S&P 500 forecasting: GDP down, ISM up what will lead the market?,

[Franck]

From the data released Jan. 30, the last quarter GDP stopped his climb: our free trading system based on economic indicators, reported to reduce the equity exposure of 20%.
In the two following days, however, data released by the ISM on Manufacturing PMI (Purchasing Managers Index) were in sharp contrast, so the system has suggested a slight increase in equity exposure again.
The U.S. Leading Indicator released last week indicates a slowing economy.
How do you think the market will move in the coming months?
Our evaluations, contrary to what is normally found on the internet, are just the result of analysis of economic data and not only personal considerations.
From our simulations on data available in the past 60 years, the best indicators that lead the stock market are in order: USLIND, GDP and NAPM.
Then follow the economic data that will be released, if you want to try to predict the S&P 500.
Hello everybody.

 

[Franck]

Today also the Chicago Fed National Financial Conditions Index worsen and our NFCI trading system suggests to decrease equity exposure of 10%.
Do you believe that we are arriving to the top of the stock market?
Waiting for your considerations.
Regards

 

[william the wie]

Today also the Chicago Fed National Financial Conditions Index worsen and our NFCI trading system suggests to decrease equity exposure of 10%.
Do you believe that we are arriving to the top of the stock market?
Waiting for your considerations.
Regards

A temporary top yeah. February tends to be a down month.

 

[EdwardBaiamonte]

Today also the Chicago Fed National Financial Conditions Index worsen and our NFCI trading system suggests to decrease equity exposure of 10%.
Do you believe that we are arriving to the top of the stock market?
Waiting for your considerations.
Regards

A temporary top yeah. February tends to be a down month.

situation is very very unstable at best. If Bernanke can pull us out of the huge monetary mess he's made, not to mention Barry's fiscal mess, without huge inflation and recession it will be an all time first in human history. At best we're in uncharted waters.

China, however, is the source of hope. They learned economic policy from us and they've pulled off 10% a year for 30 years despite massive liberal intervention at all levels, so we know anything is possible.

 

[Franck]

A temporary top yeah. February tends to be a down month.

Indeed, February is a month that according to the statistics of the last 60 years has a negative return of -0.18%, in a range that goes from -3.12% to +2.33%.
In the next update to our website will also be present all the statistics on the S&P 500.

Regards

 

[Franck]

Today also the US Job Openings Total Nonfarm (JTSJOL) is decreasing and the JTSJOL free trading system based on the derivative value of this indicator (considering its 6 months exponential average) reports to reduce equity exposure of 16%, although still with a moderate bullish indication.

What awaits us in the coming months?
We just have to follow the main economic indicators.

What do you think?

 

[william the wie]

I don't know or care. I use derivatives counter trend so my losses are small and my wins big. Of course my wife can't brag about it even though it is profitable over just about any four years so not many people jump on my bandwagon.

 

[Franck]

I don't know or care. I use derivatives counter trend so my losses are small and my wins big. Of course my wife can't brag about it even though it is profitable over just about any four years so not many people jump on my bandwagon.

Dear William, I also use the derivative value of the 3 Months Exponential Average SP500 index to forecast the trend and in the trading system simulations the results are good (in the last 20 years +4.69%/year but not the best result compared to other indicators).

How does your system works?
Have you tested it in the last years?

 

[william the wie]

Yes, it has.

 

[Franck]

Yes, it has.

What do you mean?
Can you explain me your system and if you have tested it?
Thank you

 

[william the wie]

Yes, it has.

What do you mean?
Can you explain me your system and if you have tested it?
Thank you

I am not going to go too deep into this. I do follow some simple rules based on the following safeguards:

Annual price variance for indices average close to double net movement.

After I make my initial move on Dec. index options I make no fruther purchase until an out of the money Dec. option is available on the S&P mini index: puts on the way up, on the way down calls.

From that point on I make no further moves except to lock in profits.

 

[uscitizen]

What will lead the market?
the market will lead, It need not be based on reality to perform does it?

 

[Franck]

Why don't you like to talk about trading strategies?

I try to interpret your words:

Annual price variance for indices average close to double net movement.

When the daily change in the index reaches twice the standard deviation of daily changes in the index record last year, I'll start the trade.

After I make my initial move on Dec. index options I make no fruther purchase until an out of the money Dec. option is available on the S&P mini index: puts on the way up, on the way down calls.

There are always out of money call and put. What does it means?
That you operate in the opposite direction to the daily movement, buying put/call when the index rose/fell more than the limit described in the previous paragraph?

From that point on I make no further moves except to lock in profits.

Do you set a stop loss?

Have you tested this method with an automated trading system?

It 'a pleasure to talk about getting things done and not just opinions.
Thank you!

 

[Franck]

What will lead the market?
the market will lead, It need not be based on reality to perform does it?

There is a little truth in your words: the stock market often moves differently from what you would expect.
But this is natural in the short term, while in the long-term economic indicators, including fundamentals data, leads the market.

 

[JimmieD]

How do you think the market will move in the coming months?
Our evaluations, contrary to what is normally found on the internet, are just the result of analysis of economic data and not only personal considerations.
From our simulations on data available in the past 60 years, the best indicators that lead the stock market are in order: USLIND, GDP and NAPM.
Then follow the economic data that will be released, if you want to try to predict the S&P 500..

Who knows. Stock price movements are most closely modeled by a random walk with a drift, forecasting stock prices is pretty useless. The future stock price will be today's stock price plus some drift component.

 

[Franck]

How do you think the market will move in the coming months?
Our evaluations, contrary to what is normally found on the internet, are just the result of analysis of economic data and not only personal considerations...

Who knows. Stock price movements are most closely modeled by a random walk with a drift, forecasting stock prices is pretty useless. The future stock price will be today's stock price plus some drift component.

Thus for you all the asset management firms, that have a lot of employees and invest huge amount of money, are making all for hobby?
Our website is committed to assessing all the information affecting the market, providing trading signals available free of charge.
For example, if the Accumulated US ISM Manufacturing New Orders index is decreasing, you have good probabilities that also the S&P 500 index will decrease.
If you are able to consider all information available to forecast the stock market, without supposing but only analyzing data, you can make a responsible investment.
If you don't believe it, simply observe the high correlation between our selection of economic indicators and the S&P 500 index, as you can see in our charts.
Then you will trust me and I hope you would want to collaborate with us for the development or the suggestion of more indicators to forecast the market.
Best regards.

 

[Franck]

The ISM Manufacturing Index continue to go up, more then expected!
Thus are not the economy and the stock market still arrived at their top?

 

[SteadyMercury]

China, however, is the source of hope. They learned economic policy from us and they've pulled off 10% a year for 30 years despite massive liberal intervention at all levels, so we know anything is possible.

They were a country turning the corner from developing status, akin to the US during the industrial revolution. China was able to take advantage of cheap labor and global economy to fuel economic expansion.

 

[Franck]

The ISM Manufacturing Index continue to go up, more then expected!
Thus are not the economy and the stock market still arrived at their top?

As you can see, a strong ISM Manufacturing last friday has contributed to the rise of the S&P 500 of more then 2% in 3 days!
That's why our free trading systems following the instructions provided by the economic indicators obtains good profits, investing in the stock market.

Stay tuned!

 

[JimmieD]

Thus for you all the asset management firms, that have a lot of employees and invest huge amount of money, are making all for hobby?

Hobby? No. I'm sure they love doing what they do as a profession.

Our website is committed to assessing all the information affecting the market, providing trading signals available free of charge.

(1) Is "all" information relevant and (2) how do you decide what information is relevant against information that isn't?

It's easy to say that you consider all information that affects the market, but it's much more difficult to actually do. Statistical modeling demonstrates that stock markets are most closely modeled by a random walk process. The overwhelming majority of stock picking can do no better than chance. Most individulas would be best served finding low cost index funds rather than stock picking or trading.

Then you will trust me and I hope you would want to collaborate with us for the development or the suggestion of more indicators to forecast the market.
Best regards.

The market is probably impossible to forecast in a manner that would be useful for consistent trading results.