|
PureBytes Links
Trading Reference Links
|
Not doubting that it's there, but I am having to squint hard to see a H&S
on the daily NAS Anyway, that isn't my point in replying... My question
would be, why place a bet at all until the market tips its hand? Assume for
a moment that it is a huge H&S... Why not let the pattern resolve itself
and then take a position.
For instance, if the neckline is broken, either one of two things should
happen... 1)Either the market will continue lower in which case you may
sell the break of the first bear flag that forms on either the hourly
(aggressive) or daily (a bit more conservative). 2) The market will retest
the underside of the neckline. If the market tests the underside of the
neckline, one of two things will happen. 1) Either, the test will be
successful or it will fail. A) If it is a successful test, entry triggers
placed below the market (either the lows of a prior bar just before test or
a perhaps a bear flag will have formed that you can use to trigger in
with). B) If the test fails and the market reenters the original H&S
pattern, you may buy the break of the first bull flag that sets up.
My point being, several years ago I gave up trying to figure out if a
pattern was going to hold or fold. Now, my only goal is to identify that
the pattern exists, and then have tactics in place that account for the
majority of the anticipated price behaviors. When the pattern isn't clear
(at least to me) or if the price behaviors don't conform to my preconceived
plan (maybe the first bear flag doesn't set up properly), I go look for
another trade.
The hourly bond chart provides a very good example. Note that bonds are
pegged against the top of a two week long trading range. Frankly, I think
that the market is going to fail, but I will not be short until the market
either upthrusts the trading range top and makes a reversal bar or takes
out a trigger bar below the market (currently @ 94.14 but changing
quickly). If the market does break out, I will buy the breakout of the
first bull flag that forms on the chart of one lower degree. If it breaks
out and then sets back to the breakout point, I will buy bullish thrust
from this zone (probably via a buy stop just above the high of the bar
immediately preceding the test). Point being, I always have an opinion of
what the market will do but it dosn't really impact how I trade that
market. I think I have fairly reliable methods of determining if a range
will hold or not, but I rarely take a position without confirmation through
the markets action, that my opinion is correct. (Keep in mind, that it is
a half day trading so I won't be taking the bond trade or any other trades
today, that's why I have time to write this).
Anyway, it had been awhile since I contributed anything so....... by the
way, lest I offend someone, Im not saying that having an opinion is wrong
or counter productive or that the head and shoulders isn't there or that my
method of trading is better than anyone else's, its just how I do it.
Hope all is well,
Stewart.
At 08:55 AM 5/26/00 -0500, M. Simms wrote:
>In backtesting bearish H&S patterns.....when they failed, they failed
>"big-time".....and yes, when they succeeded, the rewards were great....if
>you were short.
>
>The suspense of this market is killing me.....
>time to place your bets on the table gentlemen.
>
>> -----Original Message-----
>> From: Brian/Louise Garnant [mailto:babakid@xxxxxxxxxxx]
>> Sent: Thursday, May 25, 2000 10:48 PM
>> To: Omega-List (E-mail)
>> Subject: Re: ANOTHER QUESTION
>>
>>
>> Timeframe - ????
>>
>> Possibilities:
>>
>> 1. I could be incorrect (wrong)
>>
>> 2. The timeframes on the Nazdaq have been very accelerated,
>> beginning in Oct
>> '98. If this head and shoulders does not fail, the timeframe will also be
>> accelerated. Actual Fib retracement next that I see is 2840, and when/if
>> that should be broken there is support at 1521 and 1383, both of which are
>> 100% retracements. I am not being DOOM AND GLOOM, just what I see. I have
>> been wrong enough times in my life to fill the Grand Canyon at least once,
>> but also right enough times to fill it twice (at least! ha!!!) :)))
>>
>> 3. Scenario is partially correct, but the magnitude is off.
>>
>> 4. Head and shoulders is there but pattern will fail and will Nazdaq will
>> soon rise above 3730 level and Mr. Brian will have egg on face!!!
>>
>> At any rate, I would not be looking to go long unless I really loved the
>> company and wanted to be withy it for the long haul.
>>
>> Going short can be fun!!!
>>
>> Surf's up, I'll ride the wave tomorrow, especially if it, Naz
>> futures, open
>> up and then turn south around 10:15 EST.
>>
>> Beach Bum Brian
>>
>> The Lord will love me if I'm right or wrong. Nice to have a friend in high
>> places!!!
>>
>>
>>
>>
>>
>>
>>
>> > Care to put a time-frame on that ?
>> > You talking within 3 weeks, 3 months, 3 years ?
>> >
>> > Man, if it hits that, there'll be tons of people splattered on
>> the street.
>> >
>> > > -----Original Message-----
>> > > From: Brian/Louise Garnant [mailto:babakid@xxxxxxxxxxx]
>> > > Sent: Wednesday, May 24, 2000 9:05 PM
>> > > To: prosys@xxxxxxxxxxxxxxxx
>> > > Subject: Re: ANOTHER QUESTION
>> > >
>> > >
>> > > Actually, the support at 2800 is a Fibonacci retracement
>> level. I think
>> it
>> > > may go down to 1350 level
>> > > ----- Original Message -----
>> > > From: M. Simms <prosys@xxxxxxxxxxxxxxxx>
>> > > To: Brian/Louise Garnant <babakid@xxxxxxxxxxx>
>> > > Sent: Wednesday, May 24, 2000 9:52 AM
>> > > Subject: RE: ANOTHER QUESTION
>> > >
>> > >
>> > > > One pattern you missed: classic pennant formation - lower highs,
>> higher
>> > > lows
>> > > > formed over the past 3 weeks.
>> > > > Everything was coming to a "head".
>> > > > This always portends a major break-out....and it looks as though we
>> "got
>> > > > it".
>> > > >
>> > > > COMP 2800 sounds reasonable.....but actually there is no history of
>> > > support
>> > > > till 2500.
>> > > >
>> > > > > -----Original Message-----
>> > > > > From: Brian/Louise Garnant [mailto:babakid@xxxxxxxxxxx]
>> > > > > Sent: Tuesday, May 23, 2000 8:47 PM
>> > > > > To: [ tradergirl ]; omega-list@xxxxxxxxxx
>> > > > > Subject: ANOTHER QUESTION
>> > > > >
>> > > > >
>> > > > > That sure looks like a head and shoulders that formed and
>> > > went below the
>> > > > > neckline today on the Nazdaq, or is my imagination doing
>> > > > > doubletime? Or has
>> > > > > this been posted and I am a little short on the uptake?
>> > > > >
>> > > > > If it is a head and shoulders it is not a very good sign at this
>> > > juncture.
>> > > > > The double top at the top spanning the second week through the
>> fourth
>> > > week
>> > > > > of March was bad enough, but here and now? My next Fib
>> > > > > retracements go to a
>> > > > > 2800 even on the futures. Very good support here. Head
>> and shoulders
>> > > would
>> > > > > forbode much worse. Classic would be a further sell off, then a
>> > > > > rise back up
>> > > > > to the trendline, then, oh my, the shorts would be very
>> happy again.
>> > > > >
>> > > > > Hope I am seeing things!!! If not, I'll ride that down!
>> > > > >
>> > > > > Would like a reality check from someone.
>> > > > >
>> > > > > Thanks.
>> > > > >
>> > > > > BrianG
>> > > > >
>> > > > >
>> > > > >
>> > > >
>> > > >
>> > >
>> >
>> >
>>
>
>
>
Stewart Taylor
Taylor Fixed Income Outlook
Voice: 501-219-9774
Fax: 501-228-0963
E-Mail: staylor@xxxxxxx
Web Site: http://www.cei.net/~staylor/
|