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Hi A.J.-
Looks like you're on the right track. I've found that a computer is best
used as a device to do all your number crunching and charting, while your
experience (intuition) will tell you the right TIME to buy and sell.
Some guys like to buy into strength, etc. I personally like to buy selling
panics and short buying panics. (sometimes with the main trend and
sometimes looking for a new main trend to begin) As someone once
said...you get paid for sticking your hand into the fire and taking on
risk. I used to think that most guys went broke by counter trend
trading...BUT have personally found that the risk is lower when entering a
panicked market and looking for a rebound (with the chance of a new trend
starting and holding on for the move) BTW, for example, you will see
these mini panics occur several times a day in the S&P in both
directions....or in any time frame in all markets.
>From a bull point of view:
A few things can happen when buying a panic: (on any time frame)
1) It can keep going and you get stopped out immediately.
2) It can rebound after entering, and you can sell out near break-even if
it then turns against you (The most likely event if you picked a decent
panic spot)
3) OR, it can be a climax point for a tremendous rally and you then handle
it like any other good trade/trend.
I personally find more risk in buying a market that has already turned and
requires a really wide stop to give it room.
After all, when buying/selling a panic, we are paid to provide liquidity to
the market as speculators...and it's the hardest thing to do at the
time...so it must be correct.
However, I know many are successful buying volatility breakouts and using
"Turtle" techniques, too...I just find it a higher risk with my own psych
makeup.
Good luck -
Tom Cathey
> > Take a look at the super stars of the industry. If you can make just
15-20%
> > per YEAR trading commodities, you are on a pedestal and will attract
more
> > money than position limits will allow. Do you think an optimized
program
> > (the easy way) is the answer?
>
> Wow! I'm glad I don't trade commodities, if this is what the "super
stars" are
> doing. However, I suspect that there are many good traders who do much
better
> than this in these markets.
>
> As far as the vendor thing goes, I'd be very wary here as well - first,
if the
> system was *that* good, they wouldn't be selling it. Second, you I'd be
very
> skeptical of such canned results.
>
> Regards,
> A.J.
>
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