Model Notes: The VIX signal starts out with a sell short TSP of 16.52 (highest closing price of approx. 3 weeks) and that is very good. If stocks can hold these level, the VIX could find itself on the ropes. This model is in sync. And Gold? The 10/20 sell (TSP 111.73, GLD basis) and then covering with a TSP of 105.97 is a very respectable profit for a two-week trade. So this model is also in sync.
Featured market rotation: VIX for November (looking for a starting signal now). Brazilian real for December. S&P for January. Gold is currently non-rotational.
Model Portfolio Signals: (Gold) Flat Signal= 11/03 (TSP=105.97), (VIX) Sell=11/06 (TSP=16.52)
Note: TSP is calculated by using the closing price of the trading day after the signal day.
Nonlinear Trading Themes:
- Gold: The yellow metal is oversold and the GLD is finding support around the 104 level. Being flat is the correct position. It is too oversold to short and the last 4 trading days has not yet formed a bottom substantial enough to buy. The model gold portfolio signal is still flat.
- VIX (Nov. Featured Market): We now have this market in play. The 11/06 sell signal and the TSP of 16.52 gives us the first round. If the S&P can hold here, we could easily see a resulting VIX drop to the 13 level (a respectable profit). The model VIX portfolio remains short.
Note: Technical analysis comments are based on interpretations of non-linear trading models, combined with chart price action.
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GH Garrett – Veteran Market Watcher for ConquertheMummy.com © 2015, “Nonlinear signals that matter in gold trading.”