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CGTS Algo Trading System

byMichael Clark

LatestGetting Started



Sep. 25, 2019 4:37 AM ET•Comment!


TLT? No top in sight.

In the weekly chart, GBTC is still in a correcting move. M2F ALT needs to bottom again and start back up.

The daily chart shows a serious breach.

See how MOMO has crashed, red line, bottom pane.

NOW 14 YEAR-OLD GIRLS ARE TELLING US WHAT IS REAL? ARE TRYING TO SUE THE ADULT WORLD FOR "STEALING HER CHILDHOOD". Please, life is NEVER guaranteed; all childhoods are suspect AND fragile. There is no constitutional right to happiness or privilege.

So, Iran attack Saudi Arabia, to hurt global economies. What are we going to do about it? (IMPEACH TRUMP! IMPEACH TRUMP! IMPEACH TRUMP!)

Am I alarmed by this selling? Well, yes, the selling in GBTC has alarmed me a bit; even more, the inability of GBTC to move up above resistance for the last few weeks troubles me.

We are in a weird market -- it is hard to tell if we are coming and going. This is true in the gold sector, and even more in the oil sector. We have been BULLISH on ERX, 3x Energy Bullish ETF -- we are LONG ERX. Weirdly, ERX and ERY are both BUYS in our system.

C1=1 is bullish. MOMO shape is NOT bullish. M2F ALT 3 WEEKLY=1 is BULLISH and relatively OVERBOUGHT. In our CGTS GOLD SYSTEM we do not BUY until PROP1>=-7 and M2F ALT 3 WEEKLY=1. This is a LONG-TERM System. Typically C1=1 will generate a rally, as it did in this case; then a pull-back will occur. C1=1 may convert to C1=2, which in this system is NOT a SELL SIGNAL. M2F ALT 3 WEEKLY may fall back to 2 or even back to 1, during the correction. Then the rally will resume.

ERY, Energy Bullish 3x ETF, is supposed to be the opposite of ERX. But as we see above, ERY is also BULLISH. C1=2; M2F ALT 3 WEEKLY =1 is OVERSOLD. Momo shape is bullish.

How can these opposites both be bullish at the same time? The market is confused. BUYERS and SELLERS are both animated.

Gold stocks? Bullish or Bearish?

NUGT, 3x Gold Miners Bullish, seems to have topped. In the MOMO pane (red lines) see how the May 2019-Sept 2019 uptrend has broken. Now a down-channel has begun. COUNT1=0. How can this be? The top pane shows how this is possible. PROP1 is bullish (above or equal to -7); but PROP1 SOSO is not positive. PROP1 SOSO is a supplementary indicator designed to SMOOTH PROP1. PROP1 sometimes is volatile, and leaps up, creating a FALSE change of state; SOSO dampens this. If SOSO does not confirm PROP1, then COUNT1=0, which means it is a limbo trading state. When C1 moves from 1 to ZERO, in every case this is BEARISH, A SHORTSELL SIGNAL. When C1 moves from 3 or 4 to ZERO, it can go either way. Too soon to call.

The opposite of NUGT, JDST, 3x Bearish Gold Mining ETF, has turned Bullish, in terms of both PROP1 and PROP1 SOSO and in terms of Count1, which now equals 2, from C1=1, BUY.

Note the MOMO SHAPE above: JDST has made a (BULLISH) HIGHER HIGH. MOMO is declining now; but as long as MOMO stops its decline above 11.99, and turns back up, it will also make a HIGHER LOW. A HIGHER HIGH and HIGHER LOW is (MY OWN at least) definition of a BULL MARKET MOVE.

Is the market in trouble? October is approaching. We do not think the market is in trouble. Do we think the country is in trouble? That is a different question. The market first. We have cluttered our chart with many "squiggly lines". Of course, squiggly lines do not appeal to the Left Brain -- fundamentalism appeals to the Left Brain, accounting "truths".

Let's walk thought this chart from the top down. 1. PROP1. Bullish. Bullish when it is >=-7. Also you will see that +5 is another level of support in a Bull Market (see the orange line). A second level of support for a bull market with Prop1 is -1 (blue line). So, GSPC is holding up at or above both of these sub-floors. 2. M2F ALT (blue line) shows overbought (>70) and oversold (<30) levels; PROP1 SUM60 adds up all the days when Prop1 is bullish up to +60 and then remains there until Prop1 decays. GSPC is at SUM60 +60. M2F ALT seems to be dropping back toward OVERSOLD again, which is has done two times already sine April 2019. Nothing alarming here.

3) M5 Levels. Moves between OVERSOLD levels of -3 and OVERBOUGHT levels ot +3 (and above). +3 reading today. 4) MOMO (red line) is positive, bullish. 5) COUNT1 SPIN =1, buy. 6) COUNT 1/2 SPIN =2, Trading Sell. COUNT 1/2 is half the length and weight of COUNT1 SPIN -- so COUNT 1/2 will deteriorate earlier than COUNT1 Spin. Prices should decrease when COUNT 1/2 =2, as they did in May-June 2019 -- but have not done so August-September 2019, which some might consider a positive.

Is GSPC a realistic model for the market? Perhaps; perhaps not.

The country? Do we want to live in a country where there is enforced wealth equality. The Democrats are swinging in that direction -- LEFTIST POPULISM -- the Republicans will never support this -- RIGHTIST POPULISM will not allow that, without a fight. When we look at migration, which is it that people almost always flee regimes that attempt to impose universal poverty on a country in the name of social equality? Why do socialist countries always lose their best people eventually, as they sink in to economic chaos and political authoritarianism? The history of communist countries is always the same: the intellectuals support the poor; the poor gain power through revolution and then persecute the remaining intellectuals as "free thinkers" in a country no longer needing free thought; then the country sinks into despair and poverty; then people flee the country; and then countries put up walls to keep people from escaping. The Ruling Party becomes a party of Prison Guards. Millions die of political execution and starvation and crime. It is always the same.

Follow LEFTIST EQUALITY MOVEMENTS at your own risk. It is the path of DEATH. The path of LIFE has many imbalances; it is not fair; but life is not supposed to be fair all the time. Life is a spiritual struggle, with pitfalls, and difficulties and tests. The Mother wants all her children to have the same skills, gifts and opportunities. The Father knows this is impossible in the world in which we live; so he attempts to build in each child an ability to keep getting up every time he or she falls. It is the getting up that matters. That is the life of the Spirit.

SENTIMENT?  An SA author, who shall remain nameless, seems to think that SENTIMENT drives the markets but that the FED's policy implementation does not have any affect on Market -- nada, nilch, zilch.

Does anyone really believe that the FED has NO influence on the markets and NO INFLUENCE on investor's sentiment about the market? Is sentiment just some unconscious monster that looms out of sight and leaps when it reaches a breaking point, FEAR hidden in the unconscious? FEAR is actually VERY CONSCIOUS, and also unconscious. SENTIMENT is conscious and also unconscious. Is sentiment formed only outside of news, rumor, and technical understanding -- or do all these feed sentiment.

Clearly for investors that believe the FED moves the markets, FED moves WILL affect their sentiment and may help trigger both buying and selling.

Sentiment may be somewhat magical as a coalescing force. but there is nothing magical about what influences sentiment. And the FED does influence sentiment. How could it not?

Some BUYING SENTIMENT coming in to our short-term trading system, C1 M5.

TERRACE is M5 today; TERY is M5 yesterday; TERYY is M5 two days before.


Disclosure: I am/we are long GBTC. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Disclosure: I am/we are long GBTC.