Archived SKI Intraweek Buy Update
USERX = 14.50, Down 39 cents
THE 16-20 INDEX BUYS TOMORROW'S CLOSE; JEFF WILL BUY
Although here are never any guarantees (that caveat is always required), the 16-20 index generated its buy signal today (a day earlier than expected) and the SKI System officially covers its shorts from December 2006 at 15.73 and goes long USERX as of the close tomorrow (6/27/07). The market is supposed to decline strongly into such a buy signal and that is a BINGO so far! The run pattern into such buy signals is supposed to be at least 4 days down in a row, so expect and pray/hope for another decline tomorrow because today is just 3 days down. Everything looks correct except for the run pattern that should go to at least 4 days down (and will be OK if USERX closes down tomorrow). It does look like this buy signal may be a day early since a run of 5-6 days down would be better, but the index is buying. BUY TOMORROW'S CLOSE AND CLOSE YOUR EYES or try and beat the index by hoping for a possible continuation down day the following day or two. An up close tomorrow would not be encouraging, but the index buys tomorrow whatever happens.
My colleague buys 100% at tomorrow's close. Jeff will go to over 100% long at tomorrow's close, and will save a little to buy any down movement on Thursday. Traditional technical indicators are not quite yet oversold (see: http://stockcharts.com/h-sc/ui?s=$XAU&p=D&b=5&g=0&id=p23810285790) but will be close to oversold if prices decline again tomorrow. Therefore, I am expecting some down to sideways action after the buy signal to form the bottom. YOU WON'T GET RICH IN A DAY OR A WEEK AFTER THIS BUY SIGNAL, but it is a buy signal.
There is no price stop
on this buy. It's unlikely, but we could lose. The stop will be in terms of time (time is more important than price; but really it is the interaction of time by price that matters for SKI). The statement here is that within one-half cycle (half of a 16-20 index cycle is half of 19 trading days = about 10 trading days; I've seen it take the extra 1 day for 11 trading days) prices must be higher than the USERX buy-in price at tomorrow's close.
Go into suspended animation and hope that the first true buy signal in a year is correct. It should be, but we do NOT know the extent and duration of the ensuing rise. It is not a bull market, at least not yet. Prices will HAVE to rise to at least over USERX 15.00 (really higher than that) to generate a 16-20 index sell signal within the required 16-20 trading days after the signal. That is the way it is supposed to be. That may only be a 5% rise/profit, but it could be a lot more. We cannot predict the exact future. The prediction is that prices are bottoming and that prices will rise into a higher-order buy signal. That buy signal will NOT be XXed Out, so prices can then continue to rise. Buy in the next day or three (by the end of this week) so that you can decide to sell (all or a portion) on a rise and make money via this SKI buy signal. This may be the only true buy signal this year and SKI is supposed to make its yearly money on this signal.
The May 2006 death run still says that much lower prices will occur in the future (we are at 13 months after the death run and the shortest time in history to the life run is almost 2 years), but we have our buy signal at the USERX lows for the year (so far). I've kept saying to sell for 9 months now, but please buy now. Long-termers may need to sell in a few weeks or months and become intermediate-term traders here, but I cannot predict the future. The index says buy and according to the index, this could be the low for this year. If you buy now and prices rise, you will be sitting in a position of strength. Again, I do NOT believe that this will yield a true SKI bull market (a 92-96 index buy signal on the Path) or that we will hold a long position for a year or longer, but who knows?
ALL I KNOW IS THAT SKI IS BUYING TOMORROW'S CLOSE. We wait and wait during corrective periods and bear markets and then we are supposed to buy.
My wife had minor surgery this morning and is taking Lortabs for pain. Have your own supply of "suspended animation" drugs because we could sit in pain after buying. If prices decline after the buy signal tomorrow, DON'T WATCH (sure Jeff; sarcasm).
I am Lionski (not really, but I am supposed to be a lion after tomorrow so as to prevent you from selling at a loss if prices decline for minutes or hours or a day or two after the buy signal),
Here we go, Jeff
During the long
2006-2007 corrective period, SKI generated a buy at
the exact end of the correction, but it was just
supposed to be a short to intermediate-term true buy.
|SKI BUY SIGNAL
||SKI SELL SIGNAL
When did SKI and Jeff
sell? Here are the orginal SKI Updates for this trade:
» The Buy Signal
Jun 26 07