After 2 ½ months of being in a long “buy’ mode for SPY, the S&P 500 exchange traded fund, my trading system gave me an exit long signal today after market close. See chart below. That is ominous. I was hoping to see a strong surge to the upside following a pullback, but my system is telling me to tread the waters in the stock market carefully.
I have to be cautious as I am biased more to the long side. Need to stay flexible and turn on my caution lights….
Also see that my Ford (F) chart generated a sell signal tonight. The buy was a while back and the system yielded approximately 10% gain in 3 months. Not bad.
Question asked to me was how do I look at the SPY signals in context to my real trading as I show it as cautionary. Well - my 401K system operates independantly using monthly signals. I should look at actually closing out all my long stock fund positions when SPY signals exit. I would do better. My hedged stock systems run independantly as well. I take on more positions on the down side with put options when I see that SPY is pointing towards the exit.
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