Keith, Jim Matheny, 2019 discussed on Prosper


Doing wonderful, Keith. How are you doing? Great. Thank God. So let me give a little background. Pete is a trader, and he has subscribers to a daily update. He provides. Some people are paying, I guess about 1000 a month for your daily update, and you tell them in the short term, meaning the next day or a few days or a week. What you expect the market to do whether it's going to go up or go down and then you also give recommendations about how to capitalize on that, right. So is that accurate? Very accurate. All right, So they say that most people lose money when they try to trade. How would you respond to that? That's 100% true. If you if you Google what percentage of traders lose money in the market over or a one year period Depending on the study, roughly 93 to 95%. Active traders lose money. By the end of the year about 3 to 4%. Break even You have want under 1% that actually make money during the year. So if if you're actively getting in and out of the market theology is stacked against you that that you're going to be successful. So why are you trading them? Why my trading because we have been trading for well over 35 years, and the key to trading successfully is to do exactly the opposite of what the masses are doing. Cashed up. If you think about it, 95% of traders of are losing money. All you have to figure out is what they're doing and do the opposite. And if you do the opposite you have have you 5% chance of making money. Okay, so that makes sense. That's logical. So what are some of the tools that you can use to determine what the 95% of the traders are doing? That the two tools that we use that that are out of the most valuable tools out. There are number one investment sentiment. So, um, again, 95% of the traders whose money figure figure out what they're doing, go against them and you'll be successful. So we look at investor sentiment so When investors were excessively bullish, well short the market when they're excessively barrish look along the market, but you know it does take. It does take weeks, if not months for them to get to those extremes on another very, very valuable tool that we use is we have a, uh Proprietary algorithm. It's called the G M F a, the gamma money flow algorithm. And what that does is that it takes end of day tick data but analyzes it. It puts into a formula. The volume of optics and down ticks in the indexes and a select group of stocks. And it puts out a number between zero and 500 on zero, minus 500. And it's able to determine whether institutional money is flowing into the market or whether it's flowing out of the market. Now this tool is very, very valuable whenever On indexes rallying to an all time high or around to a multi week high. And then we begin to have diversions is inside this GMS, meaning that the stock market's hitting is sitting in your high, but that method is printing and negative value. That means that institutional money is coming out of the market, and the market typically virtually always corrects whenever this divergence occurs. God. So we utilize Pete signals managed account of Charles Schwab that we manage her clients and in 2019. Think Pete was up over 100% using this method. We started using it in September. 2019 and our accounts were up 31.62% for the last four months. The year versus the SNP was only up 11 during that time and in 2019 I mean in 2020. Rather, the account was a 19%. The s and P was up 18%. So we didn't really beat the SNP by that much. But I can tell you that anyone who invested in the S and P 500 had the watch their account. Go down over 20% 30% at some point and then come back finally make a profit. So with this manage the count we never Endure that kind of loss because we were actually in cash and actually, short part of the time that the mark was going down. So you were able to achieve the same result as the S and P in 2020 without the extreme whipsaw volatility, So that was really good, Pete and then the first month in January The strategy was up 5.75 when the S and P was was down 1%, So we had a first Good month. Anyone who wants to get the daily updates, by the way simply text the word Spartan 2474747 text the word Spartan 2474747. And we'll get you the daily updates. Now things could change quickly right now. I guess it looks like the markets are starting off February very strong. Doing very well this month. What is the short term forecast? You see that continuing or do you see the markets pulling back here? As of, you know, mid February short term the markets Look, look look like they want to go higher from here. Lot. We are seeing some signals. They're awesome institutions that are beginning to dump stock. But there are plenty that when this when the selloffs to occur there being Purchased on the dips, so there's a big buying the dip buying still occurring, so there's a big tug of war. I mean, the markets are our extended here. They are historically very rich. So, but short term out. Technicals are pointing to higher stock prices for the near term. But that could all change overnight again are our Jim Matheny, which is a proprietary algorithm. It's very, very accurate in forecasting which way the dominant money flows are, whether they're incoming or are slowing. Got it now. I was looking at the investor sentiment survey. It looks like a bullish sentiment jumped up this week and bear sentiment got got reduced. So it looks like people are becoming more optimistic about the stock back exactly this week. It's almost with 2 to 1 ratio. Typically when you hit a 2 to 1 ratio, a short term top is near when you when we hit us, 3 to 1 ratio when there's three bowls every bear then significant, declined to believe her. So we're not there yet. But if this bullishness continues over the next 1 to 2 to three weeks. We can look for a sizable pull back in the markets. But as of right now, things did. Things looked positive for the upside, right. Okay, So you subscribe to the theory that things come in waves, right? You have run ups and you have run downs, OK, And so, do you see that this run up? You know, it's hard to predict when it's gonna end. But it will end at some point is that is that fair to say everything comes to an end. There was a way to count principle. It's called the Elliot Wave. It's It was invented. I believe in the 19 twenties. Um Hi, Mr Elliot and it Zafira Way theory, meaning that there's five waves in to every cycle. You have the initial wave where there's a lot of doubt that the rallies even beginning then you have a corrective wave to then you have another thrust high. We just wait three. Where a lot of people get on board. Then you have another pullback way for and then you have five. Wait, wait five, which is When things get silly when everybody comes into the market, And as we saw over the last couple of weeks we had the game stopped fiasco. I was reading an article I believe on Yahoo business where I believe this city 30% of the U. S population during that game Stop fiasco with AMC Stock and BlackBerry stock that Almost 30% of the American adult population traded one of those vehicles during that time period. That is, that is That that's scary. That's scary, because it shows you that everybody's in and when everybody's into the market, just like we saw in 1999, the rug gets pulled out, and when it happens, it is catastrophic. It is vicious and his quick Where people just don't have time to get out. And another thing that everybody should watches when the volatility picks up when you have these massive swings that the upside downside intraday That's when you know that typically occurs at the top because When the market is going to collapse. It's going to take both the Bulls and the Bears..

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