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Trying to approach selling short as if it were somehow a
different animal denies the reality that TA is valid
regardless of trend. That is, your formulas work in inverse
as well as otherwise. The problem in applying it to the
stock market, is that this market has a bull bias overall,
and bear markets tend to be shorter in duration to the
overall historical trend. If you want to learn to trade in
either direction, start studying books on TA as applied to
trading futures. Futures traders have no such built in
bullish bias. They would never think of attacking the
short side as if it were a different subject requiring
another set of TA books from those they learned buy
strategies from.
What you'll learn from the experience of trading futures is
that the definition of a trend is compressed. A bear trend
in the S&P futures market, due to its inherint leverage, has
much more narrow parameters than what you formally
considered as minimum requirements in equities themselves.
Caution: drink deep in study and paper trading before
jumping into the short side of trading equities or S&P
futures. Your experience trading stocks does not make you
automatically experienced in trading S&P stock futures. In
fact, it may initially set you up to fail. Instead, apply
your TA techniques to such futures as Cocoa, Sugar, Corn,
etc, where the contract size and volatility might be a
little more manageable.
Scheier
Wayne Fugitt wrote:
> Evening Nicholas,
>
> I've noticed recently that many seemingly good TA buy
> signals in this bear
>
>> market are turning out to be false positives --- prices
>> don't turn up, just
>> barely hesitate before heading down to the next lower
>> plateau.
>
>
> True, I have seem some things I don't believe either.
>
>
>> Hmmmm. Throw out the TA for now?
>
>
> Seems it is about time for selling short.
>
> Could you or someone recommend a book that is devoted
> entirely to selling short?
>
> Wayne
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