Today we realized gains in the gold futures and the CORN ETF. For tomorrow, we have 3 new signals. My intuition does not care for any of them: I am bullish on gold, energy and the stock market. I am bearish on the U.S. Dollar, until the unlikely event that Congress takes some bullish action.
Having said that, I have three signals that run counter-intuitive. Bear in mind, these signals come purely from mathematical formulae applied to data. They are not based upon any fundamental economic or political developments. They are; however, profitable based upon historical statistics. Here they are:
1) Go SHORT Gold: Market On Open. Symbols: GCM11 and GLD. Record: 27 wins out of 32 trades for 84%. Futures entered at 1454.0 and as I write this, June Gold is trading at 1458.9. Thus, the position is losing money so far. Futures stop: 1473.0. As a corollary to this signal, exit long GLD, market on open.
2) Go SHORT Heating Oil: Market On Open. Symbols: HOK11 and UHN. Record: 11 wins out of 11 trades for 100%. While not statistically credible, a 100% result is compelling. Remember the 8/8 trade that shorted the Euro Currency last year? Heating Oil futures entered at 317.95, and are currently trading at 319.21. Futures stop: 325.34. Right now the market is up, so the short position is losing money.
3) Go SHORT the Russell 2000 Stock Market Index: Market On Open. Symbols: TFM11 and IWM. Record: 53 wins out of 62 trades for 86%. Futures entered at 821.30 and are currently trading at 822.50 overseas. Of course, the real Russell doesn't open until tomorrow morning, but is trading overnight on the Globex. Futures stop: 842.50. Again, this position is losing money for now. The stock market is a leading economic indicator, and for the year 2011, has portended a recovery. If this algorithmic signal is correct, the stock market will have to move against the primary trend. We'll see.
Best of luck to all!
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