Tuesday, April 22, 2014

IPM Trade Matrix - Trade 8 (Part 1)

Still waiting for the short opportunity. Will go full short if the followings levels are broken. Following is the pattern that I have been following for a few weeks now. It looks complete with clear 5-wave decline and 3-wave rise. This same pattern sported by small caps. DJIA and SP500's patterns are not perfect with 5th wave being truncated.

In any case, today's rally also created a Dow Theory divergence. If market starts to decline sharply, this divergence will take hold. Have started dipping into shorts at the close today, but will wait for a full trigger before going full short.

IPM Trade Matrix 2014 Trades

TRADE - 1: (Long) = +2.6%
TRADE - 2: (Short) = +9.3%
TRADE - 3: (Long) - Non IPM Trade Matrix trade -0.2%
TRADE - 4: (Short - 1/31/14 to 2/5/14) +7.25% 
TRADE - 5: (Long - 2/11/14 to 2/22/14) = +9.8%
TRADE - 6: (Long - 2/22/14 to 3/07/14) = +11.7%
TRADE - 7: (Long - 3/18/14 to 4/11/14) = -18.1%

TRADE - 8: Short

When: Top within IPM Turn Window - Date info e-mailed to subscribers
Next IPM Turn Window: Bottom 
Trigger: SP500 = 1877, DJIA = 16490, GDOW = 2515
Supporting Indicators: 8/4 Test completed to the downside. Downtrend in effect.  

Profit Target 1: Will be determined after the entry
Profit Target 2: - 

Stop: After trade is triggered
Trailing Stops: - 
Typical IPM Trade Matrix Risk: 1.5%
Actual IPM Trade Matrix Risk: N/A (Entry = - , Exit = - , Risk = - )
Risk Reason: -

Applicable Rule: 
  1. Sell (1/2) at profit objective 1 to minimize draw-down
  2. No Trade in opposite direction
  3. Do not go long or short without trigger to prevent losses by market moving against you.  
  4. Observe stop-losses to minimize draw-downs
  5. If stops are hit ==> Wait on the sidelines for new opportunity near IPM Turn window

Note: IPM Trade Matrix Trades will be posted in the first half of 2014. This is an experiment to understand and enhance the capabilities of this Matrix.

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  1. There are two types of traders cum analysts in the stock market:

    1- People who trade based on gut feeling or some technical or fundamental belief system. These people enter a trade, and are very aggressive about their positions. They try to convince everyone that they are right. But when they are wrong, they become quite. Quietly waiting for the next opportunity to start talking again. I used to be one of them!

    2- People who have a system with proven results. They enter the market based on the system and exit based on the same system. Their system governs their trading. You won't hear them scream or be aggressive about there positions. If they are right, they are happy and move on. If they are wrong, they are also happy because they learn, improve and move on. I believe that UST has evolved into the second kind by the grace of Almighty!

  2. So are you short now? What was your price?

  3. Yes dully short @ 16.24. Went short yesterday with IPM model expiry and IPM trade matrix condition. Lets see what happens. So far a good start by the grace of Almighty.


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