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Adam,
"Thin" is just adjective to describe a market (securities or
futures) that doesn't develop a "robust" volume. When free
markets trade with a healthy participation, prices tend to move
"smoothly" from period to period (although they can be
volatile). "Thin" markets (lack of volume), have a tendency to
"jump" around do to the nature the exchange of supply and
demand. Common sense dictates that a "fairer" price will
develop with more individuals bidding and more individuals
offering goods at various levels. (Would you rather have 20
people bidding on the house you have to sell or would you prefer
to have to pick from 2 offers?).
Moving to the bottom line: the math, that most of us use to
predict/monitor the markets, has a tendency to perform better
with a "fair" exchange of goods. "Thin" markets can be very
"choppy" markets. I love volatility, hate choppiness. Volume
can be determined by monitoring issues in the WSJ or any data
service providers.
I like my markets "phat",
Steve Karnish
CCT
----------
> From: Von Hef <VonHef@xxxxxxxxxx>
> To: metastock@xxxxxxxxxxxxx
> Subject: Re: Market discussion
> Date: Sunday, August 16, 1998 6:17 AM
>
> I appreciate everyone's stories, could you explain what you
and Guy
> mean with the term "Thin Market" and how you technically
determine
> if a market is "thin"?
> Thanks,
> Adam Hefner
>
> -----Original Message-----
> From: Steve Karnish <kernish@xxxxxxxxxxxx>
> To: metastock@xxxxxxxxxxxxx <metastock@xxxxxxxxxxxxx>
> Date: Saturday, August 15, 1998 10:21 PM
> Subject: Re: Market discussion
>
>
> >Guy,
> >
> >
> >When I first started trading, I developed a little moving
> >average oscillator and applied it to the cocoa market. I
> >watched as it posted 10 or 11 profitable trades in a row and
> >jumped in thinking I'd soon make "a pile" and retire. It
> >chugged along for about a week or so executing it's stop and
> >reverse signals. About two weeks had passed and my $3,000
> >investment had grown to over $18,000. I thought I was God's
> >gift to technical analysis. I was in a long position when
the
> >market went limit against me and continued posting limit
moves
> >for days afterwards. I escaped with a small loss and a big
> >lesson on "thin markets" and "large egos".
> >
> > As Al alluded to in an earlier post: "we need to learn that
we
> >will never know" (I think that's what he said). When I
stopped
> >thinking I had all the answers (during young and dumb "daze")
> >and realized I hardly knew anything (and still don't), things
> >got a lot easier. I'm still trying to figure out how the
grains
> >are going to go up with world currencies going in the toilet.
> >Being an ex Motor City boy, I hope you noticed that giant
move
> >off the bottom that the Canadian dollar posted last week. I
> >hear that Windsor casinos have been giving $150 Canadian in
> >exchange to $100 US for months. Looks like the market caught
up
> >with their promotional idea since last April.
> >
> >Steve Karnish
> >CCT
> >----------
> >> From: Guy Tann <grtann@xxxxxxxxxxx>
> >> To: metastock@xxxxxxxxxxxxx
> >> Subject: RE: Market discussion
> >> Date: Saturday, August 15, 1998 5:00 PM
> >>
> >> Steve
> >>
> >> You're right about that long term definition. Short term
is
> >when we get out
> >> on the close, medium term is when we exit the next morning
and
> >long term is
> >> EOD the next day, or maybe later :).
> >>
> >> I once took an unbelievable bath in Wheat in the 1950s, I
> >think. Maybe the
> >> early 60s. Wheat was right at its support level
(government
> >support price),
> >> so I rationalized that here was a price the government
would
> >pay for the
> >> stuff, why would it drop below that number. Looked like
> >limited risk to me
> >> :) . Bought 50,000 bushels and watched it drop like a
stone
> >right through
> >> the support price. Costly lesson for either a teenager or
> >someone in his
> >> early 20s.
> >>
> >> That reminds me of the 8 limit days down against me in
> >Bellies. That one
> >> taught me never to trade thin markets :) .
> >>
> >> Why do these lessons have to be so expensive???
> >>
> >> Regards
> >>
> >> Guy
> >>
> >>
> >> -----Original Message-----
> >> From: owner-metastock@xxxxxxxxxxxxx
> >[mailto:owner-metastock@xxxxxxxxxxxxx]
> >> On Behalf Of Steve Karnish
> >> Sent: Friday, August 14, 1998 6:07 PM
> >> To: metastock@xxxxxxxxxxxxx
> >> Subject: Re: Market discussion
> >>
> >> Guy,
> >>
> >> I agree with your European negative fundamentals. Every
day
> >we
> >> gather more evidence. Today, the markets seemed to be
> >> anticipating some very negative news over the weekend. Buy
> >the
> >> rumor (bonds and dollars) and sell the rumor (currencies
and
> >> equities). Those individuals holding short positions in
the
> >> D-Mark and DJU/SPU could benefit during the next 48 hours.
> >> International Monetary Socialism is failing.
> >>
> >> I still like corn and wheat for the long term (although my
> >> technical approach alternates from long to short and back
> >> again...I've traded wheat 45 times this year). I usually
get
> >in
> >> trouble when I analyze things long term. As a commodity
> >trader,
> >> I've always told people that long term is overnight.
> >>
> >> Steve Karnish
> >> CCT
> >>
> >> ----------
> >> > From: Guy Tann <grtann@xxxxxxxxxxx>
> >> > To: metastock@xxxxxxxxxxxxx
> >> > Subject: RE: Market discussion
> >> > Date: Friday, August 14, 1998 3:21 PM
> >> >
> >> > Steve
> >> >
> >> > I guess I'm not the only one who remembers 1955 in
Michigan.
> >> The year I
> >> > graduated High School and started at the Univ. of
Michigan.
> >> >
> >> > And while I agree with a lot of your comments, there are
a
> >> couple of
> >> > negative fundamentals that might enter the equation.
With
> >the
> >> Asian flu,
> >> > Russia taking a dump, the potential for this to push
Europe
> >> into a
> >> > recession, your one missing element is demand. Granted
> >people
> >> have to eat,
> >> > but do they have the money to buy corn to feed to animals
> >and
> >> then eat meat
> >> > or do they stay with basic food stuffs in bad times?
> >> >
> >> > Guy
> >> >
> >> >
> >> > -----Original Message-----
> >> > From: owner-metastock@xxxxxxxxxxxxx
> >> [mailto:owner-metastock@xxxxxxxxxxxxx]
> >> > On Behalf Of Steve Karnish
> >> > Sent: Friday, August 14, 1998 9:29 AM
> >> > To: metastock@xxxxxxxxxxxxx
> >> > Subject: Re: Market discussion
> >> >
> >> > Dick,
> >> >
> >> > Since I started something and you offered an opinion on
> >> > grains...I'd like to make a case for a bottom in corn:
> >> >
> >> > 1. "Funky-mentals": big crop, crummy exports, limited
> >> storage,
> >> > large carry over, and my mother-in-law saying it's going
to
> >> > $1.65.
> >> > Analysis: When your inlaws say go short...bet the farm.
> >> >
> >> > 2. "Cycles": We don't ever discuss cycles in this
forum.
> >> (If
> >> > people want some interesting reading they can contact the
> >> > Institute for Cyclical Research in Pittsburgh, PA.) Corn
> >has
> >> a
> >> > dominate 63 month cycle and a secondary 50 month cycle.
The
> >> > last time these two cycles coincided was in 1977. Check
out
> >> the
> >> > charts and note the 3+ year rally that corn put together
> >after
> >> > the cycle low. The next time these two cycles "come
> >together"
> >> > is September 1998.
> >> > Analysis: Earthquakes and high tides are more abundant
when
> >> the
> >> > planets line up in conjunction (just a bunch of big old
> >> cycles).
> >> > Always be aware of cycles and take notice when
amplitudes
> >> pile
> >> > up on one another.
> >> >
> >> > 2a. "Sunspots": Boy, I'm going to catch some flack for
> >> > bringing in the weather into this discussion.
But.......,
> >In
> >> > 1976, I was conducting hedging seminars with Michigan
State
> >> > University and one of the professors (Black) had just
> >> completed
> >> > a correlation of sunspots to corn price/production
report.
> >> The
> >> > given is that every 22 years there is a peak in sunspot
> >> > activity. The last two times this occurred was 1977 and
> >1955.
> >> > I'm old enough to have lived through and remember both
> >> summers.
> >> > 1955 is still the hottest summer I recall during my 30
years
> >> in
> >> > Michigan and in 1977, I was living in Denver and they had
> >over
> >> > 50 days of 90+ degrees (unheard of for the area). 1999
is
> >> > another peak year.
> >> > Analysis: Mama told me not to look into the sun, but I
> >said:
> >> > Mama, that's where the fun is. Rain makes grain, drought
> >> makes
> >> > money (if you're long).
> >> >
> >> > 3. "The techs": Near term: MFI hooking down and
seeking
> >> > another bottom; Chande MO setting up for additional
> >> divergence;
> >> > RSI seeking support; Fast Sto headed down for another
> >bottom;
> >> %
> >> > of R on support; MACD(dema) is low, but posted a "nasty"
> >down
> >> > hook Long term: When the "near term" indicators turn
on
> >> > support, (one or two weeks) this could be one of those
"buys
> >> of
> >> > the millenium".
> >> > Analysis: When different indicators, (founded in
different
> >> > math), make a coincidental bottoms ...you have a powerful
> >buy
> >> > signal.
> >> >
> >> > Opportunities to participate in absolute tops and
absolute
> >> > bottoms only roll in every couple of years. This just
> >happens
> >> > to be a time in history when there are multiple choices
> >among
> >> > basic raw materials that are making 'bargain basement"
lows.
> >> > Crude oil, certain currencies, the grains, and the metals
> >will
> >> > all be higher when inflation visits us again (remember
> >> > inflation?). Take advantage of these bottoms to position
> >long
> >> > positions.
> >> >
> >> > Steve Karnish
> >> > CCT
> >> >
> >> > ----------
> >> > > From: Dick Simmons <simmons@xxxxxxxxxxxxxxx>
> >> > > To: metastock@xxxxxxxxxxxxx
> >> > > Subject: Re: Market discussion
> >> > > Date: Sunday, August 09, 1998 6:39 PM
> >> > >
> >> > > Hi all,
> >> > > There should be more posts like this. I am sure that we
> >> would
> >> > get more out
> >> > > of this subject than some of the other discussions -
lets
> >> keep
> >> > this one
> >> > > going.
> >> > > Grains I feel have some way to go both in price and
time
> >> > before bottoming
> >> > > out.
> >> > > The Indexes are doing a counter trend move at the
moment
> >> > before falling a
> >> > > lot further - you can only be short in this market.
> >> > > Regards,
> >> > > Dick.
> >> > > -----Original Message-----
> >> > > From: Al Taglavore <altag@xxxxxxxxxxxx>
> >> > > To: metastock@xxxxxxxxxxxxx <metastock@xxxxxxxxxxxxx>
> >> > > Date: Saturday, 8 August 1998 3:48
> >> > > Subject: Re: WAG THE DOG
> >> > >
> >> > >
> >> > > >
> >> > > >
> >> > > >----------
> >> > > >> From: Steve Karnish <kernish@xxxxxxxxxxxx>
> >> > > >> To: MetaStock-List <metastock@xxxxxxxxxxxxx>
> >> > > >> Subject: WAG THE DOG
> >> > > >> Date: Friday, August 07, 1998 10:23 AM
> >> > > >>
> >> > > >> Steve wrote ".......snip-snip
> >> > > >
> >> > > >> Now, is anyone willing to discuss a possible bottom
in
> >> > grains, a
> >> > > >> possible top in the indices, the great volatility in
> >> cotton
> >> > and
> >> > > >> cocoa??
> >> > > >>
> >> > > >> Steve Karnish
> >> > > >> CCT
> >> > > >No, I do not have any comments as to the bottom in
> >grains,
> >> > but I would sure
> >> > > >like to read some comments about the DMark and
upcoming
> >> Euro
> >> > and the 30Y
> >> > > >TBond. Like, if the market is coming down as it has,
> >where
> >> > is the money
> >> > > >going? Bonds are not rising, gold is stagnant, the
CRB
> >is
> >> > falling, so
> >> > > >where, in anyone's opinion is the money going? Sure
> >would
> >> be
> >> > great to see
> >> > > >some posts concerning markets, trading, and making
money.
> >> > > >
> >> > > >Al Taglavore
> >> > > >
> >
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