Live Trading System Signals on 12/31/2024

The final trade for 2024 is in the books. We are ready for 2025. We have the data to provide us with the clarity of what has been working now as well as what has been working in the past. We will merge the two and will be updating the portfolios and the files for software subscriptions with some updates - hopefully by Thursday. We have some new V-Reversals for Crude Oil and Bitcoin that are on the list to take advantage of the mean reversion and noise in this market.

I was anxious to see if the Nasdaq 100 would close up for the year based on the day session. At the end of November, we noted that more than 100% of the gains for the year were based on the overnight session while the net gain for the day session was negative for the year. The day session finally went positive for the year in December through yesterday. After today's trade, the Nasdaq 100, day session gain is negative on the year. The total points gained in the Nasdaq 100 this year was 4186, 4293 points for the night session and -107 points for the day session. The last time and only other time that we have seen such a large divergence where there is a gain of more than 10% in the Nasdaq 100 and the day session was negative was in 2007, right before the Great Financial Crisis.

I've never seen this much pure price diverge from all other technical and fundamental factors. The bulls are dismissive of the lack of a Santa Claus rally since there are "nice gains already" on the year. Typically when a trend changes, it begins slowly and is very stealth. The winning side of the long-term trend becomes passive and satisfied and is mentally prepared for a normal pullback since they are sitting on big gains. In 2024, there wasn't even a 10% correction in the S&P 500. Oftentimes, the slow pullbacks that are dismissed can turn into an extended bear markets. Investors can be challenged by recency bias. Since there hasn't been much adverse excursion this year, a normal pullback will feel like a major market crash which can create emotional allocations and risk off trades. In August when the market sold off (but not even 10% on the S&P) some bulls were screaming for the Fed to cut rates.

The price action that we described where the trend is up but only at night while there is net selling in the day, is unusual, and has made the market difficult to day trade. If you have a strategy that looks at the daily bars for a trend to go long based on the daily bar trend, you find that there is some steep stop running. We have gap fill strategies that have traded the long side based on the long-term trend being up, only to get stopped out with the extended selling intra-day. There has been a lack of continuity in the direction of the market during a 24 hour period, more than what we normally see.

The One Million MNS live trading results today were -0.3% while the 250K Portfolio was down -$600. We were selective and worked the long side on some Nasdaq and Copper strategies based on mean reversion and the seasonality. There are two days left of the Santa Clause rally (through this Friday) and I anticipated a sharp reversal higher today since we are going into a holiday (New Years tomorrow), based on the patterns we have seen in the past. Today, the short trade was the correct trade, albeit a very choppy downtrend.

The Stock Index Portfolio 18 hypothetical results were +$4,590 per E-mini and +414.50 per Micro. The Micro took an additional long trade in the V-Reversal that was a loss that did not show up on the E-mini. My live platform (on the dedicated server) actually showed the additional live E-mini long but my desktop platform did not. Once I refreshed the data on my dedicated server, the additional long trade on V-Reversal E-mini NQ went away. This was a nice bounce from near worse case drawdowns.

The Top 50 Select Portfolio hypothetical results was +$3,132.50

The 50K Portfolio hypothetical results was -$530.00

We will have the 2025 rollover calendar details as well as an updated DontTradeOnHoliday function. We built this earlier this month but have a new date to add, January 9th, since the markets are closed on days when there is a funeral for a former president. President Carter passed away on Sunday at the age of 100 and there will be a National Day of Mourning on Thursday January 9th, 2025.