Boost for Banks

I've just updated my latest signals table based on this afternoon's Commitments of Traders data. Here's a little run-down of where things sit:

- BKX U.S. Bank Index: New signal for this setup. It goes from cash to bullish on next week's open of trading.

- S&P 500: This setup is in cash for a week more, then goes to bearish on the open the week of May 2. Looks like it'll remain bearish for a while, too, judging by the increasingly bearish positioning of the "smart money" commercial hedgers and the super-bullish stance of the wrong-way small trader crowd.

- Natural gas: One more week bearish in this setup, then she goes to cash.

- 30-year Treasury bond: One more week bearish in this setup, then she goes to cash. Hey, is there an echo?

Everything else stays the same as last week. What was it saying last week? Check the latest signals table to find out. Have a good holiday weekend, and good luck next week. Also be sure to check my portfolio page for an update early next week.

TAGS: SPX, S&P 500, gold, BKX, Bank Index, natural gas, Nikkei, crude oil,Treasury, bond, COT, Commitments of Traders,derivatives, Black Swans,market timing,trading system development, CFTC,Commodity Futures Trading Commission,COTs Timer, out-of-sample testing, walk-around testing

Gas Goosed? S&P 500 Snookered? Narley Nikkei?

Here are my latest signals from my COTs Timer trading system, as of Friday's Commitments of Traders report from the good ol' CFTC (see my latest signals table for more details):

- S&P 500: Signal goes from bullish to cash on Monday's open of trading, then to bearish on the open the week of May 2.

- BKX U.S. Bank Index: Still in cash.

- Crude oil: Ditto (still in cash).

- Gold: Ditto again.

- Nikkei: Goes from cash to bullish on Monday's open.

- Natural gas: Goes from cash to bearish on Monday's open.

- 30-year Treasury bond: Still bearish. Goes to cash on the open the week of May 2.

Good luck this week! Check out my newly updated portfolio page with my current holdings and recently closed results. Sorry for not updating that in a while. We were on vacation in Isla Mujeres (Mexico) - beautiful place!

Readers might be interested in my random musings on the markets at The Montreal Gazette's web site (see here), where I'm covering the newspaper's $21,000 Stock Market Challenge. It's open only to Quebec residents of majority age, but if you're one of those and haven't still entered, you should. All entrants are eligible for a weekly $500 random draw. If you're not eligible, check it out anyway. I'm playing along myself, too, though I can't win any of the prizes. (Some silliness about conflict of interest... blahblahblah.)

TAGS: SPX, S&P 500, gold, BKX, Bank Index, natural gas, Nikkei, crude oil,Treasury, bond, COT, Commitments of Traders,derivatives, Black Swans,market timing,trading system development, CFTC,Commodity Futures Trading Commission,COTs Timer, out-of-sample testing, walk-around testing

Flip-Floppy Traders Give Bearish Signal for Early May

Oh-oh. Some dark clouds for equity markets coming out of the latest Commitments of Traders report issued this afternoon. The CFTC's COT report has given me a bearish signal in my trading setup for the S&P 500.

That's based on the "smart money" commercial hedgers getting suddenly a fair bit more bearish in their net futures and options positioning as a percentage of the total open interest. Meanwhile, the wrong-way small traders - whom I fade in this setup - have been at extremes of bullish net positioning for the past three weeks.

See my latest signals table for more details on this and my six other market signals based on the COT data.

My bearish signal takes effect with a three-week delay - meaning on the open the week of May 2. That's about in line with the end of the S&P 500's favourable seasonal period.

In fact, my S&P 500 setup is going to see a lot of action in the coming weeks. Earlier data had given it a bullish signal for this coming Monday's open of trading. Then, the signal was going to flip to cash on the following Monday's open (i.e. on April 18). The data sure seems volatile.

In other news, my gold setup goes from bullish to cash on Monday's open. And my natural gas setup goes bearish with a one-week delay - i.e. on the open April 18. My 30-year Treasury bond signal remains bearish for a fifth straight week. And my other signals are in cash (crude oil, the BKX U.S. Bank Index and the Nikkei). Have a good weekend, and best of luck next week!

BKX, Nikkei Flip from Bullish to Cash

A couple of new signals to report based on the latest Commitments of Traders data from the CFTC: My signals for the BKX U.S. Bank Index and the Nikkei both switch from bullish to cash as of the open of trading on Monday. See my newly updated latest signals table for more details about the COT data released Friday and how it impacts all seven of my trading setups. The data I follow for signals for the BKX has especially turned negatory, as you'll see on that table. All my other setups remain the same... for now. Good luck this week!