SD- 2021- ACTIVE MANAGEMENT FOR GREATER SUCCESS IN 2021

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SD-2021- ACTIVE MANAGEMENT FOR GREATER SUCCESS IN 2021

looking at the returns of the major indexes , all closing at all time highs in 2020:

DOW $30,606 +9.6% S&P500 $3,756 +18.5% NASDAQ $12,888 -QQQ'S +48%

iF one had a portfolio overweighting the Tech sector- QQQ, one outperformed the typical portfolio and "beat" the Market (SPY) by 2.5x in that portion allocated into tech. If one held the Dow sector as part of one's portfolio, That portion underperformed the (SPY) market by a 50% lower return . If one had exposure to Bonds- they lost relative to owning any of the major indexes.

If one had a standard-age appropriate- composition portfolio, the exposure to the tech sector would have been little for those close to retirement, and they would have had modest gains- less than the market return. Even those that are decades away- with a typical target date portfolio- would be able to compare their 2020 returns to see if they had better than the "SPY" +18%.

Active management starts with comparing one's investment choices, selecting from what one believes to be the better performers- and potentially selecting only those or allocating a greater % of one's assets into those hoped for outperformers- and then periodically compare those performances against the others, and shift your allocations overweight into the winners-

For example- if you started the year 2020 with equal weight allocations only in the DIA,SPY,QQQ, You would have seen the qqq's outperform at the end of Jan-and would take some (PERHAPS NOT ALL) of the assets out of the lowest performer and put them into the 2 better performers.
At the end of Feb, THE MARKETS WERE DECLINING- (Stop-losses not considered in this part of the discussion) - Notice that the DJIA dow jones declined the most, followed by the SPY and then the QQQ's- and in the following Rally, the QQQ's clearly outperformed- and on a monthly review, one would have kept the overweight allocation in the QQQ's the better performing sector.


The theme of Momentum investing is well known- because Momentum often has persistence-as known by those that are Trend followers-From Stan Weinstein in the 1990's on, momentum and trend following approaches can reduce Risk and increase returns. This is what the big institutions know how to do- Invest, allocate, rebalance, and take excess profits off from retail traders.
Over the years, I've read a number of books and have been influenced by the authors, as well as having taken big losses in 2000 when I did not know any better- small losses in 2008, BUT THOSE PERIODS of sharp markets losses set my underlying Bias to be untrusting of the markets. 2008, 2018,2020. I controlled losses by using Stop-losses and raised cash. I've been periodically in and out but it's been a haphazard on and off again process. In the last year, I eventually set my naturally bearish bias aside and determined I would only trade With the Trend- and - thanks to the strongest trending market of this bull run, had a "successful" year- I also did not lose much in the decline in Feb/March and had cash on hand to start to reinvest as the market rallies.
For the record for this year - in the 3 accounts- year end values for 2020- We will see what the end results are 1 year from now in these accounts.

IB Roth $19,288 = $8.838 gain an 85% gain for the year- hundreds of trades -less than a 50-50 win-loss -cut losers fast and let winners run
Van Roth $13k gain ,21.9% return relatively modest drawdown

VAN IRA $150,823k = $20.6 K gain and only an 11.7% ytd return ( conservative, late to put into the market in 2020)


The IB account is an aggressive stop-loss higher Risk account- Very discretionary with a mix of ETF funds- mostly ARK and some smaller stock positions., There is a 3 day clearance for cash to become available after a sell - I intend to employ a similar approach in 2021
Since I was employed with a day job until retiring 2 weeks ago- all of my trading decisions were done after hours- with active stops on positions.
The VAN Roth- I initially used more of this account in 2020 and took on more Risk ETFs -including ARK funds- also with stops.
Had I not used stops After April) and held through 2020, the fund would have been much higher today
The VAN IRA-
I initially was slow to make many investments in the recently rolled over IRA- I had initially rolled out some of my employer IRA 2 years earlier- but was hesitant to try to manage it. I view it as the larger portion of the IRA that should be a lower Risk portion. Even though I was late to put this portfolio into full investments in 2020, the portfolio used stops and yielded double the other portion of my portfolio held by a "professional" manager that gave me a 5.5% return as of the November ytd return.
The theme this year is to combine this fund with growth and some dividend funds- but they All are required to be investment positive- The last thing I want to do is hold some dividend funds to receive a small dividend return and see the principal value drop significantly- I cannot wrap my head around dividend investors that see a 50% drop in their principal value but are content to see a small dividend check return on thousands of dollars loss in value. The Dividend funds should also give me exposure to the "value" side of the market.

In the original start in this post , I compared the Dow, Nas, and SPY- and I should point out that I also hold emerging markets exposure-
In fact, in my company IRA in early 2020, I knew I needed to add some additional exposure to emerging markets as they were valued much cheaper, and were due to see growth- I initially had only 7 selections that I started to put allocations into through the American Funds sponsored account (Not my Choice) but during the September time frame, I reviewed the holdings performance using the stockcharts Performance chart.
I found that 3 of the funds were outperforming, and so I exchanged the monies out of the lower performers and added them into the upper performers.
A few months later, I shifted the allocations some in between those 3 funds- based on the Perf Chart for the month- Mutual funds are not my choice of investments-ETFs are the way to go- but this was all our company has available.
While this did not represent a huge amount of monies- The Year to DATE return is a very respectable +38.79%-
but that is higher than any of the returns for any of the investments. Math error? No, it was due to active management and on a pullback in the emerging mkts fund- exchanging some of those funds back into the money market and then reinvesting them back in at lower prices- the essence of trend trading . Since you cannot use stop-losses on mutual funds, ETFs are preferred all day long- and less expensive .
Also notice that coincidentally- of the 3 funds I ended up holding - they were also the 3 best performers in the 1-5-10 year performance.
While that past historical performance does not always hold true , in this case it did. While I did well in selecting the top 3, in my prior adjustment, i underweighted what turned out to be the best performer of the 3 .But - did not hold any of the laggards to dilute results.



I hope for this thread to be instructive- as i am willing to share both my winning and losing trades, and my adjusting my allocations.
I will continue to be an advocate of aggressive trend trading, but I will also attempt to be a portfolio investor- with a Risk reduction approach.
I'm also an advocate of employing stops to protect gains, reduce losses, and repurchase more on pullbacks if the trend resumes.
I hope Ira will continue to add his insightful contributions- as he and I are the last remaining active members of DG's market timers-
and if someone cares to comment, but does not want to join in - pm me @[e-mail]-

The LOLO reminded me:


October 2021 EDIT/ADD Update- After seeing initial further gains into Feb 2021, as the tech bull lost momentum, markets swung into Value, out of tech, and my performance lagged- Due to my overall underperformance and the market rapidly rotating through various industry groups, I opted to make a major decision to Rollout the larger portions of my Van IRA and Roth accounts to be managed by EDELMAN FINANCIAL ENGINES- www.edelmanfinancialengines.com/
My account holdings shown in posts 10-24-21 after the transfer out in the IRA and 2 Roth accounts represent a shift in strategy to get more aligned with sector rotations starting in September-2021 .

1st chart displays End of month Sept 2020 value $236k- At the time of the transfers out Oct 22- Acct value was $241k + 20k in the IB Roth.
I rolled out $150k in the Ira and $45k in the Roth to Edelman- keeping approx 66K to allow me to stay actively engaged.

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1.1.21
"CAVEAT EMPTOR-BUYER BEWARE" DISCLAIMER-
I'm not trained or certified to be supplying any investing or trading advice-
What I put forth in this 2021 thread simply represents my personal beliefs based on my experiences, and may not be appropriate for Others
to try to follow- Consult with your qualified financial advisor-.
Just finished talking with my youngest self employed daughter -(adult) w/2 children; who plans to Buy a house and also start investing this year-
She knows that she needs to invest for the future- but doesn't understand the principle of the importance of investments compounding over time- It's hard to wrap your head around the concept without having seen the results in person of the benefit.
So, I will add some bulk in this 2021 thread designed to cover some of the basics-but , by no means a comprehensive guide-as to my beliefs about the benefit of investing- the earlier the better, and the more , the better. I can say this after working for 50 years- and only investing later in life -last 20 years, and trying to play catch-up!

DEBT- There is no point in considering investing if one has credit card debt- Credit card companies full well know the benefit of compounding interest - because that is what they do to the borrower that takes on credit card debt and then makes minimal payments- The Credit card company loans the consumer money to buy STUFF the consumer desires. The consumer then elects to be indebted to the credit card company- and pays a fee- Interest- on the borrowed money- and the credit card company has them on the hook- to be paying back money above what the item initially cost. It is because we have been programmed by easy credit that we can Have what we want- and only have to pay it back gradually in the future- The consumer can Buy (Charge) all the stuff they want -up to their credit limits- and many consumers will use multiple credit cards to get the STUFF they didn't want to save for- This perpetuates a cycle of Debt- making Credit card companies Rich- and dooming debtors with the perpetual cycle of making partial payments, increased debt, and essentially working for the Credit card companies- and not for their own benefit-

www.daveramsey.com/ If you have debt- Ramsey has a defined program to guide you to get your debt under control, and to eventually eliminate it all together- His site has a lot of Free resources, his program recordings are on You tube, and his "Financial Peace" seminars are available around the country- He and his contributors have many solid books and resources available to guide and encourage one to get out of debt, build wealth for the future. Starting with an Emergency fund for that unexpected rainy day
Some debt- is unavoidable- but we can choose between what our desire is to have and what is sensible . What one "needs" is not the same as what one Desires. Knowing the difference- and not succumbing to the easy choice of indulging the Desire is part of being an adult.
Ramsey endorses his local "ELP's- endorsed local providers- Financial advisers and investing in Mutual Funds.
Everyone takes a piece of that investment- An advisers job is to keep the investor invested for the long term and suitably positioned.
Mutual funds tend to be actively managed and come with a higher expense ratio than some of the passive ETFs that are available. So, I believe the average investor can easily learn the benefits of investing for decades , and reap higher rewards by lesser expenses using ETFs.
HOUSING- mortgage- Mortgage rates are at an all-time low- We can lock-in - a higher cost house at low rates- but do we Buy the House of our dreams- with little or no money down- or do we get a House that fills all of our needs, but costs hundreds of dollars less than the "ideal" house? The hundreds of dollars saved on the more practical house is -perhaps- our invest monies-
CAR- There is a fine line in choosing what vehicle we need, and what we may want. Buying brand new and high dollar vehicles fills the Desire, but it comes at a cost beyond what is our real "NEED" - Ramsey says to just Buy the most practical used vehicle- with cash -ideally.
There comes a point of balance in which we Buy something 10 years old with hundreds of thousand miles and needing major repairs- or something with modest mileage, several years old- paying more- but likely more reliable- Again, the difference can be paying hundreds of dollars more a month- which could be the difference in building our emergency fund, savings account, retirement fund, 529 plan.
STUDENT DEBT- So many young adults come out of school with a huge student debt - and are paying off -with interest- for years and years-decades even- Student debt is the next big cross that most owe money on-and need to be eliminated ASAP- I think interest rates are commonly above 6% - Ideally one eliminates this debt before investing- and makes smart choices what ones goes to school for and pays.
Again- refer to Ramsey
Being practical-
Most of us have debt early on in our careers, and are accustomed to carry that debt over time as something that is "normal" - Only by eliminating high interest debt can we hope to move forward -build a savings account -emergency fund- and then proceed to "invest"

By Investing earlier in life, one's funds have the opportunity to grow-exponentially over time- compounding the original investments multiple times over decades- The earlier one begins, the greater the benefit. Even starting off with a basic Target date fund- one will see large returns over time- and so I would recommend a target date fund as the initial investment vehicle-Low cost, Diversified exposure, automatic rebalancing, and gradually grows more conservative over time as one approaches retirement.
My personal belief is that one 1st invests in their employer sponsored plan to get any employer match - or perhaps up to the allowable limit-
if possible- But, after reaching the employer match, if one has funds available- funding an independent , self-directed ROTH IRA (if not offered by the Employer) makes a great deal of financial sense-
The Roth IRA is funded with monies that you have paid taxes on- The conventional IRA will eventually be taxed on All of the withdrawals at retirement, and has severe penalties for early withdrawals. The Roth is based on taxes already paid- and so no future taxes are applied on any of the earnings- A Roth Brokerage account allows one to make investments and trades and never has to pay taxes-on the returns or the capital gains from an investment sale. There is a limit on how much one can put in each year-but one should try to max out that limit each year- One can also simply elect to use a target date Fund for those Roth investments-but one can also set up a Roth to be a brokerage account-
www.financialsense.com/podcast/19816/roth-ira-vs-401k-what-you-need-know

TARGET DATE FUNDS The target date fund is ideal as a set-it and forget it investment vehicle- particularly for those that don't want to be responsible to make investing selections- Typically conservative in the approach, it could be considered "safer"
www.investopedia.com/retiremen-and therefore likely to not have stellar returns over the long run. When individuals -including myself- decide to make our own selections, we often get less than market returns because of our shifting assets around and trying to "time" the market- Or , we become fearful- believing that the market is due for a major correction, so we don't invest- Studies have proven that Individual market timers typically get mediocre returns- less than 50% of what the market returns are-
This article explains the basics of Target Date Funds- Perhaps that should be considered as a "Core" holding in one's portfolio- and then one may choose to branch out with their own selection of investments.
www.investopedia.com/retirement/targetdate-fund-best-choice/

Recommended website to get an overview :https://www.investopedia.com/investing-essentials-4689754

Market Timing-Market timing- If done successfully- has the Lure and the Potential to increase gains, and to reduce RISK.
The key word there is "IF". Market timing- when it is done emotionally and at one's discretion- gut feeling, fear, hope etc
almost always guarantees underperformance. The vast majority of market timers underperform the index they are trying to time.
www.investopedia.com/terms/m/markettiming.asp

Position Sizing- This is a critical component that means you will not put 'All of your eggs into one basket"
Position sizing protects one from one's self- particularly when the day comes where the present bullish trend stalls and the market shifts- and the winning trades begin to deliver losers. A lot of the new market participants in 2020 do not have a history of being in anything but a total big uptrend- and they may have big % bets on the big momentum names- If they have stops in place, they can retain a good portion of their winnings- Position sizing helps define the Risk and size the position so even a series of losing trades does not wipe one www.investopedia.com/terms/p/positionsizing.asp#:~:text=Position%20sizing%20refers%20to%20the,when%20determining%20appropriate%20position%20sizing.ut.

Stop-losses- Stop-losses are an essential element in both investing and trading. Stops should be placed outside of normal price volatility, so the position is not "whipsawed"- where a position pulls back and triggers the stop-loss sale, only to see the position quickly move back higher. Stop-losses combined with a position sizing approach allow the trade to fluctuate under expected movements, but will sell the position as a market order to sell if the stop price is hit on a decline. Stop orders can be combined as a stop-limit order - where one sets a price to sell if a position drops to a lower level than where one expects it will go- That stop then becomes a "market order, and will be sold at any price that a buyer would pay- potentially well below the stop price . By adding a Limit order to the stop-order, you narrow the Price you are willing to sell the position at . Note that Price can potentially open below the limit order- and thus bypasses the stop order- so a limit attached to a stop should allow for a greater price swing and lower fill.
www.investopedia.com/articles/stocks/09/use-stop-loss.asp
Limit Orders I use both Market and Limit orders when Buying a position. A limit order defines the Most you are willing to pay for a position to be filled. A market order gets you filled at whatever price someone else has on their Sell order limit request - Particularly dangerous to use market orders on a low volume or speculative position- . Typically market orders can be used on the big stocks with narrow bid-ask spreads
www.investopedia.com/ask/answers/100314/whats-difference-between-market-order-and-limit-order.asp#:~:text=Key%20Takeaways,be%20a%20buy%20or%20sell.
What is the bid-ask Spread?
www.investopedia.com/terms/b/bid-askspread.asp

The Ease in which one can place a buy or a sell order today- with fractional shares, and no commission charges-is indeed a remarkable change from just a few years earlier- Because it is so easy to do does not mean one should assume it is easy to succeed by buying the flavor of the day- Think TSLA up over 600% or is it 700% in one year- or Bitcoin- up 300%- I certainly wish I had kept a portion of both -in hindsight.
The introduction of tens of million of new trading accounts in this pandemic has the potential to make people a lot of money trading- and to potentially cause them great disappointment if they do not have a method planned to take some of those gains off the table .I had great visions because of my trading prowess in the Tech bubble in 1999-2000, until that Bubble popped, taking away all of my new found gains and a substantial amount of my principal I started with.
Are we in a Tech bubble today? Certainly - 100% we are- Are things Tech grossly overvalued? absolutely - Does this mean we should sell everything and sit in cash? No, not as long as we have a plan to protect a portion of our gains- and are not naïve

My IB account returns +85% in 2020 would make me think I was a success @ market timing- However, My Van ROTH returns - while beating the
"Market" (S&P500) did not deliver the gains I would have -had -had I allowed my winning ARK fund positions room to Run and instead I jumped in and out - That being acknowledged, what part of Market Timing was a positive in 2020-and what will I do the same -and differently ,in 2021?
IB _ My Interactive Brokers Roth account has long been my play, experiment and Risk account-over the past decade. It was my Las Vegas type trading account, something I played with over the years, often losing money on trading my Bias- and not retaining winnings. This year, I decided I would really apply a more tactical approach, and it yielded great results- This approached worked well, but this has been an extremely strong trending Bull rally-after March; and, honestly easy to make money on- I don't anticipate getting that same gain in 2021, as I think the character and momentum shift starting this past month will continue to make 2021 a more selective market. Particularly as we see a transition away from the inflated prices in all things technology.

The Van Roth- I actually hope to achieve a better gain in 2021- by being more selective, and applying an approach of partial profits, and retain a stop-loss for part of the position just above my entry cost, trying to allow the trade stop room to progress . My personal Bias is that we are due for a continued market rotation that will come at the expense of Tech getting revalued by dropping to lower valuations-
However, I will have to rely on the price chart to tell me that is occurring- I will still continue to seek out the momentum names in the Tech sector- such as the ARK funds- and try to allow them to make it a banner 2021.

The VAN IRA- This is the larger portion of my self-directed retirement funds, that I initially did little with early in 2020. I was nervous about Risking those funds in the beginning, and it was kept with a large % in cash for a good portion of the spring, gradually putting on a few positions, and late in the fall increasing those positions along with some growth funds. I felt that I needed to use this fund in a more conservative fashion that the Roth accounts- and I think that caution still is valid. However, I also realized that I can consider to take larger positions and control the "Risk" with stops-and I proceeded to add "Risk" assets into that account- including some of the ARK funds- This account intentionally represents more of a diversified account-potentially reducing the Risk by the nature of being more diversified , and thus the asset allocation mix is going to vary -from Tech to some dividend etfs and some of the popular ESG themes that evolved and did well in 2020-

ASSET ALLOCATION:
www.investopedia.com/articles/03/032603.asp#:~:text=Asset%20allocation%20is%20an%20investment,%2C%20real%20estate%2C%20and%20derivatives.&text=The%20consensus%20among%20most%20financial,most%20important%20decisions%20investors%20make.

DIVERSIFICATION
DIVERSIFICATION- DON'T PUT ALL OF YOUR EGGS IN ONE BASKET- Is the conventional wisdom. For Safety -is that also the recipe for mediocrity?
Warren Buffet - America's most famous Investor living today is cited as viewing it differently:
www.markethingych.com/story/diversify-almost-half-of-warren-buffetts-berkshire-hathaway-portfolio-is-comprised-of-a-single-stock-2020-07-07?mod=article_inline
Investopedia:
www.investopedia.com/articles/basics/05/diversification.asp

What is Right for you?

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What is Technical Analysis and why should you use it?
See the Stockcharts definition :
school.stockcharts.com/doku.php?id=overview:technical_analysis#:~:text=Technical%20Analysis%20is%20the%20forecasting,examination%20of%20past%20price%20movements.&text=Technical%20analysis%20is%20applicable%20to,forces%20of%20supply%20and%20demand.
See Stockcharts School for a series of articles on TA:https://school.stockcharts.com/doku.php?id=overview:ta_101:ta101_part01
As with all things new- a 1st reading my not all sink in, but this is Free and worth a read if interested in understanding TA.
The stockcharts school has a lot of in depth articles- and free.
Stockcharts.com has a site for "Free" limited charting- and also an inexpensive "Basic" subscription, plus a more advanced and expansive Extra, and Real-time pro subscriptions- Overall, a very good value and also articles for members from other contributors.

A good primer on applying the very basics is Dave Landry's "The Layman's Guide to Trading Stocks"
www.amazon.com/Laymans-Guide-Trading-Stocks/dp/0974765333
It takes one step by step from some of the basics understanding of the chart, the business cycle, and into one of Landry's buy set ups and sells using stops-
A less expensive book on Trend Trading in decades old but still appropriate- Stan Weinstein's Secrets from Profiting in Bull and Bear Markets
www.amazon.com/Stan-Weinsteins-Secrets-Profiting-Markets/dp/1556236832/
Landry is correct- Keep the trading approach as Simple as possible- and since indicators are lagging- don't be too reliant on indicators.
I have charts with several momentum indicators on them- but the price bar action is the main focus.
I also employ moving averages to determine the trend direction, and often the strength of the trend.

www.investopedia.com/articles/active-trading/052014/how-use-moving-average-buy-stocks.asp#:~:text=The%20moving%20average%20(MA)%20is,time%20period%20the%20trader%20chooses.

Chart (without price bars) only showing a number of emas trending, downtrending and then a resumption of the uptrend.
This simply demonstrates the obvious change in trend direction when the bars revert from sloping up and to the right, to turning down.
Uptrend, Downtrend, and then a resumption of the Uptrend


When we put the Weekly price bars onto the chart, it becomes a bit more crowded. There are different types of price bars-A conventional Bar chart- the opening price is the horizontal line on the vertical bar- The closing price is demonstrated by the horizontal bar on the right side of the vertical line- Bearish bars are red- and indicates a lower Close than the prior bar. Notice that successive red bars will pull the faster ema lines down with price. see definition :https://school.stockcharts.com/doku.php?id=overview:ta_101:ta101_part04
i.imgur.com/SPj1AZP.png

Same chart but with Japanese Candlesticks- It provides the same information as bar charts, but some prefer these as easier to interpret rather than bar charts- see stockcharts school :https://school.stockcharts.com/doku.php?id=chart_analysis:introduction_to_candlesticks


Elder Impulse Charts- I presently use these on my charts- The price bars coloration uses some technical indicator input for the color of the bars- Blue neutral- Red Bearish, Green bullish school.stockcharts.com/doku.php?id=chart_analysis:elder_impulse_system
the colored interpretation given to the price bars can be useful vs the OHLC bars.


This entry comes from a 2-22-21 post after a long time Friend posted how he made purchases during an obvious downtrend and Price Decline -
This very Basic chart illustrates the Basics that one should learn to Apply to their trading- It will keep you on the correct side of the markets.
And on the sidelines when the markets are Not trending-

A common theme among traders and investors that I also follow is to Trade WITH the trend- and not trade long when price is downtrending.
Why not? Because no one knows where the bottom lies until the stock tells us- by putting in a bottom and then a move higher.

Consider the very Simple RULES that would then apply to the following chart-.and Many others.
1- Never BUY when Price is downtrending- and is BELOW The Declining FAST ema - Pretty SIMPLE EHH?

2. You WAIT Patiently until Price makes a CLOSE above the Fast 7 ema- and realize that Often the 1st higher Close then is followed by a lower price move-
SO, You consider to only Buy at a higher price entry above that 1st attempt to Reverse the Trend down. Notice in the 3 declines on this chart,
Each time price tried to Reverse the downtrend and thus Closed Above the fast ema, that 1st initial move higher was followed by another pullback below the fast ema. This is not uncommon- This is likely typical of 50% of R.O.T (reversal of trend) trades. What to do?

3. Use a BUY-STOP entry - .5 or 1% above the High of that 1st ROT bar- to reduce the whipsaw declines- OR- only go long following a Green Elder Impulse Bar that Closes above that 1st R.O.T bar.

4. Once in the position, set a entry stop below a prior low bar. Once price moves Higher, trail a stop at the 21 or 30 ema once far enough away from the 7 ema to be clear of average price volatilty- I Often only tighten a Stop-loss and place it .5% Below the uptrending Price when the price makes a CLOSE under the fast 7 ema- It is surprising How often Price will rebound higher and continue to Trend following this 1st sign of a possible pullback If stopped out, and price continues to Trend higher- Get back in with a market BUY. If the trade is net profitable at this 1st point pullback- also consider only setting a stop-loss for 1/2 the position - to lock in a partial Gain- and allow the remaining position STOP to stay wide at the 21 or 30 ema. Do Not react intraday to a price momentarily under the fast ema- What counts is where it closes.

5. Trailing a Stop-loss- Price will often trend higher steadily above the fast ema- When Price gets big momentum and gaps far away from the fast ema like it did OCT 7,8,9, 12,13- This is a Climax Momentum move- sell 1/2 the position by trailing a stop BELOW each day's Closing Low until stopped out. and move the remaining stop up to the distant fast 7 ema.

This approach works best in Trades in Uptrends-and shallow pullbacks or sideways bases. This stock is in a sideways rolling channel- going above and below the 50 ema- (Not shown for clarity.)

Developing a set of SIMPLE and BASIC Rules that doesn't try to Guess where the bottom is and employing stops and avoiding early entries will result in trading Only with a possible uptrend and will really improve one's results.
Check out this approach -and backtest it on other trades that you -the reader -have made to see if it would not have yielded better returns-
AHH YES- That does require doing some homework - What a drag...

Toss in a 21 or a 30 & a 50 day moving average and you have a basic trading system. Gopher It!
Add some Elder Impulse colored bars- subscribe to stockcharts.

THIS is as simple a chart as it gets- It illustrates both uptrends and downtrend cycles, and HOW to position yourself on the right side of the trend.
One needs to Understand that YOU do NOT but during a Decline/downtrend- because your crystal ball or Crazy 8 ball may not have guessed the right time- and because it just got cheaper does not mean it cannot get Much cheaper! Or that it is a good Buy here.
Wait for that 1st R.O.T., AND LOOK TO ENTER ABOVE THAT- It is best to Not assume you know the bottom- and don't try to get the very low- Give it a chance to prove it is trying to go higher before you give it your hard earned Money!

2-22-21 I think learning to identify price action direction by this simple example should be a great start to using charts in your analysis and trading decisions. USE this simple process, and you will succeed- Be a Buyer in a downtrend, and you suffer pain-and unnecessary Stress.
When Price is simply sideways- above and below the converging emas- WAIT- DO NOTHING- Check the performance of the larger Indexes- and if they are the same- Sit on your hands- Do Nothing- Do No Harm!

DAVID KELLER -- THE FINAL BAR - CMT ANALYSIS stockcharts.com/tv/episodes/the-final-bar.html

"MARKET MISBEHAVIOR" What is "Confirmation Bias?" www.youtube.com/watch?v=EQmnqhfFuao

Using Stockcharts to drill down from the broad sectors to the industry groups and then to the individual stocks-
Applying the SCTR ranking to find the strongest performers.

www.youtube.com/watch?v=w7h4rVyrK6o

TOM BOWLEY- SCANNING FOR BREAKOUTS AND MODIFY SOME OF THE PREDETERMINED SCANS -APPROX 14:00 MINUTES INTO THE VIDEO
www.youtube.com/watch?v=31vlqF7G7Uk

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BUY AND HOLD (HOPE) OR CONTROL THE RISK (STOPS)

The SPY replicates the S&P 500 index-AKA the "stock market"

Buy and Hold using broad indexes over the long term has been a successful investment strategy, as the companies that went out of business in those indexes were replaced with more profitable companies-so the indexes automatically purge the losers and seek the newer winners.
One's investments can go from being profitable and promising , to being a losing investment and declining in value- This swing is known as price volatility- and it can last for several years- with no guarantee that a recovery is immediate. This chart example of 1.5 years shows price in an uptrend, then rolling over in a serious downtrend, and fortunately recovering into a substantial new uptrend to finish 2020 at all-time highs. Present FED action and QE supports a continuation of the markets to want to go higher- at ever inflated valuations.

So, Let's clean up and simplify the weekly price chart-by eliminating some of the various ema lines, but keeping a few for this reference:
Consider that each price bar illustrates the price moves of the 5 days of that week. Typically a 1 week bar moves greater than the 1 day bar seen on a Daily chart. Notice that when price is trending well, the green bars may penetrate, but do not CLOSE the week below the Fast ema.
A green bar changing to a blue bar indicates a potential slowing of momentum. A blue bar or two that Close above the moving average is normal -as price needs to pause periodically in order to base ,rest, and then move higher-
However, a Bar that CLOSES below the fast ema may indicate a further erosion in price
We'll start with a 7 ema- the line that is made is generated to represent the average of the 7 weeks-We will call this the "FAST" ema, because it responds 1st and the most to what the price bars are doing- Moving averages are also "Lagging" indicators, but they smooth out the volatility of 1 or 2 price bars.
We will also use a slower 21 ema- and consider this most basic weekly chart.
Let's "Backtest" this chart if we had just decided to invest at the open July 25 as the prior week closed at a new high.
Backtesting is applying a possible approach to the historical past markets to see if it is "successful"
For Round numbers, we invest $10,000 July 25 at a price of $293.54 per share, buying 34.06 shares.
We Hold the long position even through the substantial decline in Feb , March, and complete the year 2020 with price Closing higher $373.88.
By holding through thick and thin, we saw our account gain to $11,273.00 in mid FEB, only to CRASH to a low of $215.00 mar 23 2020.
Our account value had then declined to $7,322.00 , @ 26.7% loss from the original $10k. Investors are then rewarded with a remarkable and historic 73% move higher from the lows to the 2020 Close $373.88 account $12,700/18 months.


Holding through that shallow pullback in AUG 2019 would have been a concern for most investors seeing an immediate decline in value on their investments. Then relief with the market rallying into early 2020- and likely a level of despair in the sell-off in Feb/March- and Euphoria for the magical returns in 2020.
Once we get this pandemic behind us , it will be clear sailing in the future to even greater market highs- Cue the music!
So Buy and Hope is the best approach, Right?

[sd]

BACKTESTING A RULES BASED STOP-LOSS AND REENTRY- INVESTING APPROACH
I have not applied the following weekly chart backtest with actual $$$- but since I am an an advocate of reducing Risk , let's see what a trend following Weekly chart -using 2 emas- 7 & 21 .
I already know that a stop-loss approach will underperform a Buy and Hold approach in a trending Bull market. The potential for Whipsaws- getting stopped out and having to reenter at a higher cost is the price to pay- diminishing returns in the process- But, in the event of a market sell-off, which occurs periodically, the stop-loss approach reduces one's exposure to an undetermined drop in value.
assume that the 7 ema is a line in the sand- A trending price is expected to stay Closing above the 7 ema-
We also have a wider and lower 21 ema- as a basic wide stop-loss - gradually trailing price at a distance below- as long as price is properly trending.
If trending price slows, and Closes below the 7 ema- we have a choice- keep the stop-loss at the wider level or tighten it to the low of the the weekly bar- For this backtest, we will not try to over optimize the results- We will wait for the weekly bar to see a Close under the Fast ema on a Friday Close. That is reason to raise a stop 1% below the low of that weekly bar- because it already trails to stop @ the 21 ema. We will reenter only at the end of the week if the weekly bar closes back above the fast ema at the Friday Close price.- A stop-loss on the reentry bar will be the low of that weekly bar.. Once a reentry is taken following a Close above the fast ema, the low of that weekly bar will act as a stop-loss until the trending 21 ema can again .
This is designed to exit the Trade on a significant drop in the trend momentum, and to reenter on the appearance of the trend resuming.
It is also designed to avoid major market declines. STOP
The end result of this stop-loss approach generated a number of trades, ending in an account value Dec 30 $12,438.00.


This stop-loss approach underperformed the Buy and Hold approach- but kept one out of the markets during a major decline-and loss of Value- and profits.
The stop-loss approach retained a good % of the assets vs giving back all profits and taking a substantial paper loss in the decline.
The goal of investing is a stair step process- make a little- lose less than what one makes- Make a little more- keep more of the profits-and give back less. This process will underperform the net return in a strong bull market - but gets one safely into a cash position in times of market volatility-
this was an arbitrary backtest example using a weekly chart and 2 moving averages as a point of reference.
It slightly underperformed the Buy and Hope results, but it also severely reduced the volatility swings of the portfolio to the downside-
It additionally took advantage of holding cash and being able to repurchase shares following the sell-off at a lower cost.
Opposed to riding the market swings for a 35% decline, one can smooth out the portfolio volatility be stepping out of the markets during periods of the market selling off-

While this is instructive- and supports the stop-loss concept as a method to reduce Risk and Volatility in the portfolio- This is simply an arbitrary approach to illustrate applying TA and stops - This is also supported by mondelson, faber and others that used and studied variations on stops in a long term portfolio- Where this approach shines - is that it keeps one on the sidelines during significant market declines.

Edit-A variation on this approach would wait for the price to Close above the 21 Ema before taking an entry-thus one has the likelihood of a 7 ema crossing the 21 shortly thereafter. This simple backtest also waited for the Friday pm Closing price to occur- One would be a Buyer a few minutes before the Close.
To reduce whipsaws, one has to allow some initial room to prove itself as trending- before immediately applying the stop-loss back at the 21 ema-
If one took that initial early reentry, below the 21 ema- a stop would be required-perhaps at the Low of that entry bar.
A stop loss could also be constructed on a multiple of the Average True Range. Which averages the price swings for 14 prior days-and then set a stop based on a multiple of the ATR value- 1.5x, 2x etc.
school.stockcharts.com/doku.php?id=technical_indicators:average_true_range_atr
another stop-loss variation is the Parabolic SAR -PSAR gradually gets closer to the price over time. I include multiple PSAR values on many of my charts . If closing too tight on price, I can opt to drop 1 psar value or use the lower Sar value.


This post from 2-22-21 illustrates a very simplistic method to keep one on the correct side during Trending Periods- Both Uptrends and Downtrends.
A common theme among traders and investors that I also follow is to Trade WITH the trend- and not trade long when price is downtrending.
Why not? Because no one knows where the bottom lies until the stock tells us- by putting in a bottom and then a move higher.

Consider the very Simple RULES that would then apply to the following chart-.and Many others.
1- Never BUY when Price is downtrending- and is BELOW The Declining FAST ema - Pretty SIMPLE EHH?

2. You WAIT Patiently until Price makes a CLOSE above the Fast 7 ema- and realize that Often the 1st higher Close then is followed by a lower price move-
SO, You consider to only Buy at a higher price entry above that 1st attempt to Reverse the Trend down. Notice in the 3 declines on this chart,
Each time price tried to Reverse the downtrend and thus Closed Above the fast ema, that 1st initial move higher was followed by another pullback below the fast ema. This is not uncommon- This is likely typical of 50% of R.O.T (reversal of trend) trades. What to do?

3. Use a BUY-STOP entry - .5 or 1% above the High of that 1st ROT bar- to reduce the whipsaw declines- OR- only go long following a Green Elder Impulse Bar that Closes above that 1st R.O.T bar.

4. Once in the position, set a entry stop below a prior low bar. Once price moves Higher, trail a stop at the 21 or 30 ema once far enough away from the 7 ema to be clear of average price volatilty- I Often only tighten a Stop-loss and place it .5% Below the uptrending Price when the price makes a CLOSE under the fast 7 ema- It is surprising How often Price will rebound higher and continue to Trend following this 1st sign of a possible pullback If stopped out, and price continues to Trend higher- Get back in with a market BUY. If the trade is net profitable at this 1st point pullback- also consider only setting a stop-loss for 1/2 the position - to lock in a partial Gain- and allow the remaining position STOP to stay wide at the 21 or 30 ema. Do Not react intraday to a price momentarily under the fast ema- What counts is where it closes.

5. Trailing a Stop-loss- Price will often trend higher steadily above the fast ema- When Price gets big momentum and gaps far away from the fast ema like it did OCT 7,8,9, 12,13- This is a Climax Momentum move- sell 1/2 the position by trailing a stop BELOW each day's Closing Low until stopped out. and move the remaining stop up to the distant fast 7 ema.

This approach works best in Trades in Uptrends-and shallow pullbacks or sideways bases. This stock is in a sideways rolling channel- going above and below the 50 ema- (Not shown for clarity.)

Developing a set of SIMPLE and BASIC Rules that doesn't try to Guess where the bottom is and employing stops and avoiding early entries will result in trading Only with a possible uptrend and will really improve one's results.
Check out this approach -and backtest it on other trades that you -the reader -have made to see if it would not have yielded better returns-
AHH YES- That does require doing some homework - What a drag...

Toss in a 21 or a 30 & a 50 day moving average and you have a basic trading system. Gopher It!
Add some Elder Impulse colored bars- subscribe to stockcharts.

THIS is as simple a chart as it gets- It illustrates both uptrends and downtrend cycles, and HOW to position yourself on the right side of the trend.
One needs to Understand that YOU do NOT but during a Decline/downtrend- because your crystal ball or Crazy 8 ball may not have guessed the right time- and because it just got cheaper does not mean it cannot get Much cheaper! Or that it is a good Buy here.
Wait for that 1st R.O.T., AND LOOK TO ENTER ABOVE THAT- It is best to Not assume you know the bottom- and don't try to get the very low- Give it a chance to prove it is trying to go higher before you give it your hard earned Money!

2-22-21 I think learning to identify price action direction by this simple example should be a great start to using charts in your analysis and trading decisions. USE this simple process, and you will succeed- Be a Buyer in a downtrend, and you suffer pain-and unnecessary Stress.
When Price is simply sideways- above and below the converging emas- WAIT- DO NOTHING- Check the performance of the larger Indexes- and if they are the same- Sit on your hands- Do Nothing- Do No Harm!

Why does identifying and responding to the direction of the Trend matter?
The chart of FSLY above (In hindsight) was also a peak in the Tech sector momentum in Feb 2021-
FSLY was a high valuation tech name- and not the only one - that ended up out of favor as the sector weakened.
The next chart is the Weekly view Jan-Oct 2021 - Note that FSLY will require a 100 % gain to get back to the Feb lows.
Also, The weekly emas remain inverted and declining

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BACKTESTING ARKK W/WEEKLY 7,21 EMA

ARKK is a market outperformer in 2020, but also had a significant drop in price in Feb,March along with most stocks.
Applying the same guidelines as done in the SPY backtest- We assume an entry on jan 2 open. $48.74.00 using $10,000
This purchases 205.17 shares (partial shares to keep the math correct)
The stock went higher until mid Feb, and the investor was rewarded with an account high of $ $12,263.00 a +22% gain in 7 weeks!
But then , Price gapped down lower , pushed below the 7 ema and the 21 ema as well. The following week looked like it might recover as price went sideways -and held above the 21 ema- The investor had seen his 22% paper gain evaporate, and was holding at "breakeven" on their initial investment.
But week 3 into the decline, Price gapped down well below the 21 ema, and closed substantially lower - The investor is now seeing their investment sharply lower, followed by a 4th week lower where the investor looks at his account value and realizes a loss of 33%- over $3,000.00!
Price then rallies the following week, closing higher- The investor thinks the worst is over-but the following week the investor sees price go back lower-
The investor faces many emotional challenges as the price whipsaws his emotions from optimism to despair .
AHH, but the investor's Buy and Hold mindset is proven to them be the proven best method- as ARKK proceeds to rally to all time highs.
The investor knows that it will always work out this way, as long as he can be patient, his patience will be rewarded in the end-
Until-one day, perhaps, it will not do so-


The Investor that applies a stop-loss strategy- holds a different mind set- He now knows that even the best performing funds are not immune to market forces. He employs stops to A. Limit Risk in the investment B- lock in profits if the trade proceeds properly C - give the opportunity to purchase more shares at a lower cost after stopping out.
The Stop-Loss Advocate- (SLA) who applied the 7-21-ema stop-loss approach also entered at the Jan open.
Since he was taking a "Long" position- he required that the position be in a predominant uptrend- That the moving averages are stacked in proper alignment with the fast 7 above the 21 and sloping upwards and to the right- also the 7 is above the 21 with some clear space between them, as well as above the slower 50 ema .
The entry meets the broad criteria of being in a confirmed gradual Uptrend. Price proceeds to move higher for 2 weeks- The entry stop is set at the wider 21 ema , and the investor feels confident. Week 3, Price declines- penetrates below the 7 ema, but is still above the entry cost.
the investor moves his stop up with the 21 ema- almost at his entry cost. Price closes the week barely at the 7 ema- Potentially this is a sign the stock weakness will cause it to go lower- Investor can leave the stop at the 21, but the "Rule" suggests that the investor bring his stop closer to within 1% of the low. (He could also split his position with 2 stops- a tight one and one at the 21) Price rallies over the next 3 weeks, and has a strong pull away from the 7 ema- looks very promising that a strong trend is underway-SLA is restricted by the "rules" of this approach, so the stop continues to be set at the 21 ema., stopping out the following week at $50- with a slight profit on the initial entry.
The following week, price tries to go higher, but does not have a Friday closing bar above the fast 7 ema- so no reentry is allowed-
SLA sits in a cash position as price declines further, never closing above the 7 ema. Price drops below the 21 ema and then below the wider 50 ema,
and pulls the 7 ema to cross both the 21 and the 50 ema as well. This is a serious decline underway, SLA sits in Cash.
Finally, week 6 sees price make a Close above the upturned 7 ema- This is an early entry, but price closes above the 7 and 50 ema. On this early an entry, the uptrend is not yet proven to have resumed. It would be 2 more weeks before the 7 ema is above the 21, and the emas are once again in alignment. In this example, the early entry succeeds. Price trends on a higher moving 7 ema for 5 months , and the SLA was able to trail a stop-loss from below his entry bar, gradually to the 50 ema, and then back to the trending 21 ema-
Price trended well until late Aug, penetrated the 7 ema intraweek, but closed higher. The stop remains at the 21 ema. In Sept, price closes lower than the prior week, and at or below the 7 ema- S
SLA moves his stop to 1% below the low of the bar.,(split the stops?) where it is not hit , and weeks later, the stop is equal to the 21 ema, to where it transfers and follows higher.
The 4th week in October, Price closes the week below the fast 7 ema. SLA sets his stop loss -1% below the low @ $87.00
SLA's stop is hit the following Monday as price dropped to $86.98 SLA then has to repurchase at the higher Friday Close $100.00
SLA wishes he had split his stop position- with a portion at the tight stop, and a portion at the 21 ema- (but that is for another day to explore)
SLA'S $100 REENTRY STAYS LONG through the $124.49 Close Dec 31,2020.
SLA underperformed Buy and Hold by -6%, but he didn't sit through a 33% decline.

an added note here- On this SL example- One has to understand that while this "works" as an example method during trending (Up and Down) periods, the market does not typically have this sharp of a V rally- and can rollover into sideways trendless periods- and so the separation example of using 2 moving averages will see those moving averages come together in "Flat" markets over time-
Will we see another downturn like this? When the pandemic is behind us, isn't it going to be clear sailing higher?
The SLA approach demonstrated here -using weekly charts- provided a very decent 94% % of the possible gain with virtually minimal Risk compared to Buy and Hold.
I will explore this further and see if I can discipline myself to consider a weekly chart for the VAN IRA investments.

[sd]

Placeholder for added reading (and those to reread)
This could become a large list over time - ideally it will recommend the Bigger picture of Investing and then narrow down to the rationale to applying a technical approach to the investments-https://www.globalxetfs.com/intro-to-thematic-investing-course/
An overview-lessons- on the "Thematic Investing" movement-
- Get an overview of the Bigger economic/investing picture-before trading.
RAY DALIO- THE ECONOMIC CYCLE- You tube video - Start here- www.youtube.com/watch?v=PHe0bXAIuk0&t=204s

Muscular Portfolios by Brian Livingston- His ETF approach outperforms the market longer term with minimal drawdowns.
muscularportfolios.com/
mailchi.mp/brianlivingston.com/037


SMB Video Mike Bellafiore-the process of On becoming a consistently Profitable Trader- those elements that are not solely for day traders but essential in developing one's trading and training:

www.youtube.com/watch?v=82WCGwTGLHM


UNCOMMON RETURNS- David Swenson-
THE IVY PORTFOLIO - Mebane Faber
White Papers- Mebane Faber- series of research papers: mebfaber.com/white-papers/

Intended reading: The Black Swan- Taleb- (future goal- Incerto series

seekingalpha.com/ The go-to site for different investment articles- DGI , sector rotation lots of authors
SA-Daily - Stocks on the Move seekingalpha.com/market-news/on-the-move

On trading Psychology:
Our psychology is the #1 reason we will fail or succeed in trading
Trading in the Zone- Mark Douglas
Think and Trade like a Champion by Mark Minervini- BUY this book - He explores a lot of those psyche issues we all have that cause us to defeat ourselves, as well as giving solid advice about scaling into a position, stop-losses- and never add to a losing position.



On Technical analysis :
sTOCKCHARTS.COM - school.stockcharts.com/doku.php?id=overview:ta_101 Read this 1st to learn TA basics overview

Stockcharts Guide to managing charts stockcharts.com/videos/

The Layman's Guide To Trading Stocks by Dave Landry- This is a good primer/intro to trading with price/charts.
Very well illustrated- a simple approach- Touches on a lot -The technicals, psychology, Risk management-

On market Timing model by Faber mebfaber.com/timing-model/

stockcharts.com/tv/episodes Lots of analysis by Stockcharts contributors-
/sector-spotlight.html Julius de Kempenauer Relative Rotation Graphing to identify what sectors are leading, gaining strength, and which may be losing.

Julius de Kempenaeuer hosts "Sector Spotlight" a review with a Relative Rotation Graph RRG-
stockcharts.com/tv/episodes/sector-spotlight.html View "USING RRG TOP-DOWN 12-29-20 " #62 In the 12-29-20 #62 he explains how he uses a drill-down from the broad universe into narrower segments or sectors to identify sectors gaining momentum or those potentially losing momentum.
Webinars on Backtest and screening -have not viewed-https://www.portfolio123.com/app/webinar?
.
Screening and sorting to find the best performers-
A number of pay for investing sites use a momentum screen to define the best trending funds- ETFs or even stocks-
This Video- gives step by step directions on how to use Barcharts screener to find the best performing ETFs.
vimeo.com/493915845 Barcharts screening video- well worth viewing several times-
Chris VEr of www.thetechnicaltraders.com/spy-nearing-resistance-410-what-next/ offers this video as well as a pay for subscription - but he outlines the process he uses very clearly -

This is a similar- but very different process than that defined by the approach of Brian Livingston- Both try to determine the top performing 3 ETFs to invest in-
Chris' approach is to set a 15% stop-loss immediately on entry- and qualifies the entry as having the 50 day ema in an uptrend on the S&P 500 to ensure the market is in trend mode. He also takes partial profits out along the way- He does not include in this short video what to do with the larger cash position that would accumulate as the partial profits are taken out.
He also uses multiple look back periods-but also recent periods- to perhaps discover the trend change that may be underway - slightly different from Livingston's approach- but both have in common- invest in what is a leading and trending etf over multiple time frames.
What is interesting in this recent video is the focus on the solar/clean energy funds popular at the time the video was made- that have quickly fallen out of favor-
In what appears to be a market in transition ..... What is now trending, and how is the transition during a market rotation handled?

Stan Weinstein- Decades ago- trend trading intro : www.youtube.com/watch?v=JbKiiLo1s2o
Mark Minervini overview From Financial Wisdom -British -https://www.youtube.com/watch?v=99BE_12SU6s

i.imgur.com/3xZVNGL.png


A Clear explanation on how to use the RRG in combination with the scan functions to find the leading groups and then the best individual performers-

stockcharts.com/articles/charthingychers/2021/08/from-sectors-to-groups-to-stoc-66.html





Grayson Rose- on setting up cap weighted and equal weighted comnparison industry charts with relative strength- and using the
ACP charts to have additional ways to view multiple charts-
The ACP also includes more chart functionality programs-vs the typical sharpchart format. something new to explore.
Starting with sector performance analysis - and drilling down - plus includes a link to his chart list uploads
www.youtube.com/watch?v=Ym6aBmabdM8

Grayson Rose- Stockcharts chartschool overview video
www.youtube.com/watch?v=SRkmbjB2vZw

While I consider myself as a Swing Trader- One can learn lessons from the aspiring Day Trader-
SMB videos on Youtube- addresses the aspiring retail trader in this 1st video-
Consider the requirements he wants his daytrading novices to go through- as they learn to develop their skills- how to measure- and eventually compound - after learning- and experimenting without blowing out their account- setting limits on how much one can lose on a given day-
www.youtube.com/watch?v=7x8_olerb8k

Fibonnochi explained to setting support & resistance, targets- JCParets- allstarcharts.com
allstarcharts.com/education/helpful-technical-tools/fibonacci/

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Placeholder for Market indicators
2021 Global x Outlook:
www.etftrends.com/thematic-investing-channel/global-x-2021-outlook/

[sd]

REVIEWING THE IB ROTH WINNING TRADES FOR 2020
It's always easier to focus on the positives, rather than the negatives-That's our human nature-
I have to admit I paid more attention to making trades than I did the homework side of things-
Time to reflect on what was good and what was not- and a take-a-way for 2021

After printing out a summary of the 2020 trades in the IB account, I was genuinely somewhat surprised where my gains came from, and where I had relatively modest gains compared to where I thought my profits were coming from . Now that the dust has settled, I thought my focus was better on the ARK funds-and ARKK - but it was ARKW where I had the best gains.
My trading in that starting small $10,425 account ended 2020 @ $19,286.77 for a 84.53% gains. That's a substantial % gain, but looking over the transaction sheets, if I had held some of my positions- the net increase would have potentially been much higher-
The win-loss ratio was below 50-50 when I last counted- but also my wins to loss were a solid -verify- +3:1
I traded in and out of 56 different positions- and had 247 round trip trades-
What is ridiculous , is that my trades added up to sales of $239,780.00. so -my net Gains come in @ 3.9% +/- of the sales
The trading decisions were made after I got home from work- and stops were used.
The obvious "Good" is the high Gains: Loss ratio Cutting those losing trades quick.
One surprise is the gains from the individual Stocks I traded- Usually a smaller amount of dollars
I also periodically would sell partial positions- splitting stop levels on some trades.
tHE % VALUE IS WHAT PORTION OF THE NET GAINS WERE MADE IN THAT POSITION DURING THE YEAR.

AAPL +8.3 % $ 801.93 1 TRADE CLOSED-1-15 1 WIN
ARKF +4.97% $ 450.00 12 Buy-Sells (6 round trips) 5 WINS 1 LOSS
ARKG + 0.007 $ 72.00 17 BUY-SELLS This needs a serious chart study! Missed opportunities! 4 WIS 4 LOSS
ARKK +5.38% $ 487.00 24- BUY-SELLS 7 WIN 2 LOSERS ONE BIG LOSER
ARKQ +5.89% $ 533.00 5 BUY-SELLS FEWER TRADES- MORE NET GAINS? 5 WINS 3 LOSSES
ARKW +19.8% $1,794.00 15 BUY-SELLS BEST % PROFITS 5 WINS 2 LOSSES
BA +11.5% $1,042.00 6 BUY-SELLS 3 WINS 0 LOSS
BNTX + 4.00 2 BUY-SELL 1 ROUND TRIP
BX - 143.00 2 BUY-SELL 1 ROUND TRIP
CGC - 162.00 2 BUY-SELL 1 ROUND TRIP
CRSP +2.2% $ 199.00 PARTIAL POSITION STILL OPEN 5 SHARES
CVS - 115.00 2 BUY-SELL 1 ROUND TRIP
DKNG - 151.00 2 BUY-SELL 1 ROUND TRIP
ENPH - 62.00 2 BUY-SELL 1 ROUND TRIP
FCX - 23.00 2 BUY-SELL 1 ROUND TRIP (PRESENTLY A LARGE POSITION IN vAN ira)
FEYE +0.0% +$ 33.00 2 BUY-SELL 1 ROUND TRIP
FTIV RECENT OPEN POSITION- VERY SPEC
GBTC - 315.58 4 BUY-SELL 1 ROUND TRIP 2 LOSS
GLD +1.4% $ 132.00 BUY-SELL SOLD PARTIAL
HACK + 0.00
HYG +1.8% $ 171.00
INO +1.8% $ 173.00
IPO - 119.00 3 BUY-SELL 2 LOSERS, 1 SMALL WIN
JETS - 266.00 2 BUY-SELL
KWEB - 150 6 BUY-SELL 2 LOSS 1 WIN
LGVW +8.16% $ 793.00 6 BUY-SELL 4 WINS
LH + 47.00 1 WIN
LITE - 42 1 LOSS
MJ - 63 1 LOSS
MRNA - 29 1 LOSS
MSFT + 4.3% $329.00 6 BUY-SELL 3 WINS
NDAQ -49. 1 LOSS
NIO -162. 2 LOSSES
NKLA - 42. 1 LOSS
PAAS + 0.0 $59.00 1 WIN
PFE - $63. 1 LOSS
QS +4.9% $445.00 3 WIN
SDS -23.00
SFIX -14.00
SKYY -55.00
SLV -152.00
SNAP +17.4% $1,581.00 14 bUY-sELL 7 WINS 0 LOSSES
SPCE +13.4% $1.215.00 11 BUY-SELL 3 WINS 2 LOSS
TDOC +0.0 $ 57.00
TOKE =0.0 $ 83.00
TQQQ - 35.00 1 WIN 1 LOSS
TSLA +4.16% $ 377.00 2 WINS
UTX - 45.00
WKHS + $0.0 $ 95.00
WOOD + $ 10.00 2 BREAKEVEN - HELD FOR 2 WEEKS- WHAT HAPPENED?
WRK - 54.00
ZM +1.88% $ 170.00 7 BUY-SELL 2 WINS 1 LOSS

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REVIEWING 1 YEAR ARKW

tHERE WERE A NUMBER OF TRADES OVER THE COURSE OF THE YEAR- WITH 1 OVERSIZED TRADE CAPTURING THE MAJORITY OF THE GAIN-
I also used ARKW in the Van account- There were some months that I did not try to trade ARKW- in the IB account- Also- I believe I applied the 4 hr chart, and was trying to give some wiggle room.
I need to keep a journal- or note and chart here in 2021.



lets Study the performance possibilities of an entry using the 1st Elder Impulse green bar following a pullback. I will divide the chart into 2 charts- 6 mos each for this review.
aLSO possibly worth considering - Psar on a 4 hr chart for 1/2 the position , and a stop @ the 21 daily?



2ND CHART - sINCE we know in hindsight THERE IS A PREVAILING UPTREND -How could better ,tighter entries have been made closer to the P.O.F?
The 4 Hour Chart gives slightly faster signals than the Daily chart. a 21 ema on a daily chart is not the same value as a 21 ema on a 4 hr chart- It will be proportionately Closer to the price.
In this chart, I review the 4 hr with Elder Impulse bars and a standard parabolic psar .
The premise is that a downtrend reversal will generate a green bar on a price turn higher following a pullback-decline-
What is seen on the chart is that the reversal of the trend sell bar often generates a very wide Sell bar- this causes the P Sar value to skew wider away from price- so it's possible that an earlier entry when the psar is skewed can possibly be viable- But the psar value -if used as a buy-stop above a declining price often gets a very good lower entry. Like everything associated with TA, there's not an exact recipe for total success, but improving the odds -and also -reducing the distance of the entry to the point where the trade has failed- improves the net results-
As long as the trade is in an uptrend-
As can be seen by the chart , a lower trend line connecting the prior series of higher lows is very far below what is now an extended price- The recent momentum in late November & December has pushed prices up well beyond the prior uptrend slope- Not just for this ETF, but many others as well are likely over extended.
Ultimately, if one manages to acquire a position at the lower left, and hold for the upper right- that is ideal- but when price makes a big surge higher as it has done for the prior 6 weeks, that makes a case for tightening a stop-loss .


Could the present uptrend continue higher in Tech? Certainly, but it would be prudent to view the recent pullback as a potential warning-
Unfortunately that's my Bias overshadowing my greed. I have a number of open positions that I will be reviewing tonight with a goal of attaching stops at a prudent level-
The IB account will remain the most active account with the most aggressive stops-
I'll be trying to be more elastic to get the longer gain in the Van accounts- but I also have to protect my entry costs.

[sd]

placeholder for trade reviews in 2020

[sd]

1-4-2021
Muhammed-Alerian - " No alternative to stocks in 2021 with a supporting Fed"
Sets the tone for the start of this year- Futures Higher

The Van IRA $150,941. $29,526 CASH
STOPS ADJUSTED TO THE WIDER 21 EMA ON MOST TRENDING POSITIONS.
- Theme there is to hold growth ETFs as well as a sprinkling of uptrending dividend ETFs. This will be the most Diversified portfolio- and will be expected to have less Risk and thus lower growth potential- I'm holding ARKQ in this account as well as others-
The ESG theme continues- with Tan,GRID,ICLN,GUNR,FIW,XLB PROVIDING SOME EXPOSURE TO WHAT WERE POPULAR PERFORMERS in 2020- I expect that theme to continue- presently took some $$$ out of Tan but may go again. I expect the commodities to perform well in a recovery in 2021- so I will add to GUNR, and perhaps add a small SLV, GLD to balance this out as a "diversified Portfolio" aLSO ADDED TO THE fcx POSITION ...
Broad Growth ETFs: VOOG,IWM,VWO -lARGE CAP GROWTH, EMERGING MARKETS, SMALL CAPS
Dividend ETFs TDV,OUSM,RYT,REGL,WDIV,NOBL - NEW AREA FOR ME TO LEARN ABOUT HOLDING- DEMANDING THE TREND STAYS HIGHER W/STOPS
OTHER-
CLNE,DIS,ILMN,TRADING AAPL

VAN ROTH $63,095.00
My momentum/growth account- seeking primarily growth ETFs that i will try to widen stops on the position. I may try to split the approach here- taking partial gains on outsized moves higher- with the expectation of a reentry- but to keep a core position and trailing a wider stop-loss designed to get above the entry as it can be accomplished-
Present Holdings:ARKK,ARKQ,ARKF,ARKW,PRNT,ARKG,KOMP,CIBR,HTEC,CNBS,
$8,800 cASH FOR OTHER TRADES

IB ROTH $19,307 $14423 cash
Present Trades AAPL, CRSP, and a spec Spac underwater in FTIV

vAN ira- Buying MORE GRID,GUNR,ICL,TAN,TDV,XLB AS ALL are breaking out higher today from bases. pROVIDES A GOOD ENTRY FROM AN ESTABLISHED BASE.
ADDING SLV,GLD,GDX,AS INITIAL POSITIONS- SOME "BALANCE IN BEING DIVERSIFIED.
vwo -EMERGING MARKETS A BIG GAP HIGHER- WILL ADD TO THE EXISTING POSITIONS- ALSO ADDS DIVERSIFICATION
SMH - ADDED - NEW TO THIS ACCOUNT-

Markets not embracing everything Tech today- While Futures opened higher, indexes continue to slide lower. entering negative territory

TSLA up (not a position) Bit coin down -15% (not a position)
Unfortunately, I had small positions in each in 2020 and sold off on small profits-
Perhaps the market rotation theme is underway in 2021 , as tech has been bid up with high valuations-
ARKQ is the best performer this am of the ARK funds- up 2.75% I have a large weighting in this -approx $15k - in 2 accounts.
The theme here is automation and robotics.
KOMP is a more diversified broad based ETF than ARK funds, but also a theme on investing in innovation companies-it presently is basing at a recent high.

1ST STOP HIT- IWM- small caps - oRIGINAL POSITION -45 $176.84 11-16 I recently added 20 @ $193.51 to the position . HELD 7 WEEKS
Average cost increased to $181.96 the stock lost momentum in the last week. As part of the approach with P Sar, I typically allowed my stop to trail below the fast psar, then held 1 value below the psar under the pullback lows, gradually shifting over to the slow psar-
Worked well in trending periods . Today's price action penetrated below the stop $192 -just slightly below the psar values under the base.
tHE GOAL WAS TO HOLD THE TRADE AS LONG AS IT STAYED WITHIN THE EXPECTATION OF HIGHER HIGHS, HIGHER LOWS-
tHIS Chart is the FAST 4 hr with aggressive -take profits stops .

Comparing the Price action on the Daily chart-
Interesting that a stop trailed at the 21 ema would have been hit on today's price weakness
Also the P SAR as a lagging stop-loss performed well - particularly if one kept the stop-loss lagging 1 prior day, and then held it if price based . Of course, this was in the context of a strongly trending market.
i.imgur.com/3lZgJjC.png

The correction occurring today is resetting a lot of the Tech sector lower.
I put on a couple of spec trades in the IB account early this am that I will have to take losses on .

[sd]

How do I apply my entry & stops?

A friend asked "Since 11/16/20 BIDU reported its Q3 earnings, beating analysts' estimates by +6.76, or +49.72%, it has hit 11times 52-week highs including today's. Could you apply your 2 ways of setting stop-loss on BIDU as an example ?"
i.imgur.com/viLGhFr.png
We'll simplify the chart DOWN to the basics. P SAR , 3 MOVING AVERAGES, ELDER IMPULSE COLORED BARS.
Parabolic SAR -purple dots are one type of volatility entry BUY and then Sell - and can be used as a trailing stop-loss.
A Sell signal in BIDU occurred NOV 19 when PSAR went from below Price, to be Above price- This coincided with the drop of the RED Price Bar that Day.
As Price continued to Decline, and then recover, the Red bars below the declining fast blue 7 ema changed over to bullish Green bars .
When the bullish rising green bar met the declining PSAR above the 7 ema, it generated a PSAR Buy signal. On the Buy signal, the PSAR drops below the Price bar, and can be used as a trailing stop-loss. Gradually , this PSAR will get Closer to price over time and is still active below Price 1-2-2021 $216.07 and the PSAR value is $198.05.
I tend to delay by 1 day and do not use the present day PSAR as a stop- use the prior day, which can allow price room to have a sideways consolidation.

The 3 Moving Averages define the trend- As long as the moving averages are in alignment- with the 7 above the 21 and that above the 50- and the 50 is sloping upwards- That is an Uptrend- critical to be trading Long only in an Uptrend.
You never go long a position if the fast 7 ema is declining and below the 21 ema and pointing lower.
The price bars I use are Elder Impulse bars that get their Color from Price action and a momentum indicator-
Green Bars are usually bullish, blue bars are neutral, slower momentum, Red bars are usually declining and bearish.
Notice that green bars are often higher than the 7 ema, Blue bars may indicate a slowing of the trend, and pulling back to the 7 ema.
This is a "normal" pause or minor pullback in an uptrend , and is a healthy rest to allow price to potentially resume going higher.

While PSAR gets very Close to the price action over time, If one has a winning gain, you can widen the stop-loss to the 21 ema value.
I also interpret a bar that makes a Close below the 7 ema as possibly signaling further weakness-
This is a Daily chart- I also use a similar chart- but on a faster 4 Hr time frame- Everything is closer to the price action-
I also may sell into big gap away momentum moves part of a position.
Ultimately, the rules for a Long position require the use of stops, and to not be Buying something just because it got cheaper-and the price is heading lower.

[sd]

Tech Sells Off 1-4-2021

Tech sells off this t day of trading into the New Year!
I had a number of Tech stock positions hit- and I took some intentional sells- on the early Buys in Spec in the trading account - losses all.
Overall, I am pleased with the reallocation investments i made- away from "Tech" and more in alignment with the ESG theme and Nat resources-
I also initiated small positions in GLD, SLV, and GDX.

Part of shifting one's assets weighting is to capture changing market trends . I think one trend that has sustainability is the ESG- Clean energy movement, as well as a global recovery, needing Natural resources.
I positioned the VAN IRA with a more diverse allocation -Diversity may be dilutive-less than stellar results- but only if you fail to make the appropriate shifts- that coincide with market swings.
Tech has been in a rarified Bubble atmosphere-very similar to 2000, but the wind left those sails today as we start to see the most popular Spacs, speculative names pushed to extreme valuations on no earnings- It's one thing for the market to Buy into the someday Future-
2 of the ongoing Bubbles- BitCoin- and TSLA- are both beyond any rational valuation measures. I made a small profit on both some time earlier- but had to not chase these - unfortunately for the bank account-

While I had some stops hit, some losses taken, I also felt there was some balance in the Van IRA as i added to the existing positions in the ESG - environmental social themes as well as natural resources. and some small GLD, SLV, GDX exposure as the Dollar declines.
Winning positions were VWO- Emerging MKTS up.46%; ARKQ- Robotics - up +.72%; gunr - nAT RESOURCES +1.87% , tAN +2.14, icln + 1.56, slv + 3.17;GLD + 2.23; gdx 6.91; FCX + 4.30.
acct ENDED $150,219 - THE DAY STARTED AT $150,941- SO THIS ACCOUNT barely blinked in net value - Down lass than .5%..
The volatility moderated by investments in sectors that were not as hyped as the Tech sector-

For example- I earlier-in 2020 had made an investment in FCX- a mining stock that produces Copper -and a small amount of Gold- You could call this a "Theme" play investment- coincides with a growing emerging market theme.and gradually have added to this position- This is a thematic play on a Global recovery from the Virus-I added, Sold, and reentered and added - and I added more on the recent technical breakout higher-
30/2020 FCX FREEPORT MCMORAN INC
Buy 100.0000 $26.26 Free – $2,625.73
12/17/2020 12/15/2020 FCX FREEPORT MCMORAN INC
Buy 50.0000 $24.19 Free – $1,209.50
11/18/2020 11/16/2020 FCX FREEPORT MCMORAN INC
Buy 50.0000 $20.50 Free – $1,025.00
11/18/2020 11/16/2020 FCX FREEPORT MCMORAN INC
Buy 100.0000 $20.99 Free – $2,099.00
11/13/2020 11/10/2020 FCX FREEPORT MCMORAN INC
Sell – 99.0000 $19.51 $0.04 $1,931.15
11/09/2020 11/05/2020 FCX FREEPORT MCMORAN INC
Buy 100.0000 $18.91 Free – $1,891.50
10/28/2020 10/26/2020 FCX FREEPORT MCMORAN INC
Sell – 100.0000 $17.60 $0.04 $1,759.96
10/14/2020 10/09/2020 FCX FREEPORT MCMORAN INC
Buy 100.0000 $17.16 Free – $1,715.50

[sd]

1-5-21

Yesterday's selling took the market by surprise, but today's Rally seems to have brought the buyers back in .
My IWM position stopped out- (small caps 2,000) for net gains-In the small cap focus, I still have a large exposure to OUSM - a small cap dividend fund. I may opt to split 1/2 of OUSM and put that 1/2 back into small caps.
I added to the CLNE Nat gas/energy position today on the breakout higher in the IB. Added SLV , GLD yesterday in the Van IRA
The emerging market fund position VWO has been a solid performer this year, and I wanted to shift more assets towards the emerging markets exposure- I reviewed a few articles on ETF.com and there were 4 large EM funds listed- Using the PERF chart feature on stockcharts as a great tool to compare multiple potential investments,
if eXPENSE RATIOS are comparable, Putting the Monies to work in the better momentum performers is the way to go.
in this 1 year chart, I compare VWO,AAXJ,AIA,EEMV,INDA
The 1 year performance - with an investment at the beginning of 2020- would find a variance in returns from a low +6% for EEM min volatility EEMV , to a +34% High AIA (green line). 2nd place +24% return AAXJ; 3rd + 16% VWO; 4th-+14% INDA-
Notice that the best performer for the year also had the lesser decline in the sell-off in March
i.imgur.com/u7ZD6Q5.png

THE 1 YEAR hISTOGRAM - vANGUARD VWO WAS A MIDDLE PERFORMER

i.imgur.com/QGZlkeM.png
pAST PERFORMANCE DOES NOT GUARANTEE FUTURE PERFORMANCE
From the Mar 23 lows India was the outperformer



And- for the last 6 weeks: Vanguard is again a modest performer- + 8% compared to INDA +12%, AIA Asia 50 + 11%
The momentum theme is that most similar ETFs will Broadly Trend in the same direction - but selecting the better performers over a period of time- can potentially position one to get better gains and not be invested in an underperformer.


USING THE PERF CHART TO DETERMINE adjusting INVESTMENT $$$ SEEKING to find OUTPERFORMing investments.
I intend for the Van IRA to be a diversifed mix of investments- I think the thesis of having a margin of Safety by being diversifed in one's assets, holds true only if those assets are not correlated closely with one another- What didn't sell-off in Feb/March ? While many things globally are now highly correlated- Holding some varied investments makes sense-
The Stockcharts Performance tool- PERF is the ideal way to compare between differently priced stocks, ETFs etc.
Also, during periods of market rotations, I will be comparing similar assets, and perhaps shift the weightings between similar types of funds-
For example- I own 5 of the ARK funds- - vs putting it all into 1 fund- The ARKK is something of a Fund of Funds, holding the best of the other 4 funds... But If I only have X $$$ to invest, 20% into each of 5 funds- my net results will be the Average of those- one underperformer will pull the results down of the one outperformer. USING the Perf tool to determine which fund typically out performs over the short term as well as the long term may give a perspective to not allocate in equal portions, but to overweight one allocation and underweight another.
I View this 2021 year as a learning exercise for me- in diversified Asset management selection, as well as tactical execution.
The good performance in 2020 was simply by being invested and Buoyed by a rising tide of a bull market -that floated ALL boats-

ALSO- comparing performance to the sector performance - or Index performance for that matter-and simply investing in the broad S&P 500 market- SPY- gives exposure to the largest companies in the 11 sectors- but is seriously outperformed by owning an equal investment in the Tech large Cap- QQQ- Monies in SPY would perhaps double in 6 years- In the Q's in 4 years. Over a few decades of shifting and overweighting one's exposure heavier to the outperforming sector , one can perhaps make up for Decades of not being invested!