Monday, May 11, 2015

Preparing for the New Market Week

*  As we hover near new highs in SPY (blue line above), we see that stocks making fresh three-month new highs versus lows continue to lag.  I will be watching this measure closely to handicap the odds of further strength morphing into a fresh bull leg.  If that is in the cards, we should see a meaningful expansion of breadth.  Small caps were relatively weak after Friday's lift off, so not seeing breadth expansion yet.

*  If you train yourself for persistence and resilience in other areas of life, you build the capacity in trading.

Top readings from the past week from Abnormal Returns, including a look at divergences and possible growth scare in the economy.

Great demonstration of how easy it is to overfit backtests.  Also check out these seminal papers in financial mathematics.

What the Commitment of Traders report is telling us about positioning across asset classes from SeeItMarket.

Ten facts about SPY from New Trader U.

Four performance metrics worth tracking from Tradeciety.

Have a great start to the trading week!

Brett
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