Market Timing Update 2 - 02/27/2006

Timing Market Turns - posted 1350 EST
Market Timing for Traders – still 100% in cash

Market Timing for Investors – still 100% in cash


We are becoming more likely to go 100% short the indexes in our swing trading position at or near the close today. An afternoon decline into the middle of the SPX range will likely keep us in cash. New highs into the SPX 1305 to 1310 range will get us 50% short. Above that level, we will continue to stay in the loge. A downward move to or below today's open will probably see us at 100% short the swing position.

For our core investment position, we want more confirmation of a significance of the time loci. Our current downward target levels are not deep enough to warrant an "all in" wager with the March 13th time locus less than 10 trading days ahead.

Our SPX target levels for the coming swing downward are at the SPX 1270 area. We had projected the March 13th time locus as a high. We continue to rate its significance as strong but the potential for a high then is now at 50%.

Trading Plan
A reader will often see us repeating or sharing how we are viewing our trading plan. It is always from a conservative and disciplined perspective. As anyone can see, trading with these amazing time locus points is only part of the trading decision process.

New traders and investors (we have quite a few) reading this blog should understand that in the coming 45 days, the indexes will turn down and in dramatic form. If you have never traded in a down market (see my post on the Brief History of Early 2006), I suggest staying in cash during the balance of 2006.

Trading plans and discipline is firstly about preserving your family's capital. Trading with margin and leverage can impoverish you faster than a natural disaster. Spend the balance of this year reading and learning about investing and trading. The payoff from studying will amaze you. Please don't put your self at risk or your family's well being on the market's gaming table.

Good Trading and God bless

W. B. Busin