LAME RALLY ATTEMPT
Here is the basic buy setup with the VIX I showed the other day. First it requires an up close above the Bollinger Bands. Once this happens you then wait for a close below the open which occurred on the last bar on the chart. That close below the open gives you some short term indication that the momentum has stalled.
Due to the weather interruption we have a couple of electronic sessions that don't have corresponding VIX bars so this is an odd one. Due to the fact that I was looking for a small bounce here and a larger decline I did not expect this to generate much of a rally and we are not getting one so far. Due to a second filter I use that I mentioned but did not explain, I felt this was not a great signal. I would urge readers to do their own research with the VIX. There are a number of ways of using this to track short term moves in the stock indexes. I threw out this basic setup just to get all of you started. This particular setup is about 60% wins to losses so it does have an edge in general biases.
The one thing I like to have is also a larger picture trend in the direction of the trade in the Vix and that is not here.
We got picked off on a few Swing trades today. No matter how much I try to tell people the challenges of trading for larger wins you still have to live through some of these trades to see what I mean by this. Here is one we did in the DX that I will use as an example.
With the Dollar Index trade we got stopped out of today we had a lot of things going for us. First we had a bullish COT setup with the commercials heavily long as labeled. We then got a rally out of a false break out to the down side and got long where indicated on the chart. We moved up nicely and during this move the accumulation measures were breaking out upward. This trade looked poised to take off. In an attempt to catch what could have been a larger move which is the whole point of the Swing Trading Service. We held the stop back below the last pivot to try and allow the trade some room. Since we entered at 79.845 the stop represented a very small loss. I know people get enamored with wins and losses and we could have easily held this stop just above the entry and claimed it was a win.
This is why I stated in the web site that the win percentage is going to be a lot lower in these trades than the Bond System produces because we are going to get picked off like this often trying to catch something big. For me to lose $70 is basically a scratch anyway. I just wanted to go through the logic of a trade and what we did and why so everyone can get an idea of what we are trying to do with these.
I am looking to short this bounce in the stock indexes in the next few days if it does in fact bounce.
You should be able to get access to your money in the next couple of days the New York storm did effect some of their back office stuff.