9-30-03 Dear Reader: The S&P500 closed down by 11 to 996.

The on-balance volume (OBV)(note 2) today was -539 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from -260 to -454. We dropped a +435 from the average from six days ago, giving us a negative bias for today. We will have a positive bias Wednesday-Friday due to dropping negative numbers from the average from six days prior. No signals today.

We had today a previously unseen (by me) event: the bogey of 996.9 on 9/26 was violated by less than a point (close at 996. today). Now the rule says (please see Glossary>Run...) that if the bogey is violated after a BUY, the Run-5 State drops to OSCILLATORY. Other rules take effect only if the violation is more than 1 or 1.5 points. So we are declaring that the market has dropped to Oscillatory State (the Market State page has been updated), but we will watch the near future market action to see if we need to modify this rule that the violation here must be more than 1 point or so to drop the State to Oscillatory. The thresholds for buy and sell signals change when we go to Oscillatory state.

9-29-03 Dear Reader: The S&P500 closed up by 10 to 1007, giving us a Short-term BUY signal (see next paragraph).

The on-balance volume (OBV)(note 2) today was +585 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV rose from -529 to -260. We dropped a -764 from the average from six days ago, giving us a positive bias for today. We will have a negative bias Tuesday due to dropping a positive number from the average from six days prior. The simultaneous upturn in S&P500 and the 5DMA, while the 5DMA was below the lower threshold of -5, gives us a BUY signal. Since we are Long-purchase Clean, we can BUY with 100% of available funds. We bought SPY, QQQ, and IWM in equal amounts.

9-26-03 Dear Reader: Another down day, the S&P500 fell by 6 to 997.

The on-balance volume (OBV)(note 2) today was -608 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from -430 to -529. We dropped a -111 from the average from six days ago, giving us a positive bias for today. We will have a positive bias Monday due to dropping a negative number from the average from six days prior. We are now below the lower threshold of -5 and we are oversold, since we are below -400 on 5DMA, so a BUY signal could come any day. Keep your powder dry; it's going to be a nice BUY signal. No signals today.

9-25-03 Dear Reader: Another down day, the S&P500 fell by 6 to 1003.

The on-balance volume (OBV)(note 2) today was -701 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from -127 to -430. We dropped a +812 from the average from six days ago, giving us a negative bias for today. We will have a positive bias Friday-Monday due to dropping negative numbers from the average from six days prior. We are now below the lower threshold of -5 and we are oversold, since we are below -400 on 5DMA, so a BUY signal could come soon. No signals today.

9-24-03 Dear Reader: Another hard down day, the S&P500 fell by 20 to 1009.

The on-balance volume (OBV)(note 2) today was -1008 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from +63 to -127. We dropped a -57 from the average from six days ago, giving us a positive bias for today. We will have a negative bias Thursday due to dropping a positive number from the average from six days prior (Friday and Monday will have positive bias). We are now below the lower threshold of -5, so a BUY signal could come soon. No signals today.

If you are holding stocks and have a short-term outlook, I know you are feeling pain. The System guided us to sell on 9/19, and so avoid two large down days so far. And further, each day puts us closer to the next buy signal and that will probably be at lower prices than where we sold on 9/19. This is how the System works, and this last week has been a salutary example of its best action. If you thought yesterday's uptick in S&P500 would give a BUY signal, note that the 5DMA was well above the lower threshold for a BUY signal (which would be -5), and so once again the 5DMA shows its effectiveness as a filter with the S&P500 to try and get the best profit performance from a mercurial market in a short-term System.

9-23-03 Dear Reader: The S&P500 rose by 6 to 1029.

The on-balance volume (OBV)(note 2) today was +435 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from +165 to +63. We dropped a +944 from the average from six days ago, giving us a negative bias for today. We will have a positive bias Wednesday due to dropping a negative number from the average from six days prior. No signals today.

9-22-03 Dear Reader: It is days like today, the next day after a System SELL signal, that reaffirm my confidence in the System. If you didn't sell out on Friday, and have a short-term outlook (long-term investors may ignore these remarks), you may be feeling some pain. I do not like to suffer any declines, so I act on every SELL signal. The S&P500 was down hard by 14 to 1023. It doesn't matter if it was news that triggered it or not. News, good or bad, does not have any bearing on the signals we receive from the System, and we pay no attention to news, no matter what it is.  

The on-balance volume (OBV)(note 2) today was -764 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from +251 to +165. We dropped a -333 from the average from six days ago, giving us a positive bias for today. We will have a negative bias Tuesday due to dropping a positive number from the average from six days prior. No signals today.

9-19-03 Dear Reader: On a quadruple-witching day (options and futures contracts expiring), the S&P500 was down more or less all day, then almost flat at the close, finally closing down 3 to 1036. Short-term SELL signal today (see next paragraph).

The on-balance volume (OBV)(note 2) today was -111 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from +317 to +251. We dropped a +218 from the average from six days ago, giving us a negative bias for today. We will have a positive bias Monday due to dropping a negative number from the average from six days prior. The simultaneous downturn in S&P500 and 5DMA, while the 5DMA is above the upper threshold of +2.5, gives us a Short-term SELL signal (Market State is Run-5). SELL is recorded in Market State page update. This nice 6 business-day round trip gained 1.96%, bringing our gain for the year to 15.55%. The Results_Summary page has also been updated.

Long-Term Investors page: End-of-week update. The 200DMA (40 week moving average-Friday closes) of the S&P500 continues to advance and the BULL market is still intact (we have stopped updating weekly the Long-Term Investors page, Table 3, but will resume same if a crisis approaches). We do update Table 2 monthly, and that table shows clearly we are well above the nine month (appx 200 DMA) MA line. Barring a major decline, we should have several months (about 20 weeks) of clear sailing (maybe we should cross our fingers, just in case). No change in positions; we are 100% long in SPY and QQQ for the equity allocation of total assets. The change in our position (based on S&P500) since 4/25/03 is +15.3%. Please see Glossary for any unfamiliar terms.

Short Sellers paragraph: We can not do an actual short sale here because the Short State is Dirty, but we have to do a notional (on paper only) short sale to keep track of the Market State Flag. The bogey for this sale is the recent minor high on Thursday of 1039.6. If the S&P closes above 1041.1 (bogey plus 1.5), we will say the bogey is violated and the rules for a RunLight BUY signal have been fulfilled. Please see Glossary for any unfamiliar terms.

9-18-03 Dear Reader: In a nice advance, the S&P500 was up 14 to 1040, for a new recent high. The last time the S&P was this high was on 6/5/2002, or 15 months ago.

The on-balance volume (OBV)(note 2) today was +812 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV rose from +263 to +317. We dropped a +543 from the average from six days ago, giving us a negative bias for today. We will have a negative bias Friday due to dropping a positive number from the average from six days prior. As I mentioned yesterday, the 5DMA served us well in not giving a SELL signal despite the down S&P, so that we could benefit from today's advance. No signals today.

9-17-03 Dear Reader: The S&P500 was down 3 to 1026. I was worried we might get a SELL signal the day after a (sterile) BUY signal, but the 5DMA kept us out of trouble (see next paragraph).

The on-balance volume (OBV)(note 2) today was -57 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV rose from +86 to +263. We dropped a -940 from the average from six days ago, giving us a positive bias for today. We will have a negative bias Thursday-Friday due to dropping positive numbers from the average from six days prior. We did not get a SELL signal since the 5DMA actually rose. I hope the near future will bear this out, when I say that the 5DMA is an excellent filter with which to pair the S&P500 to try and optimize profits by keeping us in a rising market and out of a declining market. No signals today.

9-16-03 Dear Reader: The S&P500 gave a spirited advance, up 15 to 1029.

The on-balance volume (OBV)(note 2) today was +944 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV rose from -239 to +86. We dropped a -685 from the average from six days ago, giving us a positive bias for today. We will have a positive bias Wednesday due to dropping a negative number from the average from six days prior. The simultaneous upturn in S&P500 and the 5DMA, while the 5DMA was below the lower threshold of -5, gives us a (sterile) second BUY signal. Sterile because we are already 100% invested in the Short-term System. Sterile signals are not recorded on the Market State page. As I mentioned on 9/11, the last BUY signal, I was buying only 50% at that time, just out of trading exhaustion. So today, I bought an additional 25% to bring exposure up to 75%. The official record will reflect that we were 100% invested on 9/11.

9-15-03 Dear Reader: On a somewhat boring day, the S&P500 closed down 4 to 1015.

The on-balance volume (OBV)(note 2) today was -333 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from -25 to -239. We dropped a +740 from the average from six days ago, giving us a negative bias for today. We will have a positive bias Tuesday-Wednesday due to dropping negative numbers from the average from six days prior. No signals today.

9-12-03 Dear Reader: After being down most of the day, the S&P500 closed up 2 to 1019.

The on-balance volume (OBV)(note 2) today was +218 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV rose from -117 to -25. We dropped a -242 from the average from six days ago, giving us a positive bias for today. We will have a negative bias Monday due to dropping a positive number from the average from six days prior. No signals today.

Long-Term Investors page: End-of-week update. The 200DMA (40 week moving average-Friday closes) of the S&P500 continues to advance and the BULL market is still intact (we have stopped updating weekly the Long-Term Investors page, Table 3, but will resume same if a crisis approaches). We do update Table 2 monthly, and that table shows clearly we are well above the nine month (appx 200 DMA) MA line. Barring a major decline, we should have several months (about 21 weeks) of clear sailing (maybe we should cross our fingers, just in case). No change in positions; we are 100% long in SPY and QQQ for the equity allocation of total assets. The change in our position (based on S&P500) since 4/25/03 is +13.33%. Please see Glossary for any unfamiliar terms.

9-11-03 Dear Reader: The S&P500 closed up 6 to 1016. BUY signal today (see next paragraph).

The on-balance volume (OBV)(note 2) today was +543 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV rose from -201 to -117. We dropped a +121 from the average from six days ago, giving us a negative bias for today. We will have a positive bias tomorrow due to dropping a negative number from the average from six days prior. The simultaneous upturn in S&P500 and 5DMA, while the 5DMA was below the lower threshold of -5, gives us a Short-term BUY signal. If you are exhausted with the recent trading activity, I sympathize. No one is obliged to follow the BUY signals; anyone may sit out. We are BUYing only 50% of the normal amount, but we will keep score using 100%, since we don't have any rule that tells us to BUY only 50% here. Just my personal preference. BUYing 1/3 each of SPY, QQQ, and IWM (please see ETF page for explanation of these index funds).

9-10-03 Dear Reader: The S&P500 closed down 12 to 1011.

The on-balance volume (OBV)(note 2) today was -940 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell dramatically from +72 to -201. We dropped a +428 from the average from six days ago, giving us a negative bias for today. We will have a negative bias tomorrow due to dropping a positive number from the average from six days prior. No signals today. Most of us hate to see the market go down, but today's action points out the importance of observing the Short-term SELL signals (as yesterday) when they occur. Long-term investors can easily ignore these remarks.

9-9-03 Dear Reader: The S&P500 closed down 8 to 1023. Sad to say, we get a SELL signal the day after a RunLight BUY signal (see next paragraph).

The on-balance volume (OBV)(note 2) today was -685 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from +401 to +72. We dropped a +959 from the average from six days ago, giving us a negative bias for today. We will have a negative bias for the next two days due to dropping positive numbers from the average from six days prior. The simultaneous downturn in S&P500 and 5DMA, while the 5DMA is above the upper threshold of +2.5, gives us a SELL signal (Market State is Run-5). SELL is recorded in Market State page update. Fortunately this does not happen very often. We can ignore the BUY signal of yesterday and just not participate, but we cannot ignore the SELL today. And if you feel like you have been whipsawed, I can empathize, but please know that the whipsaw rule does not apply to a RunLight BUY signal (please see Glossary for any unfamiliar terms). In case you are wondering if this will happen again over the next few days, take comfort that the RunLight rules only acknowledge the first in a sequence of RunLight signals. This short round trip lost 0.81%, bringing our gain for the year to 13.6%. The Results_Summary page has been updated.

Short Sellers paragraph: We have no need to do a notional (on paper only) short sale today. No flags will change regardless of whether the 9/8/03 high of 1032 is exceeded or not. Please see Glossary for any unfamiliar terms

9-8-03 Dear Reader: The S&P500 closed up 10 to 1032. RunLight BUY signal today (see next paragraph).

The on-balance volume (OBV)(note 2) today was +740 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV rose from +340 to +401. We dropped a +435 from the average from six days ago, giving us a negative bias for today. We will have a negative bias for the next three days due to dropping positive numbers from the average from six days prior. The violation of the bogey from 9/4/03 by more than 1.5 S&P points, along with other conditions described in Glossary>Run..., gives us a RunLight Short-term BUY signal today. The RunLight signal lapses into Run-5 state immediately after the signal, so we are still in Run-5 state. BUY is recorded in Market State page update. The whipsaw rule does not apply to RunLight BUY signals; ordinarily a BUY signal immediately following a SELL signal would be ignored as a whipsaw (please see Glossary for any unfamiliar terms).

Short Sellers paragraph: We have to buy back our notional (on paper only) short sale today. The bogey for the sale was the recent minor high on Thursday of 1028. Please see Glossary for any unfamiliar terms.

9-5-03 Dear Reader: The S&P500 closed down 7 to 1021. SELL signal today (see next paragraph).

The on-balance volume (OBV)(note 2) today was -242 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from +498 to +340. We dropped a +545 from the average from six days ago, giving us a negative bias for today. We will have a negative bias for the next four days due to dropping positive numbers from the average from six days prior. The simultaneous decline in S&P 500 and the 5DMA, while the 5DMA is above the upper threshold of +2.5, gives us a Short-Term SELL signal. The Market State page has been updated. This round trip (BUY was on 8/27/03) gave us a gain of +2.5%, and brings the gain for the year to +14.41%. This compares to the gain in S&P 500 for the year of 13.64%. The Results_Summary has been updated. Please see Glossary for any unfamiliar terms.

Long-Term Investors page: End-of-week update. The 200DMA (40 week moving average-Friday closes) of the S&P500 continues to advance and the BULL market is still intact (we have stopped updating weekly the Long-Term Investors page, Table 3, but will resume same if a crisis approaches). We do update Table 2 monthly, and that table shows clearly we are well above the nine month (appx 200 DMA) MA line. Barring a major decline, we should have several months (about 22 weeks) of clear sailing (maybe we should cross our fingers, just in case). No change in positions; we are 100% long in SPY and QQQ for the equity allocation of total assets. The change in our position (based on S&P500) since 4/25/03 is +14.41% (coincidentally, identical to the short-term gain to date). Please see Glossary for any unfamiliar terms.

Short Sellers paragraph: We can not do an actual short sale here because the Short State is Dirty, but we have to do a notional (on paper only) short sale to keep track of the Market State Flag. The bogey for this sale is the recent minor high on Thursday of 1028. If the S&P closes above 1029.5 (bogey plus 1.5), we will say the bogey is violated and the rules for a RunLight BUY signal have been fulfilled. Please see Glossary for any unfamiliar terms.

9-4-03 Dear Reader: The S&P500 closed up 2 to 1028. For several days it seems like the S&P will close down and give us a SELL signal, but then closes up.

The on-balance volume (OBV)(note 2) today was +121 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV fell from +527 to +498. We dropped a +271 from the average from six days ago, giving us a negative bias for today. We will have a negative bias for the next five days due to dropping positive numbers from the average from six days prior. Since the 5DMA is over 400, we say we are over-bought and could get a SELL signal any day. The decline in the 5DMA while it was above the upper threshold of +2.5, gives us an ARM signal, the first half of an ARM & FIRE SELL signal. Any down action tomorrow in the S&P will complete the signal for a SELL. Please see Glossary for any unfamiliar terms.

9-3-03 Dear Reader: The S&P500 closed up 4 to 1026.

The on-balance volume (OBV)(note 2) today was +428 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV rose from +505 to +527. We dropped a +314 from the average from six days ago, giving us a negative bias for today. We will have a negative bias for the next five days due to dropping positive numbers from the average from six days prior. Since the 5DMA is over 400, we say we are over-bought and could get a SELL signal any day. No signals today.

9-2-03 Dear Reader: In a nice move, the S&P500 closed up 14 to 1022. Our BUY signal on Wednesday, 8/27/03, however weak it may have been, has worked out beautifully. Trust the System; it is not right 100% of the time, but our 9 year (Short-term) and 20 year (Long-term) records are shown here, so you can see how it works over time. For the year we are on track  to be close to our average 17% per year return. This is without using margin or options, or the risk of bad news on any individual stock, and with a fairly conservative approach. This is not a get-rich-quick scheme but beats fixed income investments by a wide margin. Of course, past results are no guarantee of future results.

The on-balance volume (OBV)(note 2) today was +959 (million shares). The 5 day moving average (5DMA)(note 1) of  the OBV rose from +269 to +505. We dropped a -221 from the average from six days ago, giving us a positive bias for today. We will have a negative bias for the next five days due to dropping positive numbers from the average from six days prior. Since the 5DMA is over 400, we say we are over-bought and could get a SELL signal any day. No signals today.