Will you be Short? I hope so.

September 13

1420 EDT

"Trade what you see, not what you believe you see."

What do you see? What do you see on the daily chart? on intraday charts?

I see a daily sell on momentums, an hourly sell on sentiment (daily has been on a sell). But the biggest sell signal is the volume. Where did it go?

It does not really matter if the indexes go higher or lateral from this hour of Tuesday, September 13th. I trade with confidence, but am rarely sure.

At this point, everything I know and see is telling me to be short - as short as you can be (not catastrophe, or end of world).

There are a few times in a trader's or investor's life when they see the plain written word and signals to enter a market and take 1,000+ Dow points home with them in a few days. Further, after taking that 1,000+ points in a few days, the trader or investor has the opportunity to do it again by reversing the position.

In this situation, it is be short now, then be long at the lows in a few days. In my view, this is like knowing what was going to happen on September 27, 1998, or knowing what was coming on October 12, 1987 and reversing on the October 20th lows.

You may not be comfortable taking action now. Then you will likely stay in cash or hedged. If so, then that is what you should do. Investing and trading is about you and your plan. First, plan to not lose capital, then plan to make some. Follow your plan. Then trade it. Execute the plan.

If an investor wanted to be long, then the investor would buy U.S. Treasuries and hold for a few days.

Remember! The uptick rule is gone. The only downward protection to the indexes is the collars from the exchanges.

Lateral track into FOMC Meeting, Sept. 18th

Timing Market Turns
W. B. Busin Group Publishing

Current positions - 100% short

It doesn't matter if the FOMC cuts the Fed Funds rate and possibly cuts the Discount rate again. It doesn't matter if the FOMC doesn't cut rates at all. The straw man has been assembled, dressed in sacrificial sack cloth and trudging to the financial gallows. The Fed will be blamed no matter what it does.

That is like setting your house on fire and blaming the Fire Department for not stopping you.
Several weeks ago in this TimerTrac newsletter, we projected the 10-year Treasury Note yield to touch 3.94% and possibly 3.80% at the low of this stock market correction. We believe that those projections are still on target, as the Note yield closed today at 4.408% after breaking late 2006 support at 4.40% last week.

Tap on this Link to the 10-Year Note yield chart:

http://www.market-timing-wbbusin.com/10yearNote09122007MarketTimingbyW.B.Busin.html

If the stock indexes and Treasuries walk quietly laterally towards the FOMC meeting, Sept. 18, we expect rates to then drop quickly and bonds to register their final bullish upward leg. We expect stocks and indexes to drop downward toward the next published Time Locus turning point, Sept. 24th / Sept. 28th.

We expect that the long term 12-18 month look forward for debt will be extremely bearish since we project the yield on the 10-year Treasury Note to reach 5.5% within weeks, and at least 7.0% next year. We will add the 10-year Note to our timing coverage this month.

We view the end of early July high as the end of that bullish move in rates. The June high was just the 3rd wave high of the last leg from the March 2007 low.

Daily Sentiment remains fluctuating within the neutral spread.

http://market-timing-wbbusin.com/Daily_Sentiment_Index_-_Market_Timing_by_W._B._Busin.html

As for the next 4 trading days, we are and will likely stay 100% short in all index positions, both Swing and Investor. The risk is to the downside after the attempted rally into Fed Day.


W. B. Busin
W. B. Busin Group Publication

100% Short

September 10, 2007

We will enter 100% short in the Swing positions in all indexes at today's closing.


This intraday decline should not retrace to the opening highs. Between now and 1500
EDT the indexes will likely attempt to reach that level. We expect an massive
momentum divergence to begin the next leg downward.

If you are looking for a short entry for a position, the potential of a high near
1500 EDT appears to be the best intraday Timing Locus. The NDX has
remained the strongest in these counter rallies and the RUT breaking down
quickly.

The divergence should be plain to see for all indexes but the RUT may
be the earliest and point to the selling entry a few minutes earlier than the other
indexes.

We expect this decline to proceed into the September 18th low and to set in a
grand splash of a low. This should at least challenge the August 16th lows for
the senior indexes (Dow and SPX) while the NDX should drop well into new
lows and approach the "end of Bull market" level.

We will hold this short position until at least the closing on September 17th. We
want to confirm that the models are confirming with the certain levels touched
today that we should decline quite rapidly in the days to come.

Alert

This update is exactly the text we sent to subscribers today. It includes the two previous updates from Friday, September 7, 2007.

Today is Sunday, September 9, 2007

Good afternoon,

1715 EDT

We are 25% long in the Swing positions for all covered indexes.

We are 100% short in all indexes in the Investor Core positions, producing a
market neutral portfolio position.

It is rare to receive a message from us on a Sunday afternoon as long time
readers know. This message is the result of nearly 2 days of data analysis and
application of several filters to the results of our models. That is not how we
spend our weekends.

I don't like this trade.

I don't believe I have ever said that before in this newsletter.

I did not like this current 25% long Swing trade but entered it as the signal
occurred on a Time Locus and sentiment is in neutral allowing for an upward
move. As I discussed it with Group members, we began looking at the data
points in all the indexes, verifying intraday and daily structural phasing and
technical indications.

What I don't like is much more simple than the mathematics of all that is
contained in our models. I don't like being long when the observable precedent
patterns indicate to be short. The precedent pattern also indicates to not be in
cash. But all that was not clear with minutes to go before the closing on Friday.

The easiest precedent pattern to see is the NDX gap downward on Friday that
remains open. The NDX daily bar for Friday, the size of the gap and the break
below the upward trendline are all simple basics that at best warn of more
downward action to come.

We used two favored linear filters on the signal data produced by the data
preprocessing programme, and each confirmed our belief that any upward
movement was suspect and small at best. If you know what the term
'underdetermined' means (not enough valid support for the outcome), then you
know why I don't like this trade.

At its worst, the scenario replays the continuous downward move toward new
lows for this correction. This is a direct contradiction of my stated view that the
market indexes would rise toward the FOMC meeting on September 18th.

Is the timing correct for the September 7th and September 11th Time Loci?
Yes, they have been re-checked as were the last 11 minor and major Time
Loci. Do we have a Time Locus for the September 18th FOMC Day? Yes,
indeed we do - as always is the case.

Is the pulsive upward corrective structure complete? That is where the sand
leaked into the gearbox. I just don't know on the NDX but I am leaning toward
a completion of the upward phase after examining the re-mashed data. I am
suggesting a 75% to 85% probability that it is complete and that any upward
movement will be sold immediately by the markets.

Since we have not seen the markets open on the Globex platform, we will not
have an indication even then for several hours, whether we should take our view
to a trade status.

We have two trading questions: (1.) should we be in cash?
or, (2.) should we be short? If cash is where we should be, then it will be a
100% Swing cash position. If short is where we should be positioned, then it
will also be a 100% short position.

We don't expect an extreme downward opening at this point which will allow
for a breakeven position change on Monday's opening. We will decide what position to take as we see the overnight action on the Globex and in the currencies.

Look for an early morning update tomorrow and a potential change of position
before the morning's data releases. Then we will follow that with an update if
the markets react to the Consumer data release.

This is what trading can be like in times of uncertainty and when traditional
theories and techniques are not producing expected results. We will adjust our
trading as called for by these conditions.

WBB

_______

Previously on Friday:

1545 EDT
We will enter 25% Swing long in the NDX, Dow, RUT and the SPX.

The NDX data supports the terminus view also.

WBB

NEW READERS - A 25% or 50% Swing position represents that percentage
of your "trading risk capital". We define "trading risk capital' as 2% of total risk
capital, which is the combined amounts of daily capital net of profits and losses
taken by closing each day. Open trades should be treated as marked to
market at closing.

_______

Previously today:

1455 EDT (Friday)

If the indexes proceed downward into the closing, we may indeed have an excellent Swing buy signal to enter at today's closing. We didn't expect it but we will take as large as a 25% long position in the SPX.

Yes, it will be very high risk, but we did not take this morning's gap down because we expected an upward move into the closing back to the 60% level of however much today's decline set in. We then expected the completion of lower prices with a momentum divergence buy signal in the Monday morning session. This may still be the outcome, but we want to advantage the trade entry at a price low.

The trade can carry upward in its choppy slog until September 24th. We project a move of 35-45 points for the SPX, and a similar relative amount for the Dow.

The volume pattern setup is available and the intraday structure is near completion. Intraday sentiment has touched an extreme similar to the intraday of August 16th and the 28th.

It is a minor Time Locus date, and the models are indicating a low, not a high or an acceleration point. In terms of the model, it is forming a "terminus locus", an ending.

We have not completed quick-processing the NDX data yet but expect to find the similarities consistent.

Update by 1545 EDT with any trade entries.

Please don't get in front here. You may want to wait for Monday and use the signal as an analysis aide.

WBB