Monday, February 01, 2010

Monday VIXology & Rotator Update

This week's charts are displayed on 3 day bars as this is the time increment I've adopted for looking at the Telechart Rotator model.
The VIX has now risen to the upper LR30 channel band and appears to be resting there while contemplating the next move. All the majors are showing lower LR 30 channel "kiss-offs" with the Qs displaying some reluctance to capitulate.
Keep in mind these are 3 day bars and on daily bars the Qs situation looks a LOT worse . . in fact, for the week the Qs showed above median weakness.

This is an update of the Telechart Rotator using a 6 period moving linear regression, a study that's resident in Telechart and offers instant sorting capability, based on a variety of metrics, for your custom built watchlist.
Last Friday's selection of TLT as the best momo candidate was suspect at the time. but ultimately turned out to be the best choice for the week. While TLT only gained .34% for the week, compared to the substantial losses of the majors (SPY -1.67%, IWM -2.62%, Qs -3.1%,
and EEM -3.66%), the TLT proven to be a safe haven.
Looking forward this week, TLT still has slot #2, with #1 being reserved for VXX . . an ETN that has it's own market dynamic idiosyncrasies that do not necessarily conform to standard indicators. Finally, I would be resmiss if I didn't mention my Clueless trading buddy who also uses the Telechart program to define his own version of a rotation model using a MoneyStream Surge. The Clueless One frequently expounds on various nuances of these setups and always has a few nuggets to share. You won't be bored.

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