Weekly Market Update: Looking Up
Mr. Market's Rebound Slowly Takes Hold
|Edward Rooster||Jun 16, 2019|
The trend-following ideas universe for Rooster360 continues to maintain recent gains. It’s too soon to say but it is not unreasonable to be optimistic for Q3/Q4 2019 to look differently from a year ago. Presented first is the weekly Top Down Summary.
This week’s Top Down summary reflects firmness in “long” ideas and a gradual weakening of “Sell/short” ideas, when compared to the last few weeks of data.
As we see with the top down summary chart shared immediately below, we are very far from the market of Q4 2018 - the recent news has been distressing but we have to let price tell us what Mr. Market has discounted and “baked in”.
The Top 20 LONGS as of this week are as follows. We can see that it has been quite robust for a collection of ideas not in the headlines or capturing media attention. The below summary for the Top 20 (which includes the initial “risk per share” estimates has been included to help you update your notes.
The Top 20 SELLS as of this week are the mirror image of The Top 20 LONGS. Strength begets strength in both directions.
I want to change it up this week and introduce charts of potential future leaders from the ideas universe. There are about 600+ ideas and some are underperformers and others are running out of the gate. (“Running” is a relative term given the use of weekly prices and much longer time frames. Short-term focused traders would see this as a traders’ version of watching the grass grow or a freshly painted wall dry.)
The following charts are all LONG ideas which joined the ideas universe in the beginning of March 2019. You may react with the notion that the following charts are offered a bit “late” but nothing could be further from the truth when it comes to long time frames and trend following. In past reports, there were ideas which ran on an extended basis well beyond a year - for investors and traders focused on building meaningful positions in successful investments with a minimum of turnover this would be the ideal outcome. Again, we won’t know but we can do our best.
Here is a broader detailed list of ideas that were posted in March 2019 - it’s only 40 ideas that should be more than enough for most speculators’ notes. I caution readers that I am sharing these ideas with a neutral appraisal of their odds of success - prediction is a difficult business in any aspect of life and taking risks. Everything is done on an estimated, “best efforts” and good faith basis. Let the chips fall, etc.
I offer an estimated “risk per share” column that I hope you will consider for your notes in terms of trade sizing. Say for example the “$RISK/share” says 1.00 - if your system enables you to risk losing $100 USD for one trade, then you can trade $100/$1/share = 100 shares could be traded. If the price at the entry time is $10 then the estimated initial stop loss if $10 minus $1 = $9 initial stop loss exit price where you would close out “long” idea. (IF the idea were a “short” then the entry price of $10 would have an estimated initial stop loss exit price of $10 + $1 = $11 stop loss exit.)
The updates for recent weeks has been brisk and very simplified. I hope that they will be useful starting points for your own approach to trend following over longer time frames.