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Oh boy! You asked. Okay. Here is an insight.
This is why Larry Williams is not just a great trader but also a great
educator! He takes something that has been around since the tulip days, fading
a countertrend breakout (or as someone famous once said, "When the ducks quack,
feed them"). He then gives it a Hollywood blockbuster name, "Jaws of Death" and
a trustworthy Walter Cronkite face, bonds with two time periods. We buy the
movie tickets, cubic yard of popcorn and gallon soda. But we're still not quite
sure why we feel constipated, bloated and broke when the final credits run.
That's because Larry has the steel guts to act the part, selling when everyone
else is buying and has a stop even larger than Saddam Hussein's view of
himself. I can only rent the video in amazement.
Good luck Frank! I sincerely hope that we will all discover our own Larry's
discipline, success, panache and outrageous flair. Till then, pass the popcorn
my friend...
alexander the gassy
Frank Richardson wrote:
Larry Williams -- Jaws of Death Strategy
Catchy name – good strategy for swing traders. You get at least one per month,
so far looks like 3 of these trades in June. Essentially you are working off
bond futures behaving in reverse of S&P futures I’ve gotten some bits and
pieces on this strategy from Larry’s solicitations and started trying to piece
it together. It appears that you chart the daily bond futures (USU2) – looking
for spots where the price is peaking and then a downturn in the bonds where
price closes below the EMA20 (it can take 1 or 2 down daily bars).Next you move
to say a 60 min chart of the bond futures, using a trendline to locate a bond
futures breakout (close of the bar !) to the upside out of a downward sloping
trendline. At that breakout point sell and take like a 12 point protective
stop. I can sometimes take as long as till the end of the next day or even the
following open after that for price to move in your favor. I would move a
protective stop to breakeven after 5 or 10 pt. gain. Often times you get like 2
or 3 down days off this entry. Many times establishing EOD short positions
before the breakout confirmation results in better gains, but then I believe
you subject yourself to more risk for without the breakout confirmation a
higher % of trades fail.Look at what you would have gained by shorts at:10:20
CST on 1-18-028:20 on 2-14-0211:20 on 3-05-029:20 on 4-18-0210:20 or 11:20 on
5-09-029:20 on 6-06-02day open (sucker trap) or 1:20 0n 6-18-02I’m short at
12:20 on 6-25-02 based on this strategyAnybody care to research this strategy
and provide some more insight to this o-list ? Frank
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