IPM Model Update E-mailed to Subscribers

IPM trade matrix - trade 11 (part 3)

Yesterday's market decline was very interesting. Elliott Wave pattern suggests that the market traced out a 1 and 2 waves in DJIA and SP500, while small caps have traced out a series of 1s and 2s. Primary reason for this assessment stems from the fact that after yesterdays bottom, market rallied in an impulsive manner I.e. 5 waves.

Furthermore, ipm turn windows bottom date and recent buy signals are two other reasons why one should expect a rally.

At the same time, recent sideways action might have confused a lot of investors, who were looking for a sharp rally. But after looking at some sentiment measures' extreme optimistic reading during last weekends updates, it seems like market is trying to workoff this excess by going sideways and tiring investors. 

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 - 4/23/14 to 4/28/14) = +11%

TRADE - 9: (Short - 4/30/14 to 5/12/14) = +0.3%

TRADE - 10: (Long - 5/16/14 to 5/31/14) = +7.4%

TRADE - 11: 

Bought TNA at 79.5 on 6/19, 6/23 & 6/25 based on IPM Trade Matrix long trigger. Cost Basis = 79.55 

TRADE CONDITIONS
When: IPM Model Bottom window - Date info e-mailed to subscribers

Next IPM Turn Window: Top/Bottom
Trigger: SP500 = 1947, GDOW = 2599
Supporting Indicators: Uptrend   

PROFIT TARGETS
Profit Target 1: 2000
Profit Target 2: 2050

RISK 
Stop: SP500 = 1929, DJIA = 16716, GDOW = 2578, Comp = 4292
Trailing Stops: Will be defined next week. SP500 = -, GDOW = -
Typical IPM Trade Matrix Risk: -
Actual IPM Trade Matrix Risk: -% (Entry = 1947 , Exit = - , Risk = -% )
Risk Reason: Too much optimism

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.

For Blog updates on Google+ add: Understand Survive Thrive 

For Blog updates on Twitter, add: @survive_thrive

For E-mail updates: 

Quick Update

Market is still in an uptrend. Yesterday's decline has not changed anything so far. Subscribers know the IPM Model turn window dates. As long as market does not make a lower low outside of the IPM model turn window, we should be in for higher prices.

In some regards, this could lead to a trending market for few weeks. 

IPM Trade Matrix - Trade 11 (Part 2)

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 - 4/23/14 to 4/28/14) = +11%

TRADE - 9: (Short - 4/30/14 to 5/12/14) = +0.3%

TRADE - 10: (Long - 5/16/14 to 5/31/14) = +7.4%

TRADE - 11: 

Bought TNA at 79.5 on 6/19 & 6/23 based on IPM Trade Matrix long trigger. Cost Basis = 79.7 

TRADE CONDITIONS
When: IPM Model Bottom window - Date info e-mailed to subscribers

Next IPM Turn Window: Top/Bottom
Trigger: SP500 = 1947, GDOW = 2599
Supporting Indicators: Uptrend   

PROFIT TARGETS
Profit Target 1: 2000
Profit Target 2: 2050

RISK 
Stop: Will be defined after IPM turn window expired. SP500 = -, DJIA = -, GDOW = -
Trailing Stops: SP500 = -, GDOW = -
Typical IPM Trade Matrix Risk: -
Actual IPM Trade Matrix Risk: -% (Entry = 1947 , Exit = - , Risk = -% )
Risk Reason: Too much optimism

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.

For Blog updates on Google+ add: Understand Survive Thrive 

For Blog updates on Twitter, add: @survive_thrive

For E-mail updates: 

IPM Trade Matrix - Trade 11 (Part 1)

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 - 4/23/14 to 4/28/14) = +11%

TRADE - 9: (Short - 4/30/14 to 5/12/14) = +0.3%

TRADE - 10: (Long - 5/16/14 to 5/31/14) = +7.4%

TRADE - 11: 

Bought TNA at 79.5 on 6/19 based on IPm Trade Matrix long trigger. 

TRADE CONDITIONS
When: IPM Model Bottom window - Date info e-mailed to subscribers

Next IPM Turn Window: Top/Bottom
Trigger: SP500 = 1947, GDOW = 2599
Supporting Indicators: 8/4 Test negated. Uptrend reinstated.  

PROFIT TARGETS
Profit Target 1: 2000
Profit Target 2: 2050

RISK 
Stop: SP500 = -, DJIA = -, GDOW = -
Trailing Stops: SP500 = -, GDOW = -
Typical IPM Trade Matrix Risk: -
Actual IPM Trade Matrix Risk: 0% (Entry = 1947 , Exit = - , Risk = 0% )
Risk Reason: Ending diagonal pattern.

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.

For Blog updates on Google+ add: Understand Survive Thrive 

For Blog updates on Twitter, add: @survive_thrive

For E-mail updates: 

TOM exit and IPM Trade Matrix Entry

As mentioned previously, Trade Options Matrix is an experimental product. We got some good returns in the beginning but the market trend was very strong to the upside. Cannot stay with a losing trade on an experimental product. Will exit today. Always enter an experimental trade with a very small position, all in the portfolio was only 4% short.

One reason we stopped taking short trades in an uptrend was because it clouded the vision for the real trade. Real profitable trade right now is the long trade. Even if the market declines, the confusion that this short trade will create will be much more stressful than the long trade.

We will go long on TNA. Will start with a small position 30% and then will keep on adding on any weakness due to Vix sell signal, as current turn window should mark a bottom.

Yesterday's post Fed announcement decline in markets might have been the low. It surely did trigger the buy signal. We remained reluctant because of the short trade. Short trade added murkiness to our long trading vision.

In short, this experiment showed us that once we have a clear bias, we should stay with the IPM trade matrix and not go in to make pennies. Although we might be able to make some pennies, we will lose our vision and clear directional bias. This will make things confusing in the long run.

FED Meeting & Market Structure

Past 2-3 days have been quite confusing. These days kind of remind me of the days before mid May bottom or early April top. Markets tries to get as many people off its back, before showing its true colors. 

UST's current market trajectory hypothesis for the next few weeks is: Decline, Bottom in the IPM turn window, Rally to new highs.

Since the IPM turn window is supposed to mark a market bottom, the next IPM Trade Matrix trade will be a long trade. Current Trade Option Matrix (with a very small portfolio position) is an experimental short trade and will be covered on the long trade trigger.

As you know, in the first half of the IPM trade matrix trigger levels are conservative and in the 2nd half, trigger is much more aggressive.

Following are the reasons, why it seems logical to expect lower prices before a sharp rally:

Elliott Wave structure: Following chart shows an impulsive decline since June 9 minor top. This decline has been followed by choppy sideways action. Sideways, overlapping wave structure is typically corrective in nature and normally gives way to a sharp decline. In other words, know as a bear flag. Furthermore, rally from mid May bottom was a clear 5 waves. This would require current decline to take 3-wave form. So far, we only have 1 and 2 waves. We still need wave 3 to the downside to complete current correction.

Head and Shoulders: DJIA is showing a head and shoulders pattern on the hourly scale. Once this pattern breaks, it should result in significant selling.

Sentiment: Optimism is prevalent and widely spread among market participants. This could provide fuel for the decline.

IPM Model Turn Window: Latest lows in major US indices were put in outside of IPM turn window. Over the past 4 years, it has been a very rare occurrence to see higher low within IPM turn window, in the absence of Weekly IPM Influence Window (WIIW). Therefore, it is logical to expect lower price levels within the IPM turn window.

In any case, if long trigger is activated, long trade will be entered and shorbecause that is the IPM trade matrix trade, and should be respected.

Inflection Point Model & Father's Day Discount

Inflection Point Model update will be emailed to subscribers over the weekend. This update highlights the upcoming bottom date. Performance of the Inflection Point Model has been uncannily accurate. Detailed analysis of 95% accurate performance is included in the Research and Timing section.

Latest example is the accurate prediction of May 15 bottom:

May 4, IPM Model update stated:

"Latest IPM model re-run suggests that the next IPM Model turn window is scheduled for May
14, 2014 (+/- 4 days) and according to statistical calculation it should mark a market Bottom."

As we now know, markets bottomed on May 15 at 1862 and then rallied to 1955 in 3 weeks. An astounding 93 SP500 point rally or 5% rally (87% annualized gain).

However, many people who didn't believe in the model, were not able to participate in the sharp rally. For example, following comments were written on the blog on May 20. Unfortunately, these comments could not have been more mistimed, as the market (SP500) was at 1868 at that time. These comments highlight the power of emotions in trading and the importance of the Inflection Point Model, as a mechanism to reduce emotions and introduce a trading system. This emotional power is the reason why many individual traders loose money in the markets:

1. May 20, 2014 at 1:32 PM

   I hope u were right, but today's market proves u wrong, again! Sorry, I m out~
   Replies

   
   NaqviMay 21, 2014 at 6:17 AM
   Without IPM turn window information, you are trying to understand calculus using 2nd grade math book.
2. 
   May 20, 2014 at 1:34 PM

   Or perhaps u may get one or two execuses for your failures
3. 
   May 20, 2014 at 1:37 PM

   however, successful trades tell everything. We are not your guinea pigs. Don't fool me twice!
4. 
   May 20, 2014 at 1:41 PM

   With today's 140+ decline, one should reconsider the purchase of your lucky system
5. 
   May 20, 2014 at 1:51 PM

   the ending diagonal pattern is matured and upside target is limited. I see no reason to put money at risk for only less than 5% successful break up trade. It's your responsibility to protect money for next 10-20% successful trades
6. 
   May 20, 2014 at 1:56 PM

   More, profit/risk ratio is 3/10, which is less than 1, it's definitely not a good try to enter long position
7. 
   
8. Above example shows the importance of the Inflection Point Model. As a special Father's day promotion, we are opening only 5 subscription spots at a special discounted price. Please contact subscription.ust@gmail.com for details. Subscription details are located at: Subscription 

Tom Trade 1 (Part 2)

Short TZA options from 15.
Will exit on a rise above 1938 (SP500) or 15.8 (TZA)

Extreme Greed

Even though both small caps and Nasdaq are below their recent March highs, its amazing to see extreme greed in the market. This greed is being measured by the put/call ratios 10 day MA and fear greed indicator. This kind of sentiment in conjunction with a mature Elliott wave pattern and approaching IPM model turn window, suggests that we will see a correction in the market very soon.

Here, want to be clear that the correction does not mean a new bear market. But rather a decline to get rid of optimistic extremes from the markets. Stock market's decline and rally symbolize social-sentiment. When this sentiment reaches optimistic extreme, buying power is exhausted. And therefore, potential for further rally is limited.

Right now, we are at a similar point. Once we get a correction, rally will resume. This rally could continue till next weekly IPM window, which is few months away. Therefore, we are in for a long-term rally.

As for the current market, caution is warranted as decline could be sharp. Hypothetical scenario:

• Decline this week into Monday
• Rally next week into Fed meeting or Thursday
• Decline final decline into IPM bottom window

This is just a hypothetical scenario. Trades will be based on IPM trade matrix.

Trade Options Matrix (TOM) - Experimental: Will take an aggressive short trade
Trade Equity Matrix (TEM): Will remain in cash till the bottom and will enter long within IPM bottom window on a trigger.

Market Overview

There are a lot of things going on in the market, which point towards an impending correction. When will this correction start, its anyone's guess. But its not far. And since the market needs to bottom within IPM turn window (dates already emailed to subscribers), the decline should start soon.

From an Elliott Wave perspective, a clear 5-wave rally has been completed or is very close to completion since May 16 bottom. Once this rally is complete, we will see a 3-wave decline. Since recent rally was very sharp, its possible that the decline will be pretty deep. This decline will bring back fear in the market, which has pretty much dissipated over the last 2 weeks.

From a technical perspective, couple of sell signals have been received over the last 2 days. These signals coincide very well with the correction scenario.

Trade Options Matrix 2014 Trade (TOM)

TRADE - 1: 

Trade Options Matrix will enter a short on decline below 1951 (SP500) 2602 (GDOW). 

Profit objective will be 1-2% decline.

For Blog updates on Google+ add: Understand Survive Thrive 

For Blog updates on Twitter, add: @survive_thrive

For E-mail updates: 

Into to Trade Options Matrix (TOM)

As most of the readers of the blog know that the UST team developed an IPM turn model in 2011. This resulted in amazing market timing performance, as evident from the white paper and special report published in the Research & Timing section. 

As for the trading purposes, UST developed a trading algorithm in 2011. An upgrade of the trading algorithm and its fusion with Inflection Point Model is know as the IPM Trade Matrix. IPM Trade matrix has returned more than 46% in the first 5 months, and has seen at least 3 significant enhancements. Based on prior experience, these enhancements will amplify future results (by the grace of God).

Over the last few months, we have been discussing the possibility of a new model to trade options. As you know options are very risk. But greater the risk, bigger the rewards. So the concept is as follows: 

Risk in options trading stems from three aspects: Timing, Volatility & Price Direction.

If one can handle these three aspects effectively, it could result in significant gains. From our research we realized that we have the necessary tools to address each of these aspects, which should then result in successful options trading, which could result in significant gains! For example:

Timing & Price Direction: Inflection Point Model has a 95% success rate at accurately timing the market turns along with direction

Volatility & Price Direction: IPM Trade matrix is very good at deciphering trend and price movement.

Therefore, a combination of these two measures can be very helpful in options trading. As a result, we have divided IPM trade matrix into two components:

1. Trade Equity Matrix (TEM): Used to trade 3X ETFs
2. Trade Options Matrix (TOM): Used for trading of options on 3X ETF

TOM is a work in progress and is being improved every single day. It is a very aggressive trade mechanism and has a potential of significant loss. Therefore, only 10% of portfolio is used for this purposes. And each trade does not involve 100% of capital because of risks. We will continue to enhance this mechanism and will keep sharing the updates on this model, as time goes on.

Hypothetical results show that if effective managed, this tool could multiple portfolio 10X or 1000% gain in a year. 

Next trade will be a TOM trade. It is not an equity trade. Or one can do an equity trade, but should not expect significant profit because its going to be quick. 

  

Trade Options Matrix 2014 Trade (TOM)

TRADE - 1: 

According to IPM Trade Matrix, we have recently received multiple sell signals. These signals in conjunction with the next IPM turn window suggest that we are at a top. Elliott wave pattern also suggests that same. We will discuss all of the market developments in details in the next few posts. Therefore, Trade Options Matrix will enter a short on decline below 1942 (SP500) 2590 (GDOW). 

Profit objective will be 1-2% decline.

IPM Trade Matrix 2014 Trades (TEM)

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 - 4/23/14 to 4/28/14) = +11%

TRADE - 9: (Short - 4/30/14 to 5/12/14) = +0.3%

TRADE - 10: (Long - 5/16/14 to 5/31/14) = +7.4% 

TRADE CONDITIONS

When: IPM Model Bottom window - Date info e-mailed to subscribers

Next IPM Turn Window: Top
Trigger: SP500 = 1876, GDOW = 2535
Supporting Indicators: 8/4 Test negated. Uptrend reinstated.  

PROFIT TARGETS
Profit Target 1: 1930
Profit Target 2: -

RISK 
Stop: SP500 = 1862, DJIA = 16342, GDOW = 2513
Trailing Stops: SP500 = 1912, GDOW = 2561
Typical IPM Trade Matrix Risk: -
Actual IPM Trade Matrix Risk: 0% (Entry = 1879 , Exit = 1904 , Risk = 0% )
Risk Reason: Ending diagonal pattern.

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.

For Blog updates on Google+ add: Understand Survive Thrive 

For Blog updates on Twitter, add: @survive_thrive

For E-mail updates: 

IPM turn window sent to Subscribers

Latest IPM model update has been emailed to subscribers. Next turn date will be very interesting. Soon easier trade will be long trade and that will be the time to look for a decline.

IPM turn date will govern next trades. There will be 2 trades in June.