A relatively calm week with a minor disappointment in not keeping up with the actual S&P as it climbed higher.  We were out of sync by roughly 1 percent.   The algorithm has shown a couple weak points throughout the last year but this typically shows up in overnight trading where the market moves strongly in our preferred direction but exited just prior to the overnight session.  BladeTrader v3.3 does not trade actively in overnight sessions, so if it exits just before the overnight session then the system can get behind on strong moves.

As for the market, it has shown incredible strength all around; however, take out the one big jump on the day before Non-Farm payrolls and the market hasn't done anything since October 13th.  We're getting into an area where players may not take on big risk just prior to the end of the year and though we may have a rally in December the end of earnings season may have some taking some profits and seeing if they can get back in on a pullback.

As we get closer to the new year I will start talking about the other markets we will be trading in, including Forex (currently testing but up 25% currently), Eurodollars, 2-year treasuries, and 10-year treasuries as well as options on these elements and possibly some covered call stock plays.  I think we have a great system and it works across all asset classes.

 150,000 was the headline number for the monthly employment report and markets have barely moved, in fact, they look almost tired at this point.  Has all the good news been baked in?  Has anticipation of Quantitative Easing been like morning coffee and now its late afternoon (I need a RedBull).  The markets look tired, and though we may likely move several more percentage points, we're approaching highs that haven't been seen since Lehman Brothers collapse, a new high for the year, and 10% on the S&P is in striking distance--its time to reflect on where we have been and where we are going.

Will the markets move higher, possibly.   Again, we are Long until they tell us to be short.  The stock trader's almanac posted their yearly MACD buy signal (seems a little late) but they feel we have had an election, QE2, good earnings....what's there to worry about?

When markets have nothing to worry about and there is no "Wall of Worry" to climb, how do we go higher?  I don't know what will happen in the next few weeks, but the market really hasn't gone anywhere in nearly a month (other than one 2% day before the employment report) and 1220 looks really tough to get through.