ES SELL SIGNAL

My mechanical E Mini System does have a sell signal for tomorrow. Most of the sell signals this year have been lousy and the only two losses it has had have been sells. Just looking at a chart that is kind of easy to see why they have been no good. I have no reason to believe this next one is any good either but I will take the trade if it is triggered. It does require a decline down to a certain level to trigger so it may not happen.

I am traveling tomorrow so the orders for the services are going to be out a little bit later than normal. The good news is that I don't see much if anything that will be there anyway except for one key market, and it depends on what happens tomorrow in that one. You can see on the chart above the last short term trade was a profitable long entry that was exited on today's open, which followed a losing short trade.

I want to draw attention to something and that is what I have been writing about in the Newsletter each month. I have told everyone to stay long ever since the first publication, so I have been dead on with how to keep your positions in the stock market at a time when so many people are citing all sorts of reasons as to why the market has to crash right now. However, the one condition that I have been discussing that could spell trouble for stocks is developing and getting very close. For those who get this if and when this does develop into a sell signal there will be a special bulletin that will come out warning you. I will not mention it in here at the time due to protecting the interests of those who are getting that each month. What is fair is fair.

For the time being the trend marches on in the face of all sorts of reasons why it should not be doing so according to the experts. We should get a lower short term high if and when a trend break happens, so there should be plenty of notice. For now every little minor dip gets bought and the President smack talks on a daily basis.

I have to admit I am trading crappy the last week or so just moving ahead slowly and it is frustrating. However, when I look at most of the markets with a couple of exceptions, I see a lot of choppy price action. RB has been an exception as has Cotton ( a market I don't really count ). Wheat has maintained a good trend down and that is about it. The action in the VIX tells it all, just get a load of this chart.

It is my view that when the VIX is trending this strongly you do not want to try and fade the stock market. The conventional wisdom on this would tell you to be shorting here. I have barely lived trying to do that in the past and I do not recommend it. Although the VIX measures volatility and as a result this indicates extreme complacency, we have seen this type of complacency go on for very long periods of time in this new era of Fed control. There will be a sharp break that will happen but I cannot tell you when. I would not recommend new longs here for the purpose of a long term hold, but this is also not an obvious selling spot to me yet.

Good Trading