For Friday, January 2nd

"The key to navigating bubbles successfully is to panic before everyone else does..."

- - - John P. Hussmann, Ph.D.

Although I'm not a fan of Hussman's permabear market perspectives, I do find his comment most fitting...

The March SP Futures

A BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS can be found at the bottom of every email briefing for your easy quick reference and convenience...

PLEASE TAKE THE TIME TO REVIEW THE TUTORIAL EVERY NOW AND THEN, THESE ARE THE NAVIGATIONAL TOOLS NEEDED TO MANEUVER SAFELY THROUGH THESE MARKETS, A GOOD WORKING KNOWLEDGE OF THESE TOOLS WILL MAKE YOU A BETTER AND MORE INFORMED INVESTOR/TRADER...

The main model is now short the March SP from 2081.70 as of Tuesday, December 30th... and it looks like we went short in the nick of time!!!

The last trade as of this writing is at 2051.90 for the March contract...

This market broke down below the major VP at 2072.98 without looking back... that price will be our next price point to watch for Friday...

The markets are closed for New Years Day, here's wishing you and yours a very Happy New Year, and may all your dreams come true in 2015...

For Friday, a close above 2072.90 would confirm a new main model buy signal...

Hoban Rule traders are now short this market from about 2076.90... For Friday, place your buy stop to go flat at 2074.90, also enter a new long position with a close above 2072.90 but not above 2078.90...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The Vertical Price Equilibrium spread: The current spread is long 150 SOXL at 139.236 and long 1604 SOXS at 13.015... today, the spread lost $49.11, each side of this spread moves independently, so they can get out of sync on the close, this is what happened today... we'll keep watching this spread longer term...

The NT (Near Term) indicator (the red line)

This market is no longer over bought, but it's also not over sold...

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The LT (Long Term) indicator

A more clearly defined topping pattern is now forming on this LT graph... the blue line broke down below the red line today, and the red line has now also turned downward... the downside momentum is gaining weight...

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If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The following are the current downside VPs for the MARCH SP... the VP prices are presented exactly as the formula generates them even though the SP contract itself doesn't trade at that particular decimal point... please note, I also include the VP prices that are well above the market because their deadline due dates have not yet expired...

minor - - 1952.06

MAJOR - - 1896.43 and must close above that price on Thursday, March 26th to confirm a new main model buy signal...

TOMORROW'S FLOOR PRICE - - 1703.56 EGADS!!!

For now, the main model remains short the SP...

The February Gold futures

The main model is now long the February gold from 1197.40 as of Tuesday, December 30th...

For the February gold futures, the last trade as of this writing is at 1182.00...

This market continues to be the sick sister of the bunch, but the main model remains long this market for now...

For Friday, a close below 1176.20 in the FEBRUARY gold futures contract would confirm a new main model sell signal...

Hoban Rule traders are now long this market from about 1198.40... place a sell stop to go flat at 1174.20... also, enter a new short position in February Gold with a close below 1176.20 but not below than 1170.20...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The LT (Long Term) Indicator

The blue line has again crossed down below the red line, but it has been weaving up and back... we'll give it more time to allow this market to prove itself here...

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The following are the current upside VPs for FEBRUARY gold...

minor - - 1244.88

MAJOR - - 1272.72 and must close below that price on Monday, February 2nd to confirm a new main model sell signal...

TOMORROW'S CEILING PRICE - - 1376.82

For now, the main model remains long gold...

BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS:

The SP confirmation close ALWAYS refers to the large contract 4:15 pm futures closing price... also, use only the large contract for all official main model signals, the mini contract will give you false signals...

The Confirmation Price

The confirmation price is a specific market price beyond which the market must close in order to confirm a new main model buy or sell signal... the confirmation price is not a top or bottom picker, it is not designed to get you into a new position right at, or near, the top or bottom tick... but rather, it tells you that the trend has more than likely changed direction with a high degree of reliability... as has been demonstrated with better than a 98% reliability, the confirmation price confirms that the market trend has legitimately changed direction and that a new trend has just begun... very often, a buy confirmation price may seem so far above the market that taking a new long position at that high level seems risky... the same can be said for taking a new short position at a sell confirmation price... but factually, these price points are the most ideal place to enter a new position since these confirmation prices occur where most people are likely to take new erroneous positions in the trend that is just ending... this is why the market moves so explosively after the price is confirmed, e.g., the new short holders are scrambling to cover or the new dip buyers are selling out rapidly...

The NT Indicator

The NT indicator is a near term (NT) indicator and is included in the evening briefings for the benefit of those who make counter trend trades... the NT buy and sell spikes are not main model buy and sell signals, these spikes are only very near term, although they could always develop into something more significant over the next few days... using a weather analogy, the buy/sell spikes are much like a developing low pressure area or a tropical wave, they do not indicate a fully blown hurricane, although it could eventually develop... if a fully blown hurricane actually does develop, then the main model signal itself would address that market action...

How To Read The NT Indicator

The best and safest time to take an NT signal is when the market has already trended for some time and is now approaching a VP price, especially a major VP, then the NT spike would indicate that the trend is likely to reverse since the market is already vulnerable at a VP price, the NT spike provides greater certainty for that counter trend trade...

The VP Price

The VP, or Vertical Price, is NOT a target, the market is not required or expected to reach any VP price... however, if reached, the VP price represents where the buying/selling has stretched to its maximum exhaustion point, at least temporarily, and a change in trend is very likely...

The Floor/Ceiling Price

The floor price is always there in a down trend, the ceiling price is always there in an up trend... these specific prices are rarely mentioned because the market rarely reaches them... these are not VP prices but can be treated the same as a VP price except floor and ceiling prices change every day while the VP price does not... a close beyond the floor/ceiling price should be considered a second buy or sell confirmation signal...

How To Read The VP Price

If the market touches and then moves away from the VP very quickly and doesn't return, then this typically indicates a market reversal, but if the market moves away from the VP and then returns within a day or two, maybe sooner, then the move is not over and the market is likely to continue in its current trend... repeated visits to a VP suggests the move is not yet over...

A Suggestion On How To Enter A Position On A New Main Model Signal

One way to enter a new signal trade is to take only 1/3 position only after the market trades through the confirmation price by a few points... after that initial position is taken, let the market do what it does all day... then, late in the day, if the market is still confirming the signal, then add the second 1/3 position... and then, on the close take the final 1/3 position... your average entry price will be above/below the confirmation price but the whips will be significantly reduced... this is a method I use for myself very often...

Another way to enter a new position is to wait for the actual confirmation on the close, and then take the new position...

THE HOBAN RULE

The Hoban Rule is an exclusive proprietary trading strategy that uses the main model signals... using this strategy eliminates all whips and is recommended to be used by those who are not market savvy and/or nimble enough to trade free style... this strategy can be used just as easily to trade the SP and gold...

For gold, each point is one dollar...

To take the trade, these two prerequisite criteria must be met:

1) The closing price on confirmation day must be within 6 points of the confirmation price, and

2) The confirmation price for the next signal must be more than 5 points from the closing price of that day...

Since you don't yet know the confirmation price for the next signal at that moment, you can either take the trade if the closing price meets the first criteria, or wait for the evening briefing for that information... if you took the trade on the first criteria and the evening briefing does not satisfy the second criteria, then simply close out that trade... or, if you did not take the trade and the evening briefing satisfies the second criteria as well, then take the trade in the evening session or in the after hours market if you're trading a market ETF... or you can simply take the trade the following morning...

However, if the closing price is 6 points or more from the confirmation price, then do not take the trade at that time, just stay flat...

In order to take the trade when the closing price is 6 points or more from the confirmation price:

1) Place a limit order to enter the trade when/if the market moves within 6 points of the confirmation price...

To exit the trade:

1) Place an exit stop 2 points beyond the next buy/sell confirmation price... if filled, then stay flat and wait for the next new signal to be confirmed...

2) If the next new signal is confirmed, then begin again with step 1 using the two entry criteria to begin the next new trade position...

3) If the new signal is not confirmed, simply stay flat and wait for the next newly confirmed signal to begin the next trade at step 1, or simply re-enter the original position provided that the closing price that day is within 6 points of the original confirmation price and the reverse confirmation price is at least 5 points above that day's closing price...

4) Very often, you may find the second criteria is not met since the reverse confirmation price is less than 5 points above the closing price... but, on some occasions, a day or two later, the reverse confirmation price could actually move away from the market and would therefore meet the second criteria and subsequently satisfy both prerequisite criteria allowing for an entry provided that day's closing price is still no more than 6 points from the original main model confirmation price...

Applying The Hoban Rule for your trade positions based on the buy/sell confirmation prices as described above, you will find it easy to follow and with less stress than trying to catch the market while not knowing where it will actually close... and, also, all intraday entry whips are completely eliminated...

The Vertical Price Equilibrium Spread

This spread takes advantage of the unique relationship between related markets... this spread can be entered at any time, however to optimize and maximize the benefits of this spread, it should be entered at or near the major VP points... this spread generates profits regardless of market direction... if you would like a full explanation on how to benefit from this spread, then please ask me about it...

Rejected Buy/Sell Signals

Rejected buy and/or sell signals are typically followed by a sharp market move in the opposite direction the following day, this occurs as a general rule... a rejected sell signal is typically followed the next day by a sharp rally... as well, a rejected buy signal is typically followed the next day by a sharp decline... however, if the sharp rally/decline does not occur, then you can expect to see the market make another attempt at that buy/sell signal...

The Long Term (LT) Indicator

The long term (LT) indicator is a myriad of indicators that give you an X-ray view of the market internals and trend...

The green line = the closing price for the specific market

The red line = the confirmation line, the more dominant trend

The purple line = the early warning line

The blue line = the imminent warning line

The purple and blue lines crossing the red line gives you early and imminent warning of a possible change in trend direction...

If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The email SUGGESTION BOX is always open and invites your ideas for improving and enhancing your email service, I enjoy hearing from you, many thanks...

NOTICE: I SEND OUT AN EMAIL EVERY WEEKDAY EVENING, IF YOU DO NOT RECEIVE ONE, PLEASE LET ME KNOW, THANKS...

DISCLAIMER: The information contained in this email is not intended to constitute financial advice, and is not a recommendation or solicitation to buy, sell, or hold any security. This email alert is strictly informational and educational and is not to be construed as any kind of financial advice, investment advice, or legal advice. By accepting and/or using any information contained within this email clearly illustrates that you fully understand and agree to the above terms. Copyright Paul Moskowitz, 2014.

For Wednesday, December 31st

"The key to navigating bubbles successfully is to panic before everyone else does..."

- - - John P. Hussmann, Ph.D.

Although I'm not a fan of Hussman's permabear market perspectives, I do find his comment most fitting...

The March SP Futures

A BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS can be found at the bottom of every email briefing for your easy quick reference and convenience...

PLEASE TAKE THE TIME TO REVIEW THE TUTORIAL EVERY NOW AND THEN, THESE ARE THE NAVIGATIONAL TOOLS NEEDED TO MANEUVER SAFELY THROUGH THESE MARKETS, A GOOD WORKING KNOWLEDGE OF THESE TOOLS WILL MAKE YOU A BETTER AND MORE INFORMED INVESTOR/TRADER...

The main model is now short long the March SP from 2081.70 as of Tuesday, December 30th...

The last trade as of this writing is at 2076.90 for the March contract...

For Wednesday, a close above 2088.20 would confirm a new main model buy signal...

This market finally broke down below the VP that had been holding this market up for several days...

Hoban Rule traders are now short this market from the 4:15 pm closing at 2076.90... for tomorrow, place a buy stop to go flat this market at 2090.20... enter a new long position with a close above 2088.20 but not above than 2094.20...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The Vertical Price Equilibrium spread: The current spread is long 150 SOXL at 139.236 and long 1604 SOXS at 13.015... today, the spread gained $7.42, therefore currently at an overall loss of $21.18 since the entry day is always a bit sloppy trying to leg each side on separately... actually, I entered this spread yesterday anticipating that these markets would continue higher, but this is the whole point of this spread, it makes money no matter which way the market moves... this is why this spread is worthy of serious review... this spread will not generate gains as a net long or short position would, but it does generate gain no matter which way the market move, and it's better than having the money sit in cash and earn nearly nothing...

The NT (Near Term) indicator (the red line)

Yesterday's modest buy spike disappeared and we now see a continuing downward NT line...

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The LT (Long Term) indicator

The toppy looking pattern continues looking heavy...

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If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The following are the current downside VPs for the MARCH SP... the VP prices are presented exactly as the formula generates them even though the SP contract itself doesn't trade at that particular decimal point... please note, I also include the VP prices that are well above the market because their deadline due dates have not yet expired...

minor - - 1952.06

MAJOR - - 1896.43 and must close above that price on Thursday, March 26th to confirm a new main model buy signal...

TOMORROW'S FLOOR PRICE - - 1703.56 EGADS!!!

For now, the main model remains short the SP...

The February Gold futures

The main model is now long the February gold from 1197.40 as of Tuesday, December 30th...

For the February gold futures, the last trade as of this writing is at 1198.40...

The deadline due date for this market turn around was January 1st, so it arrived two days ahead of schedule... let's hope it lasts...

For Wednesday, a close below 1174.20 in the FEBRUARY gold futures contract would confirm a new main model sell signal...

Hoban Rule traders are now long this market from about 1198.40... place a sell stop to go flat at 1172.20... also, enter a new short position in February Gold with a close below 1174.20 but not below than 1168.20...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The LT (Long Term) Indicator

Everything is pointing higher... even the red line has now turned upwards... this is an encouraging sign...

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The following are the current upside VPs for FEBRUARY gold...

minor - - 1244.88

MAJOR - - 1272.72 and must close below that price on Monday, February 2nd to confirm a new main model sell signal...

TOMORROW'S CEILING PRICE - - 1376.82

For now, the main model remains long gold...

BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS:

The SP confirmation close ALWAYS refers to the large contract 4:15 pm futures closing price... also, use only the large contract for all official main model signals, the mini contract will give you false signals...

The Confirmation Price

The confirmation price is a specific market price beyond which the market must close in order to confirm a new main model buy or sell signal... the confirmation price is not a top or bottom picker, it is not designed to get you into a new position right at, or near, the top or bottom tick... but rather, it tells you that the trend has more than likely changed direction with a high degree of reliability... as has been demonstrated with better than a 98% reliability, the confirmation price confirms that the market trend has legitimately changed direction and that a new trend has just begun... very often, a buy confirmation price may seem so far above the market that taking a new long position at that high level seems risky... the same can be said for taking a new short position at a sell confirmation price... but factually, these price points are the most ideal place to enter a new position since these confirmation prices occur where most people are likely to take new erroneous positions in the trend that is just ending... this is why the market moves so explosively after the price is confirmed, e.g., the new short holders are scrambling to cover or the new dip buyers are selling out rapidly...

The NT Indicator

The NT indicator is a near term (NT) indicator and is included in the evening briefings for the benefit of those who make counter trend trades... the NT buy and sell spikes are not main model buy and sell signals, these spikes are only very near term, although they could always develop into something more significant over the next few days... using a weather analogy, the buy/sell spikes are much like a developing low pressure area or a tropical wave, they do not indicate a fully blown hurricane, although it could eventually develop... if a fully blown hurricane actually does develop, then the main model signal itself would address that market action...

How To Read The NT Indicator

The best and safest time to take an NT signal is when the market has already trended for some time and is now approaching a VP price, especially a major VP, then the NT spike would indicate that the trend is likely to reverse since the market is already vulnerable at a VP price, the NT spike provides greater certainty for that counter trend trade...

The VP Price

The VP, or Vertical Price, is NOT a target, the market is not required or expected to reach any VP price... however, if reached, the VP price represents where the buying/selling has stretched to its maximum exhaustion point, at least temporarily, and a change in trend is very likely...

The Floor/Ceiling Price

The floor price is always there in a down trend, the ceiling price is always there in an up trend... these specific prices are rarely mentioned because the market rarely reaches them... these are not VP prices but can be treated the same as a VP price except floor and ceiling prices change every day while the VP price does not... a close beyond the floor/ceiling price should be considered a second buy or sell confirmation signal...

How To Read The VP Price

If the market touches and then moves away from the VP very quickly and doesn't return, then this typically indicates a market reversal, but if the market moves away from the VP and then returns within a day or two, maybe sooner, then the move is not over and the market is likely to continue in its current trend... repeated visits to a VP suggests the move is not yet over...

A Suggestion On How To Enter A Position On A New Main Model Signal

One way to enter a new signal trade is to take only 1/3 position only after the market trades through the confirmation price by a few points... after that initial position is taken, let the market do what it does all day... then, late in the day, if the market is still confirming the signal, then add the second 1/3 position... and then, on the close take the final 1/3 position... your average entry price will be above/below the confirmation price but the whips will be significantly reduced... this is a method I use for myself very often...

Another way to enter a new position is to wait for the actual confirmation on the close, and then take the new position...

THE HOBAN RULE

The Hoban Rule is an exclusive proprietary trading strategy that uses the main model signals... using this strategy eliminates all whips and is recommended to be used by those who are not market savvy and/or nimble enough to trade free style... this strategy can be used just as easily to trade the SP and gold...

For gold, each point is one dollar...

To take the trade, these two prerequisite criteria must be met:

1) The closing price on confirmation day must be within 6 points of the confirmation price, and

2) The confirmation price for the next signal must be more than 5 points from the closing price of that day...

Since you don't yet know the confirmation price for the next signal at that moment, you can either take the trade if the closing price meets the first criteria, or wait for the evening briefing for that information... if you took the trade on the first criteria and the evening briefing does not satisfy the second criteria, then simply close out that trade... or, if you did not take the trade and the evening briefing satisfies the second criteria as well, then take the trade in the evening session or in the after hours market if you're trading a market ETF... or you can simply take the trade the following morning...

However, if the closing price is 6 points or more from the confirmation price, then do not take the trade at that time, just stay flat...

In order to take the trade when the closing price is 6 points or more from the confirmation price:

1) Place a limit order to enter the trade when/if the market moves within 6 points of the confirmation price...

To exit the trade:

1) Place an exit stop 2 points beyond the next buy/sell confirmation price... if filled, then stay flat and wait for the next new signal to be confirmed...

2) If the next new signal is confirmed, then begin again with step 1 using the two entry criteria to begin the next new trade position...

3) If the new signal is not confirmed, simply stay flat and wait for the next newly confirmed signal to begin the next trade at step 1, or simply re-enter the original position provided that the closing price that day is within 6 points of the original confirmation price and the reverse confirmation price is at least 5 points above that day's closing price...

4) Very often, you may find the second criteria is not met since the reverse confirmation price is less than 5 points above the closing price... but, on some occasions, a day or two later, the reverse confirmation price could actually move away from the market and would therefore meet the second criteria and subsequently satisfy both prerequisite criteria allowing for an entry provided that day's closing price is still no more than 6 points from the original main model confirmation price...

Applying The Hoban Rule for your trade positions based on the buy/sell confirmation prices as described above, you will find it easy to follow and with less stress than trying to catch the market while not knowing where it will actually close... and, also, all intraday entry whips are completely eliminated...

The Vertical Price Equilibrium Spread

This spread takes advantage of the unique relationship between related markets... this spread can be entered at any time, however to optimize and maximize the benefits of this spread, it should be entered at or near the major VP points... this spread generates profits regardless of market direction... if you would like a full explanation on how to benefit from this spread, then please ask me about it...

Rejected Buy/Sell Signals

Rejected buy and/or sell signals are typically followed by a sharp market move in the opposite direction the following day, this occurs as a general rule... a rejected sell signal is typically followed the next day by a sharp rally... as well, a rejected buy signal is typically followed the next day by a sharp decline... however, if the sharp rally/decline does not occur, then you can expect to see the market make another attempt at that buy/sell signal...

The Long Term (LT) Indicator

The long term (LT) indicator is a myriad of indicators that give you an X-ray view of the market internals and trend...

The green line = the closing price for the specific market

The red line = the confirmation line, the more dominant trend

The purple line = the early warning line

The blue line = the imminent warning line

The purple and blue lines crossing the red line gives you early and imminent warning of a possible change in trend direction...

If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The email SUGGESTION BOX is always open and invites your ideas for improving and enhancing your email service, I enjoy hearing from you, many thanks...

NOTICE: I SEND OUT AN EMAIL EVERY WEEKDAY EVENING, IF YOU DO NOT RECEIVE ONE, PLEASE LET ME KNOW, THANKS...

For Tuesday, December 30th

"The key to navigating bubbles successfully is to panic before everyone else does..."

- - - John P. Hussmann, Ph.D.

Although i'm not a fan of Hussman's permabear market perspectives, I do find his comment most fitting...

The March SP Futures

A BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS can be found at the bottom of every email briefing for your easy quick reference and convenience...

PLEASE TAKE THE TIME TO REVIEW THE TUTORIAL EVERY NOW AND THEN, THESE ARE THE NAVIGATIONAL TOOLS NEEDED TO MANEUVER SAFELY THROUGH THESE MARKETS, A GOOD WORKING KNOWLEDGE OF THESE TOOLS WILL MAKE YOU A BETTER AND MORE INFORMED INVESTOR/TRADER...

The main model is currently long the March SP from 1981.50 as of Wednesday, December 17th...

The last trade as of this writing is at 2086.10 for the March contract...

For Tuesday, a close below 2081.70 would confirm a new main model sell signal...

This market is now holding above the minor VP at 2081.619, and it closed above that price again today... so far, so good, and encouraging for a continued rally from here...

Hoban Rule traders remain flat this market, with a close below 2081.70 but not below than 2075.70, enter a new short position...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The Vertical Price Equilibrium spread: Today, I entered a new longer term equilibrium spread with the intent on holding this spread through the bull market season of 2015... after some extensive research, I find the SOXL/SOXS ETF markets to be the best spread instruments for this kind of position since you get more movement from these two markets than you would from any of the other market ETF instruments... this new position is long 150 SOXL at 139.236 and long 1604 SOXS at 13.015... since the entry day is always a bit sloppy trying to leg each side on separately, the spread is currently at a loss of $28.60...

The NT (Near Term) indicator (the red line)

A modest buy spike for today, this is encouraging along with a continuous close above the nearby underlying minor VP...

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The LT (Long Term) indicator

While the NT gave us a buy spike today, this LT graph is now beginning to look a bit toppy... just keep your eye on the nearby VP sell confirmation price of 2081.70 for market direction...

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If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The following are the current upside VPs for the MARCH SP... the VP prices are presented exactly as the formula generates them even though the SP contract itself doesn't trade at that particular decimal point... please note, I also include the VP prices that are well above the market because their deadline due dates have not yet expired...

minor - - 2015.65 (already reached)

MAJOR - - 2031.95 and must close below that price on Thursday, February 5th to confirm a new main model sell signal... (already reached)

MAJOR - - 1272.98 and must close below that price on Wednesday, February 11th to confirm a new main model sell signal... (already reached)

minor - - 2081.619 (already reached)

MAJOR - - 2099.07 and must close below that price on Thursday, February 19th to confirm a new main model sell signal...

MAJOR - - 2125.608 and must close below that price on Tuesday, March 3rd to confirm a new main model sell signal...

TOMORROW'S CEILING PRICE - - 2188.24 YIKES!!!

For now, the main model remains long the SP...

The February Gold futures

The main model is now short the February gold from 1192.60 as of Wednesday, December 17th...

For the February gold futures, the last trade as of this writing is at 1183.70...

Notice we have a major VP at 1163.32 with a deadline due date on Thursday, January 1st, this is next week... we need to keep our eye on this...

For Tuesday, a close above 1197.40 in the FEBRUARY gold futures contract would confirm a new main model buy signal...

Hoban Rule traders are now short this market from about 1188.70... place a buy stop to go flat at 1199.40... also, enter a new long position in February Gold with a close above 1197.40 but not above than 1203.40...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The LT (Long Term) Indicator

This LT graph can still go either way, but it does continue to look toppy...

securedownload (3)
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The following are the current downside VPs for FEBRUARY gold...

MAJOR - - 1163.32 and must close above that price on Thursday, January 1st to confirm a new main model buy signal...

TOMORROW'S FLOOR PRICE - - 1102.31

For now, the main model remains short gold...

BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS:

The SP confirmation close ALWAYS refers to the large contract 4:15 pm futures closing price... also, use only the large contract for all official main model signals, the mini contract will give you false signals...

The Confirmation Price

The confirmation price is a specific market price beyond which the market must close in order to confirm a new main model buy or sell signal... the confirmation price is not a top or bottom picker, it is not designed to get you into a new position right at, or near, the top or bottom tick... but rather, it tells you that the trend has more than likely changed direction with a high degree of reliability... as has been demonstrated with better than a 98% reliability, the confirmation price confirms that the market trend has legitimately changed direction and that a new trend has just begun... very often, a buy confirmation price may seem so far above the market that taking a new long position at that high level seems risky... the same can be said for taking a new short position at a sell confirmation price... but factually, these price points are the most ideal place to enter a new position since these confirmation prices occur where most people are likely to take new erroneous positions in the trend that is just ending... this is why the market moves so explosively after the price is confirmed, e.g., the new short holders are scrambling to cover or the new dip buyers are selling out rapidly...

The NT Indicator

The NT indicator is a near term (NT) indicator and is included in the evening briefings for the benefit of those who make counter trend trades... the NT buy and sell spikes are not main model buy and sell signals, these spikes are only very near term, although they could always develop into something more significant over the next few days... using a weather analogy, the buy/sell spikes are much like a developing low pressure area or a tropical wave, they do not indicate a fully blown hurricane, although it could eventually develop... if a fully blown hurricane actually does develop, then the main model signal itself would address that market action...

How To Read The NT Indicator

The best and safest time to take an NT signal is when the market has already trended for some time and is now approaching a VP price, especially a major VP, then the NT spike would indicate that the trend is likely to reverse since the market is already vulnerable at a VP price, the NT spike provides greater certainty for that counter trend trade...

The VP Price

The VP, or Vertical Price, is NOT a target, the market is not required or expected to reach any VP price... however, if reached, the VP price represents where the buying/selling has stretched to its maximum exhaustion point, at least temporarily, and a change in trend is very likely...

The Floor/Ceiling Price

The floor price is always there in a down trend, the ceiling price is always there in an up trend... these specific prices are rarely mentioned because the market rarely reaches them... these are not VP prices but can be treated the same as a VP price except floor and ceiling prices change every day while the VP price does not... a close beyond the floor/ceiling price should be considered a second buy or sell confirmation signal...

How To Read The VP Price

If the market touches and then moves away from the VP very quickly and doesn't return, then this typically indicates a market reversal, but if the market moves away from the VP and then returns within a day or two, maybe sooner, then the move is not over and the market is likely to continue in its current trend... repeated visits to a VP suggests the move is not yet over...

A Suggestion On How To Enter A Position On A New Main Model Signal

One way to enter a new signal trade is to take only 1/3 position only after the market trades through the confirmation price by a few points... after that initial position is taken, let the market do what it does all day... then, late in the day, if the market is still confirming the signal, then add the second 1/3 position... and then, on the close take the final 1/3 position... your average entry price will be above/below the confirmation price but the whips will be significantly reduced... this is a method I use for myself very often...

Another way to enter a new position is to wait for the actual confirmation on the close, and then take the new position...

THE HOBAN RULE

The Hoban Rule is an exclusive proprietary trading strategy that uses the main model signals... using this strategy eliminates all whips and is recommended to be used by those who are not market savvy and/or nimble enough to trade free style... this strategy can be used just as easily to trade the SP and gold...

For gold, each point is one dollar...

To take the trade, these two prerequisite criteria must be met:

1) The closing price on confirmation day must be within 6 points of the confirmation price, and

2) The confirmation price for the next signal must be more than 5 points from the closing price of that day...

Since you don't yet know the confirmation price for the next signal at that moment, you can either take the trade if the closing price meets the first criteria, or wait for the evening briefing for that information... if you took the trade on the first criteria and the evening briefing does not satisfy the second criteria, then simply close out that trade... or, if you did not take the trade and the evening briefing satisfies the second criteria as well, then take the trade in the evening session or in the after hours market if you're trading a market ETF... or you can simply take the trade the following morning...

However, if the closing price is 6 points or more from the confirmation price, then do not take the trade at that time, just stay flat...

In order to take the trade when the closing price is 6 points or more from the confirmation price:

1) Place a limit order to enter the trade when/if the market moves within 6 points of the confirmation price...

To exit the trade:

1) Place an exit stop 2 points beyond the next buy/sell confirmation price... if filled, then stay flat and wait for the next new signal to be confirmed...

2) If the next new signal is confirmed, then begin again with step 1 using the two entry criteria to begin the next new trade position...

3) If the new signal is not confirmed, simply stay flat and wait for the next newly confirmed signal to begin the next trade at step 1, or simply re-enter the original position provided that the closing price that day is within 6 points of the original confirmation price and the reverse confirmation price is at least 5 points above that day's closing price...

4) Very often, you may find the second criteria is not met since the reverse confirmation price is less than 5 points above the closing price... but, on some occasions, a day or two later, the reverse confirmation price could actually move away from the market and would therefore meet the second criteria and subsequently satisfy both prerequisite criteria allowing for an entry provided that day's closing price is still no more than 6 points from the original main model confirmation price...

Applying The Hoban Rule for your trade positions based on the buy/sell confirmation prices as described above, you will find it easy to follow and with less stress than trying to catch the market while not knowing where it will actually close... and, also, all intraday entry whips are completely eliminated...

The Vertical Price Equilibrium Spread

This spread takes advantage of the unique relationship between related markets... this spread can be entered at any time, however to optimize and maximize the benefits of this spread, it should be entered at or near the major VP points... this spread generates profits regardless of market direction... if you would like a full explanation on how to benefit from this spread, then please ask me about it...

Rejected Buy/Sell Signals

Rejected buy and/or sell signals are typically followed by a sharp market move in the opposite direction the following day, this occurs as a general rule... a rejected sell signal is typically followed the next day by a sharp rally... as well, a rejected buy signal is typically followed the next day by a sharp decline... however, if the sharp rally/decline does not occur, then you can expect to see the market make another attempt at that buy/sell signal...

The Long Term (LT) Indicator

The long term (LT) indicator is a myriad of indicators that give you an X-ray view of the market internals and trend...

The green line = the closing price for the specific market

The red line = the confirmation line, the more dominant trend

The purple line = the early warning line

The blue line = the imminent warning line

The purple and blue lines crossing the red line gives you early and imminent warning of a possible change in trend direction...

If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The email SUGGESTION BOX is always open and invites your ideas for improving and enhancing your email service, I enjoy hearing from you, many thanks...

NOTICE: I SEND OUT AN EMAIL EVERY WEEKDAY EVENING, IF YOU DO NOT RECEIVE ONE, PLEASE LET ME KNOW, THANKS...

For Friday, December 26th

"The key to navigating bubbles successfully is to panic before everyone else does..."

- - - John P. Hussmann, Ph.D.

The March SP Futures

A BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS can be found at the bottom of every email briefing for your easy quick reference and convenience...

PLEASE TAKE THE TIME TO REVIEW THE TUTORIAL EVERY NOW AND THEN, THESE ARE THE NAVIGATIONAL TOOLS NEEDED TO MANEUVER SAFELY THROUGH THESE MARKETS, A GOOD WORKING KNOWLEDGE OF THESE TOOLS WILL MAKE YOU A BETTER AND MORE INFORMED INVESTOR/TRADER...

The main model is currently long the March SP from 1981.50 as of Wednesday, December 17th...

The last trade as of this writing is at 2078.50 for the March contract...

These markets will be closed tomorrow to celebrate Christmas... the markets will open again on Friday morning...

For Friday, a close below 2073.00 would confirm a new main model sell signal...

This market is is stalling at the minor VP at 2081.619... we also have a new major VP added today at 2072.98... although this major VP is already below the market, a two day stall at a minor VP and also at a new major VP is not constructive for this market right now... while the market may continue higher, it is also currently more vulnerable for a pull back...

Hoban Rule traders remain flat this market, with a close below 2073.00 but not below than 2067.00, enter a new short position...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The Vertical Price Equilibrium spread: This spread is still under experimental study...

The NT (Near Term) indicator (the red line)

Although this sell spike has been there for a few day already, it has continued to become more pronounced and is , as of today, threatening this rally...

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The LT (Long Term) indicator

We can see that the longer term red line still moves higher, this is bullish, but the blue and purple lines have now turned down... this means longer term bullish, near term vulnerable...

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If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The following are the current upside VPs for the MARCH SP... the VP prices are presented exactly as the formula generates them even though the SP contract itself doesn't trade at that particular decimal point... please note, I also include the VP prices that are well above the market because their deadline due dates have not yet expired...

minor - - 2015.65 (already reached)

MAJOR - - 2031.95 and must close below that price on Thursday, February 5th to confirm a new main model sell signal... (already reached)

NEW TODAY MAJOR - - 1272.98 and must close below that price on Wednesday, February 11th to confirm a new main model sell signal... (already reached)

minor - - 2081.619 (already reached)

MAJOR - - 2099.07 and must close below that price on Thursday, February 19th to confirm a new main model sell signal...

MAJOR - - 2125.608 and must close below that price on Tuesday, March 3rd to confirm a new main model sell signal...

TOMORROW'S CEILING PRICE - - 2188.24 YIKES!!!

For now, the main model remains long the SP...

The February Gold futures

The main model is now short the February gold from 1192.60 as of Wednesday, December 17th...

For the February gold futures, the last trade as of this writing is at 1175.20...

For Friday, a close above 1209.40 in the FEBRUARY gold futures contract would confirm a new main model buy signal...

Hoban Rule traders are now short this market from about 1188.70... place a buy stop to go flat at 1211.40,also, enter a new long position in February Gold with a close above 1209.40 but not above than 1215.40...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The LT (Long Term) Indicator

Still looking toppy, but not as much as previously...

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The following are the current downside VPs for FEBRUARY gold...

MAJOR - - 1163.32 and must close above that price on Thursday, January 1st to confirm a new main model buy signal...

TOMORROW'S FLOOR PRICE - - 1102.31

For now, the main model remains short gold...

BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS:

The SP confirmation close ALWAYS refers to the large contract 4:15 pm futures closing price... also, use only the large contract for all official main model signals, the mini contract will give you false signals...

The Confirmation Price

The confirmation price is a specific market price beyond which the market must close in order to confirm a new main model buy or sell signal... the confirmation price is not a top or bottom picker, it is not designed to get you into a new position right at, or near, the top or bottom tick... but rather, it tells you that the trend has more than likely changed direction with a high degree of reliability... as has been demonstrated with better than a 98% reliability, the confirmation price confirms that the market trend has legitimately changed direction and that a new trend has just begun... very often, a buy confirmation price may seem so far above the market that taking a new long position at that high level seems risky... the same can be said for taking a new short position at a sell confirmation price... but factually, these price points are the most ideal place to enter a new position since these confirmation prices occur where most people are likely to take new erroneous positions in the trend that is just ending... this is why the market moves so explosively after the price is confirmed, e.g., the new short holders are scrambling to cover or the new dip buyers are selling out rapidly...

The NT Indicator

The NT indicator is a near term (NT) indicator and is included in the evening briefings for the benefit of those who make counter trend trades... the NT buy and sell spikes are not main model buy and sell signals, these spikes are only very near term, although they could always develop into something more significant over the next few days... using a weather analogy, the buy/sell spikes are much like a developing low pressure area or a tropical wave, they do not indicate a fully blown hurricane, although it could eventually develop... if a fully blown hurricane actually does develop, then the main model signal itself would address that market action...

How To Read The NT Indicator

The best and safest time to take an NT signal is when the market has already trended for some time and is now approaching a VP price, especially a major VP, then the NT spike would indicate that the trend is likely to reverse since the market is already vulnerable at a VP price, the NT spike provides greater certainty for that counter trend trade...

The VP Price

The VP, or Vertical Price, is NOT a target, the market is not required or expected to reach any VP price... however, if reached, the VP price represents where the buying/selling has stretched to its maximum exhaustion point, at least temporarily, and a change in trend is very likely...

The Floor/Ceiling Price

The floor price is always there in a down trend, the ceiling price is always there in an up trend... these specific prices are rarely mentioned because the market rarely reaches them... these are not VP prices but can be treated the same as a VP price except floor and ceiling prices change every day while the VP price does not... a close beyond the floor/ceiling price should be considered a second buy or sell confirmation signal...

How To Read The VP Price

If the market touches and then moves away from the VP very quickly and doesn't return, then this typically indicates a market reversal, but if the market moves away from the VP and then returns within a day or two, maybe sooner, then the move is not over and the market is likely to continue in its current trend... repeated visits to a VP suggests the move is not yet over...

A Suggestion On How To Enter A Position On A New Main Model Signal

One way to enter a new signal trade is to take only 1/3 position only after the market trades through the confirmation price by a few points... after that initial position is taken, let the market do what it does all day... then, late in the day, if the market is still confirming the signal, then add the second 1/3 position... and then, on the close take the final 1/3 position... your average entry price will be above/below the confirmation price but the whips will be significantly reduced... this is a method I use for myself very often...

Another way to enter a new position is to wait for the actual confirmation on the close, and then take the new position...

THE HOBAN RULE

The Hoban Rule is an exclusive proprietary trading strategy that uses the main model signals... using this strategy eliminates all whips and is recommended to be used by those who are not market savvy and/or nimble enough to trade free style... this strategy can be used just as easily to trade the SP and gold...

For gold, each point is one dollar...

To take the trade, these two prerequisite criteria must be met:

1) The closing price on confirmation day must be within 6 points of the confirmation price, and

2) The confirmation price for the next signal must be more than 5 points from the closing price of that day...

Since you don't yet know the confirmation price for the next signal at that moment, you can either take the trade if the closing price meets the first criteria, or wait for the evening briefing for that information... if you took the trade on the first criteria and the evening briefing does not satisfy the second criteria, then simply close out that trade... or, if you did not take the trade and the evening briefing satisfies the second criteria as well, then take the trade in the evening session or in the after hours market if you're trading a market ETF... or you can simply take the trade the following morning...

However, if the closing price is 6 points or more from the confirmation price, then do not take the trade at that time, just stay flat...

In order to take the trade when the closing price is 6 points or more from the confirmation price:

1) Place a limit order to enter the trade when/if the market moves within 6 points of the confirmation price...

To exit the trade:

1) Place an exit stop 2 points beyond the next buy/sell confirmation price... if filled, then stay flat and wait for the next new signal to be confirmed...

2) If the next new signal is confirmed, then begin again with step 1 using the two entry criteria to begin the next new trade position...

3) If the new signal is not confirmed, simply stay flat and wait for the next newly confirmed signal to begin the next trade at step 1, or simply re-enter the original position provided that the closing price that day is within 6 points of the original confirmation price and the reverse confirmation price is at least 5 points above that day's closing price...

4) Very often, you may find the second criteria is not met since the reverse confirmation price is less than 5 points above the closing price... but, on some occasions, a day or two later, the reverse confirmation price could actually move away from the market and would therefore meet the second criteria and subsequently satisfy both prerequisite criteria allowing for an entry provided that day's closing price is still no more than 6 points from the original main model confirmation price...

Applying The Hoban Rule for your trade positions based on the buy/sell confirmation prices as described above, you will find it easy to follow and with less stress than trying to catch the market while not knowing where it will actually close... and, also, all intraday entry whips are completely eliminated...

The Vertical Price Equilibrium Spread

This spread takes advantage of the unique relationship between related markets... this spread can be entered at any time, however to optimize and maximize the benefits of this spread, it should be entered at or near the major VP points... this spread generates profits regardless of market direction... if you would like a full explanation on how to benefit from this spread, then please ask me about it...

Rejected Buy/Sell Signals

Rejected buy and/or sell signals are typically followed by a sharp market move in the opposite direction the following day, this occurs as a general rule... a rejected sell signal is typically followed the next day by a sharp rally... as well, a rejected buy signal is typically followed the next day by a sharp decline... however, if the sharp rally/decline does not occur, then you can expect to see the market make another attempt at that buy/sell signal...

The Long Term (LT) Indicator

The long term (LT) indicator is a myriad of indicators that give you an X-ray view of the market internals and trend...

The green line = the closing price for the specific market

The red line = the confirmation line, the more dominant trend

The purple line = the early warning line

The blue line = the imminent warning line

The purple and blue lines crossing the red line gives you early and imminent warning of a possible change in trend direction...

If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The email SUGGESTION BOX is always open and invites your ideas for improving and enhancing your email service, I enjoy hearing from you, many thanks...

NOTICE: I SEND OUT AN EMAIL EVERY WEEKDAY EVENING, IF YOU DO NOT RECEIVE ONE, PLEASE LET ME KNOW, THANKS...

For Wednesday, December 24th

"The key to navigating bubbles successfully is to panic before everyone else does..."

- - - John P. Hussmann, Ph.D.

The March SP Futures

A BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS can be found at the bottom of every email briefing for your easy quick reference and convenience...

PLEASE TAKE THE TIME TO REVIEW THE TUTORIAL EVERY NOW AND THEN, THESE ARE THE NAVIGATIONAL TOOLS NEEDED TO MANEUVER SAFELY THROUGH THESE MARKETS, A GOOD WORKING KNOWLEDGE OF THESE TOOLS WILL MAKE YOU A BETTER AND MORE INFORMED INVESTOR/TRADER...

The main model is currently long the March SP from 1981.50 as of Wednesday, December 17th...

The last trade as of this writing is at 2079.40 for the March contract...

These markets will close tomorrow, Wednesday, at 1 PM...

For Wednesday, a close below 2032.00 would confirm a new main model sell signal...

We can see that this market is now stalled at the minor VP at 2081.619, reached today... considering the force behind this rally, I'm not too concerned about a stall at a minor VP...

Hoban Rule traders remain flat this market, with a close below 2032.00 but not below than 2026.00, enter a new short position...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The Vertical Price Equilibrium spread: This spread is still under experimental study...

The NT (Near Term) indicator (the red line)

Today, the NT sell spike has become more distinct... this means this market is currently vulnerable to a sell off, but it appears all within an overall solid up trend... so, just expect to see some selling, possibly, but I suspect all selling will be met with fresh buying... the only exception to this expectation is if the market triggers and confirms a sell signal tomorrow... otherwise,stay long this market...

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The LT (Long Term) indicator

This LT graph shows a market head strong to continue higher while beginning to inch into the over bought zone... notice the red line, the red line typically does not change direction so quickly once a new direction is taken, the red line has turned higher just recently... if this market continues as it has historically, then we should continue to see this market move higher from here despite any near term selling...

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If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The following are the current upside VPs for the MARCH SP... the VP prices are presented exactly as the formula generates them even though the SP contract itself doesn't trade at that particular decimal point... please note, I also include the VP prices that are well above the market because their deadline due dates have not yet expired...

minor - - 2015.65 (already reached)

MAJOR - - 2031.95 and must close below that price on Thursday, February 5th to confirm a new main model sell signal... (already reached)

minor - - 2081.619 (already reached)

MAJOR - - 2099.07 and must close below that price on Thursday, February 19th to confirm a new main model sell signal...

MAJOR - - 2125.608 and must close below that price on Tuesday, March 3rd to confirm a new main model sell signal...

TOMORROW'S CEILING PRICE - - 2188.24 YIKES!!!

For now, the main model remains long the SP...

The February Gold futures

The main model is now short the February gold from 1192.60 as of Wednesday, December 17th...

For the February gold futures, the last trade as of this writing is at 1175.10...

For Wednesday, a close above 1221.20 in the FEBRUARY gold futures contract would confirm a new main model buy signal...

Hoban Rule traders are now short this market from about 1188.70... for tomorrow, place a buy stop to go flat at 1223.20,also, enter a new long position in February Gold with a close above 1221.20 but not above than 1227.20...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The LT (Long Term) Indicator

Yes, this LT graph still looks toppy, and I've been saying this every day for about a month...

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The following are the current downside VPs for FEBRUARY gold...

MAJOR - - 1163.32 and must close above that price on Thursday, January 1st to confirm a new main model buy signal...

TOMORROW'S FLOOR PRICE - - 1102.31

For now, the main model remains short gold...

BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS:

The SP confirmation close ALWAYS refers to the large contract 4:15 pm futures closing price... also, use only the large contract for all official main model signals, the mini contract will give you false signals...

The Confirmation Price

The confirmation price is a specific market price beyond which the market must close in order to confirm a new main model buy or sell signal... the confirmation price is not a top or bottom picker, it is not designed to get you into a new position right at, or near, the top or bottom tick... but rather, it tells you that the trend has more than likely changed direction with a high degree of reliability... as has been demonstrated with better than a 98% reliability, the confirmation price confirms that the market trend has legitimately changed direction and that a new trend has just begun... very often, a buy confirmation price may seem so far above the market that taking a new long position at that high level seems risky... the same can be said for taking a new short position at a sell confirmation price... but factually, these price points are the most ideal place to enter a new position since these confirmation prices occur where most people are likely to take new erroneous positions in the trend that is just ending... this is why the market moves so explosively after the price is confirmed, e.g., the new short holders are scrambling to cover or the new dip buyers are selling out rapidly...

The NT Indicator

The NT indicator is a near term (NT) indicator and is included in the evening briefings for the benefit of those who make counter trend trades... the NT buy and sell spikes are not main model buy and sell signals, these spikes are only very near term, although they could always develop into something more significant over the next few days... using a weather analogy, the buy/sell spikes are much like a developing low pressure area or a tropical wave, they do not indicate a fully blown hurricane, although it could eventually develop... if a fully blown hurricane actually does develop, then the main model signal itself would address that market action...

How To Read The NT Indicator

The best and safest time to take an NT signal is when the market has already trended for some time and is now approaching a VP price, especially a major VP, then the NT spike would indicate that the trend is likely to reverse since the market is already vulnerable at a VP price, the NT spike provides greater certainty for that counter trend trade...

The VP Price

The VP, or Vertical Price, is NOT a target, the market is not required or expected to reach any VP price... however, if reached, the VP price represents where the buying/selling has stretched to its maximum exhaustion point, at least temporarily, and a change in trend is very likely...

The Floor/Ceiling Price

The floor price is always there in a down trend, the ceiling price is always there in an up trend... these specific prices are rarely mentioned because the market rarely reaches them... these are not VP prices but can be treated the same as a VP price except floor and ceiling prices change every day while the VP price does not... a close beyond the floor/ceiling price should be considered a second buy or sell confirmation signal...

How To Read The VP Price

If the market touches and then moves away from the VP very quickly and doesn't return, then this typically indicates a market reversal, but if the market moves away from the VP and then returns within a day or two, maybe sooner, then the move is not over and the market is likely to continue in its current trend... repeated visits to a VP suggests the move is not yet over...

A Suggestion On How To Enter A Position On A New Main Model Signal

One way to enter a new signal trade is to take only 1/3 position only after the market trades through the confirmation price by a few points... after that initial position is taken, let the market do what it does all day... then, late in the day, if the market is still confirming the signal, then add the second 1/3 position... and then, on the close take the final 1/3 position... your average entry price will be above/below the confirmation price but the whips will be significantly reduced... this is a method I use for myself very often...

Another way to enter a new position is to wait for the actual confirmation on the close, and then take the new position...

THE HOBAN RULE

The Hoban Rule is an exclusive proprietary trading strategy that uses the main model signals... using this strategy eliminates all whips and is recommended to be used by those who are not market savvy and/or nimble enough to trade free style... this strategy can be used just as easily to trade the SP and gold...

For gold, each point is one dollar...

To take the trade, these two prerequisite criteria must be met:

1) The closing price on confirmation day must be within 6 points of the confirmation price, and

2) The confirmation price for the next signal must be more than 5 points from the closing price of that day...

Since you don't yet know the confirmation price for the next signal at that moment, you can either take the trade if the closing price meets the first criteria, or wait for the evening briefing for that information... if you took the trade on the first criteria and the evening briefing does not satisfy the second criteria, then simply close out that trade... or, if you did not take the trade and the evening briefing satisfies the second criteria as well, then take the trade in the evening session or in the after hours market if you're trading a market ETF... or you can simply take the trade the following morning...

However, if the closing price is 6 points or more from the confirmation price, then do not take the trade at that time, just stay flat...

In order to take the trade when the closing price is 6 points or more from the confirmation price:

1) Place a limit order to enter the trade when/if the market moves within 6 points of the confirmation price...

To exit the trade:

1) Place an exit stop 2 points beyond the next buy/sell confirmation price... if filled, then stay flat and wait for the next new signal to be confirmed...

2) If the next new signal is confirmed, then begin again with step 1 using the two entry criteria to begin the next new trade position...

3) If the new signal is not confirmed, simply stay flat and wait for the next newly confirmed signal to begin the next trade at step 1, or simply re-enter the original position provided that the closing price that day is within 6 points of the original confirmation price and the reverse confirmation price is at least 5 points above that day's closing price...

4) Very often, you may find the second criteria is not met since the reverse confirmation price is less than 5 points above the closing price... but, on some occasions, a day or two later, the reverse confirmation price could actually move away from the market and would therefore meet the second criteria and subsequently satisfy both prerequisite criteria allowing for an entry provided that day's closing price is still no more than 6 points from the original main model confirmation price...

Applying The Hoban Rule for your trade positions based on the buy/sell confirmation prices as described above, you will find it easy to follow and with less stress than trying to catch the market while not knowing where it will actually close... and, also, all intraday entry whips are completely eliminated...

The Vertical Price Equilibrium Spread

This spread takes advantage of the unique relationship between related markets... this spread can be entered at any time, however to optimize and maximize the benefits of this spread, it should be entered at or near the major VP points... this spread generates profits regardless of market direction... if you would like a full explanation on how to benefit from this spread, then please ask me about it...

Rejected Buy/Sell Signals

Rejected buy and/or sell signals are typically followed by a sharp market move in the opposite direction the following day, this occurs as a general rule... a rejected sell signal is typically followed the next day by a sharp rally... as well, a rejected buy signal is typically followed the next day by a sharp decline... however, if the sharp rally/decline does not occur, then you can expect to see the market make another attempt at that buy/sell signal...

The Long Term (LT) Indicator

The long term (LT) indicator is a myriad of indicators that give you an X-ray view of the market internals and trend...

The green line = the closing price for the specific market

The red line = the confirmation line, the more dominant trend

The purple line = the early warning line

The blue line = the imminent warning line

The purple and blue lines crossing the red line gives you early and imminent warning of a possible change in trend direction...

If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The email SUGGESTION BOX is always open and invites your ideas for improving and enhancing your email service, I enjoy hearing from you, many thanks...

NOTICE: I SEND OUT AN EMAIL EVERY WEEKDAY EVENING, IF YOU DO NOT RECEIVE ONE, PLEASE LET ME KNOW, THANKS...

For Tuesday, December 23rd

"The key to navigating bubbles successfully is to panic before everyone else does..."

- - - John P. Hussmann, Ph.D.

The March SP Futures

A BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS can be found at the bottom of every email briefing for your easy quick reference and convenience...

PLEASE TAKE THE TIME TO REVIEW THE TUTORIAL EVERY NOW AND THEN, THESE ARE THE NAVIGATIONAL TOOLS NEEDED TO MANEUVER SAFELY THROUGH THESE MARKETS, A GOOD WORKING KNOWLEDGE OF THESE TOOLS WILL MAKE YOU A BETTER AND MORE INFORMED INVESTOR/TRADER...

The main model is currently long the March SP from 1981.50 as of Wednesday, December 17th...

This has been another wonderful signal...

The last trade as of this writing is at 2073.60 for the March contract...

For Tuesday, a close below 2032.00 would confirm a new main model sell signal...

Hoban Rule traders remain flat this market, with a close below 2032.00 but not below than 2026.00, enter a new short position...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The Vertical Price Equilibrium spread: No new spread was entered today... this spread is still under experimental study, but so far, I'm very pleased with its performance...

The NT (Near Term) indicator (the red line)

As we can see, this market is seriously over bought near term as illustrated by the NT indicator deep into the over bought zone with a modest sell spike in place today... expect some selling, but let's hope not enough to trigger a sell signal for tomorrow... right now, this market needs some breathing room to catch its breath...

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The LT (Long Term) indicator

The LT graph also shows a deeply over bought market, but the red line just recently turned higher, the blue is still moving higher but the purple line has now slightly veered off some... considering the force of this rally, I suspect it may be difficult for this market to move significantly lower without being bought up again quickly...

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If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The following are the current upside VPs for the MARCH SP... the VP prices are presented exactly as the formula generates them even though the SP contract itself doesn't trade at that particular decimal point... please note, I also include the VP prices that are well above the market because their deadline due dates have not yet expired...

minor - - 2015.65 (already reached)

MAJOR - - 2031.95 and must close below that price on Thursday, February 5th to confirm a new main model sell signal... (already reached)

minor - - 2081.619

MAJOR - - 2099.07 and must close below that price on Thursday, February 19th to confirm a new main model sell signal...

MAJOR - - 2125.608 and must close below that price on Tuesday, March 3rd to confirm a new main model sell signal...

TOMORROW'S CEILING PRICE - - 2188.24 YIKES!!!

For now, the main model remains long the SP...

The February Gold futures

The main model is now short the February gold from 1192.60 as of Wednesday, December 17th...

For the February gold futures, the last trade as of this writing is at 1172.70...

All systems are go and deep in the green for both of our markets...

For Tuesday, a close above 1221.20 in the FEBRUARY gold futures contract would confirm a new main model buy signal... that's a country mile away from here...

Hoban Rule traders are now short this market from about 1188.70... for tomorrow, place a buy stop to go flat at 1223.20,also, enter a new long position in February Gold with a close above 1221.20 but not above than 1227.20...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The LT (Long Term) Indicator

Yes, again, this LT graph looks toppy... but now, the market itself is also moving lower... redemption for the LT graph which has been looking toppy for several weeks already... yes, patience is truly a virtue...

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The following are the current downside VPs for FEBRUARY gold...

MAJOR - - 1163.32 and must close above that price on Thursday, January 1st to confirm a new main model buy signal...

TOMORROW'S FLOOR PRICE - - 1102.31

For now, the main model remains short gold...

BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS:

The SP confirmation close ALWAYS refers to the large contract 4:15 pm futures closing price... also, use only the large contract for all official main model signals, the mini contract will give you false signals...

The Confirmation Price

The confirmation price is a specific market price beyond which the market must close in order to confirm a new main model buy or sell signal... the confirmation price is not a top or bottom picker, it is not designed to get you into a new position right at, or near, the top or bottom tick... but rather, it tells you that the trend has more than likely changed direction with a high degree of reliability... as has been demonstrated with better than a 98% reliability, the confirmation price confirms that the market trend has legitimately changed direction and that a new trend has just begun... very often, a buy confirmation price may seem so far above the market that taking a new long position at that high level seems risky... the same can be said for taking a new short position at a sell confirmation price... but factually, these price points are the most ideal place to enter a new position since these confirmation prices occur where most people are likely to take new erroneous positions in the trend that is just ending... this is why the market moves so explosively after the price is confirmed, e.g., the new short holders are scrambling to cover or the new dip buyers are selling out rapidly...

The NT Indicator

The NT indicator is a near term (NT) indicator and is included in the evening briefings for the benefit of those who make counter trend trades... the NT buy and sell spikes are not main model buy and sell signals, these spikes are only very near term, although they could always develop into something more significant over the next few days... using a weather analogy, the buy/sell spikes are much like a developing low pressure area or a tropical wave, they do not indicate a fully blown hurricane, although it could eventually develop... if a fully blown hurricane actually does develop, then the main model signal itself would address that market action...

How To Read The NT Indicator

The best and safest time to take an NT signal is when the market has already trended for some time and is now approaching a VP price, especially a major VP, then the NT spike would indicate that the trend is likely to reverse since the market is already vulnerable at a VP price, the NT spike provides greater certainty for that counter trend trade...

The VP Price

The VP, or Vertical Price, is NOT a target, the market is not required or expected to reach any VP price... however, if reached, the VP price represents where the buying/selling has stretched to its maximum exhaustion point, at least temporarily, and a change in trend is very likely...

The Floor/Ceiling Price

The floor price is always there in a down trend, the ceiling price is always there in an up trend... these specific prices are rarely mentioned because the market rarely reaches them... these are not VP prices but can be treated the same as a VP price except floor and ceiling prices change every day while the VP price does not... a close beyond the floor/ceiling price should be considered a second buy or sell confirmation signal...

How To Read The VP Price

If the market touches and then moves away from the VP very quickly and doesn't return, then this typically indicates a market reversal, but if the market moves away from the VP and then returns within a day or two, maybe sooner, then the move is not over and the market is likely to continue in its current trend... repeated visits to a VP suggests the move is not yet over...

A Suggestion On How To Enter A Position On A New Main Model Signal

One way to enter a new signal trade is to take only 1/3 position only after the market trades through the confirmation price by a few points... after that initial position is taken, let the market do what it does all day... then, late in the day, if the market is still confirming the signal, then add the second 1/3 position... and then, on the close take the final 1/3 position... your average entry price will be above/below the confirmation price but the whips will be significantly reduced... this is a method I use for myself very often...

Another way to enter a new position is to wait for the actual confirmation on the close, and then take the new position...

THE HOBAN RULE

The Hoban Rule is an exclusive proprietary trading strategy that uses the main model signals... using this strategy eliminates all whips and is recommended to be used by those who are not market savvy and/or nimble enough to trade free style... this strategy can be used just as easily to trade the SP and gold...

For gold, each point is one dollar...

To take the trade, these two prerequisite criteria must be met:

1) The closing price on confirmation day must be within 6 points of the confirmation price, and

2) The confirmation price for the next signal must be more than 5 points from the closing price of that day...

Since you don't yet know the confirmation price for the next signal at that moment, you can either take the trade if the closing price meets the first criteria, or wait for the evening briefing for that information... if you took the trade on the first criteria and the evening briefing does not satisfy the second criteria, then simply close out that trade... or, if you did not take the trade and the evening briefing satisfies the second criteria as well, then take the trade in the evening session or in the after hours market if you're trading a market ETF... or you can simply take the trade the following morning...

However, if the closing price is 6 points or more from the confirmation price, then do not take the trade at that time, just stay flat...

In order to take the trade when the closing price is 6 points or more from the confirmation price:

1) Place a limit order to enter the trade when/if the market moves within 6 points of the confirmation price...

To exit the trade:

1) Place an exit stop 2 points beyond the next buy/sell confirmation price... if filled, then stay flat and wait for the next new signal to be confirmed...

2) If the next new signal is confirmed, then begin again with step 1 using the two entry criteria to begin the next new trade position...

3) If the new signal is not confirmed, simply stay flat and wait for the next newly confirmed signal to begin the next trade at step 1, or simply re-enter the original position provided that the closing price that day is within 6 points of the original confirmation price and the reverse confirmation price is at least 5 points above that day's closing price...

4) Very often, you may find the second criteria is not met since the reverse confirmation price is less than 5 points above the closing price... but, on some occasions, a day or two later, the reverse confirmation price could actually move away from the market and would therefore meet the second criteria and subsequently satisfy both prerequisite criteria allowing for an entry provided that day's closing price is still no more than 6 points from the original main model confirmation price...

Applying The Hoban Rule for your trade positions based on the buy/sell confirmation prices as described above, you will find it easy to follow and with less stress than trying to catch the market while not knowing where it will actually close... and, also, all intraday entry whips are completely eliminated...

The Vertical Price Equilibrium Spread

This spread takes advantage of the unique relationship between related markets... this spread can be entered at any time, however to optimize and maximize the benefits of this spread, it should be entered at or near the major VP points... this spread generates profits regardless of market direction... if you would like a full explanation on how to benefit from this spread, then please ask me about it...

Rejected Buy/Sell Signals

Rejected buy and/or sell signals are typically followed by a sharp market move in the opposite direction the following day, this occurs as a general rule... a rejected sell signal is typically followed the next day by a sharp rally... as well, a rejected buy signal is typically followed the next day by a sharp decline... however, if the sharp rally/decline does not occur, then you can expect to see the market make another attempt at that buy/sell signal...

The Long Term (LT) Indicator

The long term (LT) indicator is a myriad of indicators that give you an X-ray view of the market internals and trend...

The green line = the closing price for the specific market

The red line = the confirmation line, the more dominant trend

The purple line = the early warning line

The blue line = the imminent warning line

The purple and blue lines crossing the red line gives you early and imminent warning of a possible change in trend direction...

If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The email SUGGESTION BOX is always open and invites your ideas for improving and enhancing your email service, I enjoy hearing from you, many thanks...

NOTICE: I SEND OUT AN EMAIL EVERY WEEKDAY EVENING, IF YOU DO NOT RECEIVE ONE, PLEASE LET ME KNOW, THANKS...

For Monday, December 22nd

"The key to navigating bubbles successfully is to panic before everyone else does..."

- - - John P. Hussmann, Ph.D.

The March SP Futures

A BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS can be found at the bottom of every email briefing for your easy quick reference and convenience...

PLEASE TAKE THE TIME TO REVIEW THE TUTORIAL EVERY NOW AND THEN, THESE ARE THE NAVIGATIONAL TOOLS NEEDED TO MANEUVER SAFELY THROUGH THESE MARKETS, A GOOD WORKING KNOWLEDGE OF THESE TOOLS WILL MAKE YOU A BETTER AND MORE INFORMED INVESTOR/TRADER...

The main model is currently long the March SP from 1981.50 as of Wednesday, December 17th...

The last trade as of this writing is at 2066.60 for the March contract...

For Monday, a close below 2032.00 would confirm a new main model sell signal...

Hoban Rule traders remain flat this market, with a close below 2032.00 but not below than 2026.00, enter a new short position...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The Vertical Price Equilibrium spread: This spread was closed out today with a solid gain... a new equilibrium spread will be established most likely on Monday... this spread is still under experimental study, but so far, I'm very pleased with its performance...

The NT (Near Term) indicator (the red line)

In only three market days, the NT indicator has gone from the second most over sold condition in more than 2 1/2 years to the most over bought condition today... pardon me for say, but this market is clearly unstable... certainly, this market does not behave "normally"... considering the over bought condition of this NT indicator as of today, expect to see some possible selling early next week...

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The LT (Long Term) indicator

The LT graph also shows a market now entering the over bought zone... even if this market goes higher, it is again vulnerable for some selling right here, and this market is quickly approaching several of the overhead VP points... be watchful...

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If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The following are the current upside VPs for the MARCH SP... the VP prices are presented exactly as the formula generates them even though the SP contract itself doesn't trade at that particular decimal point... please note, I also include the VP prices that are well above the market because their deadline due dates have not yet expired...

minor - - 2015.65 (already reached)

MAJOR - - 2031.95 and must close below that price on Thursday, February 5th to confirm a new main model sell signal... (already reached)

minor - - 2081.619

MAJOR - - 2099.07 and must close below that price on Thursday, February 19th to confirm a new main model sell signal...

MAJOR - - 2125.608 and must close below that price on Tuesday, March 3rd to confirm a new main model sell signal...

TOMORROW'S CEILING PRICE - - 2188.24 YIKES!!!

For now, the main model remains long the SP...

The February Gold futures

The main model is now short the February gold from 1192.60 as of Wednesday, December 17th...

For the February gold futures, the last trade as of this writing is at 1194.30...

For Monday, a close above 1229.20 in the FEBRUARY gold futures contract would confirm a new main model buy signal...

Hoban Rule traders are now short this market from about 1188.70... for tomorrow, place a buy stop to go flat at 1231.20,also, enter a new long position in February Gold with a close above 1229.20 but not above than 1235.20...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The LT (Long Term) Indicator

This reluctant market still looks toppy... reluctant because it won't go up and it won't go down, but the LT graph give a toppy impression right now...

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The following are the current downside VPs for FEBRUARY gold...

MAJOR - - 1163.32 and must close above that price on Thursday, January 1st to confirm a new main model buy signal...

TOMORROW'S FLOOR PRICE - - 1102.31

For now, the main model remains short gold...

BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS:

The SP confirmation close ALWAYS refers to the large contract 4:15 pm futures closing price... also, use only the large contract for all official main model signals, the mini contract will give you false signals...

The Confirmation Price

The confirmation price is a specific market price beyond which the market must close in order to confirm a new main model buy or sell signal... the confirmation price is not a top or bottom picker, it is not designed to get you into a new position right at, or near, the top or bottom tick... but rather, it tells you that the trend has more than likely changed direction with a high degree of reliability... as has been demonstrated with better than a 98% reliability, the confirmation price confirms that the market trend has legitimately changed direction and that a new trend has just begun... very often, a buy confirmation price may seem so far above the market that taking a new long position at that high level seems risky... the same can be said for taking a new short position at a sell confirmation price... but factually, these price points are the most ideal place to enter a new position since these confirmation prices occur where most people are likely to take new erroneous positions in the trend that is just ending... this is why the market moves so explosively after the price is confirmed, e.g., the new short holders are scrambling to cover or the new dip buyers are selling out rapidly...

The NT Indicator

The NT indicator is a near term (NT) indicator and is included in the evening briefings for the benefit of those who make counter trend trades... the NT buy and sell spikes are not main model buy and sell signals, these spikes are only very near term, although they could always develop into something more significant over the next few days... using a weather analogy, the buy/sell spikes are much like a developing low pressure area or a tropical wave, they do not indicate a fully blown hurricane, although it could eventually develop... if a fully blown hurricane actually does develop, then the main model signal itself would address that market action...

How To Read The NT Indicator

The best and safest time to take an NT signal is when the market has already trended for some time and is now approaching a VP price, especially a major VP, then the NT spike would indicate that the trend is likely to reverse since the market is already vulnerable at a VP price, the NT spike provides greater certainty for that counter trend trade...

The VP Price

The VP, or Vertical Price, is NOT a target, the market is not required or expected to reach any VP price... however, if reached, the VP price represents where the buying/selling has stretched to its maximum exhaustion point, at least temporarily, and a change in trend is very likely...

The Floor/Ceiling Price

The floor price is always there in a down trend, the ceiling price is always there in an up trend... these specific prices are rarely mentioned because the market rarely reaches them... these are not VP prices but can be treated the same as a VP price except floor and ceiling prices change every day while the VP price does not... a close beyond the floor/ceiling price should be considered a second buy or sell confirmation signal...

How To Read The VP Price

If the market touches and then moves away from the VP very quickly and doesn't return, then this typically indicates a market reversal, but if the market moves away from the VP and then returns within a day or two, maybe sooner, then the move is not over and the market is likely to continue in its current trend... repeated visits to a VP suggests the move is not yet over...

A Suggestion On How To Enter A Position On A New Main Model Signal

One way to enter a new signal trade is to take only 1/3 position only after the market trades through the confirmation price by a few points... after that initial position is taken, let the market do what it does all day... then, late in the day, if the market is still confirming the signal, then add the second 1/3 position... and then, on the close take the final 1/3 position... your average entry price will be above/below the confirmation price but the whips will be significantly reduced... this is a method I use for myself very often...

Another way to enter a new position is to wait for the actual confirmation on the close, and then take the new position...

THE HOBAN RULE

The Hoban Rule is an exclusive proprietary trading strategy that uses the main model signals... using this strategy eliminates all whips and is recommended to be used by those who are not market savvy and/or nimble enough to trade free style... this strategy can be used just as easily to trade the SP and gold...

For gold, each point is one dollar...

To take the trade, these two prerequisite criteria must be met:

1) The closing price on confirmation day must be within 6 points of the confirmation price, and

2) The confirmation price for the next signal must be more than 5 points from the closing price of that day...

Since you don't yet know the confirmation price for the next signal at that moment, you can either take the trade if the closing price meets the first criteria, or wait for the evening briefing for that information... if you took the trade on the first criteria and the evening briefing does not satisfy the second criteria, then simply close out that trade... or, if you did not take the trade and the evening briefing satisfies the second criteria as well, then take the trade in the evening session or in the after hours market if you're trading a market ETF... or you can simply take the trade the following morning...

However, if the closing price is 6 points or more from the confirmation price, then do not take the trade at that time, just stay flat...

In order to take the trade when the closing price is 6 points or more from the confirmation price:

1) Place a limit order to enter the trade when/if the market moves within 6 points of the confirmation price...

To exit the trade:

1) Place an exit stop 2 points beyond the next buy/sell confirmation price... if filled, then stay flat and wait for the next new signal to be confirmed...

2) If the next new signal is confirmed, then begin again with step 1 using the two entry criteria to begin the next new trade position...

3) If the new signal is not confirmed, simply stay flat and wait for the next newly confirmed signal to begin the next trade at step 1, or simply re-enter the original position provided that the closing price that day is within 6 points of the original confirmation price and the reverse confirmation price is at least 5 points above that day's closing price...

4) Very often, you may find the second criteria is not met since the reverse confirmation price is less than 5 points above the closing price... but, on some occasions, a day or two later, the reverse confirmation price could actually move away from the market and would therefore meet the second criteria and subsequently satisfy both prerequisite criteria allowing for an entry provided that day's closing price is still no more than 6 points from the original main model confirmation price...

Applying The Hoban Rule for your trade positions based on the buy/sell confirmation prices as described above, you will find it easy to follow and with less stress than trying to catch the market while not knowing where it will actually close... and, also, all intraday entry whips are completely eliminated...

The Vertical Price Equilibrium Spread

This spread takes advantage of the unique relationship between related markets... this spread can be entered at any time, however to optimize and maximize the benefits of this spread, it should be entered at or near the major VP points... this spread generates profits regardless of market direction... if you would like a full explanation on how to benefit from this spread, then please ask me about it...

Rejected Buy/Sell Signals

Rejected buy and/or sell signals are typically followed by a sharp market move in the opposite direction the following day, this occurs as a general rule... a rejected sell signal is typically followed the next day by a sharp rally... as well, a rejected buy signal is typically followed the next day by a sharp decline... however, if the sharp rally/decline does not occur, then you can expect to see the market make another attempt at that buy/sell signal...

The Long Term (LT) Indicator

The long term (LT) indicator is a myriad of indicators that give you an X-ray view of the market internals and trend...

The green line = the closing price for the specific market

The red line = the confirmation line, the more dominant trend

The purple line = the early warning line

The blue line = the imminent warning line

The purple and blue lines crossing the red line gives you early and imminent warning of a possible change in trend direction...

If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The email SUGGESTION BOX is always open and invites your ideas for improving and enhancing your email service, I enjoy hearing from you, many thanks...

NOTICE: I SEND OUT AN EMAIL EVERY WEEKDAY EVENING, IF YOU DO NOT RECEIVE ONE, PLEASE LET ME KNOW, THANKS...

For Friday, December 19th

"The key to navigating bubbles successfully is to panic before everyone else does..."

- - - John P. Hussmann, Ph.D.

The March SP Futures

A BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS can be found at the bottom of every email briefing for your easy quick reference and convenience...

PLEASE TAKE THE TIME TO REVIEW THE TUTORIAL EVERY NOW AND THEN, THESE ARE THE NAVIGATIONAL TOOLS NEEDED TO MANEUVER SAFELY THROUGH THESE MARKETS, A GOOD WORKING KNOWLEDGE OF THESE TOOLS WILL MAKE YOU A BETTER AND MORE INFORMED INVESTOR/TRADER...

The main model is currently long the March SP from 1981.50 as of Wednesday, December 17th...

Goodness, we're long one day and this market is up nearly 80 points!!!

I hesitate to make any fundamental comments here, but it seems there are 3 plausible reasons for this market to continue higher right now...

1) Crude stabilizing,
2) The FED, and
3) Europeans are buying U.S. stocks...

If so, then I suspect this is just the beginning of a huge leg higher for this market...

The last trade as of this writing is at 2060.10 for the March contract...

For Friday, a close below 1981.60 would confirm a new main model sell signal... yes, that sell price is a long way down, but this market now needs time to catch up with this highly spirited rally, so it needs some elbow room to work its magic...

Hoban Rule traders remain flat this market, with a close tomorrow below 1981.60 but not below than 1975.60, enter a new short position...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The Vertical Price Equilibrium spread: This spread is currently long 150 SOXL at 139.098 and long 800 SOXS at 13.314... today, I sold 200 of the remaining 1000 SOXS... today, the spread had a gain of $450.50... this spread is still under experimental study, but so far, I'm very pleased with its performance...

The NT (Near Term) indicator (the red line)

This NT indicator has gone from profoundly over sold to somewhat over bought in only a two day span... typically, when the NT indicator becomes this over bought, a pull back is likely, however due to the lightening bolt speed of the rise to the current over bought condition, I suspect this indicates more likely that a super rally has just begun, the first day or two are generally explosive as we have just witnessed and as is also illustrated by the NT indicator... my hunch is that any pull back from here will be bought very quickly...

Also, I would mention here that when the market reached the initial major VP today mid day at 2031.95, the market only paused and fell back about 5 points before continuing higher... this is generally also construed as bullish...

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The LT (Long Term) indicator

We can also see the super bolt speed of the rally with the LT graph... considering the force and momentum behind this upward price thrust, it would be difficult to imagine any slow down for some time... apparently, this market wants to move into new all time high territory, and quickly... so, we'll stay long for now and enjoy the ride...

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If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The following are the current upside VPs for the MARCH SP... the VP prices are presented exactly as the formula generates them even though the SP contract itself doesn't trade at that particular decimal point... please note, I also include the VP prices that are well above the market because their deadline due dates have not yet expired...

minor - - 2015.65 (already reached)

MAJOR - - 2031.95 and must close below that price on Thursday, February 5th to confirm a new main model sell signal... (already reached)

minor - - 2081.619

MAJOR - - 2099.07 and must close below that price on Thursday, February 19th to confirm a new main model sell signal...

MAJOR - - 2125.608 and must close below that price on Tuesday, March 3rd to confirm a new main model sell signal...

TOMORROW'S CEILING PRICE - - 2188.24 YIKES!!!

For now, the main model remains long the SP...

The February Gold futures

The main model is now short the February gold from 1192.60 as of Wednesday, December 17th...

For the February gold futures, the last trade as of this writing is at 1198.30...

This market was reluctant to go higher, and is now reluctant to go lower... after being up more than $25.00 this morning, it only finished $3.60 higher this afternoon...we'll see what it does in the coming days... gold itself still looks questionable, but the gold miners appear to be ready to launch higher...

For Friday, a close above 1229.20 in the FEBRUARY gold futures contract would confirm a new main model buy signal...

Hoban Rule traders are now short this market from about 1188.70... for tomorrow, place a buy stop to go flat at 1231.20,also, enter a new long position in February Gold with a close above 1229.20 but not above than 1235.20...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The LT (Long Term) Indicator

This LT graph can go either way at this point, although it still has an overall toppy "look" to it...

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The following are the current downside VPs for FEBRUARY gold...

MAJOR - - 1163.32 and must close above that price on Thursday, January 1st to confirm a new main model buy signal...

TOMORROW'S FLOOR PRICE - - 1102.31

For now, the main model remains short gold...

BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS:

The SP confirmation close ALWAYS refers to the large contract 4:15 pm futures closing price... also, use only the large contract for all official main model signals, the mini contract will give you false signals...

The Confirmation Price

The confirmation price is a specific market price beyond which the market must close in order to confirm a new main model buy or sell signal... the confirmation price is not a top or bottom picker, it is not designed to get you into a new position right at, or near, the top or bottom tick... but rather, it tells you that the trend has more than likely changed direction with a high degree of reliability... as has been demonstrated with better than a 98% reliability, the confirmation price confirms that the market trend has legitimately changed direction and that a new trend has just begun... very often, a buy confirmation price may seem so far above the market that taking a new long position at that high level seems risky... the same can be said for taking a new short position at a sell confirmation price... but factually, these price points are the most ideal place to enter a new position since these confirmation prices occur where most people are likely to take new erroneous positions in the trend that is just ending... this is why the market moves so explosively after the price is confirmed, e.g., the new short holders are scrambling to cover or the new dip buyers are selling out rapidly...

The NT Indicator

The NT indicator is a near term (NT) indicator and is included in the evening briefings for the benefit of those who make counter trend trades... the NT buy and sell spikes are not main model buy and sell signals, these spikes are only very near term, although they could always develop into something more significant over the next few days... using a weather analogy, the buy/sell spikes are much like a developing low pressure area or a tropical wave, they do not indicate a fully blown hurricane, although it could eventually develop... if a fully blown hurricane actually does develop, then the main model signal itself would address that market action...

How To Read The NT Indicator

The best and safest time to take an NT signal is when the market has already trended for some time and is now approaching a VP price, especially a major VP, then the NT spike would indicate that the trend is likely to reverse since the market is already vulnerable at a VP price, the NT spike provides greater certainty for that counter trend trade...

The VP Price

The VP, or Vertical Price, is NOT a target, the market is not required or expected to reach any VP price... however, if reached, the VP price represents where the buying/selling has stretched to its maximum exhaustion point, at least temporarily, and a change in trend is very likely...

The Floor/Ceiling Price

The floor price is always there in a down trend, the ceiling price is always there in an up trend... these specific prices are rarely mentioned because the market rarely reaches them... these are not VP prices but can be treated the same as a VP price except floor and ceiling prices change every day while the VP price does not... a close beyond the floor/ceiling price should be considered a second buy or sell confirmation signal...

How To Read The VP Price

If the market touches and then moves away from the VP very quickly and doesn't return, then this typically indicates a market reversal, but if the market moves away from the VP and then returns within a day or two, maybe sooner, then the move is not over and the market is likely to continue in its current trend... repeated visits to a VP suggests the move is not yet over...

A Suggestion On How To Enter A Position On A New Main Model Signal

One way to enter a new signal trade is to take only 1/3 position only after the market trades through the confirmation price by a few points... after that initial position is taken, let the market do what it does all day... then, late in the day, if the market is still confirming the signal, then add the second 1/3 position... and then, on the close take the final 1/3 position... your average entry price will be above/below the confirmation price but the whips will be significantly reduced... this is a method I use for myself very often...

Another way to enter a new position is to wait for the actual confirmation on the close, and then take the new position...

THE HOBAN RULE

The Hoban Rule is an exclusive proprietary trading strategy that uses the main model signals... using this strategy eliminates all whips and is recommended to be used by those who are not market savvy and/or nimble enough to trade free style... this strategy can be used just as easily to trade the SP and gold...

For gold, each point is one dollar...

To take the trade, these two prerequisite criteria must be met:

1) The closing price on confirmation day must be within 6 points of the confirmation price, and

2) The confirmation price for the next signal must be more than 5 points from the closing price of that day...

Since you don't yet know the confirmation price for the next signal at that moment, you can either take the trade if the closing price meets the first criteria, or wait for the evening briefing for that information... if you took the trade on the first criteria and the evening briefing does not satisfy the second criteria, then simply close out that trade... or, if you did not take the trade and the evening briefing satisfies the second criteria as well, then take the trade in the evening session or in the after hours market if you're trading a market ETF... or you can simply take the trade the following morning...

However, if the closing price is 6 points or more from the confirmation price, then do not take the trade at that time, just stay flat...

In order to take the trade when the closing price is 6 points or more from the confirmation price:

1) Place a limit order to enter the trade when/if the market moves within 6 points of the confirmation price...

To exit the trade:

1) Place an exit stop 2 points beyond the next buy/sell confirmation price... if filled, then stay flat and wait for the next new signal to be confirmed...

2) If the next new signal is confirmed, then begin again with step 1 using the two entry criteria to begin the next new trade position...

3) If the new signal is not confirmed, simply stay flat and wait for the next newly confirmed signal to begin the next trade at step 1, or simply re-enter the original position provided that the closing price that day is within 6 points of the original confirmation price and the reverse confirmation price is at least 5 points above that day's closing price...

4) Very often, you may find the second criteria is not met since the reverse confirmation price is less than 5 points above the closing price... but, on some occasions, a day or two later, the reverse confirmation price could actually move away from the market and would therefore meet the second criteria and subsequently satisfy both prerequisite criteria allowing for an entry provided that day's closing price is still no more than 6 points from the original main model confirmation price...

Applying The Hoban Rule for your trade positions based on the buy/sell confirmation prices as described above, you will find it easy to follow and with less stress than trying to catch the market while not knowing where it will actually close... and, also, all intraday entry whips are completely eliminated...

The Vertical Price Equilibrium Spread

This spread takes advantage of the unique relationship between related markets... this spread can be entered at any time, however to optimize and maximize the benefits of this spread, it should be entered at or near the major VP points... this spread generates profits regardless of market direction... if you would like a full explanation on how to benefit from this spread, then please ask me about it...

Rejected Buy/Sell Signals

Rejected buy and/or sell signals are typically followed by a sharp market move in the opposite direction the following day, this occurs as a general rule... a rejected sell signal is typically followed the next day by a sharp rally... as well, a rejected buy signal is typically followed the next day by a sharp decline... however, if the sharp rally/decline does not occur, then you can expect to see the market make another attempt at that buy/sell signal...

The Long Term (LT) Indicator

The long term (LT) indicator is a myriad of indicators that give you an X-ray view of the market internals and trend...

The green line = the closing price for the specific market

The red line = the confirmation line, the more dominant trend

The purple line = the early warning line

The blue line = the imminent warning line

The purple and blue lines crossing the red line gives you early and imminent warning of a possible change in trend direction...

If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The email SUGGESTION BOX is always open and invites your ideas for improving and enhancing your email service, I enjoy hearing from you, many thanks...

NOTICE: I SEND OUT AN EMAIL EVERY WEEKDAY EVENING, IF YOU DO NOT RECEIVE ONE, PLEASE LET ME KNOW, THANKS...

For Thursday, December 18th

"The key to navigating bubbles successfully is to panic before everyone else does..."

- - - John P. Hussmann, Ph.D.

The March SP Futures

A BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS can be found at the bottom of every email briefing for your easy quick reference and convenience...

PLEASE TAKE THE TIME TO REVIEW THE TUTORIAL EVERY NOW AND THEN, THESE ARE THE NAVIGATIONAL TOOLS NEEDED TO MANEUVER SAFELY THROUGH THESE MARKETS, A GOOD WORKING KNOWLEDGE OF THESE TOOLS WILL MAKE YOU A BETTER AND MORE INFORMED INVESTOR/TRADER...

The main model is currently long the March SP from 1981.50 as of Wednesday, December 17th...

The mid morning SP update was sent out a bit after the market moved above this important 1981.50 VP, but this is where the model confirms the new long position... I know that some of you had already taken a new long position below that level, and some of course waited a bit longer.. in all, the main model is officially long from this particular price... yesterday's VP point at 1971.50 didn't hold, even after an update had been sent... for today, we needed more proof and a higher VP to confirm this new buy signal...

The last trade as of this writing is at 2008.60 for the March contract...

For Thursday, a close below 1964.60 would confirm a new main model sell signal... that sell price is a long way down, but this market now needs time to catch up with this highly spirited rally, so it needs some elbow room to work its magic...

Hoban Rule traders remain flat this market, with a close tomorrow below 1964.600 but not below than 1958.60, enter a new short position...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The Vertical Price Equilibrium spread: This spread is currently long 150 SOXL at 139.098 and long 1000 SOXS at 13.314... today, I again re-balanced this spread and sold 300 of the 1300 SOXS for a gain of $506.70... the spread itself also had a gain today of $161.50... this spread is still under experimental study, but so far, I'm very pleased with its performance...

The NT (Near Term) indicator (the red line)

That was definitely a loud and resounding buy spike yesterday... and it followed through higher again today... egads!!!

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The LT (Long Term) indicator

If you look at the four deepest bottom spikes for the blue and purple lines, you will also see that each of these four deep spikes correlates with a significant market low, look at the green line for the market price line... all things being equal, we may now be looking at a significant low just made and this market may well be en route to its seasonal Santa Claus rally, and just in the Nick (oooops, no pun here) of time... LOL!!!

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If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The following are the current upside VPs for the MARCH SP... the VP prices are presented exactly as the formula generates them even though the SP contract itself doesn't trade at that particular decimal point... please note, I also include the VP prices that are well above the market because their deadline due dates have not yet expired...

minor - - 2015.65

MAJOR - - 2031.95 and must close below that price on Thursday, February 5th to confirm a new main model sell signal...

minor - - 2081.619

MAJOR - - 2099.07 and must close below that price on Thursday, February 19th to confirm a new main model sell signal...

MAJOR - - 2125.608 and must close below that price on Tuesday, March 3rd to confirm a new main model sell signal...

TOMORROW'S CEILING PRICE - - 2188.24 YIKES!!!

For now, the main model remains long the SP...

The February Gold futures

The main model is now short the February gold from 1192.60 as of Wednesday, December 17th...

For the February gold futures, the last trade as of this writing is at 1188.70...

For Thursday, a close above 1229.20 in the FEBRUARY gold futures contract would confirm a new main model buy signal...

Hoban Rule traders are now short this market from about 1188.70... for tomorrow, place a buy stop to go flat at 1231.20,also, enter a new long position in February Gold with a close above 1229.20 but not above than 1235.20...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals... this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition... please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...

The LT (Long Term) Indicator

The main model signals always take priority, but I've been saying for weeks that this LT graph looks toppy, just look at the complex tops for the blue and purple lines... well, maybe this time we can catch a good ride south...

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The following are the current downside VPs for FEBRUARY gold...

MAJOR - - 1163.32 and must close above that price on Thursday, January 1st to confirm a new main model buy signal...

TOMORROW'S FLOOR PRICE - - 1102.31

For now, the main model remains short gold...

BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS:

The SP confirmation close ALWAYS refers to the large contract 4:15 pm futures closing price... also, use only the large contract for all official main model signals, the mini contract will give you false signals...

The Confirmation Price

The confirmation price is a specific market price beyond which the market must close in order to confirm a new main model buy or sell signal... the confirmation price is not a top or bottom picker, it is not designed to get you into a new position right at, or near, the top or bottom tick... but rather, it tells you that the trend has more than likely changed direction with a high degree of reliability... as has been demonstrated with better than a 98% reliability, the confirmation price confirms that the market trend has legitimately changed direction and that a new trend has just begun... very often, a buy confirmation price may seem so far above the market that taking a new long position at that high level seems risky... the same can be said for taking a new short position at a sell confirmation price... but factually, these price points are the most ideal place to enter a new position since these confirmation prices occur where most people are likely to take new erroneous positions in the trend that is just ending... this is why the market moves so explosively after the price is confirmed, e.g., the new short holders are scrambling to cover or the new dip buyers are selling out rapidly...

The NT Indicator

The NT indicator is a near term (NT) indicator and is included in the evening briefings for the benefit of those who make counter trend trades... the NT buy and sell spikes are not main model buy and sell signals, these spikes are only very near term, although they could always develop into something more significant over the next few days... using a weather analogy, the buy/sell spikes are much like a developing low pressure area or a tropical wave, they do not indicate a fully blown hurricane, although it could eventually develop... if a fully blown hurricane actually does develop, then the main model signal itself would address that market action...

How To Read The NT Indicator

The best and safest time to take an NT signal is when the market has already trended for some time and is now approaching a VP price, especially a major VP, then the NT spike would indicate that the trend is likely to reverse since the market is already vulnerable at a VP price, the NT spike provides greater certainty for that counter trend trade...

The VP Price

The VP, or Vertical Price, is NOT a target, the market is not required or expected to reach any VP price... however, if reached, the VP price represents where the buying/selling has stretched to its maximum exhaustion point, at least temporarily, and a change in trend is very likely...

The Floor/Ceiling Price

The floor price is always there in a down trend, the ceiling price is always there in an up trend... these specific prices are rarely mentioned because the market rarely reaches them... these are not VP prices but can be treated the same as a VP price except floor and ceiling prices change every day while the VP price does not... a close beyond the floor/ceiling price should be considered a second buy or sell confirmation signal...

How To Read The VP Price

If the market touches and then moves away from the VP very quickly and doesn't return, then this typically indicates a market reversal, but if the market moves away from the VP and then returns within a day or two, maybe sooner, then the move is not over and the market is likely to continue in its current trend... repeated visits to a VP suggests the move is not yet over...

A Suggestion On How To Enter A Position On A New Main Model Signal

One way to enter a new signal trade is to take only 1/3 position only after the market trades through the confirmation price by a few points... after that initial position is taken, let the market do what it does all day... then, late in the day, if the market is still confirming the signal, then add the second 1/3 position... and then, on the close take the final 1/3 position... your average entry price will be above/below the confirmation price but the whips will be significantly reduced... this is a method I use for myself very often...

Another way to enter a new position is to wait for the actual confirmation on the close, and then take the new position...

THE HOBAN RULE

The Hoban Rule is an exclusive proprietary trading strategy that uses the main model signals... using this strategy eliminates all whips and is recommended to be used by those who are not market savvy and/or nimble enough to trade free style... this strategy can be used just as easily to trade the SP and gold...

For gold, each point is one dollar...

To take the trade, these two prerequisite criteria must be met:

1) The closing price on confirmation day must be within 6 points of the confirmation price, and

2) The confirmation price for the next signal must be more than 5 points from the closing price of that day...

Since you don't yet know the confirmation price for the next signal at that moment, you can either take the trade if the closing price meets the first criteria, or wait for the evening briefing for that information... if you took the trade on the first criteria and the evening briefing does not satisfy the second criteria, then simply close out that trade... or, if you did not take the trade and the evening briefing satisfies the second criteria as well, then take the trade in the evening session or in the after hours market if you're trading a market ETF... or you can simply take the trade the following morning...

However, if the closing price is 6 points or more from the confirmation price, then do not take the trade at that time, just stay flat...

In order to take the trade when the closing price is 6 points or more from the confirmation price:

1) Place a limit order to enter the trade when/if the market moves within 6 points of the confirmation price...

To exit the trade:

1) Place an exit stop 2 points beyond the next buy/sell confirmation price... if filled, then stay flat and wait for the next new signal to be confirmed...

2) If the next new signal is confirmed, then begin again with step 1 using the two entry criteria to begin the next new trade position...

3) If the new signal is not confirmed, simply stay flat and wait for the next newly confirmed signal to begin the next trade at step 1, or simply re-enter the original position provided that the closing price that day is within 6 points of the original confirmation price and the reverse confirmation price is at least 5 points above that day's closing price...

4) Very often, you may find the second criteria is not met since the reverse confirmation price is less than 5 points above the closing price... but, on some occasions, a day or two later, the reverse confirmation price could actually move away from the market and would therefore meet the second criteria and subsequently satisfy both prerequisite criteria allowing for an entry provided that day's closing price is still no more than 6 points from the original main model confirmation price...

Applying The Hoban Rule for your trade positions based on the buy/sell confirmation prices as described above, you will find it easy to follow and with less stress than trying to catch the market while not knowing where it will actually close... and, also, all intraday entry whips are completely eliminated...

The Vertical Price Equilibrium Spread

This spread takes advantage of the unique relationship between related markets... this spread can be entered at any time, however to optimize and maximize the benefits of this spread, it should be entered at or near the major VP points... this spread generates profits regardless of market direction... if you would like a full explanation on how to benefit from this spread, then please ask me about it...

Rejected Buy/Sell Signals

Rejected buy and/or sell signals are typically followed by a sharp market move in the opposite direction the following day, this occurs as a general rule... a rejected sell signal is typically followed the next day by a sharp rally... as well, a rejected buy signal is typically followed the next day by a sharp decline... however, if the sharp rally/decline does not occur, then you can expect to see the market make another attempt at that buy/sell signal...

The Long Term (LT) Indicator

The long term (LT) indicator is a myriad of indicators that give you an X-ray view of the market internals and trend...

The green line = the closing price for the specific market

The red line = the confirmation line, the more dominant trend

The purple line = the early warning line

The blue line = the imminent warning line

The purple and blue lines crossing the red line gives you early and imminent warning of a possible change in trend direction...

If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...

The email SUGGESTION BOX is always open and invites your ideas for improving and enhancing your email service, I enjoy hearing from you, many thanks...

NOTICE: I SEND OUT AN EMAIL EVERY WEEKDAY EVENING, IF YOU DO NOT RECEIVE ONE, PLEASE LET ME KNOW, THANKS...

For Wednesday, December 17th

"The key to navigating bubbles successfully is to panic before everyone else does..."
 
- - - John P. Hussmann, Ph.D.
The December SP Futures
 
A BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS can be found at the bottom of every email briefing for your easy quick reference and convenience...
PLEASE TAKE THE TIME TO REVIEW THE TUTORIAL EVERY NOW AND THEN, THESE ARE THE NAVIGATIONAL TOOLS NEEDED TO MANEUVER SAFELY THROUGH THESE MARKETS, A GOOD WORKING KNOWLEDGE OF THESE TOOLS WILL MAKE YOU A BETTER AND MORE INFORMED INVESTOR/TRADER...
 
 
The main model is currently short the December SP from 2046.20 as of Wednesday, December 10th...
Wow, yet another disappointing day for the bulls...    the DOW was up 230 points in the morning, and then it closed down 112 points...
The last trade as of this writing is at 1963.40 for the March contract...
 
Due to the overnight selling, a close today above the 1971.55 VP would have given us a confirmed buy signal, but after the market fell more than 40 points from the high, the main model reinstated the original buy confirmation price for today...  and it was a good thing it did...  there's nothing like being "sure footed" in this kind of market...
 
For Wednesday, a close above 2008.10 would confirm a new main model buy signal...  
For Hoban Rule traders, with a close tomorrow above 2008.10 but not higher than 2014.10,  enter a new long position...  
 
The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals...  this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition...  please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...
 
The Vertical Price Equilibrium spread:  This spread is currently long 150 SOXL at 139.098 and long 1300 SOXS at 13.314...  today, the spread had a gain of $62.00...  this spread is still under experimental study, but so far, I'm very pleased with its performance...
 
A note here on the spread...  this kind of spread is ideal for those days when the FED announces its FOMC meeting minutes...  no matter what the market does, this spread will work in one's favor...
 
The NT (Near Term) indicator  (the red line)
Wow, just look at this incredible buy spike!!!  It almost doesn't look real...  well, it's real, but we also realize these rallies may not hold, today is a perfect example of that...  the main model remains short while this market may experience some highly spirited rallies along the way...  this kind of overly exaggerated buy spike tells me that this market is no long oversold...
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The LT (Long Term) indicator
The LT graph is also very oversold, but no buy spike for this graph...  look at the red line, this tells us that this market is still longer term over bought...
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If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...  
 
The following are the current downside VPs for the MARCH SP...  the VP prices are presented exactly as the formula generates them even though the SP contract itself doesn't trade at that particular decimal point...   please note, I also include the VP prices that are well above the market because their deadline due dates have not yet expired...
 
minor - - 2047.01  (already reached)
 
MAJOR - - 2029.23 and must close above that price on Tuesday, December 23rd to confirm a new main model buy signal...  (already reached)
 
minor - - 2027.01  (already reached)
 
MAJOR - - 2008.12 and must close above that price on Thursday, December 25th to confirm a new main model buy signal...  (already reached)
 
minor - - 1981.55  (already reached)
 
minor - - 1971.57  (already reached)
MAJOR - - 1943.19 and must close above that price on Wednesday, January 14th to confirm a new main model buy signal... 
 
TOMORROW'S FLOOR PRICE - - 1802.24  YIKES!!!
 
For now, the main model remains short the SP...
 
The February Gold futures
The main model is now long the February gold from 1217.10 as of Tuesday, December 9th...
For the February gold futures, the last trade as of this writing is at 1196.70...
For Wednesday, a close below 1192.60 in the FEBRUARY gold futures contract would confirm a new main model sell signal...   
 
Hoban Rule traders are now flat this market...  enter a new short position in February Gold with a close below 1192.60 but not lower than 1186.60...    
The Hoban Rule will not catch all trades, but will also not incur any entry whips on any new main model signals...  this reliable and profitable strategy is presented here with each briefing only as a possible strategy option, one can use any trading strategy or any combination of strategies with the Hoban Rule that fits one's personal trading disposition...  please review some of the other trading strategies in the tutorial at the bottom of each and every evening briefing...
The LT (Long Term) Indicator
Still looking toppy...
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The following are the current upside VPs for FEBRUARY gold...  
minor - - 1212.79  (already reached)
minor - - 1223.99  (already reached)
MAJOR - - 1238.15 and must close below that price on Monday, December 29th to confirm a new main model sell signal...  (already reached)
MAJOR - - 1241.19 and must close below that price on Tuesday, January 13th to confirm a new main model sell signal...
minor - - 1265.42
MAJOR - - 1317.65 and must close below that price on Tuesday, January 27th to confirm a new main model sell signal...
TOMORROW'S CEILING PRICE - - 1428.32
 
 
For now, the main model remains long gold...
 
 
BRIEF TUTORIAL OF MAIN MODEL APPLICATIONS:
 
The SP confirmation close ALWAYS refers to the large contract 4:15 pm futures closing price...  also, use only the large contract for all official main model signals, the mini contract will give you false signals...
 
The Confirmation Price
 
The confirmation price is a specific market price beyond which the market must close in order to confirm a new main model buy or sell signal...  the confirmation price is not a top or bottom picker, it is not designed to get you into a new position right at, or near, the top or bottom tick...  but rather, it tells you that the trend has more than likely changed direction with a high degree of reliability...  as has been demonstrated with better than a 98% reliability, the confirmation price confirms that the market trend has legitimately changed direction and that a new trend has just begun...  very often, a buy confirmation price may seem so far above the market that taking a new long position at that high level seems risky...  the same can be said for taking a new short position at a sell confirmation price...  but factually, these price points are the most ideal place to enter a new position since these confirmation prices occur where most people are likely to take new erroneous positions in the trend that is just ending...  this is why the market moves so explosively after the price is confirmed, e.g., the new short holders are scrambling to cover or the new dip buyers are selling out rapidly...
 
The NT Indicator
 

The NT indicator is a near term (NT) indicator and is included in the evening briefings for the benefit of those who make counter trend trades... the NT buy and sell spikes are not main model buy and sell signals, these spikes are only very near term, although they could always develop into something more significant over the next few days...  using a weather analogy, the buy/sell spikes are much like a developing low pressure area or a tropical wave, they do not indicate a fully blown hurricane, although it could eventually develop...  if a fully blown hurricane actually does develop, then the main model signal itself would address that market action...

 
How To Read The NT Indicator
 
The best and safest time to take an NT signal is when the market has already trended for some time and is now approaching a VP price, especially a major VP, then the NT spike would indicate that the trend is likely to reverse since the market is already vulnerable at a VP price, the NT spike provides greater certainty for that counter trend trade...
 

The VP Price
 
The VP, or Vertical Price, is NOT a target, the market is not required or expected to reach any VP price...  however, if reached, the VP price represents where the buying/selling has stretched to its maximum exhaustion point, at least temporarily, and a change in trend is very likely...   
 
The Floor/Ceiling Price
 
The floor price is always there in a down trend, the ceiling price is always there in an up trend...  these specific prices are rarely mentioned because the market rarely reaches them...  these are not VP prices but can be treated the same as a VP price except floor and ceiling prices change every day while the VP price does not...  a close beyond the floor/ceiling price should be considered a second buy or sell confirmation signal...
 
How To Read The VP Price
 
If the market touches and then moves away from the VP very quickly and doesn't return, then this typically indicates a market reversal, but if the market moves away from the VP and then returns within a day or two, maybe sooner, then the move is not over and the market is likely to continue in its current trend... repeated visits to a VP suggests the move is not yet over... 
 
A Suggestion On How To Enter A Position On A New Main Model Signal
 
One way to enter a new signal trade is to take only 1/3 position only after the market trades through the confirmation price by a few points...  after that initial position is taken, let the market do what it does all day...  then, late in the day, if the market is still confirming the signal, then add the second 1/3 position...  and then, on the close take the final 1/3 position...  your average entry price will be above/below the confirmation price but the whips will be significantly reduced...  this is a method I use for myself very often...
 
Another way to enter a new position is to wait for the actual confirmation on the close, and then take the new position...
 
THE HOBAN RULE
 
The Hoban Rule is an exclusive proprietary trading strategy that uses the main model signals...  using this strategy eliminates all whips and is recommended to be used by those who are not market savvy and/or nimble enough to trade free style...  this strategy can be used just as easily to trade the SP and gold...
 
For gold, each point is one dollar...
 
To take the trade, these two prerequisite criteria must be met:
 
1)  The closing price on confirmation day must be within 6 points of the confirmation price, and
 
2)  The confirmation price for the next signal must be more than 5 points from the closing price of that day...
 
Since you don't yet know the confirmation price for the next signal at that moment, you can either take the trade if the closing price meets the first criteria, or wait for the evening briefing for that information...   if you took the trade on the first criteria and the evening briefing does not satisfy the second criteria, then simply close out that trade...  or, if you did not take the trade and the evening briefing satisfies the second criteria as well, then take the trade in the evening session or in the after hours market if you're trading a market ETF...  or you can simply take the trade the following morning...
 
However, if the closing price is 6 points or more from the confirmation price, then do not take the trade at that time, just stay flat...
 
In order to take the trade when the closing price is 6 points or more from the confirmation price:
 
1)  Place a limit order to enter the trade when/if the market moves within 6 points of the confirmation price...
 
To exit the trade:
 
1)  Place an exit stop 2 points beyond the next buy/sell confirmation price...  if filled, then stay flat and wait for the next new signal to be confirmed...
 
2)  If the next new signal is confirmed, then begin again with step 1 using the two entry criteria to begin the next new trade position...
 
3)  If the new signal is not confirmed, simply stay flat and wait for the next newly confirmed signal to begin the next trade at step 1, or simply re-enter the original position provided that the closing price that day is within 6 points of the original confirmation price and the reverse confirmation price is at least 5 points above that day's closing price...
 
4) Very often, you may find the second criteria is not met since the reverse confirmation price is less than 5 points above the closing price...  but, on some occasions, a day or two later, the reverse confirmation price could actually move away from the market and would therefore meet the second criteria and subsequently satisfy both prerequisite criteria allowing for an entry provided that day's closing price is still no more than 6 points from the original main model confirmation price...
 
Applying The Hoban Rule for your trade positions based on the buy/sell confirmation prices as described above, you will find it easy to follow and with less stress than trying to catch the market while not knowing where it will actually close...  and, also, all intraday entry whips are completely eliminated...
 
The Vertical Price Equilibrium Spread
 
This spread takes advantage of the unique relationship between related markets...  this spread can be entered at any time, however to optimize and maximize the benefits of this spread, it should be entered at or near the major VP points...  this spread generates profits regardless of market direction...  the details on how to use this spread is exclusive only to paid subscribers, if you would like a full explanation on how to benefit from this spread, then please ask me about it...
 
 
Rejected Buy/Sell Signals
 
Rejected buy and/or sell signals are typically followed by a sharp market move in the opposite direction the following day, this occurs as a general rule...  a rejected sell signal is typically followed the next day by a sharp rally...  as well, a rejected buy signal is typically followed the next day by a sharp decline...  however, if the sharp rally/decline does not occur, then you can expect to see the market make another attempt at that buy/sell signal...
 
The Long Term (LT) Indicator
 

The long term (LT) indicator is a myriad of indicators that give you an X-ray view of the market internals and trend...

 
The green line = the closing price for the specific market
 
The red line = the confirmation line, the more dominant trend
 
The purple line = the early warning line
 
The blue line = the imminent warning line
 
The purple and blue lines crossing the red line gives you early and imminent warning of a possible change in trend direction...
 
If you have a particular stock, ETF, index, or any trading market instrument that you would like to see through the analysis of the LT graph, then just let me know, just send me the market symbol, I can create an LT graph for that selection and keep it on file with me to update for you later on...  
 
 

The email SUGGESTION BOX is always open and invites your ideas for improving and enhancing your email service, I enjoy hearing from you, many thanks...
 

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