Both the signal graphs have been updated to Feb. 1, and neither is signalling a recession,
so GTT suggests it is still reasonable to ignore momentum timing signals.
rrjjgg
11 Likes
I just started a new GTT thread by accident, so, for a reference for those unfamiliar with
this method, see , https://discussion.fool.com/gtt-timing-32523262.aspx? which started the previous long thread based on the ideas referred to there.
4 Likes
For those new, the FRED data is updated around the middle of the month. The latest data is for the previous month. So the lag is generally 1 1/2 months to 2 1/2 months. Every once in a while there will be more than one update in a month.
The latest update for Advance Real Retail and Food Services Sales (RRSFS) is
2022-02-16 7:40 AM CST
Date Range: 1992-01-01 to 2022-01-01
Note that there is considerable lag. Here it is March 16 and the latest data is Feb 16, for Jan 1. Thatâs 2 1/2 months old data. I expect that the next update will come in the next day or two, or maybe today.
With respect to the GTT rules, the S&P500 is signalling to sell, but the FRED data is saying to ignore that. Perhaps by the time (if) the FRED data indicates a possible recession the S&P signal will be in the black.
4 Likes
SIGNAL CHANGE!
This week the âFREDâ graph was posted a day early and was below 0 on 3/1/22 indicating the use of
your usual timing methods, should you be a momentum based timer.
https://fred.stlouisfed.org/graph/?g=3asR
When the graph comes up click on the âmaxâ button to see the updated graph.
It is clear that the
last two extreme values were very extreme, both the low and high points, suggesting the current
reading is a type of reversion to the mean after these extremes, so it may not signal a recession.
As you can see from the graph false signals occur once in awhile.
I just checked and the second graph is available. It is still positive, but may be on the way down. Time will tell.
https://fred.stlouisfed.org/graph/?g=3atC
The unemployment graph is also still low, giving no hint of a recession.
https://fred.stlouisfed.org/series/UNRATE#0
rrjjgg
7 Likes
The Fred graph is almost at zero and improved from the last post, but still negative,
indicating the use of
your usual timing methods, should you be a momentum based timer.
I would not be surprised
if it goes above zero next month.
Neither the other graph nor the unemployment graph
is suggesting a recession anytime soon.
https://fred.stlouisfed.org/graph/?g=3asR
rrjjgg
9 Likes
GTT-Neither the other graph nor the unemployment graph
is suggesting a recession anytime soon.
The market performance would suggest that something is rotten, unstable and unknown about the near future. GTT is just lagging behind the curve.
**Sector Last % Change Market Cap 1-Year % Change**
5/18/2022 AS OF 09:36 AM ET 5/17/2022 5/17/2022
Communication Services -0.91% $4.89T -20.00%
Consumer Discretionary -2.97% $6.84T -12.69%
Financials -0.96% $7.76T -9.89%
Industrials -0.96% $5.01T -9.26%
Materials -0.98% $2.58T -3.68%
Information Technology -1.25% $13.16T 1.52%
Real Estate -0.40% $1.61T 3.09%
Health Care -0.55% $7.56T 6.41%
Consumer Staples -1.87% $4.46T 9.43%
Utilities 0.13% $1.69T 9.76%
Energy -0.16% $3.81T 58.36%
S&P 500 ÂŽ Index -1.18% -- -2.04%
GD_
6 Likes
The Fred graph is still negative,
indicating the use of
your usual timing methods, should you be a momentum based timer.
Neither the other graph nor the unemployment graph
is suggesting a recession anytime soon.
https://fred.stlouisfed.org/graph/?g=3asR
rrjjgg
4 Likes
Neither the other graph nor the unemployment graph
is suggesting a recession anytime soon.
Hehe.
Iâve seen a few mentions of âsoft landingâ in the media recently, so I think a recession is baked in now, the only debates now are how soon, and how bad. 
I wonder if any hedge funds scan the media for that term?
SA
2 Likes
GTT is useful only to control unnecessary trading when using certain timing signals. While it suggests a possible recession in the future, I donât think just one signal is all that predictive. When both
signal, the possibility of a recession increases.
That said about the GTT method, I do agree that a recession may be coming in the near future.
I canât remember the reference, but I recently saw a graph that claimed to show inflation spikes and when the next recession was . It had maybe 15 examples and all but one had a recession quickly following (within a few months).
rrjjgg
3 Likes
The Fred graph is still negative,
indicating the use of
your usual timing methods, should you be a momentum based timer.
Neither the other graph nor the unemployment graph
is suggesting a recession anytime soon.
https://fred.stlouisfed.org/graph/?g=3asR
rrjjgg
9 Likes
Neither the other graph nor the unemployment graph is suggesting a recession anytime soonâŚ
It rather surprises me that such models use that indicator.
And Iâm not complaining. Whatever works, right?
It might be a good indicator, but one of the most reliable indicators gives warning much sooner, and with a vaguely predictable amount of time.
https://fred.stlouisfed.org/series/T10Y3M
In fact Iâm astonished that the 10y-3m yield curve inversion seems to have predicted the Covid market plunge. Mysterious.
Current reading is +.056, meaning one more short term interest rate rise of 75bp would probably push it negative.
Which in turn would portend a statistically likely recession starting around a year later, plus or minus 4-5 months.
Jim
18 Likes
Jim,
Iâm following the two graphs suggested as a minimal set of signals by the originating paper and Ray (unemployment).
Part of the reason yours isnât used might be the credit spread graph you reference only includes four recessions, while the retail sales graph has twelve recessions. A bit more stat to bolster its use?
You also note the credit spread warnings were very early, so the signal might be very accurate, but slow enough to not help in deciding when to ignore momentum timing signals.
Itâs interesting to note that Lohillâs BCC signals cycle between two and three bull signals most of
2021 and that period had no change in GTT. Lohillâs signals change to two bears 4/28/22 and became three bears, BCC=0, about a month later, while the
GTT signal changed to following momentum timing signals on 4/15/22, just in time to catch the bearish
change in the BCC signals. So GTT seemed to help this time.
rrjjgg
3 Likes
The Fred graph is still slightly negative,
indicating the use of
your usual timing methods, should you be a momentum based timer.
https://fred.stlouisfed.org/graph/?g=3asR
The $SPX is barely under its 200 day MA, so it will
interesting to see what happens during the upcoming Inferior Five days.
It may give a suggestion whether weâre just in a correction or really
coming out of the bear market.
rrjjgg
1 Like
Both of the signal graphs are positive on 8/1/22, so GTT suggests ignoring momentum
signals.
Yes, this is certainly hard to do when BCC=0 and almost all the other signals posted here are
screaming âBEARâ!
(From âPsychology Todayâ: âCognitive dissonance is a term for the state of discomfort felt when two or more modes of thought contradict each other. The clashing cognitions may include ideasâŚâ ) :->
https://fred.stlouisfed.org/graph/?g=3asR
https://fred.stlouisfed.org/graph/?g=3atC
https://fred.stlouisfed.org/series/UNRATE#0
I thank Ray for correcting my last post.
https://discussion.fool.com/gtt-update-summary-35155551.aspx
I did not
carefully check a date on a graph to see it had not been updated.
Updating usually occurs on the 15th of each month, not so last time.
Your very cognitively discomforted
rrjjgg
3 Likes
Updating usually occurs on the 15th of each month,âŚ
Not quite. I have a job that runs every day, downloads the RRS and IND data files (data, not graph) and also keeps track of the âLast Updatedâ field. It also saves the file, with the date embedded in the filename. It has the data since early 2016.
Anyway⌠here is the distribution of the day numbers of the updates:
Advance Real Retail and Food Services Sales
Series ID: RRSFS
Count Day of month
1 01
1 02
1 05
1 10
2 11
5 12
7 13
19 14
26 15
21 16
8 17
3 18
2 19
1 23
1 26
Industrial Production: Total Index
Series ID: INDPRO
Count Day of month
1 01
9 14
28 15
18 16
20 17
4 18
1 27
3 28
1 31
The dates late in the month are usually the second release in a month, with revised value(s). The dates early in the month are usually preliminary, and will be revised/updated later in the month.
If you want to look at the data only once per month, you should wait until the 18âth of the month or later.
8 Likes
The 18th it is then. I had noticed variations in the dates earlier, but got in the habit of using
the 15th, provided I saw the date change.
Thanks.
rrjjgg
Both graphs are above 0, but the Advanced Retail sales is
only a hair above at 0.0039,
Advance Real Retail and Food Services Sales | FRED | St. Louis Fed.
While tech layoffs are in the news, the unemployment graph is still healthy.
If the above graph is used strictly, momentum signals can continue to be ignored using the GTT idea. Iâm thinking using
BCC signals or other momentum signals might not be a bad idea, especially if sales data weakens even a bit during the next few weeks.
rrjjgg
2 Likes
Both graphs are above 0, but the Advanced Retail sales is still barely above 0
Advance Real Retail and Food Services Sales | FRED | St. Louis Fed .
While tech layoffs are again in the news, the unemployment graph is still healthy. Momentum signals can continue to be ignored using the GTT idea.
5 Likes
SIGNAL CHANGE!
This week the âFREDâ graph was below 0 indicating the use of
your usual timing methods, should you be a momentum based timer.
https://fred.stlouisfed.org/graph/?g=3asR
When the graph comes up click on the âmaxâ button to see the updated graph.
The second graph is still positive, but is dropping. Time will tell if it hits zero.
https://fred.stlouisfed.org/graph/?g=3atC
The unemployment graph is also still low, giving no hint of being in a recession as yet.
https://fred.stlouisfed.org/series/UNRATE#0
The current BCC signal is 0 and the $SPX index is below its 200-day MA.
This has been an experiment to see if GTT helped momentum timers avoid unnecessary and costly trading. Since the graphs are
available to anyone whoâs interested, this my last regular post about this.
rrjjgg
9 Likes
Thank you for all your work!