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----- Original Message -----
From: Bob Jagow <bjagow@xxxxxxx>
To: <metastock@xxxxxxxxxxxxx>
Sent: Wednesday, April 26, 2000 8:36 PM
Subject: RE: KW0K/KW0N
> Ever traded one?
> <<I have about 700-800 2 week to 2 month spreads that I follow.>>
>
> -----Original Message-----
> From: owner-metastock@xxxxxxxxxxxxx
> [mailto:owner-metastock@xxxxxxxxxxxxx]On Behalf Of Walter Lake
> Sent: Wednesday, April 26, 2000 6:46 PM
> To: metastock@xxxxxxxxxxxxx
> Subject: Re: KW0K/KW0N
>
>
> Hi Scheier
>
> Thanks for your email. I think that you might find the Future's Mag
article
> interesting because it tries to find out who is liquefying the individual
> markets. ...
>
> i.e., where are this "large chunks" of money are going to come from that
you
> and the Funds etc. want to take out of the market.
>
> My interest is spreads. I have about 700-800 2 week to 2 month spreads
that
> I follow. So they are naturally longer term positions. Whether your
interest
> is options or spreads or naked contracts, I feel that you still have to do
> ALL of the leg work.
>
> One of the spread guru's talked about having different forms of analysis
> going in your direction. I've always liked that idea ... that's why I've
> moved away from a reliance on TA.
>
> Best regards
>
> Walter
>
> PS to others that wrote:
>
> "... instinctive recognition ..." is usually associated with "detective"
> skills, i.e., spotting what's wrong with the chart or trade. More in line
> with "the glass being half empty" rather than the other way around.
Negative
> pattern recognition is very difficult to back test. It's far easier to
state
> it positively and then back test that. This type of analysis is difficult
if
> you are used to MS's price bars stopping at the current bar (time).
Studies
> re what time and distance movement are required to achieve a MA cross are
> far more helpful.
>
>
>
> ----- Original Message -----
> From: "scheier" <scheier@xxxxxxxxx>
> To: <metastock@xxxxxxxxxxxxx>
> Sent: Wednesday, April 26, 2000 4:54 PM
> Subject: Re: KW0K/KW0N
>
>
> | Walter Lake wrote:
> |
> | > .........This simplified explanation is how I understand the COT
> positions.
> | > Maybe you
> | > could explain some more about how to think about how to trade against
> | > (contrarian maybe) hedging strategies Steve.
> | >
> | > Commercials are positioned for a longer time frame.
> | >
> |
> | That's pretty much my point, Walter. That the usefulness for these
> figures is
> | very limited for short term trading. It's not how you analyze the COT
> report to
> | crack its code, but whether you consider this report at all for a trade
> that is
> | based on a short term bar chart pattern (using my system), or a short
term
> swing
> | cycle extreme (using Steve's). If I needed to predict the market in
> order to
> | trade--something I avoid like the plague--then I'd surely want to know
> what the
> | commercials are doing. But from my point of view, that's the stuff of
> | newsletters and analysts. Commodities are so leveraged that I can make
a
> | profit in two to five days in what might be a countertrend trade for
you,
> but is
> | a tradeable short term trend for me. For this, I haven't found the
> commercials
> | of much use. I know Larry Williams would disagree with that, but Larry
> is
> | always looking for reversals to catch the big moves. I find this
> hazardous and
> | it chews up my account.
> |
> | Here I clearly don't mean to denegrate the use of commercials for longer
> term
> | position trading, but instead, I simply want to compare the usefulness
of
> the
> | tool with the time frame of the trader's system. Yours is obviously
> longer
> | term and these considerations are probably critical. Adam's P&L, for
> | instance, is almost a day trading system, short term trading at the very
> least,
> | and he could therefore find a whole series of trades that are profitable
> but run
> | counter to commercial and/or fund positioning without ever even having
to
> | consider them.
> |
> | Or maybe I've just been lucky. <g> All the best......
> |
> | scheier
> |
> | >
> | > Best regards
> | >
> | > Walter
> | >
> | > PS: For others who wrote here's an end-on look at the last 30 years of
> SK
> | > front months. It'll give you an idea of how flat they are and cheap Vs
> dear.
> | > You can do the same with the spreads. Seasonalities are different. If
> you
> | > don't like using Demetra then you can use "P" values for the dailies.
> | >
> | > ----- Original Message -----
> | > From: "scheier" <scheier@xxxxxxxxx>
> | > To: <metastock@xxxxxxxxxxxxx>
> | > Sent: Wednesday, April 26, 2000 9:55 AM
> | > Subject: Re: KW0K/KW0N
> | >
> | > | The question I guess is whether you should ever buck the
> | > | commercials in the commitment of traders report as they
> | > | accumulate a position, in this case, the grains. I think you have
> | > | to consider whether your system is designed to trade short term
> | > | signals or you're a longer term trend follower. I don't see it
very
> | > | relevant for Adam's P&L techniques, and even's Steve K's
> | > | oscillator signals could continue to give accurate calls for short
> | > | term cycles while the commercials continue to accumulate.
> | > | My experience with the commercials is that they accumulate a
> | > | long position often well before the bottom has arrived, and even
> | >
> | > --------------------------------------------------------------------
> | > Name: SxxK_FrontMonth.gif
> | > SxxK_FrontMonth.gif Type: GIF Image (image/gif)
> | > Encoding: base64
> |
>
>
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