Of his thirst for film, Manning said: “I knew that’s where I was going to try to gain some type of edge [my emphasis]. I knew I wasn’t going to run away from guys or throw through three guys. My idea was to try to have a good sense of where they were going to be. I never left the field saying, ‘I could have done more to get ready for this team.’ ”
– Peyton Manning’s Case for Being the Best Ever, New York Times
Since this is Super Bowl Sunday I was reading an article about Peyton Manning. How intense he is, how hard he works, how he prepares, and how he’s always looking for an edge.
It kind of relates to success in the markets, doesn’t it? Especially the part about gaining an edge. I understand that Manning thinks about little else other than football. But I have the feeling that if he ever decides to get actively involved in the markets, he’ll be darn good at it.
Oh yeah, the markets. They’re getting pretty ugly, so let’s look at our strategies.
ATR Trading Strategy
The portfolio is 100% in cash and has been since January 22. When I see some good trends developing I’ll enter some positions. But at the moment cash feels pretty comfortable.
COT Strategy
COT is 70% in cash. The latest Blees numbers have been posted. There are buy signals in soybeans, wheat and 30-day Fed Funds. The portfolio already owns DBA (comprised of 25% soybeans and 25% wheat, along with corn and sugar). And, outside the futures markets, there is no reasonable way to take advantage of 30-day Fed Funds.
However, the stock market is getting interesting. For example, there is now a Blees rating of 95 for the S&P. And with the recent big sell off in the precious metals I expect the Blees numbers for gold, silver and platinum to go higher over the next several weeks. I would very much like to see a rating of 100 for any of the three. If we’re patient we’ll see it.
Magic Formula Strategy
On Friday the portfolio sold DIVX and IMMU. With CF and DIVX being the only positions left, the portfolio is 90% in cash. Our exit strategy has allowed the portfolio to keep most of its gains. I expect to begin adding positions again in the next week or so.
RSI Reversal Strategy
RSI had a good week. As of Friday, the portfolio has only one position in AGQ. I’m out of town for another week, so if you’re trading this strategy keep up with the RSI signals. My updates may be late in the evening or the next day until I get back.
Long Term Timing Strategy
The strategy is about 70% invested. SLV is currently below its 10-month moving average. However, we only look at the positions in this portfolio at the end of the month. And it may be the end of the month before I buy anything new. That could change, but with the way the markets look right now I’m in no rush.
Gold/XAU Ratio
The ratio closed on Friday at 6.91. With a ratio this high I don’t expect a long lasting bear market in either the mining stocks or precious metals. Just the opposite. When this correction is complete, I expect the bull market to resume.
Have a prosperous week.
Larry