For Monday, November 2nd

“Why do dogs always race to the door when the doorbell rings? I mean, it’s hardly ever for them?

* * * Harry Hill

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 VP Price Map will replace the mid day updates, or most of them... this way, you'll never have to wonder if you missed any updates... the VP map tells you everything you need to know and you already know the two key rules for using the VP points to position yourself... this will only make you a much more savvy trader...

The December 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: UP since 10/15/15

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 below 2055.26 would turn the BTIT from up to neutral...

A close below 1867.84 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

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 is largely a direction indicator and not a signal indicator, it is a trading strategy is designed for those who prefer a broader longer term trade position without close monitoring... be advised, the price swings are also significantly wider before the trend bias shifts so caution is always highly advised and only a modest position should be taken for this strategy...

The BTIT current trade position: Now long from 2013.40 as of Thursday, October 15th, 2015... 2 trades completed, a total gain of 40.70 SP points...

The main model is now short the December SP from 2086.00 as of Thursday, October 29th...

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 2072.00 for December...

Wow, the main model major VP tagged the top of this rally like a charm...

Today, notice how the market sold off the typical 10 to 12 points and then returned to the VP... this is very typical of a near term pull back and not a new down trend... BUT, then, the market broke down again and this time it made newer lows and close near the low... this suggests further selling... this exact phenomenon actually is discussed in the tutorial at the bottom of this email... see directly below in blue...

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.

TOMORROW'S TRADE STRATEGY:

For Monday, a close above 2085.90 in the December contract would confirm a new main model buy signal... watch for the action at the lower VP points for a possible buy signal...

For Hoban Rule traders, you are currently flat this market... go long with a close above 2085.90 but not above 2091.90...

Rationale: A major VP at 2085.91...

Please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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 36 trades for a net gain of 235.30 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)

Yesterday's modest sell spike has become a bit more pronounced today...

image

The LT (Long Term) indicator

Here also, yesterday's modest sell spikes have developed into more mature sell spikes today... also, the leading purple line has now crossed down below the red line as of today... what makes this significant is that the purple line has been above the red line for many weeks... and today it broke down below this longer term red line... no telling what this market could do, but this certainly could be a simple mild pull back or this could be the major 7 year top that many have been talking about for some time now... who knows, just follow the market and the VP points... either way, from this LT graph, one can clearly see that this market is extremely over bought and is now vulnerable for a decline of some proportion... just look at how over bought the red line is, as well...

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 VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

PLEASE NOTE: It is vitally important to know where the market is on this map at all times, the main model buy and sell signals are generated only from this VP map, this VP map will replace the need for mid day updates which many of you have not been able to see or receive during your busy mid day schedule... the trade rules, which you probably already know by now, are very simple and are explained below... this would also eliminate the risk of my not sending out any mid day updates due to power failures, running errands, or any other possible reason... this way, since you already know the very simple rules, you would become a more efficient trader without depending on mid day correspondence which is always subject to loss or nondelivery...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

MAJOR - - 2085.91 and must close below that price on Wednesday, January 13th to confirm a new main model sell signal...

MAJOR - - 2085.06 and must close below that price on Wednesday, November 11th to confirm a new main model sell signal...

minor - - 2076.17

TODAY'S CLOSING PRICE - - 2072.00

minor - - 2049.02

MAJOR - - 2046.82 and must close below that price on Wednesday, November 11th to confirm a new main model sell signal...

MAJOR - - 2031.59 and must close above that price on Friday, November 27th to confirm a new main model buy signal...

MAJOR - - 2030.16 and must close below that price on Friday, November 6th to confirm a new main model sell signal...

minor - - 2035.53

minor - - 2021.14

minor - - 2016.72

MAJOR - - 1995.12 and must close below that price on Monday, December 7th to confirm a new main model sell signal...

minor - - 1979.66

MAJOR - - 1957.96 and must close above that price on Tuesday, November 24th to confirm a new main model buy signal...

minor - - 1956.25

minor - - 1850.83

minor - - 1846.14

MAJOR - - 1746.73 and must close above that price on Friday, March 25th to confirm a new main model buy signal...

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 10/2/15
A close below 1138.00 would turn the BTIT from up to neutral...
A close below 1110.80 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1173.90 as of Monday, October 19th...

The last trade as of this writing is at 1141.40...

It's good to stay short this market for now...

TOMORROW'S TRADE STRATEGY:

For Monday, a close above 1171.80 (yes, same price) in the December Gold contract would confirm a new main model buy signal... also, please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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

The LT (Long Term) Indicator

This market continues to struggle, and this can be seen in the LT graph... just look at how heavy this graph looks...

image (3)
image (4)

THE VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

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

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

minor - - 1218.51

TODAY'S CLOSING PRICE - - 1141.40

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...

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, October 30th

“My dog is half Labrador, half pit bull. He bites off my leg and then brings it back to me.”

* * * Frank Carson

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 VP Price Map will replace the mid day updates, or most of them... this way, you'll never have to wonder if you missed any updates... the VP map tells you everything you need to know and you already know the two key rules for using the VP points to position yourself... this will only make you a much more savvy trader...

The December 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: UP since 10/15/15

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 below 2052.46 would turn the BTIT from up to neutral...

A close below 1859.89 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

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 is largely a direction indicator and not a signal indicator, it is a trading strategy is designed for those who prefer a broader longer term trade position without close monitoring... be advised, the price swings are also significantly wider before the trend bias shifts so caution is always highly advised and only a modest position should be taken for this strategy...

The BTIT current trade position: Now long from 2013.40 as of Thursday, October 15th, 2015... 2 trades completed, a total gain of 40.70 SP points...

The main model is now short the December SP from 2086.00 as of Thursday, October 29th...

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 2083.00 for December...

The high of the day today was 2086.00, so this market only peeked above the highest major VP before backing off... if this market continues higher from here, then it will and we'll go long... but, if this market begins a decline from here, then the major VP tagged this market exactly...

TOMORROW'S TRADE STRATEGY:

For Friday, a close above 2085.90 in the December contract would confirm a new main model buy signal...

For Hoban Rule traders, you are currently flat this market... go long with a close above 2085.90 but not above 2091.90...

Rationale: A major VP at 2085.91...

Please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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 36 trades for a net gain of 235.30 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)

A modest sell spike today, let's see if it develops into anything more meaningful tomorrow...

image

The LT (Long Term) indicator

Modest sell spikes here also... just look at how over bought this market is right 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 VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

PLEASE NOTE: It is vitally important to know where the market is on this map at all times, the main model buy and sell signals are generated only from this VP map, this VP map will replace the need for mid day updates which many of you have not been able to see or receive during your busy mid day schedule... the trade rules, which you probably already know by now, are very simple and are explained below... this would also eliminate the risk of my not sending out any mid day updates due to power failures, running errands, or any other possible reason... this way, since you already know the very simple rules, you would become a more efficient trader without depending on mid day correspondence which is always subject to loss or nondelivery...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

MAJOR - - 2085.91 and must close below that price on Wednesday, January 13th to confirm a new main model sell signal...

MAJOR - - 2085.06 and must close below that price on Wednesday, November 11th to confirm a new main model sell signal...

TODAY'S CLOSING PRICE - - 2083.00

minor - - 2076.17

minor - - 2049.05

MAJOR - - 2046.82 and must close below that price on Wednesday, November 11th to confirm a new main model sell signal...

MAJOR - - 2035.25 and must close above that price on Monday, December 23rd to confirm a new main model buy signal...

MAJOR - - 2030.16 and must close below that price on Friday, November 6th to confirm a new main model sell signal...

minor - - 2035.53

minor - - 2021.14

minor - - 2016.72

MAJOR - - 1995.12 and must close below that price on Monday, December 7th to confirm a new main model sell signal...

minor - - 1979.66

MAJOR - - 1957.96 and must close above that price on Tuesday, November 24th to confirm a new main model buy signal...

minor - - 1956.25

minor - - 1850.83

MAJOR - - 1776.19 and must close above that price on Wednesday, February 10th to confirm a new main model buy signal...

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 10/2/15
A close below 1138.00 would turn the BTIT from up to neutral...
A close below 1110.80 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1173.90 as of Monday, October 19th...

The last trade as of this writing is at 1145.20...

It's good to stay short this market for now...

TOMORROW'S TRADE STRATEGY:

For Friday, a close above 1171.80 (yes, same price) in the December Gold contract would confirm a new main model buy signal... also, please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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

The LT (Long Term) Indicator

This LT graph shows a market struggling to stay above the water line...

image (3)
image (4)

THE VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

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

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

minor - - 1218.51

TODAY'S CLOSING PRICE - - 1145.20

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...

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, October 29th

“I once had a dog who really believed he was man’s best friend. He kept borrowing money from me.”

* * * Gene Perret

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 VP Price Map will replace the mid day updates, or most of them... this way, you'll never have to wonder if you missed any updates... the VP map tells you everything you need to know and you already know the two key rules for using the VP points to position yourself... this will only make you a much more savvy trader...

The December 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: UP since 10/15/15

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 below 2052.46 would turn the BTIT from up to neutral...

A close below 1859.89 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

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 is largely a direction indicator and not a signal indicator, it is a trading strategy is designed for those who prefer a broader longer term trade position without close monitoring... be advised, the price swings are also significantly wider before the trend bias shifts so caution is always highly advised and only a modest position should be taken for this strategy...

The BTIT current trade position: Now long from 2013.40 as of Thursday, October 15th, 2015... 2 trades completed, a total gain of 40.70 SP points...

The main model is now long the December SP from 2016.70 as of Thursday, October 22nd...

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 2083.50 for December...

TOMORROW'S TRADE STRATEGY:

For Thursday, a close below 2046.90 in the December contract would confirm a new main model sell signal... also, watch for the possible action above two MAJOR VPs, e.g., at 2085.06 and 2085.91...

For Hoban Rule traders, you are currently flat this market... go short with a close below 2046.90 but not below 2040.90...

Rationale: A major VP at 2046.82...

Please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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 36 trades for a net gain of 235.30 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 inching higher...

image

The LT (Long Term) indicator

The LT graph continues higher into extremely over bought territory... mind you, if this is now the beginning of a new bull market leg, then these indicators could stay over bought for many months while this market still continues higher... this continued over bought condition is traditionally characteristic of a legitimate long term bull market rally...

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 VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

PLEASE NOTE: It is vitally important to know where the market is on this map at all times, the main model buy and sell signals are generated only from this VP map, this VP map will replace the need for mid day updates which many of you have not been able to see or receive during your busy mid day schedule... the trade rules, which you probably already know by now, are very simple and are explained below... this would also eliminate the risk of my not sending out any mid day updates due to power failures, running errands, or any other possible reason... this way, since you already know the very simple rules, you would become a more efficient trader without depending on mid day correspondence which is always subject to loss or nondelivery...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

MAJOR - - 2085.91 and must close below that price on Wednesday, January 13th to confirm a new main model sell signal...

MAJOR - - 2085.06 and must close below that price on Wednesday, November 11th to confirm a new main model sell signal...

TODAY'S CLOSING PRICE - - 2083.50

minor - - 2076.17

MAJOR - - 2046.82 and must close below that price on Wednesday, November 11th to confirm a new main model sell signal...

MAJOR - - 2030.16 and must close below that price on Friday, November 6th to confirm a new main model sell signal...

minor - - 2035.53

minor - - 2021.14

minor - - 2016.72

MAJOR - - 1995.12 and must close below that price on Monday, December 7th to confirm a new main model sell signal...

minor - - 1979.66

MAJOR - - 1957.96 and must close above that price on Tuesday, November 24th to confirm a new main model buy signal...

minor - - 1956.25

minor - - 1850.83

MAJOR - - 1776.19 and must close above that price on Wednesday, February 10th to confirm a new main model buy signal...

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 10/2/15
A close below 1138.00 would turn the BTIT from up to neutral...
A close below 1110.80 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1173.90 as of Monday, October 19th...

The last trade as of this writing is at 1155.70...

Well, that was a quick rejection of a buy signal... triggered this morning and then faded in the afternoon... it's good to stay short this market for now...

TOMORROW'S TRADE STRATEGY:

For Thursday, a close above 1171.80 (yes, same price) in the December Gold contract would confirm a new main model buy signal... also, please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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

The LT (Long Term) Indicator

Yesterday, I said this LT graph looks heavy while the market itself appears to be holding... well, that was yesterday... today, this LT graph looks ever worse, toppy and rather heavy and over laden... staying short this market is wise for now...

image (3)
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THE VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

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

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

minor - - 1218.51

TODAY'S CLOSING PRICE - - 1155.70

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...

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, October 28th

I'm having an out of money experience.

* * * Author Unknown

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 VP Price Map will replace the mid day updates, or most of them... this way, you'll never have to wonder if you missed any updates... the VP map tells you everything you need to know and you already know the two key rules for using the VP points to position yourself... this will only make you a much more savvy trader...

The December 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: UP since 10/15/15

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 below 2007.69 would turn the BTIT from up to neutral...

A close below 1859.89 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

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 is largely a direction indicator and not a signal indicator, it is a trading strategy is designed for those who prefer a broader longer term trade position without close monitoring... be advised, the price swings are also significantly wider before the trend bias shifts so caution is always highly advised and only a modest position should be taken for this strategy...

The BTIT current trade position: Now long from 2013.40 as of Thursday, October 15th, 2015... 2 trades completed, a total gain of 40.70 SP points...

The main model is now long the December SP from 2016.70 as of Thursday, October 22nd...

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 2060.70 for December...

TOMORROW'S TRADE STRATEGY:

For Wednesday, a close below 2046.90 in the December contract would confirm a new main model sell signal...

For Hoban Rule traders, you are currently flat this market... go short with a close below 2046.90 but not below 2040.90...

Rationale: A major VP at 2046.82...

Please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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 36 trades for a net gain of 235.30 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 to inch higher, and on a day when the market itself moved lower...

image

The LT (Long Term) indicator

The LT graph continues to show a market sitting deep in over bought territory with sell spikes now emerging... today, the purple line has crossed down below the red line...

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 VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

PLEASE NOTE: It is vitally important to know where the market is on this map at all times, the main model buy and sell signals are generated only from this VP map, this VP map will replace the need for mid day updates which many of you have not been able to see or receive during your busy mid day schedule... the trade rules, which you probably already know by now, are very simple and are explained below... this would also eliminate the risk of my not sending out any mid day updates due to power failures, running errands, or any other possible reason... this way, since you already know the very simple rules, you would become a more efficient trader without depending on mid day correspondence which is always subject to loss or nondelivery...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

MAJOR - - 2085.91 and must close below that price on Wednesday, January 13th to confirm a new main model sell signal...

TODAY'S CLOSING PRICE - - 2060.70

MAJOR - - 2046.82 and must close below that price on Wednesday, November 11th to confirm a new main model sell signal...

MAJOR - - 2030.16 and must close below that price on Friday, November 6th to confirm a new main model sell signal...

minor - - 2035.53

minor - - 2021.14

minor - - 2016.72

MAJOR - - 1995.12 and must close below that price on Monday, December 7th to confirm a new main model sell signal...

minor - - 1979.66

MAJOR - - 1957.96 and must close above that price on Tuesday, November 24th to confirm a new main model buy signal...

minor - - 1956.25

minor - - 1850.83

MAJOR - - 1776.19 and must close above that price on Wednesday, February 10th to confirm a new main model buy signal...

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 10/2/15
A close below 1138.00 would turn the BTIT from up to neutral...
A close below 1110.80 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1173.90 as of Monday, October 19th...

The last trade as of this writing is at 1166.60...

Earlier this morning, this market gave the impression it was ready to launch a rally, but it didn't happen...

TOMORROW'S TRADE STRATEGY:

For Wednesday, a close above 1171.80 in the December Gold contract would confirm a new main model buy signal... also, please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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

The LT (Long Term) Indicator

This LT graph still looks heavy... but, the market itself looks like it wants to hold at current levels... so, we'll see...

image (3)
image (4)

THE VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

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

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

minor - - 1218.51

TODAY'S CLOSING PRICE - - 1166.60

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...

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, October 27th

I'm having an out of money experience.

* * * Author Unknown

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 VP Price Map will replace the mid day updates, or most of them... this way, you'll never have to wonder if you missed any updates... the VP map tells you everything you need to know and you already know the two key rules for using the VP points to position yourself... this will only make you a much more savvy trader...

The December 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: UP since 10/15/15

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 below 2006.83 would turn the BTIT from up to neutral...

A close below 1859.89 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

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 is largely a direction indicator and not a signal indicator, it is a trading strategy is designed for those who prefer a broader longer term trade position without close monitoring... be advised, the price swings are also significantly wider before the trend bias shifts so caution is always highly advised and only a modest position should be taken for this strategy...

The BTIT current trade position: Now long from 2013.40 as of Thursday, October 15th, 2015... 2 trades completed, a total gain of 40.70 SP points...

The main model is now long the December SP from 2016.70 as of Thursday, October 22nd...

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 2062.70 for December...

TOMORROW'S TRADE STRATEGY:

For Tuesday, a close below 2046.90 in the December contract would confirm a new main model sell signal...

For Hoban Rule traders, you are currently flat this market... go short with a close below 2046.90 but not below 2040.90...

Rationale: A major VP at 2046.82...

Please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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 36 trades for a net gain of 235.30 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 is moving sideways today...

unnamed

The LT (Long Term) indicator

Modest sell spikes today coming off an extremely over bought condition... nothing to worry about yet...

unnamed (1)
unnamed (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 VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

PLEASE NOTE: It is vitally important to know where the market is on this map at all times, the main model buy and sell signals are generated only from this VP map, this VP map will replace the need for mid day updates which many of you have not been able to see or receive during your busy mid day schedule... the trade rules, which you probably already know by now, are very simple and are explained below... this would also eliminate the risk of my not sending out any mid day updates due to power failures, running errands, or any other possible reason... this way, since you already know the very simple rules, you would become a more efficient trader without depending on mid day correspondence which is always subject to loss or nondelivery...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

MAJOR - - 2085.91 and must close below that price on Wednesday, January 13th to confirm a new main model sell signal...

TODAY'S CLOSING PRICE - - 2062.70

MAJOR - - 2046.82 and must close below that price on Wednesday, November 11th to confirm a new main model sell signal...

MAJOR - - 2030.16 and must close below that price on Friday, November 6th to confirm a new main model sell signal...

minor - - 2035.53

minor - - 2021.14

minor - - 2016.72

MAJOR - - 1995.12 and must close below that price on Monday, December 7th to confirm a new main model sell signal...

minor - - 1979.66

MAJOR - - 1957.96 and must close above that price on Tuesday, November 24th to confirm a new main model buy signal...

minor - - 1956.25

minor - - 1850.83

MAJOR - - 1776.19 and must close above that price on Wednesday, February 10th to confirm a new main model buy signal...

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 10/2/15
A close below 1138.00 would turn the BTIT from up to neutral...
A close below 1110.80 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1173.90 as of Monday, October 19th...

The last trade as of this writing is at 1163.10...

Earlier this morning, this market gave the impression it was ready to launch a rally, but it didn't happen...

TOMORROW'S TRADE STRATEGY:

For Tuesday, a close above 1171.80 in the December Gold contract would confirm a new main model buy signal... also, please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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

The LT (Long Term) Indicator

This LT graph still looks heavy... but, the market itself looks like it wants to hold at current levels... so, we'll see...

unnamed (3)
unnamed (4)

THE VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

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

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

minor - - 1218.51

TODAY'S CLOSING PRICE - - 1163.70

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...

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, October 26th


"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 VP Price Map will replace the mid day updates, or most of them... this way, you'll never have to wonder if you missed any updates... the VP map tells you everything you need to know and you already know the two key rules for using the VP points to position yourself... this will only make you a much more savvy trader...

The December 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: UP since 10/15/15

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 below 2006.83 would turn the BTIT from up to neutral...

A close below 1859.89 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

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 is largely a direction indicator and not a signal indicator, it is a trading strategy is designed for those who prefer a broader longer term trade position without close monitoring... be advised, the price swings are also significantly wider before the trend bias shifts so caution is always highly advised and only a modest position should be taken for this strategy...

The BTIT current trade position: Now long from 2013.40 as of Thursday, October 15th, 2015... 2 trades completed, a total gain of 40.70 SP points...

The main model is now long the December SP from 2016.70 as of Thursday, October 22nd...

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 2067.50 for December...

TOMORROW'S TRADE STRATEGY:

For Monday, a close below 2046.90 in the December contract would confirm a new main model sell signal...

For Hoban Rule traders, you are currently flat this market... go short with a close below 2046.90 but not below 2040.90...

Rationale: A major VP at 2046.82...

Please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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 36 trades for a net gain of 235.30 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)

A nice upward spike follow through from yesterday in the NT indicator...

image

The LT (Long Term) indicator

Wow, just take a look at how over bought this market is now... the blue line has not been this high in more than three years... but this is not to say it can't continue higher still... if this market wants to continue higher, then it can do exactly that and all the technical indicators can remain over bought for a very long time while the market itself continues higher nonetheless... frankly, in a bull market, the technicals can remain over bought for months while the market itself keeps on trucking up that cumbersome hill... longer term, considering this is only the beginning of a bullish season for these markets, there's no telling where this market could go from here... the only caution here is to keep your eyes on the road and on the VP map for hazards along the way... the next stop, a major VP at 2085.91...

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 VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

PLEASE NOTE: It is vitally important to know where the market is on this map at all times, the main model buy and sell signals are generated only from this VP map, this VP map will replace the need for mid day updates which many of you have not been able to see or receive during your busy mid day schedule... the trade rules, which you probably already know by now, are very simple and are explained below... this would also eliminate the risk of my not sending out any mid day updates due to power failures, running errands, or any other possible reason... this way, since you already know the very simple rules, you would become a more efficient trader without depending on mid day correspondence which is always subject to loss or nondelivery...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

MAJOR - - 2085.91 and must close below that price on Wednesday, January 13th to confirm a new main model sell signal...

TODAY'S CLOSING PRICE - - 2067.50

MAJOR - - 2046.82 and must close below that price on Wednesday, November 11th to confirm a new main model sell signal...

MAJOR - - 2030.16 and must close below that price on Friday, November 6th to confirm a new main model sell signal...

minor - - 2035.53

minor - - 2021.14

minor - - 2016.72

MAJOR - - 1995.12 and must close below that price on Monday, December 7th to confirm a new main model sell signal...

minor - - 1979.66

MAJOR - - 1957.96 and must close above that price on Tuesday, November 24th to confirm a new main model buy signal...

minor - - 1956.25

minor - - 1850.83

MAJOR - - 1776.19 and must close above that price on Wednesday, February 10th to confirm a new main model buy signal...

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 10/2/15
A close below 1138.00 would turn the BTIT from up to neutral...
A close below 1110.80 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1173.90 as of Monday, October 19th...

The last trade as of this writing is at 1164.50...

TOMORROW'S TRADE STRATEGY:

For Monday, a close above 1181.40 in the December Gold contract would confirm a new main model buy signal... also, please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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

The LT (Long Term) Indicator

This gold LT graph looks heavy and continues to inch lower, but the interesting thing is that the market itself is not collapsing... let's keep our eye on this one for a possible turn higher...

image (3)
image (4)

THE VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

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

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

minor - - 1218.51

TODAY'S CLOSING PRICE - - 1164.50

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...

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, October 23rd

"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 VP Price Map will replace the mid day updates, or most of them... this way, you'll never have to wonder if you missed any updates... the VP map tells you everything you need to know and you already know the two key rules for using the VP points to position yourself... this will only make you a much more savvy trader...

The December 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: UP since 10/15/15

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 below 1984.39 would turn the BTIT from up to neutral...

A close below 1859.89 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

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 is largely a direction indicator and not a signal indicator, it is a trading strategy is designed for those who prefer a broader longer term trade position without close monitoring... be advised, the price swings are also significantly wider before the trend bias shifts so caution is always highly advised and only a modest position should be taken for this strategy...

The BTIT current trade position: Now long from 2013.40 as of Thursday, October 15th, 2015... 2 trades completed, a total gain of 40.70 SP points...

The main model is now long the December SP from 2016.70 as of Thursday, October 22nd...

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 2051.00 for December...

This market rallied nicely to the newest overhead major VP point newly generated this afternoon at 2046.82... and again, this market was flirting with yet another sell signal...

TOMORROW'S TRADE STRATEGY:

For Friday, a close below 2046.90 in the December contract would confirm a new main model sell signal...

For Hoban Rule traders, you are currently flat this market... for tomorrow, go short with a close below 2046.90 but not below 2040.90...

Rationale: A major VP at 2046.82...

Please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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 36 trades for a net gain of 235.30 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)

Only a minor buy spike considering the huge market rally today...

image

The LT (Long Term) indicator

Huge buy spikes in the LT graph today and now entering deeply into the over bought zone... you can see by the blue line that this market is now as over bought as it has been in more than three years... this is not to say this market can't continue higher, but this is still a very clearly over bought market condition... just keep your eyes on the VP signals and you'll be able to stay out of any serious trouble...

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 VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

PLEASE NOTE: It is vitally important to know where the market is on this map at all times, the main model buy and sell signals are generated only from this VP map, this VP map will replace the need for mid day updates which many of you have not been able to see or receive during your busy mid day schedule... the trade rules, which you probably already know by now, are very simple and are explained below... this would also eliminate the risk of my not sending out any mid day updates due to power failures, running errands, or any other possible reason... this way, since you already know the very simple rules, you would become a more efficient trader without depending on mid day correspondence which is always subject to loss or nondelivery...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

MAJOR - - 2085.91 and must close below that price on Wednesday, January 13th to confirm a new main model sell signal...

TODAY'S CLOSING PRICE - - 2051.00

MAJOR - - 2046.82 and must close below that price on Wednesday, November 11th to confirm a new main model sell signal...

MAJOR - - 2030.16 and must close below that price on Friday, November 6th to confirm a new main model sell signal...

minor - - 2035.53

minor - - 2021.14

minor - - 2016.72

MAJOR - - 1995.12 and must close below that price on Monday, December 7th to confirm a new main model sell signal...

minor - - 1979.66

MAJOR - - 1957.96 and must close above that price on Tuesday, November 24th to confirm a new main model buy signal...

minor - - 1956.25

minor - - 1850.83

MAJOR - - 1776.19 and must close above that price on Wednesday, February 10th to confirm a new main model buy signal...

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 10/2/15
A close below 1138.00 would turn the BTIT from up to neutral...
A close below 1110.80 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1173.90 as of Monday, October 19th...

The last trade as of this writing is at 1165.90...

TOMORROW'S TRADE STRATEGY:

For Friday, a close above 1183.10 in the December Gold contract would confirm a new main model buy signal... also, please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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

The LT (Long Term) Indicator

This LT graph still looks heavy...

image (3)
image (4)

THE VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

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

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

minor - - 1218.51

TODAY'S CLOSING PRICE - - 1165.90

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...

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, October 22nd

"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 VP Price Map will replace the mid day updates, or most of them... this way, you'll never have to wonder if you missed any updates... the VP map tells you everything you need to know and you already know the two key rules for using the VP points to position yourself... this will only make you a much more savvy trader...

The December 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: UP since 10/15/15

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 below 1984.39 would turn the BTIT from up to neutral...

A close below 1859.89 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

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 is largely a direction indicator and not a signal indicator, it is a trading strategy is designed for those who prefer a broader longer term trade position without close monitoring... be advised, the price swings are also significantly wider before the trend bias shifts so caution is always highly advised and only a modest position should be taken for this strategy...

The BTIT current trade position: Now long from 2013.40 as of Thursday, October 15th, 2015... 2 trades completed, a total gain of 40.70 SP points...

The main model is now short the December SP from 2030.20 as of Wednesday, October 21st...

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 2009.20 for December...

This market once again peeked above the 2030.16 level early this morning and then sold off, it never looked back while passing downward through two more VP points stalling for a time at each... today's high was 2033.50, so the main model major VP nailed the top of this 172 point rally to within 3 points... hey, that's close enough for me...

TOMORROW'S TRADE STRATEGY:

For Thursday, a close above 2016.70 in the December contract would confirm a new main model buy signal...

For Hoban Rule traders, you were stopped out for an 8 point loss and are now flat this market... go long with a close tomorrow above 2016.70 but not above 2022.70...

Rationale: A minor VP at 2016.72...

Please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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 36 trades for a net gain of 235.30 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 lower today...

image

The LT (Long Term) indicator

Today's LT graph shows an interesting pattern... this market has been more overbought in recent days than it has been in more than three years, take a look at the purple line for that illustration... and today, the purple line moved down below the red line for the first time in several weeks... if nothing magical happens over the next few days for this market, then this market has the legitimate potential for a more significant decline...

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 VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

PLEASE NOTE: It is vitally important to know where the market is on this map at all times, the main model buy and sell signals are generated only from this VP map, this VP map will replace the need for mid day updates which many of you have not been able to see or receive during your busy mid day schedule... the trade rules, which you probably already know by now, are very simple and are explained below... this would also eliminate the risk of my not sending out any mid day updates due to power failures, running errands, or any other possible reason... this way, since you already know the very simple rules, you would become a more efficient trader without depending on mid day correspondence which is always subject to loss or nondelivery...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

MAJOR - - 2085.91 and must close below that price on Wednesday, January 13th to confirm a new main model sell signal...

MAJOR - - 2030.16 and must close below that price on Friday, November 6th to confirm a new main model sell signal...

minor - - 2021.14

minor - - 2016.72

TODAY'S CLOSING PRICE - - 2008.70

MAJOR - - 1995.12 and must close below that price on Monday, December 7th to confirm a new main model sell signal...

minor - - 1979.66

MAJOR - - 1957.96 and must close above that price on Tuesday, November 24th to confirm a new main model buy signal...

minor - - 1956.25

minor - - 1850.83

MAJOR - - 1776.19 and must close above that price on Wednesday, February 10th to confirm a new main model buy signal...

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 10/2/15
A close below 1138.00 would turn the BTIT from up to neutral...
A close below 1110.80 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1173.90 as of Monday, October 19th...

The last trade as of this writing is at 1166.80...

TOMORROW'S TRADE STRATEGY:

For Thursday, a close above 1183.10 in the December Gold contract would confirm a new main model buy signal... also, please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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

The LT (Long Term) Indicator

This LT graph continues to look heavy and the red line turned downward as of today...

image (3)
image (4)

THE VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

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

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

minor - - 1218.51

TODAY'S CLOSING PRICE - - 1166.80

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...

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, October 21st

"The economy depends about as much on economists as the weather does on weather forecasters."

* * * Jean-Paul Kauffmann

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 VP Price Map will replace the mid day updates, or most of them... this way, you'll never have to wonder if you missed any updates... the VP map tells you everything you need to know and you already know the two key rules for using the VP points to position yourself... this will only make you a much more savvy trader...

The December 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: UP since 10/15/15

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 below 1983.32 would turn the BTIT from up to neutral...

A close below 1859.89 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

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 is largely a direction indicator and not a signal indicator, it is a trading strategy is designed for those who prefer a broader longer term trade position without close monitoring... be advised, the price swings are also significantly wider before the trend bias shifts so caution is always highly advised and only a modest position should be taken for this strategy...

The BTIT current trade position: Now long from 2013.40 as of Thursday, October 15th, 2015... 2 trades completed, a total gain of 40.70 SP points...

The main model is now long the December SP from 1995.10 as of Thursday, October 15th...

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 2022.50 for December...

For those of you who have been following the VP map, you were able to take a short position at the 2030.20 level and then cover and go long again once the market traded down below the 2021.20 level and then closed back above it... this was not initially intended as a day trade, but it turned out that way... meanwhile, the main model is still long...

TOMORROW'S TRADE STRATEGY:

For Wednesday, a close below 2021.20 in the December contract would confirm a new main model sell signal...

For Hoban Rule traders, you are now currently long from 2027.20 per the instructions from yesterday's evening briefing, e.g., for tomorrow and this evening, enter a buy stop limit order to go long at 2027.20... if filled, enter a sell stop to go flat at 2019.20... today's low is at 2019.30, so the position is still held... for tomorrow and this evening, place a sell stop to go flat the long position at 2019.20... also, go short with a close tomorrow below 2021.20 but not below 2015.20...

Rationale: A minor VP at 2021.14...

Please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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 36 trades for a net gain of 235.30 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)

A sell spike today while in modestly over bought territory...

image

The LT (Long Term) indicator

Yesterday's modest sell spikes have become more pronounced today... this market has to turn higher very soon or the main model will be short...

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 VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

PLEASE NOTE: It is vitally important to know where the market is on this map at all times, the main model buy and sell signals are generated only from this VP map, this VP map will replace the need for mid day updates which many of you have not been able to see or receive during your busy mid day schedule... the trade rules, which you probably already know by now, are very simple and are explained below... this would also eliminate the risk of my not sending out any mid day updates due to power failures, running errands, or any other possible reason... this way, since you already know the very simple rules, you would become a more efficient trader without depending on mid day correspondence which is always subject to loss or nondelivery...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

MAJOR - - 2085.91 and must close below that price on Wednesday, January 13th to confirm a new main model sell signal...

MAJOR - - 2030.16 and must close below that price on Friday, November 6th to confirm a new main model sell signal...

TODAY'S CLOSING PRICE - - 2022.50

minor - - 2021.14

minor - - 2016.72

MAJOR - - 1995.12 and must close below that price on Monday, December 7th to confirm a new main model sell signal...

minor - - 1956.25

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 10/2/15
A close below 1138.00 would turn the BTIT from up to neutral...
A close below 1110.80 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1173.90 as of Monday, October 19th...

The last trade as of this writing is at 1176.60...

TOMORROW'S TRADE STRATEGY:

For Wednesday, a close above 1183.10 in the December Gold contract would confirm a new main model buy signal... also, please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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

The LT (Long Term) Indicator

A higher close today, but this market still looks rather heavy and considerably over bought...

image (3)
image (4)

THE VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

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

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

minor - - 1218.51

TODAY'S CLOSING PRICE - - 1176.60

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...

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, October 20th

"October is one of the peculiarly dangerous months to speculate in stocks. The other dangerous months are November, December, January, February, March, April, May, June, July, August, and September."

* * * Mark Twain

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 VP Price Map will replace the mid day updates, or most of them... this way, you'll never have to wonder if you missed any updates... the VP map tells you everything you need to know and you already know the two key rules for using the VP points to position yourself... this will only make you a much more savvy trader...

The December 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: UP since 10/15/15

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 below 1983.32 would turn the BTIT from up to neutral...

A close below 1859.89 would turn the BTIT from neutral to down...

THE BTIT LONGER TERM TRADING STRATEGY

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 is largely a direction indicator and not a signal indicator, it is a trading strategy is designed for those who prefer a broader longer term trade position without close monitoring... be advised, the price swings are also significantly wider before the trend bias shifts so caution is always highly advised and only a modest position should be taken for this strategy...

The BTIT current trade position: Now long from 2013.40 as of Thursday, October 15th, 2015... 2 trades completed, a total gain of 40.70 SP points...

The main model is now long the December SP from 1995.10 as of Thursday, October 15th...

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 2026.50 for December...

TOMORROW'S TRADE STRATEGY:

For Tuesday, a close below 2021.20 in the December contract would confirm a new main model sell signal...

For Hoban Rule traders, you are now currently flat... for tomorrow and this evening, enter a buy stop limit order to go long at 2027.20... if filled, enter a sell stop to go flat at 2019.20... also, go short with a close below 2021.20 but not below 2015.20...

Rationale: A minor VP at 2021.14...

Please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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 36 trades for a net gain of 235.30 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 buy spike moves higher today...

image

The LT (Long Term) indicator

Still over bought, and today with a modest sell spike...

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 VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

PLEASE NOTE: It is vitally important to know where the market is on this map at all times, the main model buy and sell signals are generated only from this VP map, this VP map will replace the need for mid day updates which many of you have not been able to see or receive during your busy mid day schedule... the trade rules, which you probably already know by now, are very simple and are explained below... this would also eliminate the risk of my not sending out any mid day updates due to power failures, running errands, or any other possible reason... this way, since you already know the very simple rules, you would become a more efficient trader without depending on mid day correspondence which is always subject to loss or nondelivery...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

MAJOR - - 2085.91 and must close below that price on Wednesday, January 13th to confirm a new main model sell signal...

MAJOR - - 2030.16 and must close below that price on Friday, November 6th to confirm a new main model sell signal...

TODAY'S CLOSING PRICE - - 2026.50

minor - - 2021.14

minor - - 2016.72

MAJOR - - 1995.12 and must close below that price on Monday, December 7th to confirm a new main model sell signal...

minor - - 1956.25

The DECEMBER Gold futures
BROADER TERM INTERMEDIATE TREND BIAS: UP since 10/2/15
A close below 1138.00 would turn the BTIT from up to neutral...
A close below 1110.80 would turn the BTIT from neutral to down...
The main model is now short the December gold from 1173.90 as of Monday, October 19th...

The last trade as of this writing is at 1170.00...

TOMORROW'S TRADE STRATEGY:

For Tuesday, a close above 1187.50 in the December Gold contract would confirm a new main model buy signal... also, please review and consult daily with the VP Price Map for any and all main model mid day buy/sell revisions and updates... tomorrow's trade strategy is always subject to revision based on the VP Price Map, so it is extremely important to be familiar with this map listed below...

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

The LT (Long Term) Indicator

Looking toppy and heavy, it's probably good to be short here...

image (3)
image (4)

THE VP PRICE MAP

The following is a price map in descending order of all currently active vertical prices above and below the market... those in red were generated on previously confirmed buy signals, those in green were generated on previously confirmed sell signals... today's closing price is also included to provide you with a GPS type reading of where the market currently is in relation to all VP points on both sides of the market...

The Main Model Trade Rules:

1) Any time the market trades above any overhead VP price and then closes below it, this would confirm a new main model sell signal...
2) Any time the market trades below any VP price below the market and then closes above it, this would confirm a new main model buy signal...

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

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

minor - - 1218.51

TODAY'S CLOSING PRICE - - 1170.00

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...

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...