I'll be leaving for a much needed vacation starting Monday and I won't be back till late July.Â I hope all my readers sit tight and I ask any new readers to please signup for my feed (see the upper right corner of the page).Â You'll be notified of my return when I start posting again. Have a great summer!
June 2008 Archives
While its visually stunning and has some technical merit, I won't be using the Ichimuko charting indicator to trade off of going forward from here. I probably don't know enough about it to fully use it and will resume my breakout strategy. After three strikes, err stop outs, its out for now! Heres yesterday's currency trading scorecard:
- GBPUSD: -80 Pips
- EURUSD: - 100 pips
I'm testing out a new Forex trading method right now using the Ichimuko charts and I'm 1 for 1 in my currency trades with a third one currently at a loss. At least my first trade was a winner!
- EURUSD +38 pips (break out/counter trend rally)
- AUDUSD - 25 pips (Ichimuko chart technique)
- EURUSD still short and sitting on a 37 pip loss (Ichimuko chart technique)
A long time ago, as I was searching for some good long term infrastructure plays when I came across The Greenbrier Companies (GBX). Here's what they do, from their company overview page:
The Greenbrier Companies, Inc. (Greenbrier) is engaged in designing, manufacturing and marketing of railroad freight car equipment in North America and Europe and a provider of railcar refurbishment and parts, leasing and other services to the railroad and related transportation industries in North America.I work in the railroad business and I believe that railroads are going to be a big business in the next few years as we try to find more efficient ways of moving freight long distances. Depsite my rosy outlook for the industry, GBX's stock chart stinks. It looks like the stock has been in a downtrend and last week shares were down over 7% as Greenbrier (GBX) took a big tumble on news that Ichan ended discussions with GBX on a possible "business combination" with American Railcar Industries Inc (ARII). After I read that tidbit of news I'm staying away from both companies. When Carl Ichan gets involved, you know that there are problems with the company! Carl is a smart guy but he's out for himself.
My EURUSD currency limit orders haven't triggered yet. I'm planning on going short at 1.381 but Euro seems to be bouncing back from its lows and heading higher. No matter, my order is in place for a week and if it triggers it will confirm my short-term negative bias for the Euro. Not to miss a counter rally I decided to place a limit order to go long at 1.5464 so we'll see how that goes this morning when the US markets open. You have to have patience when stalking the currency markets. The right breakout can me good profits! :)
Although I haven't placed a trade yet, I'm busy stalking the currency markets again. I've been watching the EURUSD, AUDUSD, USDJPY, and EURJPY pairs again and I'm seeing some interesting things happening. I think we're seeing possibly trend exhaustion in the EURUSD and AUDUSD pair signaling a possibly a top. Why do you ask? Well I think the rumors of the USD's demise are greatly exaggerated. While I agree that the USD will remain week in the months or years to come, the collapse of the US empire isn't going to happen when we're all watching it. It's going to be a BSE just when we think everything in the world is peachy keen. On top of this, Bernanke is shifting to an inflation watch so interest rates have no where to go but up. Higher rates means stronger dollar. Still though, the trends for the Euro and Aussie Dollar remains UP and we shouldn't fight the tape. We should be very cautious and always place our stops. Oh Forex, How I Love Thee!
I'm sorry to see Ron Paul has suspended his campaign for President but it was a matter of time and the odds were stacked against him. However, for the first time in my entire voting life, I truly felt a connection with Ron and his platform. Hell, I even registered as a Republican! I'm really happy to hear that Ron has started a new organization to help get like-minded people elected to Government at all levels. Ron started the Campaign for Liberty who's mission is:
The mission of the Campaign for Liberty is to promote and defend the great American principles of individual liberty, constitutional government, sound money, free markets, and a noninterventionist foreign policy, by means of educational and political activity. [Ron Paul's Campaign For Liberty]I just joined and I plan on staying involved. Because of Ron, I'm actually eyeing running for local government in the next few years. We can take this country back.
Say what you want about Robert Kiyosaki, the author of Rich Dad, Poor Dad, but he's a smart man. I could help but laugh when I read this line from an interview with The Street.com (emphasis mine):
"I haven't been this bullish in years," says Kiyosaki. "What a buying opportunity. ... The stock market goes on sale, and everybody runs away." But, he's excited probably only for a short time. "When the market comes back, I go back to sleep," he says.I too share his sentiment but I managed to pull money out near the top and buy near the market lows (I hope). As of yesterday I started my program of rotating my cash and bond holdings back into the market and plan to be 95% in stocks by December 2008.
Ever since the Fed bailed out Bear Stearns a few months ago, I began to wonder who'd be the next investment bank to fold. It's looking like the other shoe has dropped and the mystery bank is Lehman Brothers (LEH). Now I don't know if LEH will implode like Bear Stearns did, its desperately trying to avoid that and by selling assets to cover its write-downs, but I suspect that LEH will come out this situation extremely bloodied. Still though, Bear Stearns thought it would survive too. No matter what happens to LEH, its a pretty forgone conclusion that a test of the low ($20.25) on March 17th is coming!
Trolling through the Internet last night I discovered that my Futures Magazine article from last year, Forex and Treasuries Provide Clue for Gold, has been republished over at Traderslog. Make sure you read it quick before it gets taken down! :).
Reader sc suggested I check out the American Association of Individual Investors and poke through their portfolio scans and risk analysis. In the end I signed up as a member of AAII and Riskgrades to help analyze my portfolio risk for my 401k and IRA holdings. Overall I really like Riskgrades! My initial analysis confirms what my Excel based Monte Carlo sim revealed; I'm doing a good job but I can do better and I have holes in my strategy. Based on Riskgrades, our retirement portfolio is designated as a growth portfolio with a very low volatility relative to the S&P500; it has a beta of 0.79. My risk was reduced by 14% because of my diversification and 99% of S&P500 stocks are more riskier than our retirement portfolio. The good news is that my individual stock selections (with a few funds) are the biggest driver of my returns but my large cash position (40%) is killing my returns right now. As I wrote in my Achieving Financial Critical Mass post, I'll be contributing more money to our IRA's and selecting more stocks. In our 401K's, I'm going to start shifting our large cash positions back into the market, over the next few months, into more aggressive funds I suspect that I'll end up holding 95% stocks by the end of this year with 5% in cash and bonds.
I posted my stock analysis of Emcor Group Inc (EME) on February 2/25/06 right before I went long at $24.83. It promptly decided to fill the gap and head lower but I still held on because I like the long term infrastructure play. What can I say? I'm a die hard Civil Engineer! Well after holding on through the next 4 months, I'm sitting on a small gain of 13.8%. Nice! I goes to show you that this isn't a stock market but a market of stocks, the trick is to select the right ones.
I'm either stupid or a glutton for punishment but I bought 10 additional shares of Citigroup (C) yesterday for my Roth IRA account. I figured that C was at its bottom and wouldn't go lower than $20 because my recent modeling is showing a strong pull toward a higher price, but it didn't listen to me! I went long at $20.15 and it closed at $19.60. Sheesh! loving hating it! :) For what its worth, here are some price targets for Citigroup (C) I developed using Riskamp. Upside Price Targets: $22, $27 Downside Price Targets: $17, $12
I left work late on Friday because I got distracted running Monte Carlo simulations on our 401k accounts. I'm on a quest to refine my retirement plan of achieving Financial Critical Mass, something I heard about from Bob Brinker many years ago. Financial Critical Mass is defined as the capital you need in your retirement accounts that will continue to grow after you retire and start withdrawing from it. In other words, your living off the interest of your investments. The trouble is trying to find the right mix of funds of stocks, with the right mix of contributions and savings to pull it off. Most of my time after work was spent looking on the Internet for the median historical returns and standard deviation of those returns (no easy task) for the mutual funds and stocks we hold. Once I found them, I plugged them into the retirement example spreadsheet that came with Risk Amp and ran the simulations. The result of my simulations are promising but I did identify some holes in my 401k strategy. For one, we're not saving enough with our 401k's alone; we must start contributing to our Roth IRA's again. Second, we're not being aggressive enough with our investments; I need to identify more funds with higher historical returns to add to our investment pool. Although my market timing model helps me a great deal when it comes to making a higher return at the end of the year, I can do more to supercharge the returns on our account. So what's the first part of the new strategy now? First I'm going to schedule a monthly deposit of $200 into my Roth IRA and then add to my Noble Corp (NE), ExxonMobil (XOM), General Electric (GE), and Emcore Group (EME) positions!
Holy crap. I'm not caring a cell phone any more.
how to build a fire pit
I haven't posted price targets in a while but here's a quick one for the S&P500 based on today's close of 1360. Upside Targets: 1446, 1544 Downside Targets: 1348, 1250, 1152 If you ask me, I think we're going to see another leg down in the markets but what do I know?
My market timing model was in full swing today and it flashed a BUY. Today was a lot of carnage and I suspect that we could go even lower from here. I hope everyone has their stops in place, :). Normally I wouldn't move any money in the market until the low at 1276 on the S&P500 is taken out. Still, the market timing model is a nice short term trading model too. If you went long when the model issued a BUY signal and then closed the position and simultaneously went short with the SELL signal flashed, you'd be sitting on some decent short term gains as my little chart shows. The danger in doing this is that the model was designed to issue BUY/SELL signals for a longer time frame and you could easily get a BUY signal and end up with negative returns in the short term.
Deon posted a request to form a EURUSD NN development model and then trading team. I think its a great idea and have decided to open up the project collaboration site again if he wants to form the group and upload data as he proposed. If Deon emails me, I'll help coordinate the access to the project collaboration site and give access to interested parties.
via Ugly. Damn good horse/potatoe senese
Look at PIKIA the genetic algo for Excel
Some tech papers on GA's and NN's
Definately not related to NMT but I have to design a sewage pump system. Ewww!
Not related to NMT but good stuff for engineering nerds
Linkage to me
more linkage to me
and some more linkage to me