Potential Trades for Early Next Week These trades have not been confirmed yet, but look close to triggering early next week. My recommendation is to maintain your active portfolio to at least 10 positions, then as one one comes off after hitting its profit target, replace it with the next new signal. PENN - Buy Pending A - Sell Pending BIIB - Sell Pending IBM - Sell Pending Timing is Everything We abandoned our primary trend to primary trend signals around mid-May in favor of more robust signal generation system. That system, despite stellar historical testing over the past 12 months, is off to a slow start. Had the new system been in place just one month earlier (I had been beta testing it since March 1) that start would be a different animal altogether. One less month of walking forward real time testing and we would be sitting on this sampling of some excellent signals: AMZN Buy Apr 9 @ 1425; Now 1716 BABA Buy Apr 11 @ 176.48; Now 208 CELG Sell Apr 23 @ 89.24; Now 78.08 AAPL Buy Apr 27 @ 164; Now 188.84 NFLX Buy May 1 @ 310.36; Now 392 Trade Table We are working on a real time trades table that will be accessible 24/7 on the Blue Line website. Below is an iteration of the table. These numbers are a little different from last week's numbers as the program takes prices directly from a real time feed. We are still working out the kinks, but will have it operational and available to everyone as soon as possible. Big Picture The former ATR trend line based system finally flipped Long on Monday, but had we still be trading it with SPY calls, we would be in the hole at week's end. The bearish pattern recognition picture is not only still alive and well, it has intensified with last week's market action. Looking at this DJIA chart you can sense what is coming next, and it is not more of the same. When the next big wave of emotion sweeps over the market, trading will pick up, profits will become easier and worth of this new system will become evident. Those same conclusions apply whichever direction the next wave takes, but the big picture wave and sentiment extremes point only one way: Down. Below is a chart published Friday by Robert Prechter. As I understand it, I can quote up to 500 words of his content without "express written consent." How many words does a chart count? In any case, here is his depiction of where the market is in the grand supercycle scheme of things: The key words are "schematic only; not to scale." The DJIA chart above will unfold as a fractal of this pattern, with the "You Are Here" lurking around current prices. The aggravating sideways pattern from the early February lows may have finally concluded last week. Below is a DJIA chart without the distracting ATR trend line. I want to emphasize the Fibonacci retracement level on the Dow, 61.8%, which is the classic extent of Wave 2's. The implication, if correct, is that Wave 3 down is next. We have been there many, many times in the past few months, so I understand any skepticism. But this is the pattern that I have been monitoring since early February and the market has done nothing to invalidate my analysis. Of special note, the first red bar occurring on the gap down after the January 28th all time high, and, a first red bar on the gap down yesterday (Friday). Whatever the outcome, we will continue to trade our signals, up and down, while being cognizant that behind every signal there is a big picture catalyst lying in wait. Allan Harris June 16, 2018
