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Before a contract goes under the gun, i.e., is in the delivery month,
most speculators I have known are out, either flat or rolled over to a
succeeding delivery. Trading under the gun is, or can be, among the
most dangerous plays in an already dangerous business.
Jim Allen
Mark Brown wrote:
>
> People are the price action of a market. What is the sane thinking that is
> the mean of a market? Well, I can tell you what its not. It's not the tail
> end of a contract expiration. I would hate for my system to be at the
> apparent mercy of a bunch of desperate rookies who are working for some
> company as a hedge trader. That is precisely what you are doing if you use
> a price series that is not perpetual blended. You are trading a false
> cyclical, panic attack at the end of each contract. Then you are trying to
> make some technical sense of this and apply a system to it. How wrong?
> Come on if you want to find the true nature of a price series than you would
> want to dismiss the radical non predictive, panic stricken rush to cover
> hedge positions at the end of a commodity contract. Or would you? No if
> you have a gambler trend following method that could capitalize on such
> false volatility then fine. Just remember thought you may also be on the
> opposite side of the trade one day and then there will be a pay back.
>
> Mark Brown
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