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Strategies & Market Trends : A.I.M Users Group Bulletin Board -- Ignore unavailable to you. Want to Upgrade?

To: LemonHead who wrote (9581)	12/16/1999 1:43:00 AM
From: fuzzymath	Respond to of 18928

These are the key questions. If it wasn't 1:39 AM where I am (near Boston) I'd answer them now. But, I must get some sleep! Thanks for the questions! I will respond! Kevin

To: LemonHead who wrote (9581)	12/16/1999 11:50:00 PM
From: fuzzymath	Read Replies (3) \| Respond to of 18928

When the lights switch colors (short version): The lights switch colors when the action in the market index takes it out of the pattern bin it was occupying and moves it into a different pattern bin. This is most likely to happen when a strong reversal of market direction occurs. But--it's not purely mathematical. I look at all the models to select the color for each day. I usually just follow what the models say, though. This is surely an obscure post for anyone who hasn't visited my front page, but I'm short on time tonight (big Monday deadline at work). See my profile for a link to the site if you're interested. One question: what is Tom's IW gauge and where can I see it? I've considered putting gauges on my site that I would update daily, so that people could more judge for themselves what may happen next and what the current risk level is, based on the same evidence I use in the models. Kevin

To: LemonHead who wrote (9581)	12/17/1999
From: fuzzymath	Respond to of 18928

How I trade (forgot to answer your second question!): from November - January, I am fully invested, based on the results of my "January Effect" study. But, if anything truly weird happenned, I'd step out of the market. The rest of the year I am a short term trader. Most of my investment money is profit sharing in a tax-deferred account. It's with Fidelity. When I trade, I trade the entire portfolio -- either into cash or back into the market. Right now, I'm using FDEGX when I'm in the market. For people who would have to pay commissions, I would recommend buying index puts to hedge your portfolio if you wanted to use my methods. I'm conservative, so I normally stay in the market only when my models yield a Green light. The alternative is to only hedge when the light is Red, indicating that the models unanimously view a position in cash as likely to outperform a position in the stock market. Note that the models are of the NYSE Index. Right now we have a huge divergence between the NASDAQ and broad market (NYSE). The models would support a pruning method--but Fidelity doesn't like lots of trading, so I use the all or nothing approach with them. Kevin