Many of our investors use our Super Accelerator Model for longer term, conservative investing. The reason is because the Super Accelerator Model is conservative, and has an average of 3 signals a year while it catches the big moves as you will see. (The Super Accelerator is based on the physics principle of acceleration & momentum and their relative change of speed and direction.).
There are three elements to the Super Accelerator Model: a. A proprietary, longer term, Super Accelerator Indicator, b. a (Short Term) S.T. Accelerator, and b. a 30 day C-RSI that measures strength.
a. The main component is the Super Accelerator at the top section of the chart we posted below. Note the thick red horizontal line in the middle of each Super Accelerator chart section. Above that line is Liquidity Expansion, and below it is Liquidity Contraction. If in Expansion and the trend lines are moving up, then the Inflowing Liquidity coming into the market is aggressively strong. If in Expansion and the trend lines are moving down, then Liquidity is still in positive territory but being reduced systematically ... these are times when the market pulls back or doesn't have enough new capital to push forward.
If the Super Accelerator is in Contraction territory and the trend lines are moving down, then the Inflowing Liquidity is leaving the market. If in Contraction territory and the trend lines are moving up, then Liquidity is being replenished and any down movement is facing reduction. If at the same time, the C-RSI and the S.T. Accelerator are moving up and over their horizontal lines, then an up trending S.T. Accelerator is sending a new up signal.
b. The S.T. Accelerator is a short term measurement of acceleration or deceleration. The same principles in section a. apply. Additionally, many technical analyst have a problem with identifying trend lines because they never really know for sure where to draw them. This Model takes away that dilemma. By drawing a trend line when the S.T. Accelerator is just starting to cross over its horizontal signal line, we get a good trend line that is often a buy or sell signal that is a day or two earlier than other market systems.
c. If all is in accord for an up or down signal, there is one last element that needs to be in place. That element is the CRSI strength of the underlying index. When our CRSI Indicator reading is +2 or lower, you have entered an up but a Danger area (if the Super Accelerator and S.T. Accelerator are trending up) and you should hedge in order to insure your investments from unacceptable risks. (American citizens use insurance to cover the risk from auto accidents, home accidents or use life insurance to cover death situations ... why not their investments as well?) *** CRSI definitions: From 0 to a reading of +2 is a Danger Condition. (From over +2 to +5 is a Caution condition, and above 5 is a pretty strong level. We do post a daily matrix with these values for the SPY, QQQ, and IWM every day and the matrix cites the values for the past three days.
Unless there is a crash, Sectors Q1 or Q2 are seldom as good a shorting condition and they do not even compare to the shorting opportunity that exists for Sectors Q3 or Q4.
The SPY Super Accelerator sample chart below shows
September 2013 to March 2014.
(Red vertical lines are Sells, and Blue vertical lines are Buys.)
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Statistical performance about the Super Accelerator Model ...
Also see these links:
MarketTrackerA and MarketTrackerB