Declining volatility would certainly produce a slowdown, and the VIX, which measures the volatility of the S&P 500, is certainly approaching its year-old support level. (The dotted red line on the chart.)
Click on chart to enlarge.
|VIX 2 years daily bars|
As disconcerting as it is for me as a trader to be unable to trade, I take this fallow period to mean that my rules are doing their job. They're keeping me from making an emotional decision to trade when the signal and the math won't support such a course.
Boring? Yes. Unprofitable? Yes. Good trading practice? Yes indeed.
My trading rules can be read here. And the classic Turtle Trading rules on which my rules are based can be read here.
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 decisions for his or her own account, and take responsibility for the consequences.