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Proactive Market Timing
 
Proactive Market Timing Service

Market Timer: Fari Hamzei

Executive Officer: @Fleet_Adm_Tiko

Editors: Nancy Scott

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

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Most Recent PMT vs SPX Performance Chart

Tuesday, April 17, 2018, 1125ET
UPDATED Market Bias for Issue #236

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:

UPDATED SPX Secondary Profit Target for last 20% of our position = 2720
SPX Primary Profit Target for first 80% of our position = 2695
SPX BreakEven Stop (Last Open) for last 20% of our position = 2670
SPX Money Management Stop for 100% of our position = 2645


Action Asset Expiration Strike Option
BUY SPY Friday MAY 4 267 Calls
SELL SHORT SPY Friday MAY 4 272 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

Tuesday, April 17, 2018, 1120ET
UPDATED Timer Chart

Monday, April 16, 2018, 1005ET
Companion Chart for Market Bias Review, Issue #236

Monday, April 16, 2018, 1000ET
Market Bias for Issue #236

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 = 2725
SPX Primary Profit Target for first 80% of our position = 2695
SPX BreakEven Stop (Last Open) for last 20% of our position = 2670
SPX Money Management Stop for 100% of our position = 2645


Action Asset Expiration Strike Option
BUY SPY Friday MAY 4 267 Calls
SELL SHORT SPY Friday MAY 4 272 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 15, 2018, 2130ET
Market Timing Charts, Analysis & Commentary for Issue #236


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

Most recent S&P-500 Cash Index (SPX): 2604.47 up +51.83 (up +2%) for the week ending on Friday, April 13, 2018, which closed just above its zero 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 = 2739 with WEEKLY +2 Sigma = 2854
Current DAILY 0 Sigma (20 day MA) SPX = 2649 with WEEKLY 0 Sigma = 2706
Current DAILY -2 Sigma SPX = 2560 with WEEKLY -2 Sigma = 2559

NYSE McClellan Oscillator = +28 (-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 = 51.4 (40 is considered as oversold and 65 as overbought)

This past week, we got 5 green CI Diffs -- we have not seen that since mid February. Vols are dropping as we enter 2018 Q1 Earnings Season.


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

200-Day MA DJ TRAN = 10039 or 3.3% below DJ TRAN (max observed in last 7 yrs = 20.2%, min = -20.3%)
200-Day MA RUT = 1493 or 3.7% 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) had yet another struggling week, but finally made a test of (albeit lower) of its 50-day MA. We should punch thru this level later on this week.

Russell 2000 Small Caps Index (proxy for Risk ON/OFF) did punch thru its 50-day MA. RISK is slowly coming back to our markets.


DeTrenders Charts for SPX, NDX, TRAN & RUT Indices

50-Day MA SPX = 2709 or 3.9% above SPX (max observed in last 7 yrs = +8.6%, min = -9.3%)
200-Day MA SPX = 2593 or 0.4% below SPX (max observed in last 7 yrs = 15.2%, min = -14%)

THREE of our EIGHT DeTrenders remain 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 SELL Signal since Friday 4/06/118 CLOSE at 2604
DAILY Timing Model = on a BUY Signal since Tuesday 4/09/18 CLOSE at 2613
Max SPX 52wk-highs reading last week = 10 (over 120-140, the local maxima is in)
Max SPX 52wk-Lows reading last week = 3 (over 40-60, the local minima is in)
HA_SP1 closed near its +1 sigma channels
HA_Momo = +1.26 (reversals most likely occur above +10 or below -10)


Vol of the Vols Chart

VIX currently stands at 17.4.49, just above 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).

This week, VIX Futures discontinued their mild Contango and went into backwardation. This says we went thru a trade-able low. Our @Capt_Tiko also responds in the affirmative


5-day TRIN & TRINQ Charts

NYSE 5-day TRIN shoots towards its SELL Zone while NASDAQ's is moving back into NEUTRAL zone.


Components of SPX above their respective 200day MA Chart

This scoring indicator oscillated between 55 & 58 61, and then finally ended up at 56.8%.


SPX SKEW (Tail Risk) Chart

Last week SPX SKEW (Tail Risk) closed at 126, or near its zero sigma (normal = 120-125, range 100-150).

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

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 May, and short August VIX Futures near -0.35. Is the bottom in? @Capt_Tiko shouts YES.


HA_SP2 Chart

HA_SP2 = 55.8 (Buy signal <= 25, Sell Signal >= 75)

This coveted prop indicator has struggled just above 50 area for a week now but we do expect it to rally up this week. Also worth noting is the pattern of 3 timeframe Stoch_RSIs. Looking to recompute/recaliberate our bias once all three are above 80% mark.


US Treasury T-Notes & T-Bonds Yields Chart

The Flight-to-Safety Trade is over, and our beloved Maury, has his dancing shoes once again.

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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