Unleashing Creativity

Ulli Uncategorized 2 Comments

President Obama attempted to unleash creativity by announcing the widely anticipated new regulations designed to overhaul financial markets.

The new regulations would increase some of the powers of the Fed but also add another layer of bureaucracy via a newly created consumer protection agency.

For some straight talk, please read Mish’s commentary at Global Economics titled “Obama’s Blueprint for Reform Concentrates Still More Power in Hands of the Fed.”

The market’s merely yawned and ended almost unchanged. Our Trend Tracking Indexes (TTIs) barely moved, and we seem to have reached a point of equilibrium. With no apparent driver to propel the indexes higher, the path of least resistance could very well be to the downside.

Nobody knows for sure, so we are content tracking our sell stops and will let the market tell us what our next move is to be.

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Comments 2

  1. Hi Ulli,
    Thanks for the excellent blog. I would like your opinion on the notion that using automatic sell stops instead of manually selling after a security has lost a certain percentage could somehow be disadvantageous.

    Would it be possible or even worth manipulating the market to take out my relatively small position?

    Thanks,
    VR

  2. VR,

    We talked about this many times. I advocate tracking sell stops on a day-end-closing price basis only (in the case of ETFs) and then enter the order the next day. That way, you don't have to deal with the "noise" of intra day fluctuations.

    Ulli…

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