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Proactive Market Timing
 
Proactive Market Timing Service

Market Timer: Fari Hamzei

Executive Officer: @Admiral_Tiko

Editors: Capt. Stephanie Alexander & Nancy Scott

Here is the most recent How the PMT Market Bias Service Works Video

PMT Archives   Current PMT Issue

Most Recent PMT vs SPX Performance Chart

Friday, August 10, 2018, 0001ET
Notice of Change of Bias with Timer Digest


Dear Jim,

We have had a good run but now we're getting too may bearish divergences.

We are going SHORT SPX (while locking in another 44 handles) with a 1% stop.

Cheers……..

Fari Hamzei

Monday, August 6, 2018, 1010ET
Companion Chart for Market Bias Review, Issue #252

Monday, August 6, 2018, 1005ET
Market Bias Review for Issue #252

Our current Market Bias with Timer Digest is LONG SPX as of JUL 17 at 2809.55
Our previous Market Bias was SHORT SPX as of JUL 10 at 2793.84


            Here are the trade parameters for this week:

4 SPX Secondary Profit Target for last 20% of our position = 2885
SPX Primary Profit Target for first 80% of our position = 2870
SPX BreakEven Stop (Today's Open) for last 20% of our position = 2840
SPX Money Management Stop for 100% of our position = 2825


Action Asset Expiration Strike Option
BUY SPY Friday AUG 24 284 Calls
SELL SHORT SPY Friday AUG 24 288 Calls
You need to execute both legs and hold it as a Call-Spread.

Note A: Once the Primary Profit Target has been reached, traders are advised to close 80% of their position in order to lock in profits. The remaining balance can be carried over with a BreakEven STOP, based on the SPX level at the time of entry, in order to make the trade a zero-risk trade with the final position running to reach the Secondary Profit Target. Once either Secondary Profit or Money Management (BreakEven STOP after the 80% peel-off) is hit, our Option/ETF trade for that week is over. Go to Cash and wait for the next PMT Issue.

Note B: When we change our Market Bias with Timer Digest, You need to go FLAT asap. With PMT Pro, that is before the Close that day and with the basic PMT, at the open of the next day. The following trading day, we will issue new SPX targets and a new SPY options trade, as long our new market bias with Timer Digest is NOT flat.

Fari Hamzei

Monday, August 6th, 2018, 0750ET
Market Timing Charts, Analysis & Commentary for Issue #252


Timer Charts of S&P-500 Cash Index (SPX) + NASDAQ-100 Cash Index (NDX)

Most recent S&P-500 Cash Index (SPX): 2840 up +22 (up +0.78%) for the week ending on Friday, August 3, 2018, which closed above its +1.5 sigma.

DJIA ALL TIME INTRADAY HIGH = 26617 (reached on Friday, January 26, 2018)
TRAN ALL TIME INTRADAY HIGH = 11424 (reached on Tuesday, January 16, 2018)
SPX ALL TIME INTRADAY HIGH = 2873 (reached on Friday, January 26, 2018)
NDX ALL TIME INTRADAY HIGH = 7511 (reached on Wednesday, July 25, 2018)
RUT ALL TIME INTRADAY HIGH = 1708 (reached on Tuesday, July 10, 2018)

Current DAILY +2 Sigma SPX = 2846 with WEEKLY +2 Sigma = 2861
Current DAILY 0 Sigma SPX = 2811 with WEEKLY 0 Sigma = 2722
Current DAILY -2 Sigma SPX = 2775 with WEEKLY -2 Sigma = 2583

NYSE McClellan Oscillator = -7 (-150 is start of the O/S area; around -275 to -300 area or lower, we go into the “launch-pad” mode, over +150, we are in O/B area)
NYSE Breadth Thrust = 50.8 (40 is considered as oversold and 65 as overbought)

Another week of reasonable good intraday vol, specially on Thursday. We now expect a break to new ATHs.



Canaries [in the Coal Mine] Chart for DJ TRAN & RUT Indices

200-Day MA DJ TRAN = 10,499 or 5.7% below DJ TRAN (max observed in last 7 yrs = 20.2%, min = -20.3%)
200-Day MA RUT = 1576 or 6.2% below RUT (max observed in last 7 yrs = 21.3%, min = -22.6%)

DJ Transportation Index (proxy for economic conditions 6 to 9 months hence) finally putting in a channel break out. Need to see a CLOSE above 11,130.

Russell 2000 Small Caps Index (proxy for Risk ON/OFF) had a mixed week and ended at its 50-day MA. RISK ON still is at crossroads here.



DeTrenders Charts for SPX, NDX, TRAN & RUT Indices

50-Day MA SPX = 2771 or 2.5% below SPX (max observed in last 7 yrs = +8.6%, min = -9.3%)
200-Day MA SPX = 2701 or 5.1% below SPX (max observed in last 7 yrs = 15.2%, min = -14%)

SEVEN of our EIGHT DeTrenders are in POSITIVE territory. The DeTrenders for DJ Tran & RUT will continue to be harbingers of future price behavior in broad indices.



HA_SP1_Momo Chart

WEEKLY Timing Model = on a BUY Signal since Friday, June 15, 2018 CLOSE at 2779
DAILY Timing Model = on a SELL Signal since Wednesday, August 2, 2018 CLOSE at 2827
Max SPX 52wk-highs reading last week = 22 (over 120-140, the local maxima is in)
Max SPX 52wk-Lows reading last week = 5 (over 40-60, the local minima is in)
HA_SP1 closed above its +2 sigma channels
HA_Momo = +0.76 (reversals most likely occur above +10 or below -10)



Vol of the Vols Chart

Spot VIX currently stands at 11.64, right about its -1 sigma (remember it's the VIX volatility pattern aka "its sigma channels" that matters, and not the level of VIX itself (this is per Dr. Robert Whaley, a great mentor and inventor of original VIX, now called VXO). VIX usually peaks around a test of its +4 sigma).

VIX continues to meander. Should it trade above 15 (its current zero sigma), IOHO, it will serve as a decent warning for another sharp drop.



5-day TRIN & TRINQ Charts

Both NYSE & NASDAQ 5-day TRINs are in NEUTRAL zone.



Components of SPX above their respective 200day MA Chart

This scoring indicator finally rose to 69%. Next targets are: a break out to 72% area and then the low 80%s.



SPX SKEW (Tail Risk) Chart

On Friday, SPX SKEW (Tail Risk) closed near 146.2, right about its zero sigma (normal = 120-125, range 100-150).

Is all quiet on the Eastern & Mid-Western Fronts? Our beloved @Capt_Tiko says YES.


How to interpret the value of SPX SKEW? (from CBOE white paper on SKEW)



3-month VIX Futures Spread(VX) Chart

This popular timing indicator, (long AUG, & short NOV VIX Futures) is at -2.25. IOHO, we are slowly approaching overbought areas.



HA_SP2 Chart

HA_SP2 = 69 (Buy signal <= 25, Sell Signal >= 75)

Our coveted SP2 prop indicator dropped to 39.8 on Monday and then rose all the way up to 69 on Friday, nearing its overbought area.



US Treasury T-Notes & T-Bonds Yields Chart

During this past week, the YTMs for the Notes & Bonds, slowly drifted down after hitting 3.0 on the ten yr but that was no surprise - most talking heads on Comedy Central (aka CNBC) have been talking about it for months. Our beloved Maury (& Mrs. Maury) are uber happy as a clam now.

Fari Hamzei




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Chat with Fari on TradeStation.com Fari Hamzei writes for CBOE Options Hub on event-deriven basis       Futures & Options for Stock Indices
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