is the beginning of an ENERGY CRISIS in the largest sense of the world.  The beginning of the winding down of the world, in terms of energy.

Let's look at today's WEEKLY C1 SPIN CHANGES, which highlight energy stocks.

Here are some pictures of this group.  We are bullish on oil stocks.  GUSH (Below), the Bullish Oil and Gas 3x ETF seems to be breaking out of a minor consolidation.  LONG.

GUSH's dark sister, or shadow, DRIP, should give a reverse or inverse picture of GUSH above.

We also look at ERY, Energy Stocks Bearish ETF.  We looked at ERX, its light brother, yesterday if I remember correctly.

We want to look at one more stock from this group: SPWR, Sun Power.  It is a BUY.

We were expecting selling today.  We got some selling.  But most of our portfolios were up, even with another GBTC meltdown.  This tells us that the selling (so far) is not really significant; we hope this continues to be so.  Both NDX and UDOW are perched in the higher strata and are signaling a normal selling spate.  December is usually pretty kind to stocks.  So far selling has been muted.

BITCOIN.  Well I show it (with some glee) when it goes up.  I should show it when it goes down, as it has the last three days.  I got in at $500 -- so I am not feeling any pressure to sell at this point.  It has support at 1573.  We'll see how it handles this support level.

One of our favorite trades at the moment is XNET, XUNLEI LTD, a Chinese ISP company that shocked the business world a couple months ago when it announced it had become an I-Coin generator (One Coin) with which users could manage their XNET accounts.  Suddenly XNET became a virtual money player.  The stock soared.  Then it crashed back to earth -- sort of.  But look at the chart below.  PROP1 is our major trading chord; PROP3 is a version of PROP1 for very volatile issues (usually low-priced issues): note both PROP1 and PROP3 are bullish.  PROP1 broke in late November after the doubling of the stock; BUT it is back up again.  We have a chart of the only other time this stock was both PROP1 and PROP3 positive, March 2015, at which time the stock DOUBLED.  NOTE: THIS STOCK, WE CONSIDER HIGHLY SPECULATIVE.

I wanted to show an update of a stock I recommended some time ago, and watched it flounder since.  FINL, Finish Line.  This shows why our systems often need patience to unfold.  This stock spent a lot of time going sideways; but now it is energized.

CENX, CENTURY ALUMINUM, crashed back into PROP1 DEFLATION ZONE.  But it has bounced back.

WHAT ABOUT EVEP, EV Energy Partners?  We were very BULLISH two weeks ago.  And EVEP has sagged.  PROP1 has broken down; COUNT1 has popped up to 3.  But notice PROP3 is still bullish; and the trends are holding up (TREND SHAPE, top pane).

Here is today's FULL REPORT

READERS PORTFOLIO.

UNDER SEPARATE COVER.

We have added a new data-field to our RP.  COUNT2 30.  A rally in C2 carries the C2 COUNT to 30.  A selloff carries C2 COUNT to -30.  If you see a stock that is Long-term LONG with a C2 COUNT -30, this is one to consider.  A stock that is Long-Term SHORT and has a C2COUNT of 30 is a SHORTSELL CANDIDATE.  When a LONG Trade breaks down from 30, this is a  possible SELL SIGNAL; when a SHORT Trade breaks up from -30, this is a possible COVER SIGNAL.  We will demonstrate this more later.  Also, a C1 move between 4 and ZERO is bearish, but it signals a furious struggle between Buyers and Sellers that often precedes a reversal from SHORT to LONG.  And, a Bullish C1 move from ZERO to 1 seems to be less powerful than a move from Zero to 2 and then back to 1.  We added Count1 (as data) back to our report.  You can work with COUNT1 and COUNT2 30 COUNT by yourself.  COUNT1 also tells you in PROP1 is bullish (COUNT1 1 or 2) or bearish (COUNT1 3 or 4).

FOR SUBSCRIBERS ONLY.

For fundamental CGTS descriptions:

http://home.mindspring.com/~mclark7/CGTS142.htm

MJC, CGTS

We have refined our system to a simple system of SPINS.

LEGEND:

COUNT1 SPIN SYSTEM AND COUNT7 SPIN SYSTEM

Essentially the trading mechanism is this:

BUY: COUNT SPIN = 1*

EMV =-1

M4-21 =-1

PROP1 >=-7

SELL: COUNT SPIN >=2

EMV = 1

M4-21 = 1

PROP1 >=-7;

OR: SELL AND SHORTSELL when PROP1<-7**

SHORTSELL: COUNT SPIN =3

EMV = 1

M4-21 = 1

PROP1<-7

COVER SHORT: COUNT SPIN = 4

EMV = 1

M4-21 = 1

PROP1<-7

OR: COVER AND BUY when PROP1>=-7**

* two anomalies.  BUY when TODAY's COUNT =2; YESTERDAY'S COUNT = 0.  SHORT when TODAY'S COUNT = 4; YESTERDAY'S COUNT = 0.  "COUNT" in above description applies for both COUNT1 SPIN and COUNT7 SPIN.

**PROP1 must be confirmed by its shadow, "CGTS LONG-TERM TREND RSTDIFF SO REAL" which I have re-named PROP1 SHADOW.

Please note: Count7 Spin System requires 2400 data-points to calculate.  Where zero show here, it is because we do not have enough trading days compiled to calculate a value.

PROP1 l GREATER than or equal to -7 is BULLISH by definition; PROP1 below -7 is BEARISH

Disclosure: I am/we are long SNAP, UDOW, QQQ, GBTC, EVEP.

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