Roger Writes from NC with Thoughts on the Stock Market

1)lOOK AT THE CHART OF usagx----THE USAA GOLD FUND. It is falling and in my opinion, has about 75 cents to a dollar more to fall. Also notice, the early May peak and the early July peak. I personally sold in early May and bought back in late May when the market had a panic sell like yesterday. I also went to 50 percent cash in early July. When a few prices went to newer highs in early August I wondered "IF" I was wrong. Now we know the answer.-----Yesterday was an elliott wave three----ie volatility and volume. While there can be a wave four bounce at any time, the ultimate answer is that a fifth wave down is still to come. DOES THIS FIFTH WAVE HAVE TO BE MUCH LOWER THAN YESTERDAY'S LOW???? NO!!!! An interday lower price would satisfy requirements.-----------but, LOOK FOR GAPS IN LATE MAY--EARLY JUNE IN INDIVIDUAL STOCKS. PUT GTC BUY ORDERS IN THE MIDDLE OF THE GAPS. PS---the chart action of $BPGDM was a warning to watch for a sell off. IMO look for a bottom between 50-60 percent. 2)The major averages now have broadening tops on monthly, weekly, daily, and even hourly charts. Now internal indicators are weakening. Be careful of a few days of sell off. 3)Sept-Oct are the worst months of the year for the averages. WHY??? 1)Folks sell to raise money for school/college expenses.----2)Sept 15 corp tax payments.-----3)Sept 30 fiscal year end for mutual funds---want to show realized profits for year.----4)Farmers harvest and want their yearly income which puts strain on banks.----5)Retailers place orders to stock up for Christmas sales. Inventory expense/cost/loans.--------In other words, there is a lot of cash needs in the fall of the year. BE WATCHFUL FOR A MARKET CORRECTION.

Using the MktMetrics program trading DIA produced these results

This Phase is “My Trading Daily Diary” focused on Accuracy. Days Day Date (+/-) 160 Days (124/160= 77.5% Accurate) since inception 12-9-15 (all inclusive) 160. Friday 8-19-2016 Began: $44,887.35 Ended: $45,755.50 +868.15 159. Thursday 8-18-2016 Began: $42,143.75 Ended: $44,887.35 +2,743.60 158. Wednesday 8-17-2016 Began: $40,858.00 Ended: $42,143.75 +1,285.75 157. Tuesday 8-16-2016 Began: $39,477.50 Ended: $40,858.00 +1,380.50 156. Monday 8-15-2016 Began: $38,311.00 Ended: $39,477.50 +1,166.50 155. Friday 8-12-2016 Began: $37,425.50 Ended: $38,311.00 +885.50 154. Thursday 8-11-2016 Began: $40,012.35 Ended: $37,425.50 -2,586.85 153. Wednesday 8-10-2016 Began: $37,566.35 Ended: $40,012.35 +2,446.00 152. Tuesday 8-9-2016 Began: $35,612.10 Ended: $37,566.35 +1,954.25 151. Monday 8-8-2016 Began: $33,361.90 Ended: $35,612.10 +2,250.20 150. Friday 8-5-2016 Began: $37,599.70 Ended: $33,361.90 -4,237.80 149. Thursday 8-4-2016 Began: $36,608.80 Ended: $37,599.70 +990.90 148. Wednesday 8-3-2016 Began: $35,531.00 Ended: $36,608.80 +1,077.80 147. Tuesday 8-2-2016 Began: $40,774.80 Ended: $35,531.00 -5,243.80 146. Monday 8-1-2016 Began: $39,157.00 Ended: $40,774.80 +1,617.80 Month of July 2016 Results July Beginning Balance: $23,000.00 July Ending Balance: $39,737.00 Gain/Loss over prior month: +$16,737.00 Highest: $39,737.00 (7-29-16) Lowest: $23,000.00 (7-5-16) Number of + Days: 17 Number of – Days: 2 (July 1, did not trade) Net Gain/Loss for Week Ending 7-29-16: +$5,116.30 vs. +$2,026.30 Prior Week Net Gain/Loss for Month Ending 7-29-16: $16,737.00, First month focused on Accuracy. 145. Friday 7-29-2016 Began: $38,737.50 Ended: $39,157.00 +419.50 144. Thursday 7-28-2016 Began: $35,927.70 Ended: $38,737.50 +2,809.80 143. Wednesday 7-27-2016 Began: $34,155.40 Ended: $35,927.70 +1,772.30 142. Tuesday 7-26-2016 Began: $33,398.80 Ended: $34,155.40 +756.60 141. Monday 7-25-2016 Began: $34,040.70 Ended: $33,398.80 -641.90 140. Friday 7-22-2016 Began: $33,373.90.10 Ended: $34,040.70 +666.80 139. Thursday 7-21-2016 Began: $32,118.40 Ended: $33,373.90.10 +1,255.50 138. Wednesday 7-20-2016 Began: $31,594.10 Ended: $32,118.40.10 +524.30 137. Tuesday 7-19-2016 Began: $32,857.70 Ended: $31,594.10 -1,263.60 136. Monday 7-18-2016 Began: $32,014.40 Ended: $32,857.70 +843.30 135. Friday 7-15-2016 Began: $29,631.45 Ended: $32,014.40 +2,382.95 134. Thursday 7-14-2016 Began: $27,409.70 Ended: $29,631.45 +2,221.75 133. Wednesday 7-13-2016 Began: $25,858.70 Ended: $27,409.70 +1,551.00 132. Tuesday 7-12-2016 Began: $24,897.45 Ended: $25,858.70 +961.25 131. Monday 7-11-2016 Began: $24,738.95 Ended: $24,897.45 +158.50 130. Friday 7-8-2016 Began: $24,226.35 Ended: $24,738.95 +512.60 129. Thursday 7-7-2016 Began: $23,931.75 Ended: $24,226.35 +294.60 128. Wednesday 7-6-2016 Began: $23,558.35 Ended: $23,931.75 +373.43 127. Tuesday 7-5-2016 Began: $23,000.00 Ended: $23,558.35 +558.35

Roger in NC wrote this to me about the current state of the Stock Market

Roger was for many years a stalwart with E.F. Hutton & Company. MARKET COMMENTS: 1)Will reversal patterns ever work??? There are only 3 classic reversal patterns. They are a parabolic, a head and shoulders, and a broadening top(megaphone pattern). In the last 16 years the major market averages have done a giant broadening top. From early 2015 they have done another broadening top. Now on the daily chart they have done another since early May. Furthermore, they have done even a tiny one in the last month. IMPLICATION----SOMEDAY, IF GOVT MANIPULATION FAILS, THEN THE POTENTIAL BEAR MARKET WOULD BE HORRENDOUS. 2)How overpriced is the market. IF you use bollinger bands, then you know that the upper and lower bands are 2 standard deviations from the dotted line of price volatility. weekly also. but, utilities are now 3 deviations above the 10 year average. As a working broker I signaled to my trading accounts that the govt bond market was at a bottom in 1980-81. That's when the govt yields were 15 percent. Who could have forecasted that govt yields would go to the lowest levels in us history and worldwide to the lowest yields in 5,000 years. Who would have believed a 36 year bull trend???? Everyone knows that some day that trend will reverse, but WHEN??? So far, we cannot see a good trend reversal pattern. 3)gold/silver/miners. from here---up or down??? Arguments can be made for both. My opinion, raise some cash. WHY??? IF you sell and have some cash, then you can always buy back at some price.

Day-Traders Top 31 BUYS

AAT ARR BPOP BWZ BXP BZF CHFC CHN CLRO DKT DTK ESBA ESRT GBLI HCP IGT ISM ITW IVR JFC JSM MOFG NEWS ODFL PFF PLD PPBI PRFT RDCM RWR STWD UGP

Why is the Dow down for the seventh day in a row?

The Generals (DOW 30 + DIA) have changed course from above +80% to 75%. Today's Date: 08/02/16 Last Updated: 08/01/16 AAPL S/BUY 38+ 1.69(2)= 3.38 75U 1.74(3)= 5.22 0.44+ 1.84U AXP BUY 97- 0.57(2)= 1.14 90D 0.77(3)= 2.31 0.33+ 1.17U BA BUY- 83- 2.37(2)= 4.74 71D 1.53(3)= 4.59 0.25+ -0.15D CAT S/BUY 97- 2.23(2)= 4.46 85D 1.35(3)= 4.05 0.57+ -0.41U CSCO BUY 97+ 0.32(2)= 0.64 90U 0.39(3)= 1.17 0.28+ 0.53U CVX SELL- 91- 1.65(2)= 3.30 36D 3.49(3)= 10.47 -0.23+ 7.17U DD BUY 84- 0.95(2)= 1.90 94U 0.94(3)= 2.82 0.28+ 0.92U DIA S/BUY 99- 1.14(2)= 2.28 80D 1.14(3)= 3.42 0.48+ 1.14U DIS S/SELL 36- 0.90(2)= 1.80 10D 1.12(3)= 3.36 -0.29+ 1.56U GE BUY 76+ 0.52(2)= 1.04 35D 0.20(3)= 0.60 0.05+ -0.44D GS BUY 52- 1.86(2)= 3.72 67D 1.98(3)= 5.94 0.55+ 2.22U HD BUY 67+ 1.30(2)= 2.60 84U 1.09(3)= 3.27 0.74+ 0.67D IBM BUY 100+ 1.59(2)= 3.18 89U 1.81(3)= 5.43 0.74+ 2.25U INTC BUY- 100/ 0.44(2)= 0.88 81D 0.34(3)= 1.02 0.51+ 0.14D JNJ BUY 97- 0.89(2)= 1.78 90U 0.61(3)= 1.83 0.35+ 0.05D JPM SELL- 58- 0.55(2)= 1.10 77D 0.70(3)= 2.10 -0.06+ 1.00U KO SELL- 83- 0.72(2)= 1.44 24D 0.40(3)= 1.20 -0.13+ -0.24D MCD SELL 29- 2.34(2)= 4.68 14U 0.65(3)= 1.95 -0.07+ -2.73D MMM S/BUY 100/ 1.96(2)= 3.92 72D 1.46(3)= 4.38 0.38+ 0.46U MRK BUY 75- 0.80(2)= 1.60 63D 0.50(3)= 1.50 0.11+ -0.10D MSFT BUY 80+ 0.66(2)= 1.32 84U 0.61(3)= 1.83 0.30+ 0.51D NKE SELL 73- 1.28(2)= 2.56 31D 0.57(3)= 1.71 0.02+ -0.85D PFE BUY 100+ 0.27(2)= 0.54 93U 0.42(3)= 1.26 0.37+ 0.72U PG S/BUY+ 100+ 0.85(2)= 1.70 77U 1.16(3)= 3.48 0.22/ 1.78U TRV BUY+ 85+ 1.17(2)= 2.34 51U 0.90(3)= 2.70 -0.16+ 0.36D UNH BUY 96- 2.02(2)= 4.04 86U 1.12(3)= 3.36 0.12+ -0.68D UTX BUY 83- 1.09(2)= 2.18 87D 1.15(3)= 3.45 0.30+ 1.27U V BUY 47+ 1.28(2)= 2.56 73U 0.80(3)= 2.40 0.21+ -0.16D VZ BUY- 92- 1.00(2)= 2.00 49D 1.44(3)= 4.32 0.05+ 2.32U WMT BUY 96+ 0.59(2)= 1.18 71U 1.17(3)= 3.51 0.16+ 2.33U XOM SELL- 90- 1.31(2)= 2.62 34D 2.56(3)= 7.68 -0.28+ 5.06D 77% 81% 66% 0.21 0.96 AVERAGE: 75% KEY: 52%-100% = Positive, 48%-0% = Negative This will clarify the illustration of analyzing the group: Dow30+DIA 90% 97% 90% 97% 87% 94% 97% 87% 87% 77% representing the decay of the past ten days.