MarketTrak Question/Comment Message

Posted By: Stan   Date: Mon Jan 7, 2008

Title: False email message?

  Today in my email I received this "go to cash" signal:
 " Monday, January 7, 2008
  The trading model will go to CASH at the close today and
  then back to LONG at the close tomorrow (Tuesday)."
  When I look at your MarketTrak Forecast Summary on your home page,
 I see this "Long" signal(summarized):
 " Last Forecast / Page Update: Monday, 01/07/08 10:52 MST
  Current Forecast: UP - Stocks should generally move higher over the next few weeks.
  Current ANO value: 0.001545
  Current Trading Model Position: LONG
  Current UP Probability: 93.04 Percent"
  So, which is correct, the email I got today or your Forecast Summary
  on your home page?



The trading position shown on the forecast page is the position at the close for "Market Data Entry" date shown. This position will hold up to the close of the next trading day. The position is determined by the delayed ANO value which is input to the trading model. Since the last market data entry was Friday, the delayed ANO value (the value five days previous) for this date is: 0.000586. This means that the LONG trading position will hold up to the close on Monday. Now, if you look at the table at the end of the forecast page, you will see that the next ANO value is: 0.000467 which is below the CASH set point of 0.0005. This means that the model will go to cash at the close today (Monday).

This is a little confusing so I will fix this in the next model update. I usually give more warning of a position change but I didn't notice this was going to happen until this afternoon. The position change will be brief as the model will go back to LONG at the close tomorrow. This is because the delayed ANO value for tomorrow is: 0.001123, which is above the CASH set point.


Tuesday, January 8 Update: I modified the format of the forecast page summary. Trading position changes are now clearly indicated.

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