$SPX for the week 31/10/2016

There is not much change from last weeks analysis, the range between the 50 day line, which held as resistance on Monday, and the previous resistance now support, was tested on Friday which has held as support.

A break of either of these levels is required for me to take further action on my trading decisions on US equities, for now I am being cautious, but still buying the dip on some of my short term strategies.

I have 3 trading methods with various strategies within those methods which require an analysis of the indices for clues on how to approach my trades. Quite simple this week…same as last week and not much to add.

Trend Following — I have some open trades which have been going sideways along with the S&P. I will not be looking at any new trades at this time and will manage my open trades based on price action on the indices.

Mean Reversion — I have 2 strategies within this method and have gone to cash on one of them. I could be turning the system on and off around these levels. The decision to turn on/off is 100% mechanical and I do not interfere with it. The system has been tested and is robust, just keeping the discipline and being consistent.

A new system which I have been testing has been added (I started trading it last week), it needs some adjustments but that will happen with time, it is good enough to start trading. It is a low trade frequency system that trades in various ETF’s. Current position in this is long $MDY; — Midcaps.

Until next week, be patient, watch out for these levels on the $SPX and be ready to take action when the break of this trading range happens.

Good trading

Miguel — TravelingTrendTrader

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