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Rakesh,
In the trading psychology literature, I recall reading that there are
"intuitive" traders who are not consciously aware of the step-by-step
processing taking place inside their brain to select and exit trades. It
was likely in one of the Mark Douglas books or it could have been during a
conversation I had with him. I don't recall the specific reference.
Having said this let me give you a little background on my trading
experience. I started in the mid 70's as a chartist, drawing charts by hand
for several hours per day for years. My roots are in classical chart
reading as described in "Technical Analysis of Stock Trends" by Edward and
Magee, and "Technical Analysis and Stock Market Profits" by Richard W.
Shabacker.
I wasn't exposed to a single bit of Gann/Elliott until I had 10 years of
pattern trading experience. I wrote Nature's Pulse as a toolkit to help me
explore these techniques. I didn't intend for it to be a business at first.
I gave it away to a few friends and word got around and the business was
started. I spent 6 years seriously involved in searching for those high
probability turning points. I sent every NP user a newsletter every month
during this period of time, at no charge. Every newsletter contained two or
three turning point forecasts for the month ahead and it included everything
used to make the forecast so that all users could learn from it.
So what exactly does one do as we start to approach that forecasted turn
data? I know what I did. I looked at the pattern. If the pattern looked
right I would take the trade, otherwise I would skip it. The trading worked
out well for me so I stuck with it during all those years.
It was only after I was not able to come up with new automation tools for NP
that I had an Aha! In hindsight, I am able to look back and conclude that
those 6 years of using forecasted turning points was an illusion for me. I
truly believe that it was my pattern recognition skills along with my
trading experiences that were overriding those forecasted turning points.
Keep in mind the idea mentioned in the first paragraph about competent
intuitive traders not being consciously aware of their complete decision
making process. For those who trade with those high-probability turning
points I would like to ask you exactly what you do when you get to one of
those points? Do you know if it is going to be a high or low? Do you
include the possibility of an acceleration of the trend? How do you decide
long, short, or do nothing? How do you decide if it is going to be a
short-term or long-term trade? How do you decide if it is going to be a 1,
2, or 3 unit (position size) trade?
Just think about it. I don't expect you to give me answers to those
questions. As I mentioned, I went for 6 years thinking that the turning
points were important. Perhaps for you they are crucial. As we all know,
there are many, many ways to trade profitably. What works for one person
may not work for another.
Best regards,
Ed Kasanjian
-----Original Message-----
From: Rakesh Sahgal [mailto:rsahgal@xxxxxxxxxx]
Sent: October 21, 2000 10:21 PM
To: 'realtraders@xxxxxxxxxxx'
Subject: RE: [RT] Software - Pattern Smasher
Ed,
Thank you for taking the time to respond to my post.
1. No, I have not had a bad trading week. I said in my post - you were kind
enough to offer me an upgrade. So where is the question of making
objectionable comments only, just to speak ill of you or simply because I am
facing a bad time at work? I just stated facts as they exist. If you did not
like it, I am sorry. However the facts remain what they are.
2. I will also take this opportunity to say I have made a lot of money using
Nature's Pulse. Irrespective of what your later findings maybe, the AutoMode
and AutoScan features were very good inputs in my trading decisions. I and
my friends have spent quite a lot of money on different products
individually and NP was one I considered a good investment.
3. While you may not find the approach used by NP relevant any more - I
will not try to argue with you on that since I do not have the competence to
engage in such heavy duty research - the NP methodology worked for me. It is
as simple as that. Now how much of a problem it is to help out customers who
just want some small problem resolved, is for you to decide.
Regards
Rakesh Sahgal
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