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Hello and Welcome,
Welcome to the new Trizen Systems newsletter. This will be the new format for discussing our algorithmic trading systems and other information. Weekly updates will include Actual Profits/Losses, Commitment of Traders, Articles and Actual Trading screen shots. Pass this along to anyone that you feel would like to understand more about the financial markets, derivatives, and how to trade them successfully. Year to Date (YTD) Performance vs. the S&P 500:
Return on Initial Capital: +18.94% We are currently above the S&P index by 18.72% |
| Market Action
Weekly Profit (P/L): -$(199) |  A really good start as our system still had a short only model and quickly transitioned in one day with a nearly 3% move this week brought our profits down into negative territory but only slightly. Overall, with the strength of the move over the last two weeks, the Short Only models performed quite well and managed upside risk above expectations. From 1040 to nearly 1120 in the S&P representing a nearly 8% move in the futures contract is quite honestly an impressive move considering the data that came out these last two weeks.
The trade continues to be the Euro FX, and until this no longer works, the market will trade accordingly. Additionally, we are coming up on earnings season while fund managers move into defensive positions.
Our fundamental strategy shifted to a hedge on Tuesday and an all out bull market after Friday's results; however, we will maintain a hedge until we have a stronger signal as the COT is really diverging and there are is no clear direction.
This is a great opportunity to turn all four algorithms that we have on and advance our numbers significantly. Look for larger profit numbers (along with slightly higher losses during down days) in the coming weeks.
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| Commitment of Traders
Bulls-n-Bears | | The COT, or Commitment of Traders, represents a government report that collects all the open positions for all traders in the futures market. It breaks it out into Hedgers, Professionals, and Small Traders. Hedgers maintain large portfolio positions and will hedge their positions using the S&P (so they can protect against falling markets). Professionals speculate and tend to be on the right side of the market opposite the hedgers. In most cases the Small trader (Green) is a contrarian indicator.
Analysis: Last week we felt the market would test 1100 which did occur and then continued higher to test 1115. The COT though showed the professionals were going LONG while the hedgers remained significantly short. Things changed this week with hedgers closing positions (buying) and professionals transitioning to short positions.
Though the market has made a strong move we continue to be defensive as the COT clearly shows professionals transitioning over the weeks from long to short to long and now short again.
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| Making Sense of the Market
The market is always right |  Though I personally felt this week was simply short covering and fund managers transitioning their portfolios into safer bets (blue chips, strong earnings companies) along with the Euro moving higher--the market is always right now matter how much you feel "it just can't go higher." The economic reports were relatively poor but the market simply moved higher after initial sell offs. In a two week period the futures contracts moved in an 8% range! But, it doesn't matter, the market is right.
Initial claims came in worse than expected, but the market moved higher. The Philly Fed came in worse than expected but markets moved higher. The market is always right. In general you can't fight the market, you can only try to manage your risk if the trade is going against you (like it did this week for our systems). Instead of losing 8%, we loss about a half percent. Losses are a part of the business, but stick to your system and capitalize when you're in agreement with the market. |
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Sincerely,
Edward Zaremba
Trizen Systems, Inc.
Commodity Trading Advisor
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| | BladeTrader Version 3.6 | | Version 3.6 and 3.3 have been released. We will have four accounts for each side and version and seperate percentages. |
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U.S. Government Required Disclaimer - Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to Buy/Sell futures, stocks or options on the same. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results.
CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL, OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE DISCUSSED WITHIN THIS SITE, SUPPORT AND TEXTS. OUR COURSE(S), PRODUCTS AND SERVICES SHOULD BE USED AS LEARNING AIDS ONLY AND SHOULD NOT BE USED TO INVEST REAL MONEY. IF YOU DECIDE TO INVEST REAL MONEY, ALL TRADING DECISIONS SHOULD BE YOUR OWN. |
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