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1 Confidential Do Not Copy or Distribute The Association for Technical Analysis A TA www.afta-dfw.com Disclaimer This information is produced by the Association for Technical Analysis (A f TA) and is intended for the private use of its members

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Confidential Do Not Copy or Distribute

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This information is produced by the Association for Technical Analysis (AfTA) and is intended for the private use of its members

  • nly.

Although reasonable care is exercised in presenting the information contained herein, AfTA does not make any guarantee or other representation as to the accuracy or completeness of such information, nor that use of any such information will result in profits

  • r prevent losses.

Neither the Association nor its Officers assume any responsibility whatsoever for errors or omissions. Comments or materials presented do not necessarily reflect the

  • pinion of AfTA or its Officers, nor do they constitute an endorsement
  • f any products or services mentioned.

The Association for Technical Analysis A TA

www.afta-dfw.com

Disclaimer

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TONIGHT’S SPEAKER

The Association for Technical Analysis A TA

www.afta-dfw.com

Dean Somes

Cross Capital Partners Anadromous Research

  • Mr. Somes is the portfolio manager for Cross Capital Partners, a family office

located in Dallas, TX. He is a graduate of Boston College, earning dual B.A. degrees, and a published author, having written chapters in two books titled, Your Options Handbook (Wiley, 2011), by Jared Levy and What's Behind the Numbers? (McGraw-Hill, 2012), by John DelVecchio and Tom Jacobs, which was awarded the 2013 Book of the Year by Stock Trader's Almanac.

  • Mr. Somes also provides institutional technical analysis research through his

company, Anadromous Research, to the team of fund managers at the first short-

  • nly actively managed ETF named "The Active Bear", (NYSE: HDGE) and the

Forensic Accounting ETF (NYSE: FLAG) as well as other traders and money managers.

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PLAYING NOSTRADAMUS: A A LOOK AT

AT 2015

2015

* Disclosure: Dean Somes nor his companies nor affiliations makes no guarantees or other representations as to the accuracy or completeness of information presented or discussed within this presentation, nor that use of any such information will result in profits or prevent losses. What you read or hear should not be considered to be investment

  • advice. You are responsible for any decisions you make using information received in this presentation. You should do

your own due diligence prior to making any investment decisions.

DEAN SOMES

JANUARY 20TH, 2015

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Swiss Franc & Danish Krone

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Euro

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Currency hedged Euro equities

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Unemployment

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Unemployment Indicators

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US Summary

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US Summary: P/E’s point to limited expansion in 2015 with Tech and Healthcare outperforming again

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Midcaps

PPO = % Price Oscillator A momentum oscillator measuring difference between two MA as a % of larger MA.

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SPY ROC

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Nasdaq 100

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Number of Hindenburg Omens up:

Increased Volatility?

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Commodities

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Correlation b/w US Dollar and Commodities

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Oil: Tight vs. Conventional

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Oil: Amount of Excess Capacity

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Oil Crash: Only 5 times since ‘85 (3 during US Recessions)

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High Yield Energy Credit: +15% of high yield market

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Strong cash flow and strong valuation

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Strong revenue, cash flow and valuation

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Gold

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30-Year Yield

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Conclusion

  • Oil should snapback to around $60/barrel.

 Credit is the subsector that should provide the best risk/reward return

  • structure. However, spreads could widen just a bit further.
  • The ECB QE decision should mark an important

inflection point for European stocks.

 A large QE would be immediately beneficial for Euro stocks. Watch HEDJ.  Gold is improving as investors diversify their currency holdings.

  • 2015 could be another year of US dominance versus

Europe and other non-commodity countries

  • However, volatility should increase this year based on a normalization of

equity response to earnings growth.

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Conclusion

  • Yields are falling, coinciding with the fall in

commodities.

 A rebound in commodities may see a spike in yields, pushing bonds back down from overbought levels.

  • If inflation rises, US Dollar should fall.

 Thus, a rebound in commodities is important to watch.

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Thank you!

Dean Somes

Manager, Cross Capital Partners, LP President, Anadromous Research LLC dean@crosscapitalinc.com

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TONIGHT’S SPEAKER

The Association for Technical Analysis A TA

www.afta-dfw.com

Ian Naismith

Naismith Trading Labs

Ian Naismith lives in Frisco, Texas and owns Investment Portfolio Solutions, Inc. and Naismith Trading Labs, Inc., and licenses trading signals to financial institutions in the global areas of equities, debt, commodities, currencies, and special situations. Also, he is currently Chief Technical "Animalyst" for MBS Highway. He has created and operated two registered investment advisory firms; created and co- managed a global currency mutual fund - Currency Strategies Fund; was a contributing author to "Technical Analysis in the FX Markets" (published by The Technical Analyst, UK), and has been the January cover story in FOREX Journal (published in Singapore) five years in a row - including 2014. He has developed trading indicators, indexes, and consults mutual funds, registered investment advisors, and financial product manufactures. Naismith is an honorary board member, past president and chairman of the National Association of Active Investment Managers (NAAIM) which represents about $35 billion under management.

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DISCLAIMER

  • This is not direct investment advice, nor is

intended to be investment advice, or construed as investment advice; but is meant to hopefully add to your well diversified toolbox for decision making.

  • If I offend you, please forgive me.
  • A lot of this is my opinion – therefore fact… ;-)
  • Equal emphasis (if not greater) should be given

to “store of value” compared to “how do I make 15% instead of 10%”…

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Quick Bio

  • Owner, “Artist At Work” of Investment Portfolio

Solutions, Inc.

  • Index, product creation; institutional consulting
  • Assist in signal providing to mutual funds, hedge funds,

RIA’s, UCITs funds (over $1.3 billion)

  • Published author – FOREX; created/managed U.S.

global currency mutual fund

  • Past president/chairman of National Association of

Active Investment Managers (NAAIM)

  • Avid music composer/performer/collector; avid cook
  • Wife & girlfriend of 35 years, 2 children, live in Frisco TX.
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BIASES…

  • I only create portfolios and signal to institutions in a

dynamically moving hedge format… No naked longs

  • r shorts for me…
  • Over the long haul, smoothness of equity curve,

volatility and drawdown control is more important to me than the total return…

  • No algorithm, indicator or logic works of all the

time… Thus have an allocation inventory system of a competing algos and indicators – and be willing to step aside yourself when your system is not working…

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quick primer of continuing poo-poo (that will influence 2015...)

  • Continued “holographic markets” via overt

and covert manipulation of economic indicators, employment numbers, futures contracts, interest rates, machine trading,

  • etc. etc. etc. with the goal of forcing the

“risk trade”…

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Poo poo, cont.

  • Political ineptness with all things fiscal and/or

creating value (on both sides…sorry…….)

  • Attempted electronic sabotage…
  • Global currency shell games and the continued

myth of a strong dollar…

  • A gunning for control of the electronic

landscape, both digital currency and internet policing…

  • The further dividing of the economic cold

war…

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Now, 2015… already some changes!

  • The two year market cadence is decaying!!!
  • Market cadence defined: a sequence of

increasing or receding time frames comprising the whole of a market phase…

  • Important: detection of the POTENTIAL closure
  • f a market phase through runup and decay

tracking…

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Which would you rather own???

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So… based on current markets, be on the lookout for…..

  • Cadence behavior – if the current cadence decay

continues in the short term, it increases the chances for much greater volatility this year – thus a traders market and/or more caution for strategic allocators…

  • If the current decay is eradicated soon with the

resumption of dominant cadence from 2013 – strategic allocation and buy on the dips makes sense – but keep your eye on breadth…!!!!!!!!!!!!

  • If there is a cadence stair-step down with lower

highs and lower lows on the > +2 & < -2% tracking, fasten your seat belt….

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Finally --- Fractured exchanges!!!!!!!!

  • Find news sources that point out “mini flash crashes” within

different exchanges. Starting sources = NANEX and it is generally reported after detection on ZeroHedge.com If you notice more flash crash activity, then adjust accordingly…

  • Outside of an engineered or truly surprise geopolitical,

technological or medical event, I believe a “Black Swan” is showing itself now is exchange fracture --- where micro flash crashes turn to mini flash crashes turn to macro flash crashes…

  • If a macro event occurs, we cannot assume the frequency,

severity, or exchange/govt response to such event(s)… This is the age where the designers of machine learning are warning us of the machines knowing more than us in the near future….

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Ian Naismith contact info….

  • Technibeast@gmail.com
  • Cell 941-586-8658
  • When not traveling – I am very

accessible and like red wine…..