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Bill - I HOPE you can figure out how to get past your closed mind and
understand what folks are talking about.
The point about HOPE Bill, is that is what people do. I have seen guys
at primary dealers with years of experience HOPE for the market to come
back. People with P's on their P&L of millions per year. It is normal.
Unless you are an android, there are shades of grey everywhere. What is
right for you is not right for everybody else, especially for novice
traders. How long would you have waited (and hoped) for the market to
come back if it had kept falling on the day Rubin resigned. The gap was
1/2 point. Most folks, if it came to back 3/8ths might have held on, and
then it might have gone straight to hell and a hand basket! How much
would not having a stop have killed you a couple years back when we went
down limit on 700K payrolls?
You seem to think there is only one way to trade, and that it is yours.
Well the way to trade is to recognize the patterns, control your
emotions and have sound money management (i.e., stops).
Earl is anything but a novice trader. He has been doing it for years and
I assume that he has a pretty good trading record. He did not say that
he ALWAYS day trades w/out stops. I have even on occasion waited a few
minutes b4 setting a stop, which in my opinion is stupid too, but I
always tell people to do what I say and not what I do.
I am glad that you have a way that works for you, but it will not work
for everybody. And trading without stops is just a recipe for
destruction. If the pattern is dead, get out. I almost always get out b4
my stops are hit, unless I have them way too close. When the pattern
doesn't work, I'm gone, but that still does not say that I should not
keep stops. Nothing like a Barry story or hedge fund rumor to clobber
you. Yes, bonds might grind back a couple of ticks, but then they might
continue the other way. How many folks out there do you think will see
the grind back and think they are safe. MORE THAN YOU CAN IMAGINE. And
that is why they should have stops!
Steve Poser
--
Steven W. Poser, President
Poser Global Market Strategies Inc.
http://www.poserglobal.com
T-Bondtrader wrote:
>
> I can see that people are getting upset with this thread, so before it gets
> out of hand, let me say this is my last on the current subject:
>
> >The only time I do not put stops physically in the market is when I am day
> >trading, am prepared to monitor the price action, have a stop level marked
> >on my chart, and have a market order already ready to fire.
> >
> >Earl
>
> So far as I am concerned, Earl, has summed it up nicely. Forgetting the
> where, the r/r/r, etc, that at the end of the day is how I trade - i.e. day
> trade on the bonds. All of Earl's comments on position trading, I can see
> makes a lot of sense.
>
> Next point:
>
> Stewart wrote: "Damn right I want to be stopped out of a fast market."
>
> Don't we all! The point I was trying to make was that when those
> conditions happen, the likelihood is that the market will go straight
> through your stop. You will get an appalling fill, usually at the bottom.
> If it doesn't bounce back, then you can take your own action. If it was
> really bad, then only an option could save you anyway - as Brent suggests.
>
> Stewart also wrote: "It just as easily could have gone another 700 or 1400
> or 2100 or 2800 against you as come back to unchanged."
>
> He is, of course, quite right to say that it might do any of those things.
> But when has it? Was there a break, or are we saying straight up or down?
> If the latter, when would one expect your stop of say 6 ticks to be filled?
>
> When you do your research on the bonds, you know the odds of how far it
> will move. Tell me the last time the bonds went limit (3pts) up or down.
> Tell me how many times it went half a point without a stall in between,
> etc. You have to do your research and then settle on the odds. Then work
> within a capital structure that allows you, within the r/r/r to have that
> money at the back of you, if a really large unexpected move happens. You
> have to have the right capital to trade at your level of risk. I say all
> this for the benefit of the the newbie not seasoned pros, naturally - and I
> only speak on the bonds, day trading.
>
> It always sounds the best advice to put stops in the market and for
> position players, perhaps anyway, and in certain markets, perhaps anyway,
> but in the bonds - depending on how you trade - it may be better to be
> disciplined with your stops, but not in the market. That is what I have
> found and what I advocate. But don't let's get heated over it.
>
> It is when I hear people talking about 'hope', I wonder how they trade. If
> stops are there to stop you 'hoping' when the market moves against you, it
> is not stops you want to worry about - it is whether or not you ought to be
> trading!
>
> Anyway, there are many different trading ideas on RT - and long may it be
> so, for the sake of everyone to gain from the various views.
>
> 'Nuff said!
>
> Bill Eykyn
> www.t-bondtrader.com
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