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>you can either see it coming and are out well beforehand, or if it >goes past you, it will usually retrace and let you out >before the move in the opposite direction.
The key word in this sentence is "usually". I agree that in normal times you can usually move in time to be out before your stop is hit and that usually the bonds will retrace and let you out... but it is not about normalcy... it is about managing the bad tail.
>Bonds virtually always stop and breathe en route for anywhere. Very sudden spikes are usually just that, when your stop would be blown anyway,>with the most ghastly fill.
Yeah, but that "stop for a breath" could be a hell of a long ways up the road. Frankly, I view trading as eliminating as much chance as is humanly possible... counting on breathing space is a unnecessarily risk. Get stopped, wipe your brow, curse a bit and start looking for the next setup. In terms of slip, unless Im trading around the employment report or other vol. inducing event, slippage in the bonds has seldom been a problem.... and the more the slip the happier I am to be out of the trade. Anyway, I just don't believe in fading heat... just seen to many disasters develop that way.
>market frame work - and I have not found an indicator working within a>day's trading to be of any value. I have searched enough and I only wish >there was one.
Again, there are lots of ways to skin the trading cat. I am first and foremost a tape reader, have been for years..... I find an oscillator or two to be of great help in quantifying the market and in drawing my attention to the setups. You haven't found one, but I know many that have.
>If 'reading the tape' is not one's style of trading, then I am sure that >you must have stops set in the market, in order to preserve capital - >particularly if it is mechanical system, for example. It is just that, to >me, if you don't day trade by being able to flow with the market, all the >stops in the world are not going to make you money.
My style of trading is to read the tape.... and I still don't trade without resting stops. I have never viewed stops as a mechanism for making money but they have everything to do with limiting your risk and making you a survivor.
Again, these are my opinions and Bill has his opinions. That is what makes a market and as far apart as Bill and I seem to be on this thing, we both have a lot in common. We both think that the price action is much more important than any oscillator that has ever been invented..... want to get a real leg up... take some time and learn to read the tale of the tape.
Stewart. 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/
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