This is an alert about BPT Mechanical mean reversion systems (not the KISS trend systems which have been in the safety of cash for the major indexes)

KISS systems URL

The KISS systems for the indexes have been safely in cash as they employ a type of smart trailing stop.  The mean reversion systems scale into sell offs like this, and times like this are not fun where there's draw down. Over the long run the systems work out but at times during deep corrections they can take some heat. 

This morning the SPY Trend/Pullback stopped out (per my comments last night that we set a hard stop at yesterday's candle low). and Yesterday the RSI oversold exited on SPY for a slight winner

- SPY: 1st entry for Bull Exhaustion

-  MES Futures: RSI Oversold is taking a 2nd entry, and the QE BTS is taking a 3rd entry, CCI divergence is taking a 2nd entry

Additionally some ways to limit risk with these:
1. If the same sub system takes the same entry on both SPY and MES futures, one can choose to only do one of them instead of both.
2. One can limit the number of entries that they are willing to take, such as 8 or 10 etc
3. Yet another idea I may play around with is limiting the systems to only one entry instead of 3 possible entries. This would greatly cut down on the number of entries, and the way it would work, if one system entered too early, your 2nd or 3rd entry could simply be from one of the other sub systems taking an entry at better prices.

Anyway, the market has had a strong correction since late July, which we were calling for.  Now we'll see where this bottoms on. 

Matt

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