AlgoTrendTraders Weekly Report
Thomas Meyer, Editor | October 6, 2025
Email: algotrendtraders@gmail.com | X: @AlgoTrendTrade1
IMPORTANT DISCLAIMER: The information published in this newsletter should not be used to make personal investment decisions. We do not know your personal financial situation. Investments should be made only after consulting with your professional investment advisor and only after reviewing the prospectuses or financial statements of the companies in which you’re considering investing.
Executive Summary
New all-time highs across SPY, QQQ, Gold, and Bitcoin as volatility expands. Crude oil reverses, triggering new bearish trade despite challenging 3-year whipsaw pattern. Healthcare sector breaks bullish for first time in over a year while Energy retreats to neutral. Markets show broad strength with rising profit cushions on all major long positions.
Current Market Status
Active Trades & Exits
Key Developments
🚀 All-Time High Parade: Fresh records in SPY, QQQ, Gold, and Bitcoin. Expanded volatility pushed exits to more profitable positions across all four, with Bitcoin’s stop rising nearly $10,000.
🛢️ Crude Oil Reversal: Price closed below yellow transition zone, triggering new bearish trade. Despite 3-year whipsaw pattern suggesting more frustration ahead, system discipline requires following the signal.
🏥 Healthcare Breakout: XLV (Healthcare) moves bullish for first time in a year - significant sector rotation. XLE (Energy) retreats from bullish to neutral.
💰 Profit Expansion: Gold extends remarkable 9-month run to 47.47% profit with widest stop buffer at 2.1 Expected Moves. Both stock indices holding double-digit gains.
Why Trade Crude Despite Expected Whipsaws?
The 3-year chart offers no indication this short trade will succeed where others failed. We trade it anyway because we don’t know the future. System discipline is what gives us the best chance at catching the eventual profitable crude oil trend. Following the rules, even when uncomfortable, is essential to long-term success.
S&P 500 Sectors At-a-Glance
🟢 Bullish (7): Communications (XLC), Financials (XLF), Industrials (XLI), Technology (XLK), Utilities (XLU), Healthcare (XLV), Discretionary (XLY)
🟡 Neutral (3): Materials (XLB), Energy (XLE), Real Estate (XLRE)
🔴 Bearish (1): Staples (XLP)
Two changes this week: XLE drops from bullish to neutral; XLV breaks bullish for first time in over a year
Portfolio Services
Thomas Meyer Investment Management
Not comfortable managing trades yourself? I can handle it for you. Funds stay in your name at Charles Schwab Institutional.
Learn more: tminvestmentmanagement.com
Here are the latest charts…
System Performance Through October 5, 2025
Why Trend-Following Works
The Problem with Buy-and-Hold: When you need your money (retirement, medical, education), a 30-50% loss at the wrong time can derail your plans forever.
The Solution: Disciplined exit strategies. Every trade has a predetermined stop-loss based on the security’s normal volatility. Small losses, big wins.
Key Principles:
Follow trends until they break
Weekly closes eliminate daily noise
Risk management is more important than being right
Boring but historically effective
Trading Methodology
The Yellow Channel System:
Above yellow zone = 🟢 Bullish (go long)
In yellow zone = 🟡 Neutral (no trade)
Below yellow zone = 🔴 Bearish (go short)
Exit Strategy: Based on each security’s 52-week volatility (”Expected Move”). Stops move up with profitable trades but never down.
Best Entry: When new signals trigger. Late entries carry higher risk - consider smaller position sizes.
Remember: Always have your exit strategy prepared before entering any trade.
This is not a “get-rich-quick” scheme. Trend-trading requires discipline, patience, and proper risk management. Past performance does not guarantee future results.