Category Archives for "ETFs"

October 1, 2013

Which S&P500 stocks to focus on when the SPX has 5 higher closes

Rob Hanna had a good post recently; titled What the String of 5 Higher Closes Under These Circumstances is Suggesting .  With mean reversion trading, you are expecting stock prices to snap back towards their mean, like a rubber band stretched too far.  But, sometimes, that rubber band can be stretched so far that it breaks (and therefore, won’t snapback).  For some time, I have been searching for how to tell when that rubber band is stretched so far that it is broken.  Rob’s post had several key concepts that might help us to solve this puzzle and possibly even be the foundation of a stock strategy.

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