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Al,
Thanks for your post, and the quote, which I haven't seen put so succinctly
before. Especially the last phrase. I reckon that's the holy grail!
" Mark Douglas and Bob Koppel have repeatedly preached that you don't know,
you
will never know, and you don't need to know."
I am trading stocks privately from the bush in the land of Oz, and enjoy
mining the nuggets off this list because there are so many different inputs.
For three years I have been trying to achieve emotionless trading. I'm
getting better, but the dollars still hurt a bit as they leave.
I recently read an interesting study which the list might like to know
about. In a long out-of-print book called "Too much invested to quit" by
Allan Teger, Pergammon Press 1980 (not worth buying, its a thesis on the
escalation of conflict) the authors looked at decision making during
auctions for a $ prize where the winner takes the profit, and the loser
loses their stake (sound familiar?). They found 3 distinct phases to the
participants approach. First the participant tried to make a profit. When
the bid passed the prize value, a profit was impossible and a new strategy
of regaining past losses takes over. If losses are not regained then (when
about half the remaining funds are left) economic considerations become less
important and a competitive goal of beating the opponent takes over - even
to the extent of bankruptcy.
Key finding was the apparent need to reject actions which became
meaningless - we would rather re-define a situation than accept that we were
wrong. And go bust doing it. The authors found that those participants
who had a plan didn't go bust, because they could define their losses in
terms of their plan, rather than the existing situation.
They extended the study to different situations, and the same behaviour
repeated itself. Trading doesn't seem so different.
Regards,
Chris
-----Original Message-----
From: owner-metastock@xxxxxxxxxxxxx
[mailto:owner-metastock@xxxxxxxxxxxxx]On Behalf Of Al Taglavore
Sent: Tuesday, 1 September 1998 5:14
To: metastock@xxxxxxxxxxxxx
Subject: Re: commodity traders
Steve, I sent the post with tongue-in-cheek (check the hour..I think you
and I are the only ones on this list up at this hour).
To answer your question, however, I have been taught to sell new lows and
buy new highs. Views on the grains? I have no views. I would be glad to
share with the list my views on the direction of the DMark and TBond as you
have asked, but again, I have no views. Not trying to be a smart-ass, but,
as I have stated in previous posts, I try very hard to have no bias: just
trade the markets I follow. I do understand the postion you are in:
advising clients, and that is a heavy responsibility.
Understand my position. I am like a baseball player in a game where there
are no called strikes. I can sit back and select my position. I can go
days without a position. I do not account to anyone. Very few can predict
a market as poorly as I can. Larry Connors ("Street Smarts") went at
length to explain that if you have a bias, you can miss the move. Mark
Douglas and Bob Koppel have repeatedly preached that you don't know, you
will never know, and you don't need to know.
I am slow, and it has taken me two years to understand what they were
teaching. In the last year, I have had one of my most profitable trading
years because I realize that I will never know what the next tick will be,
or when the trend changes. I just try to react to whatever the market is
doing; I take my profits too quick. Bill Williams stated many times that
we trade our mind, not the market.
I do not make a great deal of posts to this List because I understand that
my views of TA are not the same as most others. But I do glean some very
good ideas from many of the posts. Particularly enjoy your posts along
with Richard, John, Harvey and Rick, among others.
Al Taglavore
----------
> From: Steve Karnish <kernish@xxxxxxxxxxxx>
> To: metastock@xxxxxxxxxxxxx
> Subject: Re: commodity traders
> Date: Monday, August 31, 1998 8:44 AM
Steve Karnish wrote:
Snip-snip-snip
... Are you suggesting a short position here? I'd love to here your
> views on the grains. The grains will bottom in the immediate
> future (this week, September, October). ...
>
> Al, I gather from previous post that you trade the D-Mark, long
> bonds, Euro's. Can you share with the list your views on the
> direction of these markets?
>
> Trading in Idaho (long the Mark and Bonds),
Steve Karnish
> CCT
Snip-snip-snip
> > From: Al Taglavore <altag@xxxxxxxxxxxx>
> > To: metastock@xxxxxxxxxxxxx
> > Subject: Re: commodity traders
> > Date: Monday, August 31, 1998 12:45 AM
> >
> > Aren't we supposed to sell new lows, buy new highs? "The trend
> is your
> > friend" (until it ends)
> >
> > Al Taglavore
> >
> > snip-snip-snip...
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