Commentary

9/3/20 – Probable xCF

It’s worth noting that xFC yesterday, a theoretical flat day, saw very good gains, while today, a long day, has been quite painful so far. If someone was long a 3x Bear with 3xWushu yesterday, then went long a 3x Bull today, they wouldn’t be happy. The risk involved in these things is no joke. It takes a lot of self discipline to put up with heat, especially for long periods of time, even if you let something else do your thinking for you.

Because of the elevation of price above the averages, this probably will still be a buy tonight. It’s kind of a buy for people who aren’t pissed off about today though. It is a little iffy because a lot of people are leaving for the holiday so it comes down to behavior on the last classical Lipstick day of a strange summer.

4 thoughts on “9/3/20 – Probable xCF”

  1. It’s painful to follow the signal to long 3x TQQQ today. I wonder if the strategy can combine open price of the trading day into consideration because the gap down today gave a clear signal it’s a down day.

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  2. It was very dangerous here, I haven’t been long personally. If I told people every time I was scared, that would be almost all the time. It looks to me like there was 40 minutes to get out after the open. If there is no rally between 9:30 and 10:00, that’s a bad sign on a gap down. I could see giving the market another 10 minutes at 10 to come to its senses. I understand the pain, it was tough to sell their without it being planned in advance and the trade was already painful.,

    I’ve been meaning to look at close to open to see if there is any advantage to acting if the opening gap is positive or negative. I doubt that the answer is clear, I’ll take a look over the weekend probably. My friends at Investiquant.com are specialists in playing gaps. I modeled my work after theirs, at this point our work has diverged. Their understanding of probability is more traditional than mine.

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  3. x0C is dubious to buy but not crazy. There is the fundamental risk of the labor day weekend.

    The more serious challenge is the one I showed today with the multiple strategies.

    For example, r13r21 is the return leader
    r13r21 LCC = 12.02 CO = 11.97 HLd = 15.08
    For x0C:
    r13r21 LCC=-1.14 CO = 0.02 HLd = -1.02
    The numbers for em13 x0C are better and even slightly positive but that’s not the big kahuna anymore.
    It’s a buy if you just look at em13, but haven’t we been a little disappointed lately… I’d give more weight to r13r21

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