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Depending on the flexibility of your company's 401k, Adam, you may be able
to purchase the Rydex Ursa fund (shorts the S&P at a volatility ratio
of 1:1), or the Profund Ultra Short OTC (shorts the Nasdaq at 2:1).
Otherwise, you can only go to cash if you're still bearish from these levels.
Good luck with your decisions...
<p>Scheier
<p>vonhef wrote:
<blockquote TYPE=CITE> <font face="Arial"><font size=-1> Mark,</font></font><font face="Arial"><font size=-1>
You always have good and practical things to share.......thanks!
I like the way you define "signal" and "trigger"....and you are correct</font></font><font face="Arial"><font size=-1>that
I analyze the S&P rather than trade it, this is because my main involvement
in the S&P is long term (401K stuff), and for this</font></font><font face="Arial"><font size=-1>reason
I have been out of it since late August (I cant short my 401k). Naturally
I am looking for a good place to enter back into the</font></font><font face="Arial"><font size=-1>market
(I will enter when the trend proves itself up. ).</font></font><font face="Arial"><font size=-1>
As for triggers, I have been using entry methods based on monthly contracts
in the grains (also using pit prices thanks to you).</font></font><font face="Arial"><font size=-1>I
am getting more comfortable with the method based on the "Bands", but since
it is partially subjective (cant seem to find that elusive</font></font><font face="Arial"><font size=-1>mechanical
system <g>) I will wait until further testing before I use real money.
I just expressed this using the S&P since most of the</font></font><font face="Arial"><font size=-1>markets
discussed on the list seem to be stock related, but now that Steve is posting
some of his commodity trades, I may start</font></font><font face="Arial"><font size=-1>posting
some grain trades (anyone interested?).</font></font> <font face="Arial"><font size=-1> As
always, I appreciate the tutorial.</font></font> <font face="Arial"><font size=-1>
Adam Hefner</font></font>
<div style="FONT: 10pt arial">----- Original Message -----
<div style="BACKGROUND: #e4e4e4; font-color: black"><b>From:</b> scheier</div>
<b>To:</b> metastock@xxxxxxxxxxxxx<b>Sent:</b>
Saturday, October 16, 1999 4:51 PM<b>Subject:</b> Re: S&P500</div>
Hello Adam!
<p>Enjoyed the charts. Am reminded when reading your posts
on the difference between analysis and trading. It's seems
the conclusions I've come to about this are best translated into what I
think is the difference between a signal and a trigger. A signal
may tell me things about the bigger picture that might give me comfort
to the trade, or provide further background, but it might not be the best
place to take a position. On the other hand, the snap back
reversal of 4 days ago in the s&p (which your charts don't show because
they incorporate all session pricing as opposed to pit-session only), was
a gimmie for me as a trade trigger. It wasn't till it broke
into a new low that this highly profitable trade confirmed my suspicions
about the bigger trend. But if I needed those confirmations
to have taken the trade before hand, I never would have been short.
Now that this low and support point has been taken out, I'm on alert to
a reversal. And this despite the Signals are all saying the
trend is now more clearly down.
<p>It's not that break downs from h&s necklines can't work as triggers
too, but I'd hate to be risking real equity to find out so late in the
trade.
<p>And thanks for reminding me of Murphy's rules regarding validation of
this kind of break out. That will surely help us all, whether
just getting in, or trying to decide whether to cover and run.
<p>One more note regarding the same subject: I also find that
using the continuation charts helps me get the big picture thing, but I'd
never trust making trade decisions off them. In other words,
if the signal is not in the current contract I'm trading, I find it a risky
stretch of faith to rationalize the trade by what I see in the continuous
contract.
<p>An interesting example that caution can be seen between the March Sugar
contract and the Sugar continuation chart. It's tempting to
be selling the "break" of a neckline in the continuation chart, but the
corrective nature of the current sugar decline in the March contract
suggests the short trade has little life left in it and could culminate
in a rapid reversal to new contract highs after such a breakdown.
In other words, the break might be only good for a day trade in the March
contract, even though such a break in the continuous contract suggests
much bigger things below.
<p>Scheier
<br>
<p>vonhef wrote:
<blockquote TYPE="CITE"><style></style>
<font face="Arial"><font size=-1>Well,
as most of you have probably noticed, the S&P 500 has dropped below
the neck-line.In the classic technical analysis this is a very bearish
signal. My long term trend has alsoturned down today......this is the first
time since October of 98.As always....comments welcome.
Adam Hefner</font></font></blockquote>
</blockquote>
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</x-html>From ???@??? Mon Oct 18 06:10:35 1999
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From: "Jeff" <jcob3@xxxxxxxxxxx>
To: <metastock@xxxxxxxxxxxxx>
Subject: Re: Elliot Wave POV on MU
Date: Mon, 18 Oct 1999 05:26:08 -0400
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Lenny:
Thanks for the explanation. Most informative and interesting.
GT
Jeff
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