Odds Czar: Simple Biases In the Futures Market: 2008

A

Art Collins

Art's futures biases for Dec 14.

A "1" means bullish bias. A "-1" means bearish bias. The total is the sum of biases. A positive sum will be long bias. A negative sum will be a short bias. A sum of zero will be a neutral bias.

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Happy New Year everyone. May your 08 trading be especially profitable.
I am currently on vacation and have limited Internet access so I can not at present supply the extra year-end wrap-up--new year commentary that I normally do at this time. Hopefully I'll have all that after I again have easier access to my charts and other online-dependant accoutrements.
The last week of the year was an unexpected fizzle; contrary to the bullish move that normally leads into the rollover. The question now is whether the counter-calendar bias trends will continue into January or whether the seasonal bias will again go according to expectations (as in bullish through at least the first week in January). We'll just have to wait and see.
As always, we have a more immediate task at hand; figuring the most probable daily directions for our targeted financials. All the complexes have definite ideas; namely they're signaling long in the indexes and short in the bonds and currencies.
 

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For the new 2007 thread, I'll repost my original introduction for new readers.


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I'm Art Collins, a published book author, lecturer, and a frequent contributor to Futures Magazine. I'm also a 17-year Chicago Board of Trade member, professional futures trader and mechanical system advocate.

I'm here to share system ideas and for camaraderie, something I miss from my days on the floor. I've decided to keep a daily journal on Elite Trader as a way to generate more feedback on my system ideas. Each day, I will post my daily market biases to keep the discussion going.

Here are some of my core beliefs. Feel free to add feedback, call foul on me, or whatever.
1. The average trader can't succeed unless he or she is 100% mechanical. Most of us can not "hear what the markets are telling us" because for all practical purposes, the markets ain't saying squat.
2. Human psychology tends to be drastically out of synch with what is needed to trade successfully.
3. When one combines mechanical with discretionary, one tends to get the worst of both worlds.
4. Simple is best.
5. Basic elements can be combined to create greater wholes.
6. Day trading can work, but there are inherent problems compared to other types of trading. The main problem lies in the relatively small trading arcs compared to trading costs.
7. Ideas have to test well over a fairly wide array of times and markets in order to be considered trustworthy.
8. When you do decide to trade a mechanical system, you must adequately budget for it. You must also follow all signals exactly as mandated.

How do I go about building mechanical systems? I identify simple market biases, some of which are not good enough to overcome trading edges. By assigning them +1/-1 strength/weakness values, however, and combining them with other such indicators, you can often get a whole significantly greater than the sum of the parts. I will be showing this on a step-by-step basis, using TradeStation performance summaries to substantiate my contentions.

Undoubtedly, my programming skills are short of the levels many of you are at. I intend to keep expanding my abilities rather than justify my limitations. Just to reiterate though, I’ve been privy to some very esoteric complex systems and some very basic ones. The lion's share of profits has come from the latter, at least in my humble experience.
 
Art's futures biases for Jan 3.

A "1" means bullish bias. A "-1" means bearish bias. The total is the sum of biases. A positive sum will be long bias. A negative sum will be a short bias. A sum of zero will be a neutral bias.

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Wednesday's signals are even more insistent for Thursday. They urge longs in the indexes, shorts in the bond and currency complexes.
 

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Art's futures biases for Jan 3.

A "1" means bullish bias. A "-1" means bearish bias. The total is the sum of biases. A positive sum will be long bias. A negative sum will be a short bias. A sum of zero will be a neutral bias.

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According to the CzarCharts, Friday represents a likely day for the stock market to make it's first significant positive showing of the year. A possible fly in the ointment is whether the market will already be sharply higher by the daily opening in the wake of the 7:30 government numbers. Even a moderately higher spike, however, will likely be followed by strength.
 

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Art's futures biases for Jan 8.

A "1" means bullish bias. A "-1" means bearish bias. The total is the sum of biases. A positive sum will be long bias. A negative sum will be a short bias. A sum of zero will be a neutral bias.

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Despite the fact that the day-of-month indicator has switched to the down-side, the calendar biases remain net bullish across the board. The other major categories concur, so the strategy is definitely buy-oriented for Tuesday.
Other item of note: the unusually large number of less-frequent indicators pointing toward the up-side in the Japanese yen.
 

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hi art ... happy and healthy 2008 for you

any chance this yr you will be including crude oil
gold and silver in your numbers posted here on ET ?
 
seth arb wrote
hi art ... happy and healthy 2008 for you

any chance this yr you will be including crude oil
gold and silver in your numbers posted here on ET ?

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seth--
nothing at present, but i'm always in the lab and i never say never
 
Art's futures biases for Jan 8.

A "1" means bullish bias. A "-1" means bearish bias. The total is the sum of biases. A positive sum will be long bias. A negative sum will be a short bias. A sum of zero will be a neutral bias.

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The CzarCharts still insist that the upside is the likeliest direction for the indexes on Wednesday. The currencies are also getting buy signals. Note the +6 either-or reading in the euro as well as further support in the second box.
 

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Art's futures biases for Jan 10.

A "1" means bullish bias. A "-1" means bearish bias. The total is the sum of biases. A positive sum will be long bias. A negative sum will be a short bias. A sum of zero will be a neutral bias.

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The CzarCharts still call for up-trending index markets for Thursday, albeit considerably less insistent than yesterday. There is also a bull bias in the currencies, particularly the euro.
 

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Art's futures biases for Jan 11.

A "1" means bullish bias. A "-1" means bearish bias. The total is the sum of biases. A positive sum will be long bias. A negative sum will be a short bias. A sum of zero will be a neutral bias.

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For Friday, the euro and Swiss franc continue to show biases to the up-side.
 

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