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Lynn,
To clarify the "averaging" comment: my approach (trading rules) allows the
system to generate one signal a week. Sometimes, in the course of events,
I will add to a position that is already profitable. Normally, if I
receive another signal, I am usually scaling into another position because
the market has moved against me.
Nothing wrong with Minor and DiNapoli. I use fib projections based on the
calculations of the previous week. Friday after the close, I establish a
"range" for following week (based on the previous 5 days of trading). If
the range
is penetrated by the price and I have a confirming signal in my momentum
indicator,
I either "add" to my position or "reverse".
I've personally studied with some of the so-called "masters" and have a
fairly good
working knowledge of technical concepts. I teach classes at two
universities and lecture on wheat, cattle, currencies and indices from a
technical viewpoint. No matter how accomplished one becomes at technical
analysis (and I'm just another student, trying to learn everyday), somehow
one must filter all their knowledge and make a decision to "pull the
trigger".
It has been my experience that as learned more about fibonacci, momentum
oscillators, Edwards and Magee (read it 127 times), fractals, etc., etc.,
..
that the more I learned, the more I started to understand that each of
these "looks" at the market have their own shining moment. The problem is
getting some kind of "coincidence of conjunction". When the serendipity of
everything turning at once finally happens, it can be powerful...but, how
often does that set up?
I monitor 9 separate momentum oscillators (some are off the shelf, others
are bastardized concoctions of my own making). When I "template" these
together and start to watch their movement I start to ask myself some
interesting questions. "Do I initiate a position when 5 out of 9 of these
indicators turn"? "Should I pull the trigger after 7 turn"? "Should I
wait for all 9 to turn". Herein lies the entire dilemma any technical
trader faces:
"When do I have enough objective evidence to make a subjective decision"?
Also, after making that subjective decision you become a slave to the trade
you initiate. Once in, one must constantly analyze to make a subjective
decision to get out (or place an subjective, arbitrary stop at a point
where the market
"shouldn't go"). This process then plays a major role in "tweaking" your
brain (ego, subconscious, dark corners, etc.). After placing 10,000+
trades
over my career, I know the toll that this can take on the old "grey
matter".
Some of the best technicians I know can't trade their way out of a paper
bag. Usually, they are using the bag to lose their lunch or someone is
handing them their lunch in the bag. I've been very right a lot of times
and waited for one more confirming indicator ... only to end up in a losing
position because my trigger finger was "gun shy". I've made every mistake
in the book.
Now, I can rationalize everything that happens (if something doesn't work
out, it's the "system's" fault). I still do my obligatory daily technical
analysis and I can bullshit that view with the best of them. But, when
push comes to shove, I initiate all my positions from a mechanical system.
Sure, if I'm long the S&P and it goes to zero and I keep adding long
positions, I'm screwed. I do trade the meats, the softs, the grains and
diversify my portfolios so there is some protection against blow outs in
any one of my eight markets. There are no guarantees in any approach. If
I was a greedy bastard, I'd subject my clients to close stops and convince
them that they needed them for "their protection" (and my pocketbook).
In the past, I have shared every detail (formulae, rules, etc.) and results
in actual markets (i.e., CocoLoco). I enjoy this forum (kinda) but
contribute more to the MetaStock forum (less idiots, kinder folks). I sure
hope Arch Crawford is right and the market go straight down (today or
tomorrow). If I reverse my position next week, I sure hope he's wrong
(until I'm short again).
Actually, I don't give a rip about Arch...(I swing trade..give me Clyde Lee
or Linda Bradford Rascke).
This is a very difficult arena to play in (especially the "zero sum" minus
"some more" in futures). There are some great contributors to this forum
(S. Poser, Ira, C. Lee, Earl, Norman, T. Alexander, just to name a few).
Unfortunately, a number of good traders have jumped ship and are no longer
around. Quality posts are always appreciated. Where is sheriff John
Boggio?
Steve Karnish
Cedar Creek Trading
----------
> From: MRLYNNG@xxxxxxx
> To: kernish@xxxxxxxxxxxx; realtraders@xxxxxxxxxxxx
> Subject: Re: S&P 500
> Date: Wednesday, August 18, 1999 8:27 AM
>
> In a message dated 08/17/1999 9:14:17 PM Pacific Daylight Time,
> kernish@xxxxxxxxxxxx writes:
>
> << I use a momentum oscillator and some fibonacci derived high and low
> projections to trigger my trades. I'm always in the market long or
short.
> I average losers up or down. And I don't use any stops. >>
> ***************************************
> Steve:
> Seems like you got the attention of several traders. To clarify, could
you
> give your definition of averaging losers up or down. As for the fib
> projections, what time frame are you using, daily, weekly, 60 min etc.
and is
> this method basded on work used by Miner, DiNapoli or others? Thanks.
> Lynn
Steve Karnish
CCT
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