Smart Money Indicator Signals a Shift to TLT Bonds

Dan Murphy of Joshua Tree Financial publishes an email alert titled MillionDollar Target. He’s managed a private fund for decades and after research into the smart money buying in the market, created what he calls the ‘Smart Money Indicator’ (SMI). It processes the internal trading of the largest market movers and from that generates signals for medium and long term shifts in market direction. His SMI switches between long, using the ETF SPY, or short the market with the ETF TLT.

During 2017 the SMI has indicated a long in the market,  but a week ago signaled a switch to short the SPY, and long Bonds via the TLT (iShares 20+ Year Treasury Bond).

The passage below is an excerpt from his latest email. You can be added to his email list by contacting him at; dan@milliondollartarget.com .

Traders,
Volatility has been exceptionally low this September.

This week was a perfect example of going no where.
I’ve seen more action in a cemetery.
But in 2010, the market looked fine, and then the rug was pulled out from underneath is a hurry.
 
The SMI was on a sell signal in early April that year, and a month stocks climbed higher by 4.8%…
…then bam!
The stock market imploded.
I believe the market would have fallen anyway even if there weren’t structural issues and quote stuffing.
 
The same thing happened in 1987, well ahead of the crash.
Personally, I don’t think we’re going to see a big down move…
…but I’m prepared for it.
 I don’t know any old offensive traders.
They seem to get wiped out of the trading gene pool pretty quickly.
Trade smart, 
Dan “Prince of Proof” Murphy

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