For Friday, August 28th

Do not value money for any more nor any less than its worth; it is a good servant but a bad master.

* * * Alexandre Dumas

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 it every now and then, a good working knowledge of these tools will make you a better and more informed investor/trader...

The September SP Futures

IMPORTANT NOTE:

USE ONLY THE LARGE SP CONTRACT FOR ALL SIGNALS, THE MINI CONTRACT WILL GIVE YOU FALSE SIGNALS... AND THEN, ONCE A SIGNAL IS TRIGGERED (AND CONFIRMED), THEN YOU CAN TRADE ANY OTHER MARKET FROM THAT SIGNAL...

BROADER TERM INTERMEDIATE TREND BIAS: NEUTRAL since 8/27/15

The broader term intermediate trend (BTIT) bias is determined by the collective penetration of the most near term ceiling and floor prices... when ALL the near term ceiling prices have been penetrated on the close and none of the floor prices are penetrated, then the BTIT bias would be UP... when the reverse occurs, then the BTIT bias would be DOWN... the bias would turn to NEUTRAL when one or more of the ceiling/floor prices are penetrated on the close in the counter direction...

A close above 2100.34 would turn the BTIT from neutral to up...

A close below 1839.72 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

The BTIT trading strategy is designed for those who prefer a broader longer term trade position without close monitoring...

A long position will be taken when the BTIT turns up and a short position when the BTIT turns down... when the BTIT turns neutral, the position is then closed and will remain flat...

The BTIT current trade position: Now flat as of 8/27/15... 1 trade completed, a total gain of 99.90 SP points...

The main model is now long the September SP from 1948.50 as of Thursday, August 27th...

This market has been one huge roller coaster ride between VP points... we had yet another unintended day trade short form the 1982.93 major VP, another gift for those who took that signal...

It's always wise to hold only a light position in order to tolerate the wild price action of this market...

The last trade as of this writing is at 1989.60...

TOMORROW'S TRADE STRATEGY:

For Friday, a close below 1983.00 would confirm a new main model sell signal...

For Hoban Rule traders, you are now currently flat... enter a new short position with a close below 1983.00 but not below 1977.00...

Rationale: There is a major VP at 1982.93... now that this market has rallied above it, a close below this price would be considered negative for this market...

Are you having difficulty finding an entry point for a new signal??? Consider the Hoban Rule, even a child could follow the simple rules... I use it myself...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on the entry of 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 Hoban Rule can be used with any other additional trading strategies that fit your disposition and comfort level...

The Hoban Rule Performance History:

The Hoban Rule was introduced to the evening briefing on 9/4/14... since that time, this strategy has now completed 33 trades for a net gain of 259.20 SP points... this is a simple but elegant strategy for anyone who prefers a less challenging trade plan based on the main model signals... of course, past performance is never a guarantee of future success, but this particular trading strategy has an impressive history and is well worth considering if you have difficulty taking the best advantage of the main model signals... if you would like to see the trade by trade score sheet for the Hoban Rule, just ask me for it and I will email it to you...

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

This market is no longer profoundly oversold, it's now only typically oversold but still oversold... after more likely whips like today, this market will probably continue higher from here... it's always wise to keep only a light position so you do not become a victim of this market...

image

The LT (Long Term) indicator

The LT graph shows a dramatic recovery from its incredibly oversold lows... now, the blue line is only moderately oversold, the purple line is now in neutral territory...

image (1)
image (2)

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 September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2123.32
minor - - 2124.15
minor - - 2127.91
minor - - 2135.08
minor - - 2139.98
minor - - 2144.74
MAJOR - - 2242.94 and must close below that price on Thursday, March 24th to confirm a new main model sell signal...
MAJOR - - 2245.25 and must close below that price on Thursday, March 10th to confirm a new main model sell signal...
MAJOR - - 2246.704 and must close below that price on Monday, January 18th to confirm a new main model sell signal...
MAJOR - - 2247.31 and must close below that price on Monday March 7th to confirm a new main model sell signal...
MAJOR - - 2266.79 and must close below that price on Thursday, February 4th to confirm a new main model sell signal...
MAJOR - - 2271.71 and must close below that price on Friday, March 4th to confirm a new main model sell signal...
TOMORROW'S HIGHEST CEILING PRICE - - 2653.62

The following are the current downside VPs for the September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2028.301
minor - - 2050.901
minor - - 2042.31
minor - - 2057.67
MAJOR - - 2006.68 and must close above that price on Wednesday, October 14th to confirm a new main model buy signal...
MAJOR - - 2002.48 and must close above that price on Wednesday, October 21st to confirm a new main model buy signal...
MAJOR - - 2029.208 and must close above that price on Monday, September 7th to confirm a new main model buy signal...
minor - - 2028.30
MAJOR - - 2013.95 and must close above that price on Friday, October 23rd to confirm a new main model buy signal...
MAJOR - - 1982.93 and must close above that price on Friday, September 25th to confirm a new main model buy signal...
minor - - 1822.04
MAJOR - - 1770.65 and must close above that price on Wednesday, November 25th to confirm a new main model buy signal...
TOMORROW'S LOWEST FLOOR PRICE - - 1588.68

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 8/19/15
A close below 1112.19 would turn the BTIT from up to neutral...
A close below 1096.49 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1159.60 as of Monday, August 24th...

The last trade as of this writing is at 1124.30...

This market seems to be going nowhere fast...

TOMORROW'S TRADE STRATEGY:

For Friday, a close above 1168.70 in the December Gold contract would confirm a new main model buy signal...

Rationale: We now have a ceiling price at 1168.79 for tomorrow... a close above this price would be positive for this market...

The Hoban Rule was expressly designed for the SP market and no other market at this time...

The LT (Long Term) Indicator

Still looks rather toppy, but stalled completely today right at the red line...

image (3)
image (4)

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

minor - - 1067.04

MAJOR - - 1023.99 and must close above that price on Monday, October 12th to confirm a new main model buy signal...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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

MAJOR - - 1135.25 and must close below that price on Friday, August 28th to confirm a new main model sell signal... (already reached)

minor - - 1198.69 TWO MINOR VP WITH THE EXACT SAME PRICE

minor - - 1198.69 TWO MINOR VP WITH THE EXACT SAME PRICE

minor - - 1218.51

MAJOR - - 1241.16 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...

MAJOR - - 1269.09 and must close below that price on Monday, September 28th to confirm a new main model sell signal...

TOMORROW'S HIGHEST CEILING PRICE - - 1458.32

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... VP prices behave like magnets, they attract the market price, and when the price touches the VP point, then the polarity reverses and repels price... all this market ever does is ping pong between VP prices...

The main model formula is specifically designed to determine precisely and to the exact market price where the market is most likely to reach complete buying and/or selling exhaustion, there is no guessing about it. This is why the market almost always backs away from those VP points after reaching them, at least for 10 to 12 points before resuming the trend... also, at those VP points, the market is the most vulnerable to a legitimate trend change. Therefore, when the market trades through those VP points and then backs away and closes on the other side of it again, there is a very high likelihood of a trend reversal at that time... these VP point are like magnets, they pull and attract the price until the VP is reached, and then upon reaching the VP it then reverses polarity and repels price... at that point, the market can back away and confirm a new trend signal or return to the VP and resume the original trend... this is where the main model determines the buy and sell confirmation prices...

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 to trade the SP market only... 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...

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...

3) Also, you may enter the trade anytime after the signal is confirmed if the market comes back to within 5 points of the original signal confirmation price...

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 reverse confirmation price 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 5 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, August 27th

Do not value money for any more nor any less than its worth; it is a good servant but a bad master.

* * * Alexandre Dumas

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 it every now and then, a good working knowledge of these tools will make you a better and more informed investor/trader...

The September SP Futures

IMPORTANT NOTE:

USE ONLY THE LARGE SP CONTRACT FOR ALL SIGNALS, THE MINI CONTRACT WILL GIVE YOU FALSE SIGNALS... AND THEN, ONCE A SIGNAL IS TRIGGERED (AND CONFIRMED), THEN YOU CAN TRADE ANY OTHER MARKET FROM THAT SIGNAL...

BROADER TERM INTERMEDIATE TREND BIAS: DOWN since 8/20/15

The broader term intermediate trend (BTIT) bias is determined by the collective penetration of the most near term ceiling and floor prices... when ALL the near term ceiling prices have been penetrated on the close and none of the floor prices are penetrated, then the BTIT bias would be UP... when the reverse occurs, then the BTIT bias would be DOWN... the bias would turn to NEUTRAL when one or more of the ceiling/floor prices are penetrated on the close in the counter direction...

A close above 1949.50 would turn the BTIT from down to neutral...

A close above 2100.34 would turn the BTIT from neutral to up...

THE BTIT LONGER TERM TRADING STRATEGY

The BTIT trading strategy is designed for those who prefer a broader longer term trade position without close monitoring...

A long position will be taken when the BTIT turns up and a short position when the BTIT turns down... when the BTIT turns neutral, the position is then closed and will remain flat...

The BTIT trade position: short from 2048.40 as of Thursday, August 20th, 2015 when the BTIT turned down...

The main model is now short the September SP from 2098.30 as of Tuesday, August 18th...

Today's rally makes me think that the FED covered their short positions today... LOL!!!

It's always wise to hold only a light position in order to tolerate the wild price action of this market...

The last trade as of this writing is at 1940.10...

TOMORROW'S TRADE STRATEGY:

For Thursday, a close above 1948.50 would confirm a new main model buy signal... not so far away now...

Rationale: We have a ceiling for tomorrow at 1948.50... a close above that price would break that ceiling and allow this market to run higher...

For Hoban Rule traders, you are now currently flat... enter a new long position tomorrow with a close above 1948.50 but not above 1954.50...

Are you having difficulty finding an entry point for a new signal??? Consider the Hoban Rule, even a child could follow the simple rules... I use it myself...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on the entry of 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 Hoban Rule can be used with any other additional trading strategies that fit your disposition and comfort level...

The Hoban Rule Performance History:

The Hoban Rule was introduced to the evening briefing on 9/4/14... since that time, this strategy has now completed 33 trades for a net gain of 259.20 SP points... this is a simple but elegant strategy for anyone who prefers a less challenging trade plan based on the main model signals... of course, past performance is never a guarantee of future success, but this particular trading strategy has an impressive history and is well worth considering if you have difficulty taking the best advantage of the main model signals... if you would like to see the trade by trade score sheet for the Hoban Rule, just ask me for it and I will email it to you...

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

Extremely oversold condition with a clear buy spike... there's a reasonable chance we'll see a buy signal tomorrow...

image

The LT (Long Term) indicator

Solid buy spike while in extremely oversold territory... even though the low of these lines are off the radar screen, you can now see the line peek above the bottom of the graph... this is also accompanied with a huge upturn in the market... a bottom??? If the buy signal is triggered and confirmed tomorrow, then most definitely we have a bottom... of sorts, anyhow...

image (1)
image (2)

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 September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2059.65 (already reached)
minor - - 2053.53 (already reached)
MAJOR - - 2041.66 and must close above that price on Thursday, September 10th to confirm a new main model buy signal... (already reached)
MAJOR - - 2029.208 and must close above that price on Monday, September 7th to confirm a new main model buy signal... (already reached)
minor - - 2028.30 (already reached)
MAJOR - - 1990.13 and must close above that price on Monday, September 14th to confirm a new main model buy signal... (already reached)
NEW DOWNSIDE VP PRICES NOW DEVELOPED
minor - - 1822.04
MAJOR - - 1770.65 and must close above that price on Wednesday, November 25th to confirm a new main model buy signal...
TOMORROW'S LOWEST FLOOR PRICE - - 1588.68
The following are the current upside VPs for the September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2082.61
minor - - 2110.55
minor - - 2112.69
minor - - 2113.45
minor - - 2128.99
minor - - 2129.701
minor - - 2131.58
MAJOR - - 2136.04 and must close below that price on Tuesday, September 20th to confirm a new main model sell signal...
MAJOR - - 2139.05 and must close below that price on Friday, September 18th to confirm a new main model sell signal...
MAJOR - - 2158.53 and must close below that price on Tuesday, September 1st to confirm a new main model sell signal...
MAJOR - - 2166.05 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...
MAJOR - - 2172.08 and must close below that price on Thursday, September 10th to confirm a new main model sell signal... SAME EXACT VP
MAJOR - - 2172.08 and must close below that price on Tuesday, September 15th to confirm a new main model sell signal... SAME EXACT VP
TOMORROW'S HIGHEST CEILING FLOOR PRICE - - 2319.22

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 8/19/15
A close below 1112.19 would turn the BTIT from up to neutral...
A close below 1096.49 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1159.60 as of Monday, August 24th...

The last trade as of this writing is at 1122.80...

TOMORROW'S TRADE STRATEGY:

For Thursday, a close above 1168.70 in the December Gold contract would confirm a new main model buy signal...

Rationale: We now have a ceiling price at 1168.79 for tomorrow... a close above this price would be positive for this market...

The Hoban Rule was expressly designed for the SP market and no other market at this time...

The LT (Long Term) Indicator

The topping action continues...

image (3)
image (4)

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

minor - - 1067.04

MAJOR - - 1023.99 and must close above that price on Monday, October 12th to confirm a new main model buy signal...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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

MAJOR - - 1135.25 and must close below that price on Friday, August 28th to confirm a new main model sell signal... (already reached)

minor - - 1198.69 TWO MINOR VP WITH THE EXACT SAME PRICE

minor - - 1198.69 TWO MINOR VP WITH THE EXACT SAME PRICE

minor - - 1218.51

MAJOR - - 1241.16 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...

MAJOR - - 1269.09 and must close below that price on Monday, September 28th to confirm a new main model sell signal...

TOMORROW'S HIGHEST CEILING PRICE - - 1458.32

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

minor - - 1067.04

MAJOR - - 1023.99 and must close above that price on Monday, October 12th to confirm a new main model buy signal...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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... VP prices behave like magnets, they attract the market price, and when the price touches the VP point, then the polarity reverses and repels price... all this market ever does is ping pong between VP prices...

The main model formula is specifically designed to determine precisely and to the exact market price where the market is most likely to reach complete buying and/or selling exhaustion, there is no guessing about it. This is why the market almost always backs away from those VP points after reaching them, at least for 10 to 12 points before resuming the trend... also, at those VP points, the market is the most vulnerable to a legitimate trend change. Therefore, when the market trades through those VP points and then backs away and closes on the other side of it again, there is a very high likelihood of a trend reversal at that time... these VP point are like magnets, they pull and attract the price until the VP is reached, and then upon reaching the VP it then reverses polarity and repels price... at that point, the market can back away and confirm a new trend signal or return to the VP and resume the original trend... this is where the main model determines the buy and sell confirmation prices...

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 to trade the SP market only... 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...

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...

3) Also, you may enter the trade anytime after the signal is confirmed if the market comes back to within 5 points of the original signal confirmation price...

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 reverse confirmation price 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 5 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, August 26th

Do not value money for any more nor any less than its worth; it is a good servant but a bad master.

* * * Alexandre Dumas

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 it every now and then, a good working knowledge of these tools will make you a better and more informed investor/trader...

The September SP Futures

IMPORTANT NOTE:

USE ONLY THE LARGE SP CONTRACT FOR ALL SIGNALS, THE MINI CONTRACT WILL GIVE YOU FALSE SIGNALS... AND THEN, ONCE A SIGNAL IS TRIGGERED (AND CONFIRMED), THEN YOU CAN TRADE ANY OTHER MARKET FROM THAT SIGNAL...

BROADER TERM INTERMEDIATE TREND BIAS: DOWN since 8/20/15

The broader term intermediate trend (BTIT) bias is determined by the collective penetration of the most near term ceiling and floor prices... when ALL the near term ceiling prices have been penetrated on the close and none of the floor prices are penetrated, then the BTIT bias would be UP... when the reverse occurs, then the BTIT bias would be DOWN... the bias would turn to NEUTRAL when one or more of the ceiling/floor prices are penetrated on the close in the counter direction...

A close above 2097.93 would turn the BTIT from down to neutral...

A close above 2100.34 would turn the BTIT from neutral to up...

THE BTIT LONGER TERM TRADING STRATEGY

The BTIT trading strategy is designed for those who prefer a broader longer term trade position without close monitoring...

A long position will be taken when the BTIT turns up and a short position when the BTIT turns down... when the BTIT turns neutral, the position is then closed and will remain flat...

The BTIT trade position: short from 2048.40 as of Thursday, August 20th, 2015 when the BTIT turned down...

The main model is now short the September SP from 2098.30 as of Tuesday, August 18th...

The incredible weakness and volatility continues... it's good to be short this market, although notice how oversold this market is right now... there's nothing wrong with controlling risk by keeping your positions light...

It's always wise to hold only a light position in order to tolerate the wild price action of this market...

The last trade as of this writing is at 1873.90...

We had a buy signal via update last night, but 45 points higher we had another update to close out that long position and reinstate the short position...

SUBSCRIBER QUESTION: WHY DID YOU SEND OUT AN UPDATE TO REINSTATE THE SHORT POSITION RIGHT AWAY?

MY RESPONSE: Good question, but here's why, several reasons...

If the market were already trading ABOVE 1948.50, then I would suggest to stay long and take a short position with a close below that 1948.50 price... and it doesn't mean one couldn't just hold their long anyhow, but 1948.50 is more significant to the main model than the 1895.60 buy from last night...

With this kind of market, the main model is moving as quickly as the market and these are critical price points... they're not VP points, but they're key prices which the market must overcome to confirm and continue in either direction... also, the BTIT is down, so the bias is still lower...

And also, since the market was already 45 points above last night's buy price and only 8.50 points away from a more significant buy price, the risk is minimal and well worth reinstating the short position before the market began moving lower, presuming that it would begin moving lower again... and, behold, it did... after the update was sent out, the market fell nearly another 70 SP points... the 45 points on the long side was an unintended day trade and a wonderful gift from the main model, I hope many of you were able to take advantage of it...

SUBSCRIBER QUESTION: HOW ARE YOU ABLE TO PREDICT WITH SUCH RELIABLE ACCURACY WHICH WAY THE MARKET IS GOING TO GO?

MY RESPONSE: Actually, I never predict anything... the strategy is never to predict but to follow what the market is doing and run with it without hesitation and without second guessing, that's where most people make their mistakes, hesitation and second guessing can be costly... the main model generates the signals, so all that needs to be done is to follow those signals...

TOMORROW'S TRADE STRATEGY:

For Wednesday, a close above 1948.50 would confirm a new main model buy signal... yes, that's a long way from here, but the main model knows that this volatility requires more elbow room to avoid unnecessary whips...

For Hoban Rule traders, you are now currently flat... enter a new long position tomorrow with a close above 1948.50 but not above 1954.50...

Are you having difficulty finding an entry point for a new signal??? Consider the Hoban Rule, even a child could follow the simple rules... I use it myself...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on the entry of 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 Hoban Rule can be used with any other additional trading strategies that fit your disposition and comfort level...

The Hoban Rule Performance History:

The Hoban Rule was introduced to the evening briefing on 9/4/14... since that time, this strategy has now completed 33 trades for a net gain of 259.20 SP points... this is a simple but elegant strategy for anyone who prefers a less challenging trade plan based on the main model signals... of course, past performance is never a guarantee of future success, but this particular trading strategy has an impressive history and is well worth considering if you have difficulty taking the best advantage of the main model signals... if you would like to see the trade by trade score sheet for the Hoban Rule, just ask me for it and I will email it to you...

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

The NT indicator is off the radar screen today... the value is -2.435 but the chart only goes down to -2.1, to give you some idea... if this is in fact a bear market, then this market can continue lower for a very long time while still remaining oversold... this is a major characteristic of bear markets, if this is actually one of them... being oversold in a bull market is one thing, but in a bear market, we can see it remain oversold for months at a time while the market still continues lower...

image

The LT (Long Term) indicator

Still off the radar screen, but a modest uptick... I may refit these graphs so you can see the depth of the oversold condition, especially if this selling continues...

image (1)
image (2)

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 September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2059.65 (already reached)
minor - - 2053.53 (already reached)
MAJOR - - 2041.66 and must close above that price on Thursday, September 10th to confirm a new main model buy signal... (already reached)
MAJOR - - 2029.208 and must close above that price on Monday, September 7th to confirm a new main model buy signal... (already reached)
minor - - 2028.30 (already reached)
MAJOR - - 1990.13 and must close above that price on Monday, September 14th to confirm a new main model buy signal... (already reached)
TOMORROW'S LOWEST FLOOR PRICE - - none
THERE IS NOTHING BUT THIN AIR BENEATH THIS MARKET RIGHT NOW...

The following are the current upside VPs for the September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2082.61
minor - - 2110.55
minor - - 2112.69
minor - - 2113.45
minor - - 2128.99
minor - - 2129.701
minor - - 2131.58
MAJOR - - 2136.04 and must close below that price on Tuesday, September 20th to confirm a new main model sell signal...
MAJOR - - 2139.05 and must close below that price on Friday, September 18th to confirm a new main model sell signal...
MAJOR - - 2158.53 and must close below that price on Tuesday, September 1st to confirm a new main model sell signal...
MAJOR - - 2166.05 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...
MAJOR - - 2172.08 and must close below that price on Thursday, September 10th to confirm a new main model sell signal... SAME EXACT VP
MAJOR - - 2172.08 and must close below that price on Tuesday, September 15th to confirm a new main model sell signal... SAME EXACT VP
TOMORROW'S HIGHEST CEILING FLOOR PRICE - - 2319.22

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 8/19/15
A close below 1112.19 would turn the BTIT from up to neutral...
A close below 1096.49 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1159.60 as of Monday, August 24th...

The last trade as of this writing is at 1139.80...

TOMORROW'S TRADE STRATEGY:

For Wednesday, a close above 1168.70 in the December Gold contract would confirm a new main model buy signal...

Rationale: We now have a ceiling price at 1168.79 for tomorrow... a close above this price would be positive for this market...

The Hoban Rule was expressly designed for the SP market and no other market at this time...

The LT (Long Term) Indicator

An imposing looking top for the gold LT graph...

image (3)
image (4)

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

minor - - 1067.04

MAJOR - - 1023.99 and must close above that price on Monday, October 12th to confirm a new main model buy signal...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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

MAJOR - - 1135.25 and must close below that price on Friday, August 28th to confirm a new main model sell signal... (already reached)

minor - - 1198.69 TWO MINOR VP WITH THE EXACT SAME PRICE

minor - - 1198.69 TWO MINOR VP WITH THE EXACT SAME PRICE

minor - - 1218.51

MAJOR - - 1241.16 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...

MAJOR - - 1269.09 and must close below that price on Monday, September 28th to confirm a new main model sell signal...

TOMORROW'S HIGHEST CEILING PRICE - - 1458.32

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

minor - - 1067.04

MAJOR - - 1023.99 and must close above that price on Monday, October 12th to confirm a new main model buy signal...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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... VP prices behave like magnets, they attract the market price, and when the price touches the VP point, then the polarity reverses and repels price... all this market ever does is ping pong between VP prices...

The main model formula is specifically designed to determine precisely and to the exact market price where the market is most likely to reach complete buying and/or selling exhaustion, there is no guessing about it. This is why the market almost always backs away from those VP points after reaching them, at least for 10 to 12 points before resuming the trend... also, at those VP points, the market is the most vulnerable to a legitimate trend change. Therefore, when the market trades through those VP points and then backs away and closes on the other side of it again, there is a very high likelihood of a trend reversal at that time... these VP point are like magnets, they pull and attract the price until the VP is reached, and then upon reaching the VP it then reverses polarity and repels price... at that point, the market can back away and confirm a new trend signal or return to the VP and resume the original trend... this is where the main model determines the buy and sell confirmation prices...

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 to trade the SP market only... 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...

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...

3) Also, you may enter the trade anytime after the signal is confirmed if the market comes back to within 5 points of the original signal confirmation price...

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 reverse confirmation price 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 5 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, August 25th

Do not value money for any more nor any less than its worth; it is a good servant but a bad master.

* * * Alexandre Dumas

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 it every now and then, a good working knowledge of these tools will make you a better and more informed investor/trader...

The September SP Futures

IMPORTANT NOTE:

USE ONLY THE LARGE SP CONTRACT FOR ALL SIGNALS, THE MINI CONTRACT WILL GIVE YOU FALSE SIGNALS... AND THEN, ONCE A SIGNAL IS TRIGGERED (AND CONFIRMED), THEN YOU CAN TRADE ANY OTHER MARKET FROM THAT SIGNAL...

BROADER TERM INTERMEDIATE TREND BIAS: DOWN since 8/20/15

The broader term intermediate trend (BTIT) bias is determined by the collective penetration of the most near term ceiling and floor prices... when ALL the near term ceiling prices have been penetrated on the close and none of the floor prices are penetrated, then the BTIT bias would be UP... when the reverse occurs, then the BTIT bias would be DOWN... the bias would turn to NEUTRAL when one or more of the ceiling/floor prices are penetrated on the close in the counter direction...

A close above 2097.93 would turn the BTIT from down to neutral...

A close above 2100.34 would turn the BTIT from neutral to up...

THE BTIT LONGER TERM TRADING STRATEGY

The BTIT trading strategy is designed for those who prefer a broader longer term trade position without close monitoring...

A long position will be taken when the BTIT turns up and a short position when the BTIT turns down... when the BTIT turns neutral, the position is then closed and will remain flat...

The BTIT trade position: short from 2048.40 as of Thursday, August 20th, 2015 when the BTIT turned down...

The main model is now short the September SP from 2098.30 as of Tuesday, August 18th...

Incredible weakness and volatility all across the board... it's good to be short this market, although notice how oversold this market is right now... there's nothing wrong with controlling risk by keeping your positions light...

It's always wise to hold only a light position in order to tolerate the wild price action of this market...

The last trade as of this writing is at 1868.90... 230 SP points in one week!!!

TOMORROW'S TRADE STRATEGY:

For Tuesday, a close above 1990.10 this would confirm a new main model buy signal...

For Hoban Rule traders, you are now currently flat... enter a new long position with a close above 1990.10 but not above 1996.10...

Rationale:

There is a major VP at 1990.13... a penetration below and then a close above this price today would be considered bullish for this market...

Please Note: Right now, there are no downside VP or floor prices... this means the main model is anticipating continued wide volatility and will avoid whips with nearby VP points... keeping a light position gives you the luxury of holding and withstanding the market turbulence while en route... another way to reduce risk is to use the EQ spread... if you want to know how to use it, then just ask me and I'll email the details on this interesting spread...

Are you having difficulty finding an entry point for a new signal??? Consider the Hoban Rule, even a child could follow the simple rules... I use it myself...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on the entry of 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 Hoban Rule can be used with any other additional trading strategies that fit your disposition and comfort level...

The Hoban Rule Performance History:

The Hoban Rule was introduced to the evening briefing on 9/4/14... since that time, this strategy has now completed 33 trades for a net gain of 259.20 SP points... this is a simple but elegant strategy for anyone who prefers a less challenging trade plan based on the main model signals... of course, past performance is never a guarantee of future success, but this particular trading strategy has an impressive history and is well worth considering if you have difficulty taking the best advantage of the main model signals... if you would like to see the trade by trade score sheet for the Hoban Rule, just ask me for it and I will email it to you...

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

From the looks of this NT indicator, I would NOT consider adding new short positions here, this market is extremely oversold... yes, it could still continue lower, but intelligent money management would also dictate discretion here... this market could turn around and rally 100 SP point without blinking and without disturbing the trend direction, so please be wary...

image

The LT (Long Term) indicator

The blue and purple lines are so far down, they've gone off the radar screen... to give you some idea as to where they are today, the value for the blue line is -5.95, the chart only goes down to -3.50... the purple line today reaches -4.89, these are profoundly over sold levels... without any doubt, expect a highly spirited rally at ANY TIME... please, keep your positions light so you would not be at great and unnecessary risk of injury...

image (1)
image (2)

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 September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2059.65 (already reached)
minor - - 2053.53 (already reached)
MAJOR - - 2041.66 and must close above that price on Thursday, September 10th to confirm a new main model buy signal... (already reached)
MAJOR - - 2029.208 and must close above that price on Monday, September 7th to confirm a new main model buy signal... (already reached)
minor - - 2028.30 (already reached)
MAJOR - - 1990.13 and must close above that price on Monday, September 14th to confirm a new main model buy signal... (already reached)
TOMORROW'S LOWEST FLOOR PRICE - - none
THERE IS NOTHING BUT THIN AIR BENEATH THIS MARKET RIGHT NOW...

The following are the current upside VPs for the September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2082.61
minor - - 2110.55
minor - - 2112.69
minor - - 2113.45
minor - - 2128.99
minor - - 2129.701
minor - - 2131.58
MAJOR - - 2136.04 and must close below that price on Tuesday, September 20th to confirm a new main model sell signal...
MAJOR - - 2139.05 and must close below that price on Friday, September 18th to confirm a new main model sell signal...
MAJOR - - 2158.53 and must close below that price on Tuesday, September 1st to confirm a new main model sell signal...
MAJOR - - 2166.05 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...
MAJOR - - 2172.08 and must close below that price on Thursday, September 10th to confirm a new main model sell signal... SAME EXACT VP
MAJOR - - 2172.08 and must close below that price on Tuesday, September 15th to confirm a new main model sell signal... SAME EXACT VP
TOMORROW'S HIGHEST CEILING FLOOR PRICE - - 2319.22

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 8/19/15
A close below 1112.19 would turn the BTIT from up to neutral...
A close below 1096.49 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1159.60 as of Monday, August 24th...

The last trade as of this writing is at 1152.80...

TOMORROW'S TRADE STRATEGY:

For Tuesday, a close above 1168.70 in the December Gold contract would confirm a new main model buy signal...

Rationale: We now have a ceiling price at 1168.79 for tomorrow... a close above this price would be positive for this market...

The Hoban Rule was expressly designed for the SP market and no other market at this time...

The LT (Long Term) Indicator

The LT graph shows clear sell spikes in deeply over bought territory... also, if you look at the distance between all the previous blue tops, you can see that this current sell spike is occurring just about on time and also while deeply over bought... a short gold position here should yield promising gains... we'll see...

image (3)
image (4)

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

minor - - 1067.04

MAJOR - - 1023.99 and must close above that price on Monday, October 12th to confirm a new main model buy signal...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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

MAJOR - - 1135.25 and must close below that price on Friday, August 28th to confirm a new main model sell signal... (already reached)

minor - - 1198.69 TWO MINOR VP WITH THE EXACT SAME PRICE

minor - - 1198.69 TWO MINOR VP WITH THE EXACT SAME PRICE

minor - - 1218.51

MAJOR - - 1241.16 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...

MAJOR - - 1269.09 and must close below that price on Monday, September 28th to confirm a new main model sell signal...

TOMORROW'S HIGHEST CEILING PRICE - - 1458.32

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

minor - - 1067.04

MAJOR - - 1023.99 and must close above that price on Monday, October 12th to confirm a new main model buy signal...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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... VP prices behave like magnets, they attract the market price, and when the price touches the VP point, then the polarity reverses and repels price... all this market ever does is ping pong between VP prices...

The main model formula is specifically designed to determine precisely and to the exact market price where the market is most likely to reach complete buying and/or selling exhaustion, there is no guessing about it. This is why the market almost always backs away from those VP points after reaching them, at least for 10 to 12 points before resuming the trend... also, at those VP points, the market is the most vulnerable to a legitimate trend change. Therefore, when the market trades through those VP points and then backs away and closes on the other side of it again, there is a very high likelihood of a trend reversal at that time... these VP point are like magnets, they pull and attract the price until the VP is reached, and then upon reaching the VP it then reverses polarity and repels price... at that point, the market can back away and confirm a new trend signal or return to the VP and resume the original trend... this is where the main model determines the buy and sell confirmation prices...

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 to trade the SP market only... 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...

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...

3) Also, you may enter the trade anytime after the signal is confirmed if the market comes back to within 5 points of the original signal confirmation price...

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 reverse confirmation price 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 5 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, August 24th

"The key to navigating bubbles successfully is to panic before everyone else does."
 
 
* * John P. Hussmann, Ph.D.
 
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 it every now and then, a good working knowledge of these tools will make you a better and more informed investor/trader...
The September SP Futures
IMPORTANT NOTE:
 
USE ONLY THE LARGE SP CONTRACT FOR ALL SIGNALS, THE MINI CONTRACT WILL GIVE YOU FALSE SIGNALS...  AND THEN, ONCE A SIGNAL IS TRIGGERED (AND CONFIRMED), THEN YOU CAN TRADE ANY OTHER MARKET FROM THAT SIGNAL...
 
BROADER TERM INTERMEDIATE TREND BIAS:  DOWN since 8/20/15
 
The broader term intermediate trend (BTIT) bias is determined by the collective penetration of the most near term ceiling and floor prices...  when ALL the near term ceiling prices have been penetrated on the close and none of the floor prices are penetrated, then the BTIT bias would be UP...  when the reverse occurs, then the BTIT bias would be DOWN...  the bias would turn to NEUTRAL when one or more of the ceiling/floor prices are penetrated on the close in the counter direction...
 
A close above 2097.93 would turn the BTIT from down to neutral... 
 
A close above 2100.34 would turn the BTIT from neutral to up...
 
NEW TODAY:  INTRODUCING THE BTIT LONGER TERM TRADING STRATEGY
 
The BTIT trading strategy is designed for those who prefer a broader longer term trade position without close monitoring...  
 
A long position will be taken when the BTIT turns up and a short position when the BTIT turns down...  when the BTIT turns neutral, the position is then closed and will remain flat...
 
The BTIT trade position:  short from 2048.40 as of Thursday, August 20th, 2015 when the BTIT turned down...
 
The main model is now short the September SP from 2098.30 as of Tuesday, August 18th...  
 
Incredible weakness all across the board...  it's good to be short this market...
 
It's always wise to hold only a light position in order to tolerate the wild price action of this market...
 
 
The last trade as of this writing is at 1970.40...  
 
TOMORROW'S TRADE STRATEGY:
 
For Monday, a close above 1990.10 this would confirm a new main model buy signal...    
For Hoban Rule traders, you are now currently flat...  enter a new long position with a close above 1990.10 but not above 1996.10...
 
Rationale:
 
There is a major VP at 1990.13...  a penetration below and then a close above this price today would be considered bullish for this market...  
 
Please Note:  this is the final downside VP, and the market has now closed well below it...  if this market fails to rally from here, then there is nothing to hold this market from a more severe decline...
 
Are you having difficulty finding an entry point for a new signal???  Consider the Hoban Rule, even a child could follow the simple rules...  I use it myself...
 
The Hoban Rule will not catch all trades, but will also not incur any entry whips on the entry of 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 Hoban Rule can be used with any other additional trading strategies that fit your disposition and comfort level...
 
The Hoban Rule Performance History:
 
The Hoban Rule was introduced to the evening briefing on 9/4/14... since that time, this strategy has now completed 33 trades for a net gain of 259.20 SP points...  this is a simple but elegant strategy for anyone who prefers a less challenging trade plan based on the main model signals...  of course, past performance is never a guarantee of future success, but this particular trading strategy has an impressive history and is well worth considering if you have difficulty taking the best advantage of the main model signals...  if you would like to see the trade by trade score sheet for the Hoban Rule, just ask me for it and I will email it to you...
 
The NT (Near Term) indicator  (the red line)
The NT indicator is now in deeply over sold territory with no buy spike for now...
image
The LT (Long Term) indicator
The LT graph is about as over sold as it was last October at a major bottom...
image (1)
image (2)
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 September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...

 

 

minor - - 2059.65  (already reached)
minor - - 2053.53  (already reached)

MAJOR - - 2041.66

and must close above that price on Thursday, September 10th to confirm a new main model buy signal...  (already reached)

MAJOR - - 2029.208

and must close above that price on Monday, September 7th to confirm a new main model buy signal...  (already reached)
minor - - 2028.30  (already reached)
MAJOR - - 1990.13 and must close above that price on Monday, September 14th to confirm a new main model buy signal...  (already reached)
TOMORROW'S LOWEST FLOOR PRICE - - 1865.12  
 
The following are the current upside VPs for the September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...

 

 

 

minor - - 2082.61
minor - - 2110.55
minor - - 2112.69
minor - - 2113.45
minor - - 2128.99
minor - - 2129.701
minor - - 2131.58
MAJOR - -  2136.04 and must close below that price on Tuesday, September 20th to confirm a new main model sell signal...

 

 

 

MAJOR - -  2139.05 and must close below that price on Friday, September 18th to confirm a new main model sell signal...
MAJOR - -  2158.53 and must close below that price on Tuesday, September 1st to confirm a new main model sell signal...  

MAJOR - -  2166.05 

and must close below that price on
Tuesday, September 22nd
to confirm a new main model sell signal...

MAJOR - -  2172.08 

and must close below that price on
Thursday, September 10th
to confirm a new main model sell signal...
  SAME EXACT VP

MAJOR - -  2172.08 

and must close below that price on
Tuesday, September 15th
to confirm a new main model sell signal...
  SAME EXACT VP

 

TOMORROW'S HIGHEST CEILING FLOOR PRICE - - 2319.22  
 
The DECEMBER Gold futures 
BROADER TERM INTERMEDIATE TREND BIAS:  UP since 8/19/15 
A close below 1112.19 would turn the BTIT from up to neutral...
A close below 1096.49 would turn the BTIT from neutral to down...
The main model is now long the December gold from 1114.80 as of Monday, August 17th...
The last trade as of this writing is at 1158.70...
TOMORROW'S TRADE STRATEGY:
For Monday, a close below 1135.30 in the December Gold contract would confirm a new main model sell signal... 
 

This Sunday afternoon gold update supersedes ALL previous gold briefings... 

For Monday, a close below 1159.60 in the December Gold contract would confirm a new main model sell signal...    

Rationale:  We now have a ceiling price at 1159.60 for Monday...  a close below this price on Monday would be negative for this market...

The Hoban Rule was expressly designed for the SP market and no other market at this time...  
The LT (Long Term) Indicator
The gold market is as over bought as the SP is over sold...  and the purple line now has a slight sell spike while in deeply over bought territory...  this market needs to be watched carefully...
image (3)
image (4)
The following are the current upside VPs for December gold... 
 
 
MAJOR - - 1135.25 and must close below that price on Friday, August 28th to confirm a new main model sell signal...  (already reached)
 
minor - - 1198.69  TWO MINOR VP WITH THE EXACT SAME PRICE  (already reached)
minor - - 1198.69  TWO MINOR VP WITH THE EXACT SAME PRICE  (already reached)
 
minor - - 1218.51  (already reached)
 
MAJOR - - 1241.16 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...  (already reached)
 
MAJOR - - 1269.09 and must close below that price on Monday, September 28th to confirm a new main model sell signal... 
TOMORROW'S HIGHEST CEILING PRICE - - 1458.32  
 
 
 
The following are the current downside VPs for December gold... 
 
 
minor - - 1091.907 
 
miner - - 1070.13
 
MAJOR - - 530.11  (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal...  yes, very odd...
 
This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...
TOMORROW'S LOWEST FLOOR PRICE - - 480.22  (no typo)
 
 
 
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...  VP prices behave like magnets, they attract the market price, and when the price touches the VP point, then the polarity reverses and repels price...  all this market ever does is ping pong between VP prices...
 
The main model formula is specifically designed to determine precisely and to the exact market price where the market is most likely to reach complete buying and/or selling exhaustion, there is no guessing about it.  This is why the market almost always backs away from those VP points after reaching them, at least for 10 to 12 points before resuming the trend...  also, at those VP points, the market is the most vulnerable to a legitimate trend change.  Therefore, when the market trades through those VP points and then backs away and closes on the other side of it again, there is a very high likelihood of a trend reversal at that time...  these VP point are like magnets, they pull and attract the price until the VP is reached, and then upon reaching the VP it then reverses polarity and repels price...  at that point, the market can back away and confirm a new trend signal or return to the VP and resume the original trend...  this is where the main model determines the buy and sell confirmation prices...
 
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 to trade the SP market only...  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...  
 
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...
 
3)  Also, you may enter the trade anytime after the signal is confirmed if the market comes back to within 5 points of the original signal confirmation price...
 
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 reverse confirmation price 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 5 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, August 21st

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

* * * John P. Hussmann, Ph.D.

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 it every now and then, a good working knowledge of these tools will make you a better and more informed investor/trader...

The September SP Futures

IMPORTANT NOTE:

USE ONLY THE LARGE SP CONTRACT FOR ALL SIGNALS, THE MINI CONTRACT WILL GIVE YOU FALSE SIGNALS... AND THEN, ONCE A SIGNAL IS TRIGGERED (AND CONFIRMED), THEN YOU CAN TRADE ANY OTHER MARKET FROM THAT SIGNAL...

BROADER TERM INTERMEDIATE TREND BIAS: DOWN since 8/20/15

The broader term intermediate trend (BTIT) bias is determined by the collective penetration of the most near term ceiling and floor prices... when ALL the near term ceiling prices have been penetrated on the close and none of the floor prices are penetrated, then the BTIT bias would be UP... when the reverse occurs, then the BTIT bias would be DOWN... the bias would turn to NEUTRAL when one or more of the ceiling/floor prices are penetrated on the close in the counter direction...

A close above 2097.93 would turn the BTIT from down to neutral...

A close above 2100.34 would turn the BTIT from neutral to up...

The main model is now short the September SP from 2098.30 as of Tuesday, August 18th...

No less than three mid day updates were sent out today in an effort to keep pace with this declining market... yet, the market closed below all VP points and the lower nearby floor... this has now turned the BTIT longer term index from NEUTRAL to DOWN...

It's always wise to hold only a light position in order to tolerate the wild price action of this market...

The last trade as of this writing is at 2026.40... although if I look again in 15 seconds the price would likely be very different, the volatility is stunning, especially for those without a market strategy...

TOMORROW'S TRADE STRATEGY:

For Friday, a close above 2028.30 would confirm a new main model buy signal...

For Hoban Rule traders, you are now currently flat... enter a new long position tomorrow with a close above 2028.30 but not above 2034.30...

Rationale:

There is a minor VP at 2028.30... a penetration below and then a close above this price today would be considered bullish for this market...

This Friday mid day SP update supersedes ALL previous SP briefings...

For Friday, a close above 1990.10 this would confirm a new main model buy signal...

For Hoban Rule traders, you are now currently flat... enter a new long position today with a close above 1990.10 but not above 1996.10...

Rationale:

There is a major VP at 1990.13... a penetration below and then a close above this price today would be considered bullish for this market...
Are you having difficulty finding an entry point for a new signal??? Consider the Hoban Rule, even a child could follow the simple rules... I use it myself...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on the entry of 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 Hoban Rule can be used with any other additional trading strategies that fit your disposition and comfort level...

The Hoban Rule Performance History:

The Hoban Rule was introduced to the evening briefing on 9/4/14... since that time, this strategy has now completed 33 trades for a net gain of 259.20 SP points... this is a simple but elegant strategy for anyone who prefers a less challenging trade plan based on the main model signals... of course, past performance is never a guarantee of future success, but this particular trading strategy has an impressive history and is well worth considering if you have difficulty taking the best advantage of the main model signals... if you would like to see the trade by trade score sheet for the Hoban Rule, just ask me for it and I will email it to you...

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

The NT indicator continues lower... the main model remains short...

image

The LT (Long Term) indicator

The LT graph shows a market deeply oversold, but with no buy spikes in view...

image (1)
image (2)

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 September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2059.65 (already reached)
minor - - 2053.53 (already reached)
MAJOR - - 2041.66 and must close above that price on Thursday, September 10th to confirm a new main model buy signal... (already reached)
MAJOR - - 2029.208 and must close above that price on Monday, September 7th to confirm a new main model buy signal... (already reached)
minor - - 2028.30 (already reached)
MAJOR - - 1990.13 and must close above that price on Monday, September 14th to confirm a new main model buy signal...
TOMORROW'S LOWEST FLOOR PRICE - - 1865.12

The following are the current upside VPs for the September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2082.61
minor - - 2110.55
minor - - 2112.69
minor - - 2113.45
minor - - 2128.99
minor - - 2129.701
minor - - 2131.58
MAJOR - - 2136.04 and must close below that price on Tuesday, September 20th to confirm a new main model sell signal...
MAJOR - - 2139.05 and must close below that price on Friday, September 18th to confirm a new main model sell signal...
MAJOR - - 2158.53 and must close below that price on Tuesday, September 1st to confirm a new main model sell signal...
MAJOR - - 2166.05 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...
MAJOR - - 2172.08 and must close below that price on Thursday, September 10th to confirm a new main model sell signal... SAME EXACT VP
MAJOR - - 2172.08 and must close below that price on Tuesday, September 15th to confirm a new main model sell signal... SAME EXACT VP
TOMORROW'S HIGHEST CEILING FLOOR PRICE - - 2319.22

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 8/19/15
A close below 1112.19 would turn the BTIT from up to neutral...
A close below 1096.49 would turn the BTIT from neutral to down...
The main model is now long the December gold from 1114.80 as of Monday, August 17th...

The last trade as of this writing is at 1152.50...

I wonder what market this is and I wonder what it did with the gold market... i know the gold market always looked weak, but this market doesn't behave the way the gold market has in more than two years... okay, maybe it's a new day... let's hope this rally continues...

TOMORROW'S TRADE STRATEGY:

For Friday, a close below 1135.30 in the December Gold contract would confirm a new main model sell signal...

The Hoban Rule was expressly designed for the SP market and no other market at this time...

The LT (Long Term) Indicator

Wow, deeply over bought, let's see what tomorrow brings...

image (3)
image (4)

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

MAJOR - - 1135.25 and must close below that price on Friday, August 28th to confirm a new main model sell signal... (already reached)

minor - - 1198.69 TWO MINOR VP WITH THE EXACT SAME PRICE (already reached)

minor - - 1198.69 TWO MINOR VP WITH THE EXACT SAME PRICE (already reached)

minor - - 1218.51 (already reached)

MAJOR - - 1241.16 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal... (already reached)

MAJOR - - 1269.09 and must close below that price on Monday, September 28th to confirm a new main model sell signal...

TOMORROW'S HIGHEST CEILING PRICE - - 1458.32

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

minor - - 1091.907

miner - - 1070.13

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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... VP prices behave like magnets, they attract the market price, and when the price touches the VP point, then the polarity reverses and repels price... all this market ever does is ping pong between VP prices...

The main model formula is specifically designed to determine precisely and to the exact market price where the market is most likely to reach complete buying and/or selling exhaustion, there is no guessing about it. This is why the market almost always backs away from those VP points after reaching them, at least for 10 to 12 points before resuming the trend... also, at those VP points, the market is the most vulnerable to a legitimate trend change. Therefore, when the market trades through those VP points and then backs away and closes on the other side of it again, there is a very high likelihood of a trend reversal at that time... these VP point are like magnets, they pull and attract the price until the VP is reached, and then upon reaching the VP it then reverses polarity and repels price... at that point, the market can back away and confirm a new trend signal or return to the VP and resume the original trend... this is where the main model determines the buy and sell confirmation prices...

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 to trade the SP market only... 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...

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...

3) Also, you may enter the trade anytime after the signal is confirmed if the market comes back to within 5 points of the original signal confirmation price...

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 reverse confirmation price 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 5 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, August 20th

"One way to end up with $1 million with these markets is to start with $2 million."

* * * Ralph Seger

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 it every now and then, a good working knowledge of these tools will make you a better and more informed investor/trader...

The September SP Futures

IMPORTANT NOTE:

USE ONLY THE LARGE SP CONTRACT FOR ALL SIGNALS, THE MINI CONTRACT WILL GIVE YOU FALSE SIGNALS... AND THEN, ONCE A SIGNAL IS TRIGGERED (AND CONFIRMED), THEN YOU CAN TRADE ANY OTHER MARKET FROM THAT SIGNAL...

BROADER TERM INTERMEDIATE TREND BIAS: NEUTRAL since 7/27/15

The broader term intermediate trend (BTIT) bias is determined by the collective penetration of the most near term ceiling and floor prices... when ALL the near term ceiling prices have been penetrated on the close and none of the floor prices are penetrated, then the BTIT bias would be UP... when the reverse occurs, then the BTIT bias would be DOWN... the bias would turn to NEUTRAL when one or more of the ceiling/floor prices are penetrated on the close in the counter direction...

A close above 2105.00 would turn the BTIT from neutral to up...

A close below 2047.22 would turn the BTIT from neutral to down...

The main model is now short the September SP from 2098.30 as of Tuesday, August 18th...

A mid day buy signal was triggered today after the FED made its announcement, but the market rejected that signal...

This market is nothing but incredibly volatile... it's always wise to hold only a light position in order to tolerate the wild price action of this market...

The last trade as of this writing is at 2071.90...

TOMORROW'S TRADE STRATEGY:

For Thursday, if the SP closes above 2082.60 this would confirm a new main model buy signal...

For Hoban Rule traders, you are now currently flat after being stopped out at 2084.60... this trades was for a gain of 9.50 SP points... nice!!! for tomorrow, enter a new long position with a close above 2082.60 but not above 2084.60...

Rationale:

There is a minor VP price at 2082.61... a close above this price would be considered bullish for this market...

This Thursday morning SP update IS IN ADDITION TO ALL previous SP briefings...

The overnight low has been 2054.00... we have a minor VP at 2053.53... this was not traded... close, but no cigar... to ignite a signal, the market must first trade below it and then close back above it ...

For Thursday, if the SP trades down below 2053.60 and then closes above 2053.50 this would confirm a new main model buy signal... the market is now trading at 2059.40 ...

For Hoban Rule traders, you are now currently flat... enter a new long position today with a close above 2053.50 but not above 2059.50...

Rationale:

There is a minor VP at 2053.53... a penetration below and then a close above this price today would be considered bullish for this market...

ALSO, if the above condition is not met, the following is the trade strategy for today:

For Thursday, a close above 2059.60 would confirm a new main model buy signal...

For Hoban Rule Traders, enter a new long position today with a close above 2059.60 but not above 2065.60 ...

This Thursday afternoon SP update IS IN ADDITION TO ALL previous SP briefings... 

Take the best position of the three as the market dictates...

1)  For Thursday, if the SP trades down below 2053.60 and then closes above 2053.50 this would confirm a new main model buy signal...    the market is now trading at 2059.40...

For Hoban Rule traders, you are now currently flat...  enter a new long position today with a close above 2053.50 but not above 2059.50...

Rationale:

There is a minor VP at 2053.53...  a penetration below and then a close above this price today would be considered bullish for this market...

2)  ALSO,  if the above condition is not met, the the following is the trade strategy for today:

For Thursday, a close above 2059.60 would confirm a new main model buy signal...

For Hoban Rule Traders, enter a new long position today with a close above 2059.60 but not above 2065.60...

Rationale:

There is a minor VP at 2059.65...  a penetration below and then a close above this price today would be considered bullish for this market...

3)  ALSO,  a close today above 2048.30 would confirm a new main model buy signal...  the market is currently trading at 2047.90...

For Hoban Rule Traders, enter a new long position today with a close above 2048.30 but not above 2054.30...

Rationale:

There is a floor price today at 2048.31...  a close above this price today would be considered bullish for this market... 

 

Are you having difficulty finding an entry point for a new signal??? Consider the Hoban Rule, even a child could follow the simple rules... I use it myself...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on the entry of 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 Hoban Rule can be used with any other additional trading strategies that fit your disposition and comfort level...

The Hoban Rule Performance History:

The Hoban Rule was introduced to the evening briefing on 9/4/14... since that time, this strategy has now completed 33 trades for a net gain of 259.20 SP points... this is a simple but elegant strategy for anyone who prefers a less challenging trade plan based on the main model signals... of course, past performance is never a guarantee of future success, but this particular trading strategy has an impressive history and is well worth considering if you have difficulty taking the best advantage of the main model signals... if you would like to see the trade by trade score sheet for the Hoban Rule, just ask me for it and I will email it to you...

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

The NT sell spike continues downward...

image

The LT (Long Term) indicator

Today, all key lines are moving lower and the blue and purple lines have crossed south of the red line... the bias is clearly lower for now...

image (1)
image (2)

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 September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2053.53
MAJOR - - 2029.208 and must close above that price on Monday, September 7th to confirm a new main model buy signal...
minor - - 2028.30
MAJOR - - 1990.13 and must close above that price on Monday, September 14th to confirm a new main model buy signal...
TOMORROW'S LOWEST FLOOR PRICE - - 1865.12

The following are the current upside VPs for the September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2082.61
minor - - 2110.55
minor - - 2112.69
minor - - 2113.45
minor - - 2128.99
minor - - 2129.701
minor - - 2131.58
MAJOR - - 2136.04 and must close below that price on Tuesday, September 20th to confirm a new main model sell signal...
MAJOR - - 2139.05 and must close below that price on Friday, September 18th to confirm a new main model sell signal...
MAJOR - - 2158.53 and must close below that price on Tuesday, September 1st to confirm a new main model sell signal...
MAJOR - - 2166.05 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...
MAJOR - - 2172.08 and must close below that price on Thursday, September 10th to confirm a new main model sell signal... SAME EXACT VP
MAJOR - - 2172.08 and must close below that price on Tuesday, September 15th to confirm a new main model sell signal... SAME EXACT VP
TOMORROW'S HIGHEST CEILING FLOOR PRICE - - 2319.22

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: NEUTRAL since 8/17/15
A close above 1122.60 would turn the BTIT from neutral to up...
A close below 1084.30 would turn the BTIT from neutral to down...
The main model is now long the December gold from 1114.80 as of Monday, August 17th...

The last trade as of this writing is at 1133.60...

This market always looks like it wants to go lower... but maybe things are changing...

TOMORROW'S TRADE STRATEGY:

For Thursday, a close below 1111.10 in the December Gold contract would confirm a new main model sell signal...

Take a look at the comment below on the major VP at 1122.07...

The Hoban Rule was expressly designed for the SP market and no other market at this time...

The LT (Long Term) Indicator

Somewhat overbought, but why stand in the way??? This market cleared a major VP hurdle that was due today, this is definitely encouraging for this market, it should continue higher from here...

image (3)
image (4)

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

minor - - 1108.26

MAJOR - - 1122.07 and must close below that price on Wednesday, August 19th to confirm a new main model sell signal... NOTICE: RIGHT ON TIME AND EXPIRING TODAY

minor - - 1198.69

minor - - 1218.51

MAJOR - - 1241.16 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...

MAJOR - - 1269.09 and must close below that price on Monday, September 28th to confirm a new main model sell signal...

TOMORROW'S HIGHEST CEILING PRICE - - 1458.32

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

minor - - 1091.907

miner - - 1070.13

MAJOR - - 1056.02 and must above that price on Thursday, August 20 to confirm a new main model buy signal... expiring after tomorrow...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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... VP prices behave like magnets, they attract the market price, and when the price touches the VP point, then the polarity reverses and repels price... all this market ever does is ping pong between VP prices...

The main model formula is specifically designed to determine precisely and to the exact market price where the market is most likely to reach complete buying and/or selling exhaustion, there is no guessing about it. This is why the market almost always backs away from those VP points after reaching them, at least for 10 to 12 points before resuming the trend... also, at those VP points, the market is the most vulnerable to a legitimate trend change. Therefore, when the market trades through those VP points and then backs away and closes on the other side of it again, there is a very high likelihood of a trend reversal at that time... these VP point are like magnets, they pull and attract the price until the VP is reached, and then upon reaching the VP it then reverses polarity and repels price... at that point, the market can back away and confirm a new trend signal or return to the VP and resume the original trend... this is where the main model determines the buy and sell confirmation prices...

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 to trade the SP market only... 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...

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...

3) Also, you may enter the trade anytime after the signal is confirmed if the market comes back to within 5 points of the original signal confirmation price...

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 reverse confirmation price 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 5 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, August 19th


"One way to end up with $1 million with these markets is to start with $2 million."

* * * Ralph Seger

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 it every now and then, a good working knowledge of these tools will make you a better and more informed investor/trader...

The September SP Futures

IMPORTANT NOTE:

USE ONLY THE LARGE SP CONTRACT FOR ALL SIGNALS, THE MINI CONTRACT WILL GIVE YOU FALSE SIGNALS... AND THEN, ONCE A SIGNAL IS TRIGGERED (AND CONFIRMED), THEN YOU CAN TRADE ANY OTHER MARKET FROM THAT SIGNAL...

BROADER TERM INTERMEDIATE TREND BIAS: NEUTRAL since 7/27/15

The broader term intermediate trend (BTIT) bias is determined by the collective penetration of the most near term ceiling and floor prices... when ALL the near term ceiling prices have been penetrated on the close and none of the floor prices are penetrated, then the BTIT bias would be UP... when the reverse occurs, then the BTIT bias would be DOWN... the bias would turn to NEUTRAL when one or more of the ceiling/floor prices are penetrated on the close in the counter direction...

A close above 2105.00 would turn the BTIT from neutral to up...

A close below 2047.22 would turn the BTIT from neutral to down...

The main model is now short the September SP from 2098.30 as of Tuesday, August 18th... yes, granted, the mid day update was sent out when this market was trading a few points lower, but the signal price is still the official signal price and is listed as such...

This market is nothing but incredibly volatile...

The last trade as of this writing is at 2094.10...

TOMORROW'S TRADE STRATEGY:

For Wednesday, a close above 2103.30 this would confirm a new main model buy signal...

For Hoban Rule traders, you are now short this market from about 2094.10... for tomorrow, place a but stop to go flat at 2105.30... also, enter a new long position tomorrow with a close above 2103.30 but not above 2109.30...

Rationale:

A ceiling at 2098.25 appeared and was penetrated and then the market closed below it... this is considered at least near term bearish for this market...

This Wednesday morning SP update supersedes ALL previous SP briefings...

For Wednesday, if the SP closes above 2082.60 this would confirm a new main model buy signal... the market is now trading at 2078.90...

For Hoban Rule traders, you are now currently short... place a buy stop to go flat at 2084.60... also, enter a new long position today with a close above 2082.60 but not above 2084.60...

Rationale:
There is a ceiling at 2082.61 which was penetrated this morning... a close above this price today would be considered bullish for this market.

Are you having difficulty finding an entry point for a new signal??? Consider the Hoban Rule, even a child could follow the simple rules... I use it myself...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on the entry of 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 Hoban Rule can be used with any other additional trading strategies that fit your disposition and comfort level...

The Hoban Rule Performance History:

The Hoban Rule was introduced to the evening briefing on 9/4/14... since that time, this strategy has now completed 32 trades for a net gain of 249.70 SP points... this is a simple but elegant strategy for anyone who prefers a less challenging trade plan based on the main model signals... of course, past performance is never a guarantee of future success, but this particular trading strategy has an impressive history and is well worth considering if you have difficulty taking the best advantage of the main model signals... if you would like to see the trade by trade score sheet for the Hoban Rule, just ask me for it and I will email it to you...

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

This market is going nowhere fast and the NT indicator illustrates that clearly holding slightly overbought...

image

The LT (Long Term) indicator

We actually have modest sell spikes today in the LT graph... it is highly recommended to have some strong coffee in the morning to avoid falling asleep watching this exciting mid day market action...

image (1)
image (2)

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 September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2053.36
MAJOR - - 2031.01 and must close above that price on Thursday, September 3rd to confirm a new main model buy signal...
minor - - 2028.30
MAJOR - - 1990.13 and must close above that price on Monday, September 14th to confirm a new main model buy signal...
TOMORROW'S LOWEST FLOOR PRICE - - 1865.12

The following are the current upside VPs for the September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2082.61
minor - - 2110.55
minor - - 2112.69
minor - - 2113.45
minor - - 2128.99
minor - - 2129.701
minor - - 2131.58
MAJOR - - 2136.04 and must close below that price on Tuesday, September 20th to confirm a new main model sell signal...
MAJOR - - 2139.05 and must close below that price on Friday, September 18th to confirm a new main model sell signal...
MAJOR - - 2158.53 and must close below that price on Tuesday, September 1st to confirm a new main model sell signal...
MAJOR - - 2166.05 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...
MAJOR - - 2172.08 and must close below that price on Thursday, September 10th to confirm a new main model sell signal... SAME EXACT VP
MAJOR - - 2172.08 and must close below that price on Tuesday, September 15th to confirm a new main model sell signal... SAME EXACT VP
TOMORROW'S HIGHEST CEILING FLOOR PRICE - - 2319.22

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: NEUTRAL since 8/17/15
A close above 1122.60 would turn the BTIT from neutral to up...
A close below 1084.30 would turn the BTIT from neutral to down...
The main model is now long the December gold from 1114.80 as of Monday, August 17th...

The last trade as of this writing is at 1116.70...

This market always looks like it wants to go lower...

TOMORROW'S TRADE STRATEGY:

For Wednesday, a close below 1111.10 in the December Gold contract would confirm a new main model sell signal...

The Hoban Rule was expressly designed for the SP market and no other market at this time...

The LT (Long Term) Indicator

Rather toppy looking LT graph now, but the market itself isn't breaking down quite yet... we're holding longs for now...

image (3)
image (4)

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

minor - - 1108.26

MAJOR - - 1122.07 and must close below that price on Wednesday, August 19th to confirm a new main model sell signal... (already reached)

minor - - 1198.69

minor - - 1218.51

MAJOR - - 1241.16 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...

MAJOR - - 1269.09 and must close below that price on Monday, September 28th to confirm a new main model sell signal...

TOMORROW'S HIGHEST CEILING PRICE - - 1458.32

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

minor - - 1091.907

miner - - 1070.13

MAJOR - - 1056.02 and must above that price on Thursday, August 20 to confirm a new main model buy signal...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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... VP prices behave like magnets, they attract the market price, and when the price touches the VP point, then the polarity reverses and repels price... all this market ever does is ping pong between VP prices...

The main model formula is specifically designed to determine precisely and to the exact market price where the market is most likely to reach complete buying and/or selling exhaustion, there is no guessing about it. This is why the market almost always backs away from those VP points after reaching them, at least for 10 to 12 points before resuming the trend... also, at those VP points, the market is the most vulnerable to a legitimate trend change. Therefore, when the market trades through those VP points and then backs away and closes on the other side of it again, there is a very high likelihood of a trend reversal at that time... these VP point are like magnets, they pull and attract the price until the VP is reached, and then upon reaching the VP it then reverses polarity and repels price... at that point, the market can back away and confirm a new trend signal or return to the VP and resume the original trend... this is where the main model determines the buy and sell confirmation prices...

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 to trade the SP market only... 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...

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...

3) Also, you may enter the trade anytime after the signal is confirmed if the market comes back to within 5 points of the original signal confirmation price...

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 reverse confirmation price 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 5 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, August 18th

"One way to end up with $1 million with these markets is to start with $2 million."

* * * Ralph Seger

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 it every now and then, a good working knowledge of these tools will make you a better and more informed investor/trader...

The September SP Futures

IMPORTANT NOTE:

USE ONLY THE LARGE SP CONTRACT FOR ALL SIGNALS, THE MINI CONTRACT WILL GIVE YOU FALSE SIGNALS... AND THEN, ONCE A SIGNAL IS TRIGGERED (AND CONFIRMED), THEN YOU CAN TRADE ANY OTHER MARKET FROM THAT SIGNAL...

BROADER TERM INTERMEDIATE TREND BIAS: NEUTRAL since 7/27/15

The broader term intermediate trend (BTIT) bias is determined by the collective penetration of the most near term ceiling and floor prices... when ALL the near term ceiling prices have been penetrated on the close and none of the floor prices are penetrated, then the BTIT bias would be UP... when the reverse occurs, then the BTIT bias would be DOWN... the bias would turn to NEUTRAL when one or more of the ceiling/floor prices are penetrated on the close in the counter direction...

A close above 2105.00 would turn the BTIT from neutral to up...

A close below 2047.22 would turn the BTIT from neutral to down...

The main model is now long the September SP from 2082.60 as of Friday, August 14th...

Maybe we'll finally catch a good run from here, although the volatility reigned supreme this morning...

The last trade as of this writing is at 2099.90...

TOMORROW'S TRADE STRATEGY:

For Tuesday, a close below 2082.70 in the September SP contract would confirm a new main model sell signal...

Also for Tuesday, if the market trades tonight or tomorrow above 2110.60, then a close below 2110.60 tomorrow would confirm a new main model sell signal...

Rationale:

minor - - 2082.61 This VP has held this market captive for nearly 6 weeks while the market trades above and below this price...
minor - - 2110.55
For Hoban Rule traders, you are currently flat this market after being stopped out at 2080.70... enter a new short position with a close below 2082.70 but not below 2076.70...

Also for Hoban Rule traders, if the market trades tonight or tomorrow above 2110.60 and then closes tomorrow below 2110.60, enter a new short position with a close below 2110.60 but not below 2104.60...

This Tuesday afternoon SP update supersedes ALL previous SP briefings...

For Tuesday, if the SP closes below 2098.30 this would confirm a new main model sell signal... the market is now trading at 2093.60, so this signal is now possible...

For Hoban Rule traders, enter a new short position today with a close below 2098.30 but not below 2092.30...

Rationale:

There is a ceiling at 2098.25 which was appeared and was penetrated this morning... a close below this price today would be considered bearish for this market...

Are you having difficulty finding an entry point for a new signal??? Consider the Hoban Rule, even a child could follow the simple rules... I use it myself...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on the entry of 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 Hoban Rule can be used with any other additional trading strategies that fit your disposition and comfort level...

The Hoban Rule Performance History:

The Hoban Rule was introduced to the evening briefing on 9/4/14... since that time, this strategy has now completed 32 trades for a net gain of 249.70 SP points... this is a simple but elegant strategy for anyone who prefers a less challenging trade plan based on the main model signals... of course, past performance is never a guarantee of future success, but this particular trading strategy has an impressive history and is well worth considering if you have difficulty taking the best advantage of the main model signals... if you would like to see the trade by trade score sheet for the Hoban Rule, just ask me for it and I will email it to you...

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

Big up spike in the NT indicator today, although this market was never actually oversold...

image

The LT (Long Term) indicator

All three key lines are now moving higher and the blue and purple lines are now above the red line... current indications are this market could continue higher for some time...

image (1)
image (2)

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 September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2082.61 This VP has held this market captive for nearly 6 weeks while the market trades above and below this price...
minor - - 2110.55
minor - - 2112.69
minor - - 2113.45
minor - - 2128.99
minor - - 2129.701
minor - - 2131.58
MAJOR - - 2136.04 and must close below that price on Tuesday, September 20th to confirm a new main model sell signal...
MAJOR - - 2139.05 and must close below that price on Friday, September 18th to confirm a new main model sell signal...
MAJOR - - 2158.53 and must close below that price on Tuesday, September 1st to confirm a new main model sell signal...
MAJOR - - 2166.05 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...
MAJOR - - 2172.08 and must close below that price on Thursday, September 10th to confirm a new main model sell signal... SAME EXACT VP
MAJOR - - 2172.08 and must close below that price on Tuesday, September 15th to confirm a new main model sell signal... SAME EXACT VP
TOMORROW'S HIGHEST CEILING FLOOR PRICE - - 2319.22

The following are the current downside VPs for the September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2053.36
MAJOR - - 2031.01 and must close above that price on Thursday, September 3rd to confirm a new main model buy signal...
minor - - 2028.30
MAJOR - - 1990.13 and must close above that price on Monday, September 14th to confirm a new main model buy signal...
TOMORROW'S LOWEST FLOOR PRICE - - 1865.12

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: NEUTRAL since 8/17/15
A close above 1122.60 would turn the BTIT from neutral to up...
A close below 1084.30 would turn the BTIT from neutral to down...
The main model is now long the December gold from 1114.80 as of Monday, August 17th...

The last trade as of this writing is at 1117.00...

TOMORROW'S TRADE STRATEGY:

For Tuesday, a close below 1111.10 in the December Gold contract would confirm a new main model sell signal...

The Hoban Rule was expressly designed for the SP market and no other market at this time...

The LT (Long Term) Indicator

A key lines are moving higher and are now in neutral to over bought territory...

image (3)
image (4)

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

minor - - 1108.26

MAJOR - - 1122.07 and must close below that price on Wednesday, August 19th to confirm a new main model sell signal... (already reached)

minor - - 1198.69

minor - - 1218.51

MAJOR - - 1241.16 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...

MAJOR - - 1269.09 and must close below that price on Monday, September 28th to confirm a new main model sell signal...

TOMORROW'S HIGHEST CEILING PRICE - - 1458.32

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

minor - - 1091.907

miner - - 1070.13

MAJOR - - 1056.02 and must above that price on Thursday, August 20 to confirm a new main model buy signal...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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... VP prices behave like magnets, they attract the market price, and when the price touches the VP point, then the polarity reverses and repels price... all this market ever does is ping pong between VP prices...

The main model formula is specifically designed to determine precisely and to the exact market price where the market is most likely to reach complete buying and/or selling exhaustion, there is no guessing about it. This is why the market almost always backs away from those VP points after reaching them, at least for 10 to 12 points before resuming the trend... also, at those VP points, the market is the most vulnerable to a legitimate trend change. Therefore, when the market trades through those VP points and then backs away and closes on the other side of it again, there is a very high likelihood of a trend reversal at that time... these VP point are like magnets, they pull and attract the price until the VP is reached, and then upon reaching the VP it then reverses polarity and repels price... at that point, the market can back away and confirm a new trend signal or return to the VP and resume the original trend... this is where the main model determines the buy and sell confirmation prices...

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 to trade the SP market only... 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...

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...

3) Also, you may enter the trade anytime after the signal is confirmed if the market comes back to within 5 points of the original signal confirmation price...

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 reverse confirmation price 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 5 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, August 17th

"One way to end up with $1 million with these markets is to start with $2 million."

* * * Ralph Seger

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 it every now and then, a good working knowledge of these tools will make you a better and more informed investor/trader...

The September SP Futures

IMPORTANT NOTE:

USE ONLY THE LARGE SP CONTRACT FOR ALL SIGNALS, THE MINI CONTRACT WILL GIVE YOU FALSE SIGNALS... AND THEN, ONCE A SIGNAL IS TRIGGERED (AND CONFIRMED), THEN YOU CAN TRADE ANY OTHER MARKET FROM THAT SIGNAL...

BROADER TERM INTERMEDIATE TREND BIAS: NEUTRAL since 7/27/15

The broader term intermediate trend (BTIT) bias is determined by the collective penetration of the most near term ceiling and floor prices... when ALL the near term ceiling prices have been penetrated on the close and none of the floor prices are penetrated, then the BTIT bias would be UP... when the reverse occurs, then the BTIT bias would be DOWN... the bias would turn to NEUTRAL when one or more of the ceiling/floor prices are penetrated on the close in the counter direction...

A close above 2113.61 would turn the BTIT from neutral to up...

A close below 2047.22 would turn the BTIT from neutral to down...

The main model is now long the September SP from 2082.60 as of Friday, August 14th...

Maybe we'll finally catch a good run from here...

The last trade as of this writing is at 2088.10...

TOMORROW'S TRADE STRATEGY:

For Monday, a close below 2082.70 in the September SP contract would confirm a new main model sell signal...

For Hoban Rule traders, you are currently now long this market from about 2088.10 on the close... enter a sell stop to go flat at 2080.70... also, enter a new short position with a close below 2082.70 but not below 2076.70...

Are you having difficulty finding an entry point for a new signal??? Consider the Hoban Rule, even a child could follow the simple rules... I use it myself...

The Hoban Rule will not catch all trades, but will also not incur any entry whips on the entry of 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 Hoban Rule can be used with any other additional trading strategies that fit your disposition and comfort level...

The Hoban Rule Performance History:

The Hoban Rule was introduced to the evening briefing on 9/4/14... since that time, this strategy has now completed 30 trades for a net gain of 263.00 SP points... this is a simple but elegant strategy for anyone who prefers a less challenging trade plan based on the main model signals... of course, past performance is never a guarantee of future success, but this particular trading strategy has an impressive history and is well worth considering if you have difficulty taking the best advantage of the main model signals... if you would like to see the trade by trade score sheet for the Hoban Rule, just ask me for it and I will email it to you...

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

The NT indicator continues lower, but it's currently working off some very heavy numbers...

image

The LT (Long Term) indicator

Today's LT graph actually looks very positive... both the blue and purple lines are moving higher and are above the red line... this looks like the beginning of a possible longer term bullish move...

image (1)
image (2)

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 September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2082.61 This VP has held this market captive for nearly 6 weeks while the market trades above and below this price...
minor - - 2110.55
minor - - 2112.69
minor - - 2113.45
minor - - 2128.99
minor - - 2129.701
minor - - 2131.58
MAJOR - - 2136.04 and must close below that price on Tuesday, September 20th to confirm a new main model sell signal...
MAJOR - - 2139.05 and must close below that price on Friday, September 18th to confirm a new main model sell signal...
MAJOR - - 2158.53 and must close below that price on Tuesday, September 1st to confirm a new main model sell signal...
MAJOR - - 2166.05 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...
MAJOR - - 2172.08 and must close below that price on Thursday, September 10th to confirm a new main model sell signal... SAME EXACT VP
MAJOR - - 2172.08 and must close below that price on Tuesday, September 15th to confirm a new main model sell signal... SAME EXACT VP
TOMORROW'S HIGHEST CEILING FLOOR PRICE - - 2319.22

The following are the current downside VPs for the September SP... as long as the due date has not yet passed, the VP is still active and can effect these markets... 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 may also include the VP prices that are well below the market because their deadline due dates have not yet expired...
minor - - 2053.36
MAJOR - - 2031.01 and must close above that price on Thursday, September 3rd to confirm a new main model buy signal...
minor - - 2028.30
MAJOR - - 1990.13 and must close above that price on Monday, September 14th to confirm a new main model buy signal...
TOMORROW'S LOWEST FLOOR PRICE - - 1865.12

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 8/10/15
A close below 1088.60 would turn the BTIT from up to neutral...
A close below 1084.30 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1114.80 as of Friday, August 14th...

The last trade as of this writing is at 1114.40...

TOMORROW'S TRADE STRATEGY:

For Monday, a close above 1114.80 in the December Gold contract would confirm a new main model buy signal...

The Hoban Rule was expressly designed for the SP market and no other market at this time...

The LT (Long Term) Indicator

Sell spikes in over bought territory... this market may once again be in trouble... we'll know more on Monday...

image (3)
image (4)

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

minor - - 1091.907

miner - - 1070.13

MAJOR - - 1056.02 and must above that price on Thursday, August 20 to confirm a new main model buy signal...

MAJOR - - 530.11 (there is no typo) and must above that price on Thursday, January 14th 2021 (again, no typo) to confirm a new main model buy signal... yes, very odd...

This major VP is incredibly low and is also very far out in time, but this is what the main model is telling me for gold, so I'm providing the information...

TOMORROW'S LOWEST FLOOR PRICE - - 480.22 (no typo)

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

minor - - 1108.26

MAJOR - - 1122.07 and must close below that price on Wednesday, August 19th to confirm a new main model sell signal... (already reached)

minor - - 1198.69

minor - - 1218.51

MAJOR - - 1241.16 and must close below that price on Tuesday, September 22nd to confirm a new main model sell signal...

MAJOR - - 1269.09 and must close below that price on Monday, September 28th to confirm a new main model sell signal...

TOMORROW'S HIGHEST CEILING PRICE - - 1458.32

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... VP prices behave like magnets, they attract the market price, and when the price touches the VP point, then the polarity reverses and repels price... all this market ever does is ping pong between VP prices...

The main model formula is specifically designed to determine precisely and to the exact market price where the market is most likely to reach complete buying and/or selling exhaustion, there is no guessing about it. This is why the market almost always backs away from those VP points after reaching them, at least for 10 to 12 points before resuming the trend... also, at those VP points, the market is the most vulnerable to a legitimate trend change. Therefore, when the market trades through those VP points and then backs away and closes on the other side of it again, there is a very high likelihood of a trend reversal at that time... these VP point are like magnets, they pull and attract the price until the VP is reached, and then upon reaching the VP it then reverses polarity and repels price... at that point, the market can back away and confirm a new trend signal or return to the VP and resume the original trend... this is where the main model determines the buy and sell confirmation prices...

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 to trade the SP market only... 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...

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...

3) Also, you may enter the trade anytime after the signal is confirmed if the market comes back to within 5 points of the original signal confirmation price...

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 reverse confirmation price 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 5 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...