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>we seem to be arguing over semantics
>of what a technical indicator is, as opposed to "tape reading" being
>something separate and apart from technical analysis.
>
>I sense a great learning opportunity for me and hopefully many others on
>this list, so I hope you can respond in good detail to my question and
>comments.
>
>Thanks for any insights,
>
>Neil
Dear Neil
This may not be wholly the answer you want, but... as you may recall, in
August you asked to be put on my list of people who wanted to be told when
the manual I was writing was ready and your "learning opportunity" is, I
hope in and amongst those 200 odd pages.
You see, the manual is all about reading the tape. Now, what I call
reading the tape and what someone else calls reading the tape may be two
different things - but I hope not. I think of it as following the price
action against a particular set of parameters and being able to act and
react to what this price action does, in certain circumstances. For me, by
definition, this means having the right information to hand, at the start of
each day, and through previous analysis and by recognising certain price
patterns and movements when they happen, at particular moments in time,
being able to profit from them. Sounds easy doesn't it?!!
Funnily enough, it really is not that difficult, once you understand what
all the parameters are and one very prime parameter is the actual instrument
itself. The sheer size and liquidity of the T-Bonds has a vital part to
play. The behaviour of this enormous crowd, as reflected in the manner in
which the market moves is crucial for me. In fact, if it were not for the
vast size of this market, I would not want to put all in a manual for public
consumption, but because it is so big, it just doesn't matter. In any case,
no two people are going to read the tape in precisely the same way, at
exactly the same moment, so that when anyone goes to the market to place an
order, that order is not going to affect anyone else. Furthermore there is
always someone on the other side to take your position. That is what is so
lovely about it.
The only reason I don't use the common indicators is because I don't think
any of them work. For me they lag and I cannot afford to be behind the
market. If I were position trading I might be able to afford to lag the
market (in fact, I would jolly well have to afford to, or not do it!) and
not worry, because it is all going to happen eventually, according to the
indicator in which I must have complete faith. The road that is pave with
indicators and systems is meant to lead to the Holy Grail, but you see I
think that is a mirage...
I prefer to have complete faith in me reading the tape correctly more times
than not, on a short time frame (within a day) and making more money when
right than losing when wrong. I like to sleep nights and merely use the
markets overnight moves as part of my analysis for the next day. For me it
is a gamble to wake up rich or poor - and I don't like gambling. I like to
wake up and become rich and not poor, by doing what the tape says I should
do
And the tape is more reliable than an indicator. I have collected over a
100 indicators and none of them do anything to tell me what to do, but they
all tell me what I should have done. Personally, I cannot put bread on the
table, each day, that way. Now I know that what I do is jolly hard work -
but it is all from home, with no employer, no being ordered around, no
travelling in the rush hour, no lots of other things. It is an easy
living - if you can do it. That is why I have called the manual "A Hard Way
to make an Easy Living"
Go to www.dbceuro.com (got it right this time, I hope!) and follow links to
T-Bonds. If you can get to good old London town on Guy Fawkes night (5th
Nov) I'll buy you a drink after the seminar - if you don't buy me one first!
Best wishes
Bill Eykyn
PS The manual is at the printers and I am currently sorting out the FedEx
prices, etc.to the States and elsewhere. Airmail is decidedly cheaper, but
much longer. You pays your money...
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