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Dan, not so fast...
Maybe, maybe not.
Look at a weekly stock chart.
Try to buy and sell at the absolute high and low
of a swing on that weekly stock chart. It's TOUGH!!
I think we are talking about the same thing? If you
compromise, don't try for the absolutely best entry and
exit, you can get a fill because price spends a few
days in that range.
But if you get good at determining the best levels,
you often will struggle to get your trade filled.
Look at the weekly chart of QQQ. The bottom on
the week of 4/06/01 would be an ideal entry. Now
look at the daily chart, that bottom happened on
one day 4/04/01.. Would you have been filled at
that price. I really doubt it. I know from experience..
-Neal.
At 06:04 PM 5/17/2001 +0000, you wrote:
>I think we are talking about two different things. I am coming at it from
>the perspective of a positional stock trader who sees turning points playout
>over days rather than a short term options or futures trader who watches
>turning points playout over minutes.
>
>Thanks for the clarification.
>
>Dan
>
> >From: Neal Hughes <neal@xxxxxxxxxxxxx>
> >Reply-To: realtraders@xxxxxxxxxxxxxxx
> >To: realtraders@xxxxxxxxxxxxxxx
> >Subject: Re: Re[2]: [RT] Re: Fibo Research
> >Date: Thu, 17 May 2001 10:14:07 -0700
> >
> >
> > >
> > > >Liquidity can be a real problem.
> > > >
> > > >When you are right, you struggle to get a fill, because there
> > > >is a lot of competition for the liquidity at turning points. When
> > > >you are wrong, it is very easy to get a fill..
> > > >
> > > >when you are nailing market turning points, you find
> > > >there isn't enough liquidity..
> > > >
> > > >Neal
> > >
> > >This statement seems counterintuitive to me. At turning points, there is
> >a
> > >balance between buyers and sellers and liquidity should be at its
> >greatest.
> > >When a market is trending, buyers and sellers are out of balance and the
> > >market moves. Are we talking about the same thing?
> > >
> > >Thanks,
> > >
> > >Dan
> >
> >
> >Dan,
> >
> >Think about it this way.. If you manage to predict the high and the low
> >of the day.. What are your chances of getting a fill at those two
> >prices, the high and the low? There are very few trades at the
> >high and the low, usually. Often the chart reverses so fast at those
> >levels.
> >
> >It is very easy to get a fill when the market goes against you,
> >more difficult to do so when you are right. Even more difficult if you
> >are precise.
> >
> >If you haven't struggled with this a lot, try Fibonacci!
> >
> >Joe DiNapoli wrote an excellent article on this (published years ago
> >in Stocks and Commodities magazine). It was about the problem
> >of X'd trades (cancelled trades) at turning points.. If members are
> >interested I'll locate it on the web for you.
> >
> >If you haven't had a trade cancelled by a floor trader, keep getting
> >better... It will happen.
> >
> >-Neal.
> >
> >
> >
> >
> >
> >
>
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