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Things will look different than 1932 even if we get a replay because the dollar had a gold peg back then. What "value stocks" are you looking at? In my view the best way to play this climate is having longs and shorts to smooth out the bumpiness. When the daily swings in the indexes aren't...

I wouldn't use options for this. You're better off buying the physical coins for such a strategy. The ratio has stayed below 1 for a really long time in the early 1980's. It got below 0.8 in fact! Here's a chart from "Historical Charts of Interest": Platinum to Gold ratio

Trading bot results for the day: -2.14% (S&P 500: -4.42%) At this point I have to assume the real possibility of somebody big going under over the weekend. Thursday's trading may not matter much because the high-reward scenario is a big down Friday followed by a bloodletting on Monday...

Trading bot results for today: +0.92% (S&P 500: +4.74%) Today reminds me of when TARP was announced and the markets gapped up almost 10%. The financials gapped up nearly 25%. It was euphoria for a few hours... and then it was sold relentlessly. It is still my view that the stock market...

Closed out the LQD leg of the LQD/KIE pair trade and replaced it with PBT to make PBT/KIE. Entry price for PBT was $20.00 at the open today. The reason for the repositioning is that we didn't see the rush to IG yesterday like I anticipated, and oil has really fallen to a great valuation here...

Trading bot results for today: -1.8% (S&P 500: -6.66%) I implemented the LQD/KIE pair trade at the open today with $2.5k for each leg. I'm still carrying the trade with -0.5% loss on the LQD long leg and +7% gain on the KIE short leg. I am quite exhausted now because I check prices and...

Here's my pair trade idea for next week: LQD/KIE The idea is that we want to have short exposure in the insurance companies who have large portfolios of municipal and high yield debt, which are going to be downgraded en mass tomorrow. The adverse impact to the short position by insurance...

The world's top professional gamer, Johnathan "fatal1ty" Wendel, identified 5 catagories as important areas that the pros master. Here's a quote from the interview: In the same interview he also mentions physical health as being very important: To emulate fatal1ty's approach to training...

I was going back through some old notes this morning and found a relevant passage for next week's trading: Obviously that is advise I wrote for myself, and not intended to be advise to anyone else.

I do a lot of ratio charts, so here is a quick "how to" for anyone who wants to follow along and doesn't know how to make them. Go to stockcharts.com and for the symbol, enter both symbols separated by a : So to get a AINV/IWM ratio chart, use AINV:IWM as the symbol. Here is an example:

Here is an assessment of the market that will be the basis of my discretionary trading decisions for next week. Note that the trading bot operates in its own separate account, so none of the trading decisions that come from this analysis will have anything to do with the daily trading bot...

Trading bot results (for Friday 8-5-2011): +0.7% (S&P 500: -0.06%)

Closed out the EUR/AUD short at 1.3574. Call it capitulation if you want, but it a winner was about to turn into a loser for me, and volatility just keeps on rising. I don't want the uncertainty right now. So, result is no leverage in my portfolio now, and I don't need to use the capital inflow...

Trading bot results for today: -1.91% (S&P 500: -4.78%) My concern has been validated today, a huge down day for the markets. The trading bot fared very well on a relative basis, but my discretionary position trades have gotten hammered. Most of the profits on my EUR/AUD short are gone, and...

Trading bot results for today: +0.71% (S&P 500: +0.5%)

And just for completeness, here is the SPY/GLD ratio chart going back to GLD's birth in 2004. From this view, it is plain that the "recovery" since the March 2009 market bottom is largely fictitious:

Trading bot results for today: -0.7% (S&P 500: -2.56%) The S&P has been down on all but the first two days since I started this journal almost 2 weeks ago. I see a lot of confusion on ET lately about how the market will act. The people who were long or writing straddles into last friday...

There's a huge difference between 6 and 3. At 3 you can buy twice as much DOW as at 6. The difference between 3, 2, and 1 is HUGE :D You are correct that we cannot know where it will go to and it will be difficult to pick the bottom of the ratio. My plan is to let monetary policy and credit...

I mentioned earlier in the journal that it was my expectation that the yield curve would blow out in the long end. I was very wrong, it has flattened sharply over the last week. I view this as very ominous for equities. And through this flattening gold has risen to new highs, which is counter to...

Marty Schwartz mentioned in his book "Pit Bull" that stress from trading was a huge factor for him, to the point that he became physically ill at times. He also mentioned an opponent in the trading championship he competed in basically died from trading stress (there were probably other...