Thursday, September 22, 2011


The BRICs -- Brazil, Russia, India and China -- fell as one below the 20-day Donchian price channel into bear phase, and each broke free of a sideways trend that began in early August.

sym phase trend adx   200/50 40/10

All have strong average directional indexes, meaning the trend seems to have some power. And all are following the pattern of the U.S. market, which suggests that continuation of the fall or its reversal will depend upon factors exogenous to these giant, industrializing countries.

The lockstep decline is, I think, a teachable moment. Some stock-market gurus say, to diversify, a portfolio should have overseas stocks. Hate to tell ya gang, but it's all one, giant, global market. You might be able to find diversification on Mars. But here on Planet Earth, a trader's sole hope lies in being rational and nimble.


  • phase: 20-day price channel phase, with green for bull trend, red for bear trend and yellow for neutral trend.
  • trend: Price direction, green for higher highs and higher lows, red for lower highs and lower lows, yellow for neither.
  • adx: Average directional index location, indicating the strength, or the temperature, of the trend. Orange for 40 or greater, aqua (light blue) for 25 and up but below 40, magenta (light purple) for 20 and up but below 25, and brown for anything below 20. (Mnemonic: Orange for the overhead sun, blue for the surrounding sky, magenta for sunset on the horizon and brown for the earth.)
  • 200/50: The moving average cross, green for the 50-day ma above the 200, red for below and yellow for closely aligned.
  • 40/10: The moving average cross, green for the 10-day ma above the 40, red for below and yellow for closely aligned.

About my trading methods

Read a detailed explanation of my analysis method, including trading rules.


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.

The trader’s greatest sin is inaction. Sleeper, awake! Seize the Nietzchean moment. Roll out of bed and trade.

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