Monday, May 04, 2015

NYC Networking Event and More Resources for the Start of the Week

*  Above we see a composite measure of breadth specific to SPX stocks (raw data from the excellent Index Indicators site).  Specifically, we're looking at a composite of the percentages of SPX stocks trading above their 3, 5, 10, and 20-day moving averages.  Note the pattern of declining highs and rising lows in the recent data, as the average has traded largely within a range.  A disproportionate share of the market's gains since 2006 have occurred when the breadth measure has fallen in its weakest quartile, with an average five-day gain of +.48%.  Conversely, when the breadth measure has been in its strongest quartile, the next five days have averaged a loss of -.09%.  Yet another example of how a short-term trend does not necessarily yield short-term momentum.

*  If you live in the greater NYC area and are interested in participating in a craft beer networking, pencil in the date of Thursday, May 21st.  The specific after-hours time and location will be forthcoming.  I'll be there to discuss my latest market research and fresh topics in trading psychology and my good friends from SMB will offer trading insights as well.  Should be a fun way to meet other traders and enjoy a few good brews!

My Forbes blog is slowly turning into the single largest source of posts on trading that draws upon the relatively new field of positive psychology.  The new book, slated to come out in September, will be the first book I know of to specifically go into detail re: how positive psychology can fuel trading performance.  It's an exciting area that continues to expand.

More great perspectives from the week linked by Abnormal Returns, including how crowded trades unwind.

*  The Reformed Broker asks a provocative question:  Has the bull market in China just begun?

Valuable practical research on markets from the academic world via Alpha Architect, including why backtests fail.

Interesting site with podcast interviews to help with ideas for better system trading.

Valuable lessons from the flash crash and the associated regulatory fiasco.

Have a great start to the week!