Markets continue to be extremely challenging. Anyone who had exposure to markets last week knows exactly what we mean. Volatility continues to be very high, and leading indicators continue to open and close most trading days ‘on the edge’. Markets are almost ‘designed’ to mislead and confuse. A very, very solid method is required to beat these markets. In our Trade Alerts method, designed to take short term trades, we are sitting on a performance of +50% since January. You got this right, capital is up 50% during the fastest sell off in history of financial markets. And our leading indicator analysis as a complement to our proprietary algorithm did help tremendously to get our trades right in recent months!
Recently we wrote multiple articles about our leading indicators, which may be considered a teaser of our premium services work:
One of our leading indicators is the VIX index.
We are not going to reveal all the details of below chart as we did share them in our special weekend edition in our Trade Alerts service. Suffice it to say that this index continues to mislead with a false breakout on Friday, a weekly close right below a bearish level in the last few minutes of the week, and a potential reversal pattern.
The ‘good news’ for long or medium term investors is that VIX is now falling below its ‘armaggedon’ area. Note that this is clearly the intention of this indicator, it may turn up any time is what below chart suggests.
How to play these markets in the short term? Either on the long side or short side, it doesn’t really matter, but the long side looks to have a bias until proven otherwise (this is subject to change on a day by day basis). It really requires a solid leading indicator method combined with an algorithm that has stood the test of time.
How to play these markets in the medium term? By identifying the solid long term trends, and taking medium term positions. That’s what we do in our Momentum Investing service.
Our premium members get regular updates of this, and many other leading indicator charts. Exceptionally we share a chart (like the one below) to give a sense of our premium work, but we always limit the information we share in order to respect our premium members.