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Proactive Market Timing
 
Proactive Market Timing Service

Market Timer: Fari Hamzei

Executive Officer: @Fleet_Adm_Tiko

Editors: Nancy Scott

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Most Recent PMT vs SPX Performance Chart

Monday, April 2, 2018, 1245ET
UPDATED Market Bias for Issue #234

Our current Market Bias with Timer Digest is LONG SPX as of Friday MAR 23 at 2588.26
Our previous Market Bias was SHORT SPX as of MAR 16 at 2752.01


            Here are the trade parameters for this week:

SPX Secondary Profit Target for last 20% of our position = 2700
SPX Primary Profit Target for first 80% of our position = 2665
SPX BreakEven Stop for last 20% of our position = 2585
SPX Money Management Stop for 100% of our position = 2570


Action Asset Expiration Strike Option
BUY SPY Friday APR 20 258 Calls
SELL SHORT SPY Friday APR 20 265 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.

Fari Hamzei

Monday, April 2, 2018, 1005ET
Companion Chart for Market Bias Review, Issue #234

Monday, April 2, 2018, 1000ET
Market Bias for Issue #234

Our current Market Bias with Timer Digest is LONG SPX as of Friday MAR 23 at 2588.26
Our previous Market Bias was SHORT SPX as of MAR 16 at 2752.01


            Here are the trade parameters for this week:

SPX Secondary Profit Target for last 20% of our position = 2705
SPX Primary Profit Target for first 80% of our position = 2675
SPX BreakEven Stop (Last Open) for last 20% of our position = 2633
SPX Money Management Stop for 100% of our position = 2600


Action Asset Expiration Strike Option
BUY SPY Friday APR 20 262 Calls
SELL SHORT SPY Friday APR 20 268 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.

Fari Hamzei

Sunday, April 1, 2018, 1300ET
Market Timing Charts, Analysis & Commentary for Issue #234


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

Most recent S&P-500 Cash Index (SPX): 2640.87 up 52.61 (up +2.03%) for the week ending on Thursday, March 29, 2018, which closed at its -1 sigma.

SPX ALL TIME INTRADAY HIGH = 2872.87 (reached on Friday, Jan 26, 2018)
SPX ALL TIME CLOSING HIGH = 2872.87 (reached on Friday, Jan 26, 2018)

Current DAILY +2 Sigma SPX = 2820 with WEEKLY +2 Sigma = 2873
Current DAILY 0 Sigma (20 day MA) SPX = 2704 with WEEKLY 0 Sigma = 2702
Current DAILY -2 Sigma SPX = 2588 with WEEKLY -2 Sigma = 2545

NYSE McClellan Oscillator = -11 (-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 = 45.4 (40 is considered as oversold and 65 as overbought)

Most probably we have seen the SPX lows on this shock wave, but as always, only time will tell (and we shall see it in our rear-view mirror).


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

200-Day MA DJ TRAN = 9994 or 4% above DJ TRAN (max observed in last 7 yrs = 20.2%, min = -20.3%)
200-Day MA RUT = 1487 or 2.8% above RUT (max observed in last 7 yrs = 21.3%, min = -22.6%)

DJ Transportation Index (proxy for economic conditions 6 to 9 months hence) had another struggling week, and so far has been stuck between 50 bar and 200 bar for seven weeks now. It won't stay here forever. A breakout or breakdown here shall be a huge tell (Grumpino calls that "a Bigly Tell," if only he could read a chart LOL).

Russell 2000 Small Caps Index (proxy for Risk ON/OFF) could not hold over its 50-day MA for more than 2 weeks and it is trading below. RISKY wants to get back ON but seems a tad "dazed and confused" in the holy words of LedZepp.


DeTrenders Charts for SPX, NDX, TRAN & RUT Indices

50-Day MA SPX = 2729 or 3.3% above SPX (max observed in last 7 yrs = +8.6%, min = -9.3%)
200-Day MA SPX = 2589 or 2% below SPX (max observed in last 7 yrs = 15.2%, min = -14%)

Now, FOUR of our EIGHT DeTrenders ended up 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 12/16/16 CLOSE at 2258
DAILY Timing Model = on a SELL Signal since Tuesday 3/20/18 CLOSE at 2716
Max SPX 52wk-highs reading last week = 8 (over 120-140, the local maxima is in)
Max SPX 52wk-Lows reading last week = 16 (over 40-60, the local minima is in)
HA_SP1 closed above its -1 sigma channels
HA_Momo = -2.35 (reversals most likely occur above +10 or below -10)


Vol of the Vols Chart

VIX currently stands at 19.97, at about its zero 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).

The mild Contango in the VIX Futures says we are near a trade able low or just above it. STAY VIGILANT......


5-day TRIN & TRINQ Charts

Both NYSE & NASDAQ 5-day TRIN were near a BUY Zone but now moving back into NEUTRAL zones.


Components of SPX above their respective 200day MA Chart

This scoring indicator rallied hard from 51% to 58%. The 50% line-in-the-sand was not breached and we think of that as a positive development.


SPX SKEW (Tail Risk) Chart

Last week SPX SKEW (Tail Risk) closed at ~119.34, or about its -2 sigma (normal = 120-125, range 100-150).

Is all quiet on the Eastern & Mid-Western Fronts? Smart Money says YES, BIGLY......lol

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, now long April, short July VIX Futures near +0.75. Is the bottom in? @Capt_Tiko says YES.


HA_SP2 Chart

HA_SP2 = 45.5 (Buy signal <= 25, Sell Signal >= 75)

This coveted prop indicator gave us a great signal last week..... LONG LIVE SP2....next major target past 50 (we should/may vacillate at 50 first) is 75.


US Treasury T-Notes & T-Bonds Yields Chart

The Flight-to-Safety Trade was back this past week.... as mentioned here before, our dear friends at Maury & Co. are no longer smiling.

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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