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OK OK , any scenario may have merits. But they are only scenarios, and this one
has been around for ten years now. Eventually it could happen yes, but what is
worse go short at DJ 5000 and see 10000 or go long at 10000 and see 5000?
In essence, what is it you advocate?
- Please be specific: What is to be traded?
- Go long, flat, or go short?
- If so, at what level, with which stop?
- And once in the trade what's the exit plan?
Gwenn
PS. I usually buy my umbrella when it rains yes, not in the summer... :-))
| -----Ursprungliche Nachricht-----
| Von: James Taylor [SMTP:jptaylor@xxxxxxxxxxxxxxx]
| Gesendet am: Friday, October 08, 1999 7:52 AM
| An: BruceB; realtraders@xxxxxxxxxxxx
| Betreff: Re: Spinning Financial Illusions - The Story of Bubblenomics
|
| Did I say that you should have gone short when Fleck did ?
|
| Fleck is not a technical trader. He is well informed of the fundamentals.
| The fact is, the upward bias in the market makes short selling a
| challenging venture. The most profitable period for shorts were 1973-74,
| and 1930s.
|
| A good project and challenge for this board is to develop a trading system
| that is profitable on the short side, as well as long. A good test of the
| system is to run it from the 1920s thru present day for the Dow, to allow
| the most data points, and challenge of a market which has been going up the
| majority of that period.
|
| The fact is, market breadth is horrible and worsening, fewer and fewer
| stocks are going up, earnings are punk at best, and valuations are insane.
| When will the bubble finally burst ? I agree with Fleck's theory, the
| techs must breakdown first. Since that is the area of the most froth
| (Nasdaq at over 120 times earnings).
|
| Do you wait for the rain to start before you buy your umbrella ?
| Can the bubble get larger before it blows ? Sure, but I would consider
| risk/reward before blindly going long, hoping the long line of greater
| fools keeps coming.
|
| Do yourself a favor and read all you can on this tragety waiting to happen.
| http://www.stern.nyu.edu/%7Enroubini/asia/AsiaHomepage.html
|
| and for god's sake, prepare yourself.
| http://www.advsoftware.com/summary.htm
|
| ---------
|
| At 08:40 AM 10/7/99 -0400, BruceB wrote:
| >James, just out of curiosity, how much would my account be down right now if
| >I had gone short when Fleckenstein first became bearish? How much does the
| >market have to fall before I even get back to break-even on his wonderful
| >advice?
| >
| >Bruce
| >
| >
| >From ???@??? Fri Oct 08 06:48:07 1999
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From: "t-bondtrader" <t-bondtrader@xxxxxxxxxxxxx>
To: <Proffittak@xxxxxxx>
Cc: <realtraders@xxxxxxxxxxxx>
Subject: Re: December Bonds
Date: Fri, 8 Oct 1999 11:53:46 +0100
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Status:
>i am pretty sure we break down
>will sell short on close < yesterdays low with stop @yesterdays high +4
>regards
>Ben
Just got back to see your mail, Ben. If I read you correctly, that is an
overnight trade, which I don't take. The gap opening would have been too
much for me to have taken advantage of, but the bounce and little wedge that
formed under S2 would have been bought on the prospect of an Oops trade
ahead.
The market, as you know, went on to end with a wedge with a flat bottom
facing south and that leaves another interesting prostpect for today and the
not-so-First Friday Unemployment Report. Anyway, we should get some good
volatility and we are either going to retrace, yet again, to a diminishing
trend line before a possible big descent, or else this will, itself, be the
moment of the break down to a much lower level. Or neither! That is why I
am just a guesser, as a position trader...
As a day trader, what I can do is set the scene for myself and react
according to what I see happening with price action, there and then. There
is a good map to go by, above, but none below, but if we seriously breach
yesterday's low, the market is likely to be giving us direction m'thinks.
The logical target would have to be the projected lower trend line, thus
yielding about 4 points per contract - over whatever time it takes?!!!
Inividuals will have to make their own assessment of this as a position
trade and what sort of retracement and drawdown is acceptable. With
options there is yet another strategy. For day traders, it is each day as
it comes. So whichever way it goes today, that is all one is concerned
about - after the figures come out and the market hopefully tells us...
I guess you are probably in there already, Ben, and I hope it goes your way.
Best of trading
Bill Eykyn
www.t-bondtrader.com
|