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Well, I think this is the best confirmation: We speak for Yuki's H&S,
something q u i t e differennt than T/A H&S [as for the timing alone].
Although the readers should know that life is not as easy as exposed
here : Many times we ask from the market to be on our side, we become
crazy with the idea and 100Xhappy when confirmed, but, but, it is not
a T/A rule, we should be always ready to pull the stop trigger when
the probabilities are not in our side, etc. etc.
Your text is an excellent presentation of "trading T/A before T/A
signals", very interesting but a bit dangerous for people who dont
even know Dylan. Your H&S was blowing in the wind, I'm afraid you
were the only person who walked on this side [not to mention
the "walk on the wild side" here] and I'm more than happy you pocket
the results.
Take a look at the H&S code, it will be useful for other periods,
with less inspiration...
Thank you for this great example
Dimitris
--- In amibroker@xxxxxxxxxxxxxxx, Yuki Taga <yukitaga@xxxx> wrote:
> Hi DT,
>
> Saturday, November 15, 2003, 9:55:26 PM, you wrote:
>
> DT> In the N100 market, the serious Sell signals appeared on Nov10
> DT> Close [not earlier] If they were short signals also is a matter
> DT> of further discussion.
>
> November 10 (last Monday) is also the exact date I went heavily
> short. The signals I'm talking about were only short term, not for
> any reversal of trend. No "this is the end of life as we know it"
> signal, just a "we have a *significant* chance for a severely lower
> market on Tuesday with a pretty low risk if we take a Monday entry",
> and sure enough that is exactly what we got. That's what it's all
> about: significant chance of an immediate strong move in the
> direction you are going to speculate in, while at the same time a
> greatly diminished risk of a big move the other way. I know of no
> other trade criteria that I am really interested in when it comes to
> speculation (as opposed to an investment). ^_-
>
> (By the way, the actual signals came from the individual issues,
none
> of which had an inside day on Monday like the ^225 itself did,
albeit
> with a poor close. You have these stocks, courtesy of my weekly
> updates; take a look at 8601 and 8604 and 8306 8307 and 8403 -- to
> name five -- to compare *their* action Monday with the action of the
> index itself. You will see the market told its tale not so much in
> the index, but in some of the important components -- banks are
> weighted very heavily in Tokyo.)
>
> And, take a look at the rise line (rest of the week) that followed
> those collapses on Tuesday in *every* case. If this isn't just
> begging for collapse resumption, I never saw anything that was.
This
> is basic, really basic, swing trader stuff. You grab that short
> windfall, then you WAIT, very patiently, for a re-entry off the
> bounce (a real gambler, which I don't consider myself to be, would
> have re-shorted on Thursday or Friday). But another entry short is
> likely, and probably this Monday, although I will want to see the
> follow through, if any, after what is sure to be a rather ugly open.
>
> DT> As for the [ambiguous] H&S, it is out of any statistics the last
> DT> months, even if it is fully formatted... All my !!!!!!! if you
> DT> "saw" and trade the last leg before the formation !!!!
>
> For me, H&S was an easy expectation after 10/24. (Note: A well
> formed H&S was certainly NOT visible 6 bars ago. But the
expectation
> that one might develop was there since 10/24.) It was only an
> expectation until last week, but it did play out exactly as I
> expected, and since I played the market that way, it was great. I
> did expect it had a good chance of developing, and here it is.
> Sometimes I get them right, believe me. I also miss my share, too,
of
> course.
>
> But, to wit:
>
> Have a look at ^225 volume over the past 3 months. It is a
screaming
> *classic* potential H&S setup. The left shoulder (up to the
> September high) is on huge volume, particularly compared to seasonal
> volumes and volumes of only several months earlier. These were the
> same volumes that could only *scream* long in late spring and early
> summer. If one did not see these volumes beginning in June, and get
> on the train, one belongs in a mutual fund, IMO, or in the bond
> market as a coupon clipper. This is as basic as it gets, and if one
> missed this run up on the long side, well, it's back to a serious
> re-read of Edwards and Magee, maybe with a written test at the end.
> ^^_^^
>
> Now, take a look at the "head" (October high). Volume is distinctly
> less on the peak than *either* of the bursts of volume that comprise
> the left shoulder. A H&S is certainly not a done deal at that
point,
> but that collapse on 10/24 was a fire alarm, my good friend. The
> sprinkler system triggered that day (we talked about that day on
this
> board, remember?), and I started looking for places where fires
might
> be inclined to start. I don't think it's a leap of the imagination
> to surmise that A) the market is still full of believers, so B) we
> might get a bounce right back up off this big down draft, and C)
that
> down draft itself might be a sign of fatigue on the long side, and
> the subsequent bounce high might be a trap for longs. Does that
seem
> too difficult to imagine?
>
> Now that the right shoulder has formed, have a look at the volume
> there. It's pathetic in comparison to both left shoulder and head.
> Not once in the run up of the right shoulder has volume even
> *touched* the 50-day SMA. In fact, starting on about 10/24 --
> there's that date again -- the 50-day SMA of volume has gone into a
> decline, the most noticeable decline of volume in many, many months.
> Quite simply, 11/4 & 11/5 look like exhaustion highs to me, and the
> formation is now eloquent in both its clarity and classic design --
> so there. ^_^
>
> In any case, 10/24 definitely brought a potential H&S into my mind,
> and I was looking for the formation to complete, I traded it that
> way, and it has. I doubt if I'm the only one to have done so.
>
> Thank you for saying it was a good call. Sometimes I manage to get
> them right. ^^_^^
>
> Can this neckline hold? Of course. I don't think it will, but it
> sure might. But we are going to have to get some serious volume
back
> in here. And foreigners became net *sellers* in Tokyo last week for
> the first week since Dylan went electric (sorry, you young guys just
> probably won't get that one). ^^_^^ Somebody besides me sees the
> forest for the trees, I think.
>
> Best,
>
> Yuki
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