Non-Farm Payroll (NFP) Model Forecast – July 2014

This article presents the Trader Edge aggregate neural network model forecast for the July 2014 non-farm payroll data, which is scheduled to be released tomorrow morning at 8:30 AM EDT.

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Recommended Reading 07-24-2014

Readers repeatedly ask me for book and article recommendations, especially new traders who are interested in learning more about trading and investing.  Here are four new book recommendations from my personal finance library, all written by Jack D. Schwager. A complete list of all past recommendations is available on the Recommended Reading page.

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Two New Improvements to Trader Edge Recession Models

After personally suffering the costly effects of ECRI’s notoriously ill-advised recession call in 2012, I embarked on the journey to create my own recession models. Since developing the initial models in late 2012, I have published the model forecasts shortly after the end of each month.  As I learned more about the art of forecasting recessions (and market peaks and troughs), I have incorporated a few improvements to the models.

The structure of the models makes it very easy to incorporate new explanatory variables, so I am always on the lookout for new data series that are causally related to recessionary environments.  I recently discovered two new data series, which will be incorporated into the Trader Edge recession models going forward.

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Recession Model Forecast 07-01-2014

The following article updates the diffusion index, recession slack index, aggregate recession model, and aggregate peak-trough model through June 2014.

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Non-Farm Payroll (NFP) Model Forecast – June 2014

This article presents the Trader Edge aggregate neural network model forecast for the June 2014 non-farm payroll data, which is scheduled to be released tomorrow morning at 8:30 AM EDT — one day early due to the fourth of July on Friday.

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06-30-2014 AAR Strategy Update Posted

The June 30, 2014 AAR Strategy update is now available on the AAR Subscribers page.  If you are not currently a subscriber and would like to learn more about the strategy, there is a detailed description on the AAR Strategy page.

The AAR strategy is a conservative, long-only, asset allocation strategy that rotates monthly among five large asset classes: large-cap U.S. stocks, developed country stocks in Europe and Asia, emerging market stocks, U.S. Treasury Notes, and commodities. The strategy was inspired by the Ivy League portfolio and uses trend and technical filters to reduce downside risk.

If none of the five candidates pass their respective trade filters, the AAR strategy remains in cash for the month.   Stop-loss orders are used on every trade to control losses and to facilitate position sizing.

Brian Johnson

Copyright 2014 – Trading Insights, LLC – All Rights Reserved.

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A New Market Timing Indicator

I am always on the lookout for new trading tools, indicators, and insights.  One of my primary sources of inspiration is magazines like Active Trader and Technical Analysis of Stocks and Commodities. Now that I have finished my first book, I finally have some additional time to investigate new research ideas. I recently read an interesting article in the June 2014 issue of Active Trader by Euan Sinclair titled “Uncertainty as a Predictive Tool.”  Sinclair concluded that the standard deviation of strike prices in the option chain (as a function of volume) could be used to measure uncertainty or ambiguity, which is predictive of future performance.  I was intrigued by the idea and I dedicated some time over the weekend to constructing and testing an uncertainty indicator as a predictor of the performance of the S&P 500 index.

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Option Strategy Risk / Return Ratios #1 on Amazon Again

The print version of my new book “Option Strategy Risk / Return Ratios: A Revolutionary New Approach to Optimizing, Adjusting, and Trading Any Option Income Strategy was the #1 Options book on Amazon again this morning. Since reaching #1 last month, the book has consistently been in Amazon’s top 10.  In addition, the early reviews have been very encouraging; eleven independent readers have posted 5-Star reviews.

If you enjoyed the book, please consider posting your own review on Amazon and sharing your insights with other prospective readers via Amazon and via social media.

Thank you for your continued support.

Continue reading for the complete reviews on Amazon.

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