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Neil,
One thing I keep an eye on at all times is the 20 period exponential
average of true range on my 5 min bar. In "normal conditions" this is
about 150 points, 250 is a pretty busy market, yesterday it got up to 450
points. To me this kind of volatility is too much because it puts my stops
too far away from the entry point which automatically stops me trading.
Also keep an eye on the bid ask spread. If it is too wide then don't
trade.
rgds
Philip
----------
> From: Neil Harrington <njhprovo@xxxxxxxxxx>
> To: 'Timothy Morge' <tmorge@xxxxxxxxxxxxxxx>; 'The Funkhousers'
<l-funkho@xxxxxxxxxxxxxxxxxxxx>
> Cc: Nchrisc@xxxxxxx; omega-list@xxxxxxxxxx
> Subject: RE: CME Class Action
> Date: 28 August 1998 06:14
>
> Tim,
>
> Good comments from you, as usual. Thanks. I have some questions about
some
> of your comments below...
>
> | -----Original Message-----
> | From: Timothy Morge [mailto:tmorge@xxxxxxxxxxxxxxx]
> | Sent: Thursday, August 27, 1998 8:41 PM
> | To: The Funkhousers
> | Cc: Nchrisc@xxxxxxx; omega-list@xxxxxxxxxx
> | Subject: Re: CME Class Action
> |
> | <SNIP>
>
> | And the
> | guys that want to
> | trade every day can't just make the wise decision to just
> | not trade today.
> <SNIP>
> | At least we, as off-floor traders can look and say: No
> | thanks. Not today. Too
> | crazy.
> |
>
> How and when do you decide the market is too crazy and to not trade
today?
> What I am inferring from your comments is that you watch the market for x
> period of time, see something that looks crazy in your trading time frame
> (ATR too large, etc.), then decide not to trade "today". Please elaborate
on
> this...
>
> | <SNIP>
>
> | So, my advice, for what it's worth, is to take some personal
> | responsibility for
> | making the decisions you made today: You chose to trade in
> | 'the market from
> | hell,' you traded against the trend and against the
> | volatilty, and your backups
> | were not adequate.
>
>
> Similarly, how and when during the day do you decide this is a market
from
> hell, and thus decide not to trade today.
>
> <SNIP>
>
> But
> | don't forget to evaluate your own part in this: Did you do
> | your job today?
>
> In essense, as an experienced day trader, how would you advise people to
> evaluate whether or not to trade on a given day. You may have deeper
pockets
> than many on the list, so please couch your reply in terms of an account
> that trades 1 contract.
>
> Thanks again for your comments and any insights you might give by
replying
> to this message.
>
> Neil
>
> |
> | Best,
> |
> | Tim Morge
> |
|