A New Way To Use The Incredible Coppock Indicator

Listening to music you like has a similar effect on the brain to taking drugs. I live my life in a drug-fuelled state of euphoria, but this drug does not harm me.

Maybe that explains why I have had a moment of revelation. I am not a bear any more. I think this market has turned, and the bulls are back in charge. I have completely restored my Palantir position. I have crystallised a considerable loss buying the shares at up to 50pc higher than when IG sold me out. I will forget the loss, but if Palantir goes where I think it is going, and I have no shares, that would kill me every day.

Please turn on the music, Edwin, because I am taking Coppock to places you never dreamed it could go. My latest discovery is – Coppock goes weekly.

Above is a chart of the Nasdaq 100 Technology sector index using weekly candlesticks. The golden rule is that Coppock MUST be negative to give a buy signal. I have marked them all with blue smileys. There have been 14 since 2008, so still relatively infrequent.

They are not a licence to print money but an excellent guide to short-term trends as well as picking THE bottom every time. Seven, half, the signals were followed by major uptrends. Note also that the indicator is presently deeply negative, so it looks promising.

Just as an aside, there are over 100 million songs on Spotify, and I have spent several years picking my favourites from that vast selection. No wonder I love them so much and know I will find many more.

Let us look at a chart of my favourite QQQ3 with weekly candlesticks. Candlestick charts were invented in Japan and encapsulate a great deal of information. The vertical line (on a weekly candlestick) shows the range of prices for the week. The solid block shows the opening and closing prices. It is coloured red if the price closes lower on the week and green if it closes higher.

The Japanese attach great significance to hammer-shaped candlesticks, which can give an early warning of a changing trend. This is similar to the way Western chartists talk about one and two-day reversals, ideally on massive volume.

In recent days, we have had all of those things, which is one reason for feeling bullish. Now let’s look at Coppock. It is around its lowest level in the history of this ETF. Makes you think that we could indeed be at or around an important turning point. The double smileys are for Coppock signals from a deeply negative position, and they have worked incredibly well. The next Coppock buy signal will be a double smiley.

Another intriguing chart is for the Direxion Technology 3x daily rebalanced ETF, TECL. Look at the quality of those signals. The deep negative turning points I have again marked with a double smiley. The next turning point, with Coppock deeply negative and falling, will be a double smiley.

I could go on, but you get the idea. Coppock is a tool of awesome power. You nailed it, Edwin. The horizontal blue line, as I am sure you have realised, is to mark as near as my “tremblin’ ‘ands” can get to zero. The wisdom of the ancients, hopefully.

Have I mentioned in a previous post that it was only some 30,000 years ago that life expectancy in homo sapiens improved sufficiently for there to be three generations of a family alive at the same time. This was hugely important in an age before writing and computers because these oldies became repositories of knowledge like the old elephant matriarchs who know how to find water during droughts.

Information storage is important otherwise, humanity spends all its time relearning the same old lessons and cannot move forward on the shoulders of past giants, as Newton or somebody put it.

This ‘old memories’ function is less needed, which may explain why my children treat me with so little respect and my grandchildren with none at all. It is almost the other way around because the old need the young to make sense of a fast-changing modern world.

A question raised by the charts above is – do we even need to wait for a buy signal once the weekly Coppock is deeply negative? I guess that we probably don’t, especially in a market like the US, where the indices are in a secular uptrend. So if you want to buy some QQQ3 or TECL, why not?

Share Recommendations

Direxion Technology 3x Leveraged Daily Rebalanced. TECL

Wisdomtree Nasdaq 100 3x Leveraged Daily Rebalanced QQQ3

Strategy – Time To Be Greedy!

This is completely random, but why is kissing women so great, exchanging spit with someone? Why is it such a turn-on? Every Georgette Heyer book ends with the Hero grabbing the heroine (small caps for her) in a crushing embrace and violently kissing her. After some initial struggles, she melts in his arms. Why?

This is what AI has to say about it.

Kissing is great because it triggers the release of hormones that make you feel good, enhance emotional connection, and can even boost your immune system. These effects contribute to a sense of pleasure, intimacy, and well-being, both physically and emotionally. 

The wisdom of AI

That explains a lot. I listen to music because I can’t find any women who want to kiss me any more. Thank God music works!

This may explain why I have become so bullish on the market, no wet towels and fevered brains needed, just a dose of Dr Feelgood. I also think, more rationally, that Coppock is increasingly heading into the buy zone and that fears of the damage Trump may do are overdone.