Post: #76

(09-24-2013 09:45 AM)Architekt Wrote:  Watching a couple of youtube vids... This literally seems like the easiest way to make money ever conceived

Quote:With all due respect...it is one of the most DIFFICULT WAY to make money. You will see. Remember that i warned you. Best of luck on your journey.[/b] It is possible, but challenging and difficult.

Yeah anyone who enters blindly into the market thinking its easy will get ripped to shreds. In my opinion 90% of the game is mental and that takes many years to understand and perfect. Having said that it is a great time to be a long term investor IMO but that isnt always the case

Post: #77

(09-24-2013 12:28 PM)samsamsam Wrote:  Not to try to take this of course, but would you guys be staying the market long term? Or time to get out? Unless you are day trading/short investment windows. I am long in the market and just wondering if I should be taking the profit and run? Thanks.

This market is going way higher over the next 5 years. If you are a non-active investor stay long in my opinion.

Post: #78

I think this is a really good primer on day trading.

http://forumserver.twoplustwo.com/30/bus...ed-810427/

Post: #79

(09-24-2013 12:33 PM)gsinplaya Wrote:  

(09-24-2013 12:28 PM)samsamsam Wrote:  Not to try to take this of course, but would you guys be staying the market long term? Or time to get out? Unless you are day trading/short investment windows. I am long in the market and just wondering if I should be taking the profit and run? Thanks.

This market is going way higher over the next 5 years. If you are a non-active investor stay long in my opinion.

I would say that we are at all time highs now because the market is being artifically propped up by quantitive easing. The last 5 years have seen phenominal gains in the stockmarket. I'm pesimistic as government debt levels in Europe and the US are dangerously high. In addition baby boomers are retiring which puts pressure on welfare systems especially in Europe. I am not as bullish for the next 5 years, when quantitive easing is reduced I don't think the market will continue the trend of the last 5 years.

Post: #80

(09-24-2013 01:14 PM)RonnieB Wrote:  

(09-24-2013 12:33 PM)gsinplaya Wrote:  

(09-24-2013 12:28 PM)samsamsam Wrote:  Not to try to take this of course, but would you guys be staying the market long term? Or time to get out? Unless you are day trading/short investment windows. I am long in the market and just wondering if I should be taking the profit and run? Thanks.

This market is going way higher over the next 5 years. If you are a non-active investor stay long in my opinion.

I would say that we are at all time highs now because the market is being artifically propped up by quantitive easing. The last 5 years have seen phenominal gains in the stockmarket. I'm pesimistic as government debt levels in Europe and the US are dangerously high. In addition baby boomers are retiring which puts pressure on welfare systems especially in Europe. I am not as bullish for the next 5 years, when quantitive easing is reduced I don't think the market will continue the trend of the last 5 years.

This is what I think and I am sort of concerned about the potential drop that could occur in the short term. Just curious what others thought. Those that are more involved with the market. Thanks for the replies.

Post: #81

I've been managing my money in the markets on and off for at least 15 years, and granted I've never gone beyond basic technical analysis, but I would never consider daytrading as a legitimate undertaking or sole income stream. Cash flow is king and daytrading just seems so precarious. I'll admit I usually made my best returns making bets during a bubble ('99/'00) or investing in the most battered stocks after a major crash ('09). Other than that it seems like a struggle during periods to get and hang onto gains (mainly May-Jul as I was 50% invested and heavy into Fixed Income/Yield investments), right now I'm just at the point where I just want to stay in positions mid/long-term and slowly collect gains/distributions.

If you're looking for books centered on trading, markets, etc, look around as a year or two ago I came across a huge freely available file that contained several hundred books, many probably mentioned here.

(09-24-2013 02:27 PM)samsamsam Wrote:  This is what I think and I am sort of concerned about the potential drop that could occur in the short term. Just curious what others thought. Those that are more involved with the market. Thanks for the replies.

Nobody knows, really, nobody knows. Anybody pretending to is looking to sell subscriptions.

Post: #82

(09-24-2013 10:46 PM)phoenix101 Wrote:  Nobody knows, really, nobody knows. Anybody pretending to is looking to sell subscriptions.

I agree.

There are a few exceptions to that like when new stocks are released. yahoo went public in the early 1990s and google did the same in the mid 2000s and both shot up immediately- they just started off very undervalued.

Would I try to make a living on just day trading? of course not. Is it possible to identify undervalued stocks? sure.


The other time it is good to invest is after the market takes a major hit, a couple of years ago greece went bankrupt and the dow fell a couple hundred points. The stocks that fell, some were good companies that were bound to recover. I bought more google the next day.

Post: #83

@master thespian - I agree it is possible to increase your odds/probabilities by seeking undervalued companies/sectors.

@samsamsam - not exactly scientific journals but just some scenarios of some blogs I casually follow. Just be careful some of these seem to have a long-term bullish bent...which I think should be the case when you're investing in the biggest companies in the U.S./the world but sometimes the cash inflow can get too ahead of itself. You can pretty much assume even the guys with the best prediction rate are 50% successful at best.

1. http://stock-chartist.com/2012/01/that-o...log-again/
http://seekingalpha.com/article/1407441-...is-uncanny (can use bugmenot to sign in to read whole article)
2. Market Anthropology - this guy seeks out historical analog chart patterns that match current patterns...sometimes I see how he gets the pattern, sometimes not
http://www.marketanthropology.com/2013/0...-bust.html
http://www.marketanthropology.com/2013/0...pdate.html
I don't know how he finds patterns but I've just started testing out my own thing in Excel to match current 30, 60, or 90-day patterns in Excel to historical data (still iffy, just using CORREL function for now against years of daily historical prices)
3. Carl Futia Blogspot - gives daily mid-term prediction, every other week or so also gives some brief commentary on the market
4. Kimble Charting - a general, big picture, broad view on a couple patterns/trends in sectors
5. http://fat-pitch.blogspot.co.uk/ Don't read frequently but has an interesting take on market patterns, trends
6. http://www.channelsandpatterns.com/ I don't browse this one anymore but a look at how one guy does technical analysis
7. http://advisorperspectives.com/dshort/gu...Update.php John Carlucci has an interesting indicator for when the market is tradeable or not tradeable. I've looked at the Canadian version of this indicator and seems to be a little bit of a different animal. This spurred me to look into "my own" indicator but it's often like looking at a Rorschach test and seeing something different. I was studying for a while the different patterns that form in the A/D % Index and it's MACD, Sto, how different things worked when MA was above 0, moved above/below 0 etc. http://stockcharts.com/h-sc/ui?s=$SP...&listNum=1 (not sure if you will be able to see this in its entirety)

Post: #84

while i agree with the sentiments of ronnieb, master_thespian, phoenix101,and also ginsplaya. And some of my geopolitical concerns are briefly touched upon here

Generally, you trade with the trend as much as possible. That is usually the safest route. If the trend is up, you stay bullish; if the trend is bearish, you stay bearish. The market can remain irrational, more than we can remain solvent.

Just dont over-expose yourself.

so, samsamsam, if your concern is that there maybe a correction in the short term, how will you deal with it?

the answer is simple: you hedge your position with options or long/short strategies...so, in case of any unexplained and unexpected downturn, your risk is limited.

when in doubt: HEDGE. or stay out of the market.

(09-24-2013 12:28 PM)samsamsam Wrote:  Not to try to take this of course, but would you guys be staying the market long term? Or time to get out? Unless you are day trading/short investment windows. I am long in the market and just wondering if I should be taking the profit and run? Thanks.

Post: #85

I have heard hedging or buying put options can be expensive. Is there a cost effective way to do that? Thanks for all the good info.

Post: #86

(09-24-2013 01:14 PM)RonnieB Wrote:  I would say that we are at all time highs now because the market is being artifically propped up by quantitive easing. The last 5 years have seen phenominal gains in the stockmarket. I'm pesimistic as government debt levels in Europe and the US are dangerously high. In addition baby boomers are retiring which puts pressure on welfare systems especially in Europe. I am not as bullish for the next 5 years, when quantitive easing is reduced I don't think the market will continue the trend of the last 5 years.

True. I share your sentiments....but at the end of the day: market tells us what to do. If it is up, i go with it; if it is down, i go with that too. The post below will give an insight into the way i approach the market...(suggestions and improvements welcome)

(08-06-2013 09:42 AM)Nemencine Wrote:  .......
@numanist

With all due respect, i dont care whether jobs were "created" or not. I also dont care whether they are low-paying, part-time jobs. All that i care about is how the market react to the unemployment data. The rest is superfluous to me. That is why i am faintly amused by this thread on QE3 inflation or something. The only reality to me--the only question i ask myself: what are the actionable way for me to profit from these?

last nov/dec...i got into these stocks long: APOG, LL, AOS, MHK, HD. (i missed ED short because it didnt retest my short levels.)

my thesis? QE3 infinity + hurricane sandy + good company fundamentals + solid technical setup + outperforming sector/industry.

All of them did well...+30% gain to +80% gain....closed them all down last month when bernanke started talking about "tapering". I have had my run. That was how i played the QE3 infinity.

(NEMENCINE's ADDENDUM: I completely ignore all the doom and gloom of places like zero hedge...talking about QE is bad or good...i simply dont care...all that i care about is how is the market reacting to this...and how can i exploit this to my benefit...i dont care about coming up with some brilliant economic theory...i care about making money off the decaying carcass....you should see the performance of the EURUSD when any new QE is announced...either operation twist or whatever. It became like clockwork trades.)

ED short was based on the explosion of their plants(consolidated edison) during hurricane sandy. That may sound machiavellian, but as i read about the hurricane sandy, i started looking for insurance companies to short...i started looking for power companies to short....lumber/housing development companies to go long...and i started looking for the company that made the red Blitz petrol cans. I was reading reports of long lines with "Blitz" petrol cans in shortage.

This is how my brain works with regards to finance. I dont care too much about the "truth" of one school vs another.

With all due respect, i dont belong to the Frankfurst school or to the Keynesian economists school. I belong to the one that makes me money....while it is making me money. I dumped her faster than a used-up slut the minute it stops making me money.

So, if and when stagnation did come(if it did), i will simply look into Japanese financial history, and ask myself, how do i transfer this to american economy and reap the financial rewards?

I have no control over economic policy...the only thing i can do is how i react to it....and the market may remain irrational longer than i can remain solvent. i simply play the hands that i am dealt.

(NEMENCINE'S ADDENDUM: Otherwise, the debate back and forth is as useless as people arguing about talent vs hardwork...or money vs game...or looks vs game...I just try to max out my potential and do the best with what i am given. I will leave the academic exercise to others. What can i control? what is the best that i can do with what i can control? that is all for me.)

The Housing bubble 2003 to 2007 wasnt real either...however, there were people who printed millions and ran away with it before it exploded. Same with the tech bubble...I sincerely dont care if it is a dog and pony show. i just dont. if gold is in play, i will be with gold...if it is auto and healthcare sector/industry, i will sleep with them.

Take a look at what i posted here yesterday about new zealand. China banned dairy imports from NZ.

Questions that ran through my mind:
#1. how does this affect the kiwi or ( NZDs) aka the new Zealand currency going forward?
#2. How does it affect, in the futures market, the price of milk/dairy?
#3. How does it affect the stocks of companies with heavy exposure to new zealand #1 export: dairy products.?
#4. How do i hedge my bets?

these are the kind of things i personally care about.

regards,

Post: #87

(09-25-2013 11:57 AM)samsamsam Wrote:  I have heard hedging or buying put options can be expensive. Is there a cost effective way to do that? Thanks for all the good info.

I don't really touch options, especially since it is prohibitive with commissions through TD Waterhouse (have half with TD, half with RBC Direct Investing)...the few times I've touched them, when I should've broken even or near it I would be down several hundred due to commissions. I have a friend who does options trading through Interactive Brokers in Canada and says the commission are really, really cheap--I believe this is an American company.

@Nemencine - yeah I think people are very slowly going to wake up and get angry at listening to the Zerohedge permadoom infostream all the while having missed out on (a) great runup(s).

Post: #88

(09-24-2013 10:46 PM)phoenix101 Wrote:  ..... I'll admit I usually made my best returns making bets during a bubble ('99/'00) or investing in the most battered stocks after a major crash ('09)......

(09-24-2013 11:46 PM)master_thespian Wrote:  .....The other time it is good to invest is after the market takes a major hit, a couple of years ago greece went bankrupt and the dow fell a couple hundred points. The stocks that fell, some were good companies that were bound to recover. I bought more google the next day.

That is how you fucking trade event driven strategies! fucking a! That is what i am talking about!
In fact, let me point out a good example here. This happens on the 5th of august, 2013 when china hit new zealand with a total ban on all their dairy products. I quickly made a post here about the event and mentioned some stocks like dean foods(ticker: DF) and kraft(ticker:KRFT) as potential good short candidates....they were both demolished later. Unilever was crushed too...all starting from 6th of august....NZD currency went down with a veangeance before recovering when the dust settled. out of all the stocks....KRFT has the best fundamentals....DF had the worst fundie.

(08-04-2013 04:40 PM)Nemencine Wrote:  EVENT DRIVEN TRADE: #1. short NZD currencies when the forex market opens,
#2. short stocks of milk-related products companies with exposure to nEW ZEALAND's milk industry...
#3. prepare to go long milk-product companies without exposure to new zealand after the dust settles...
#4. go long alternatve to milk-products without exposure to new zealand.

WHY?

I just read this right now in the NYT: CHINA BANS milk powder from NEW ZEALAND over Botulism fears.

Holy shite!

The main export from New Zealand is MILK/dairy product...their main trading partner: CHINA.

holy shite double time!

basically, NEW ZEALAND currency, the NZD, aka the KIWI is fucked for the time being. Short that baby. Also, CHINA took the additional steps of banning milk products from australia too....

To those who likes to trade global macro...that means the stocks of companies with exposure to dairy products from new zealand will experience a hit....there could also be a sympathetic play against other diary products giants that are not exposed to the new zealand market...however, since they are dairy giants, they will also take a hit.(making them a good buy at a later date.)

Naturally, as things even out...dairy giants without exposure to new zealand product will gobble up market share...displacing their weakened competitors....

also, alternative to milk, (supply elasticity) will experience increase in market share....

I have begun some quick preliminary research on the subject:
http://kevinbellamy.wordpress.com/2011/0...ry-top-10/
(kraft, unilever, nestle, dean, etc....)

http://www.bloomberg.com/markets/compani...-products/

http://www.idfa.org/resource-center/memb...companies/

Need to go and do more research and see if i can MILK this....my job here is done....you lads take it from here....
.

The best short candidates were DF and LWAY. They subsequently missed earnings...DF is cash flow negative. revenue is dropping while operating income is eating the company innards....their debt to equity is ridiculous. ..DF earnings is shite. i mean,for heaven's sake just take a quick look at the company's fundamentals.

LWAY blames higher milk prices for shitty earnings. i like their debt to equity, but everything else sucks: they are having increase revenues while experiencing an increase total operating expenses--which means they cannot keep overhead underwrap.....their profit margin is also shrinking. Here is LWAY fundie.

KRFT on the other hand kick arse... i like their fundamentals...their debt could use some work...but still...KRFT kicks arse. Which makes it the one to buy when the dust settles from NZ dairy ban. KRFT staged a strong bullish run when it got to the appropriate technical levels(major support and resistance level at 52.20 area)...( i didnt pull the trigger though. why? i dont trust politicians:yes, NZ later announced to the world that the problem with their dairy products has been contained and resolved...but i was skittish...i just rode the shorts in LWAY and DF and let the rest be.

anyways, the chart tells the tale..... below is the chart of KRFT, DF, and LWAY. i was short DF and LWAY.

Post: #89

charts of KRFT, DF and LWAY.

anyways, the chart tells the tale..... below is the chart of KRFT, DF, and LWAY. i was short DF and LWAY.

Post: #90

Damn some of you guys are smart...Thanks for the charts very easy to understand visually. This stuff isn't new to me but I have never practiced or applied this stuff. Thanks.

Post: #91

Nemencine, nice call on the New Zealand dairy product ban. Wish I saw that post!

Are you trading clients money or trading on your own account?

Do you have any views on the NZD at the moment. The NZD/USD seems overstretched when it gets in the 0.83 - 0.85 range and it doesn't take much to make it dip back down. It's one pair I'm keeping my eye on.

Post: #92

(09-25-2013 11:57 AM)samsamsam Wrote:  I have heard hedging or buying put options can be expensive. Is there a cost effective way to do that? Thanks for all the good info.

There are many ways to hedge. Option trading is not the only one.

You can hedge with commodity futures, options, stocks, bonds, forex, etc.

The examples i have given below assumes you are doing things the right way.

Let me start with COMMODITY FUTURES:

Let us say that you are farmer that raise and sell cows. You are a cattle farmer. You anticipated that this year you will have to sell your cows for considerably less than their worth due to fear of mad cow disease.... How do you hedge against such a potential loss? One way is to go to the CBOT and and sell short cattle futures. If your fear is warranted, the loss you will experience from your cattle selling for less their worth will be upset by the gains you made selling short cattle futures on the CBOT. If your fear is unwarranted, then the gain you make from the selling your cattle will more than upset the loss you experience from selling cattle futures short.

Airlines do this too. Due to global terrorism and middle eastern unrest which results in spike/increase in the price of jetfuel/kerosene. Aeroplanes burn through jetfuel a lot. This means, you will be put in the position of losing airline customers if you increase your traveling prices due to increase cost of jetfuel or kerosene due to middleeastern unrest. So, how do you keep down your cost and beat the competition with an attractive air travel price while experiencing increase jetfuel price? You can go LONG crude oil futures...as the middleeastern unrest raise crude oil prices, the airlines make money from long crude oil, thereby offsetting the rising cost of jetfuel they need to run their planes.


STOCKS/INDEXES:
For stocks, let us assume that Tesla is strong, General Motors sucks. They are both in the automotive industry space. You can go long Tesla Motors(ticker: TSLA) shares and hedge your bet with short GM or F. The principle is you find the strongest in the industry to go long, and the weakest to go short; all at the same time. That is a simple long/short strategy. So, if TSLA goes up and GM goes down = you make money since you are long TSLA and short GM at the same time; However, if TSLA goes up and GM goes up = the money you are losing in GM short is offset by the money you are making in TSLA = it balances out....; If TSLA goes down and GM goes down = the money you lose in TSLA is offset by the money you make shorting GM = it cancels out. Of course, all these assume you do select the right stocks at the right time, etc.

BONDS:
You noticed that Bernanke just started his QE program.... so you want to hedge against devaluation/inflation while profiting from the QE madness. One way is to go long the housing market ETFs(e.g XHB) or housing market stocks(e.g. APOG) and short 10 year bond as an hedge due to bernanke's QE... Or you can go long TIPS(inflation adjusted treasury bonds) as a hedge against inflation while shorting the US dollar through the EURUSD because of bernanke's QE madness. long EURUSD = long EUR, short USD. or you can simply go long the XAU/USD because Long XAU/USD = long XAU and short USD simultaneously. XAU = gold, USD = us dollar. Since gold is an hedge against inflation.

FOREX/CURRENCY:
Let us say that you own a mega corporation that does business all over the world.... you make toothpaste in Canada and sell it in the UK. you are making good money because(a) your toothpaste is selling, your raw material acquisition costs are cheaper, you are the perfect example of six sigma implementation, etcetera, etcetera ( b) and also, because canadian currency, the canadian dollar(CAD), is cheap compared to the British pound(GBP). Even though you are making 1 toothpaste for 1 CAD and selling it for 1 GBP... however, since the rate of exchange between CAD and GBP is 1:2... that is, 1 GBP = 2 CADs... when you convert your profit of 1 GBP to CAD...you get 2 CADs = you've doubled your money!. (this is the reason why currency devaluation is good for exporters)
Now, however, things are about to change, they are electing a new PM in the UK who wants the MPC to aggressively expand their asset purchase facility through the roof. That means, the value of GBP will drop due to devaluation...so, a megacorporation can protect their bottomline by hedging through selling short the GBP/CAD currency(shorting GBP/CAD = long CAD, short GBP.). Basically using the currency market to hedge against the downside. The profit made from short GBP/CAD will then offset the shrinking profit margin from the tightening exchange rate differential. Voila!

OPTIONS:
There are a hundred different ways to use options. I guess the simplest one is to say that you are long AAPL shares, then you take PUT options on AAPL.

----
Of course, you can mismatch all these different methods of hedging together in a thousand different ways as you see fit/comfortable with. Hopefully, you find this to be helpful.

regards,

--Nemencine

Post: #93

Hey, there pheonix 101, i will try my best to reply to this good post of yours. Of course, commentaries and evaluations are welcome.

You are the highlighted in dark, bold italics.... my response is interspersed inbetween.


'phoenix101' wrote: this guy seeks out historical analog chart patterns that match current patterns...sometimes I see how he gets the pattern, sometimes not.....


NEMENCINE's response: The book Methods of a wallstreet master by victor sperandeo did that. He talked about how he went through historical patterns and tried to use that to trade. The book might lent some insight. The main thing that concerned me with this approach is the fallacy of technical analysis: just because a pattern has occurred in the past, doesnt mean that its present occurrence right now bodes towards the same thing. Let us take support and resistance levels(S/R levels). Just because an S/R level worked in the past, doesnt mean it will work again when a S/R level shows up(i assume you know this already, phoenix101). The reason for that is the change in fundamental reality.
If a stock forms a solid congestion S/R level at $58 today before a breakout, and price later comes back to $58 after a runup...you have 50/50 chance of experiencing a bounce. If the fundamental reality of the company situation is the same as was last time:you will most likely get a bounce...if the fundamental reality is completely different, dont be surprised if price slice through that level like a hot knife through butter.
The reason is because these technical levels(s/r, channels, wedges, triangles, head-and-shoulder, etc) are created by fundamental traders bleeding their orders into the market over days and weeks. Trying to prevent the market from running away as they accumulate position... they fractionate their orders in at those levels... when the market comes back to retest those levels(with fundamental situation still ceteris pauribus) their resting, remaining orders gets triggered: providing the bounce due to market memory. This is also why you want a fresh pattern to use...not one that has been tested by price action...because those latent orders would have been eroded.

The thing is that orders that are fractionated into these levels follows a herding behaviour on the level of market microstructure...they cascade in due to liquidity disequilibrium and latent and pending interest, of course, generating episodic volatility in the process. All these leads to the concavity of price orders that follows power laws characteristics at these s/r levels, all following a herding behaviour. Which leads to one question: is there a way to different between herding behaviour that leads to fakeout or good breakout?

At the end of the day, Fundamental traders create the patterns in the market, technical trader (and HFT traders)creates the noise in the market. in fact, all technical patterns are simply a combination of two things: support and resistance and regression lines(or colloquially known as TRENDLINES).

For a more rigorous treatment of the subject matter:

#1. Price Formation in Financialized Commodity Markets:the role of information.

#2. Avalanche dynamics and Trading Friction effects on the Stock Market.

#3. How market slowly digest changes in supply and demand.

In a nutshell, the main question, in my humble opinion is: when this pattern was created, what was the macro/fundamental reality? are they similar now? otherwise, the pattern is immaterial.

I was quite interested in why technical analysis seems to be 50/50 chance of succeeding, that is why i started asking myself the question: when you read market history and market wizards books and past market gurus...why do some of them have longevity? and others dont? why was the gann method or elliot wave or wyckoff patterns worked like a charm for some times, then stop working? why was the moving averages crossover a sure money maker during the 80s but stopped?

I realized that the market, despite her inefficiencies, the market have the tendency to neutralize a method after a time: trading history is full of carnage of trading methods whose bones are scattered across the field of trading battles. This means, the method that was effective worked because the fundamental reality of that time makes it permissible. Breakouts are prone to failure, however, during 2008, breakouts in the forex market works like a charm...the market is like a big immune system adapting to whatever you throw at it. She doesnt allow an exploitable edge to stand for too long...maybe 10 to 15 years. It is absolutely critical to know why and when a method can or cannot work. That is also one of the limitation of backtesting.


'phoenix101' wrote: I don't know how he finds patterns but I've just started testing out my own thing in Excel to match current 30, 60, or 90-day patterns in Excel to historical data (still iffy, just using CORREL function for now against years of daily historical prices)......


NEMENCINE's response:there is a book that conducted exhaustive pattern test on the market: Encyclopedia of chart patterns by thomas bulkowski
. Mr. bulkowski ran hundreds of statistical studies on hundreds of market patterns over decades of data. The conclusion, that i take from that encyclopedia is to trade with the trend as much as possible. respectfully, that your patterns hardly matter. what matters is that you are trading with the trend. why do i say this?

On page 438 of the second edition, chapter 28, you will see a bullish pattern called the "thorn bottoms"...it is a bullish pattern...this bullish looking pattern--as the author freely admit--it is a bullish pattern the author pulled out of his arse. I shit you not. Well...let us see what he did next, shall we? He then examine this bullish pattern in bull market vs bear market, i,.e, trend vs counter-trend. In trending market, the bullish pattern performed 66.66%...and reach its intended price target 76% of the time(using measured move to determine price target). In counter-trend market however, the pattern only performed 31.5%. result: trend vs counter-trend = 66.66% vs 31.5% .

Mr. Bulkowski then turned the pattern upside down: inverting it thereby creating its opposite(the "horn tops" pattern)...a bearish pattern...so, he then run a trend vs counter-trend analysis...this is on page 451, chapter 29. Results? In a trending market it performed at 47%...in a counter-trend market, it performed at 19%. Look at that disparity in trend vs counter-trend : 47% vs 19%.

My point? TRADE WITH THE TREND. Even if you pull a technical pattern out of your behind...in a trending market aligned with the polarity of that pattern...it is pretty much guarantee...it will score...with a good R/R...you are in business.

Mind you, the "horn bottoms" is not the only technical patterns mr bulkowski made up out of thin air and ran statistical tests on...there was the scallops...the bump and run reversal top/bottom...there is even a complex form of head and shoulder that he created...and the list goes on...

Now, take a wild guess at the performance of these patterns when traded with the trend vs countertrend?

You know the answer to that...i dont even need to post the results.

Trade with the trend. Here is a video by dennis gartman that makes the point well: http://jny.kewego.com/video/iLyROoafJo27.html


'phoenix101' wrote: John Carlucci has an interesting indicator for when the market is tradeable or not tradeable. I've looked at the Canadian version of this indicator and seems to be a little bit of a different animal. This spurred me to look into "my own" indicator but it's often like looking at a Rorschach test and seeing something different. I was studying for a while the different patterns that form in the A/D % Index and it's MACD, Sto, how different things worked when MA was above 0, moved above/below ......


NEMENCINE's response: speaking for me only: using indicators is not compatible with my psychology. It is not my trading style. For technicals, i simply use price action, trendline, support and resistance levels. that is pretty much it for me.

regards,

--Nemencine

Post: #94

jayjuanGee, and others

i read your post here and there...For those interested in investment, i will say that the best person for you to address these specific kinds of question to is WESTCOAST. You can also check out his thread here: INVESTING ADVICE. It offers tip and advice towards your investment-oriented mindset.

To those interested in trading, the most realistic, sober depiction of trading experience/arc through the travails and tribulations, is given here by "DEFGUY".

Good luck,

--Nemencine

(09-24-2013 12:04 PM)JayJuanGee Wrote:  Certainly, I'm no expert, yet it seems that for anyone who may not want to invest more than an hour or so a week into researching and staying on top of his stock market investments (and or trading) then mutual funds or various kinds of index funds would be potentially better vehicles for dollar cost averaging - meaning just putting in a small amount of money into a diversified set of various index funds on a periodic basis, maybe once or twice a month.

Maybe it is more difficult to become rich with these kinds of index and/or mutual funds (b/c someone is taking a cut, especially if it is a mutual fund), but at least, we do not have to become too technically sophisticated or to spend a lot of time trying to figure out which stocks and when to trade... we just rebalance from time to time, maybe 2-3 times a year, at most.

I just noticed that my Capital One - online account allows me to add an additional investment account and thereafter I can make stock trades for $6.95 a pop or I could buy no load, no transaction costs mutual funds without any transaction fees or another possibility is that there are some mutual funds that do have transaction fees - looks like $19.95 trading fee. In reviewing the various investment options, I still think that there are so many mutual funds available within the no cost, no fee arena that it could take some time just figuring out which ones of the funds to go with. Let's just say to pick several funds and then invest maybe $1,000 to $10,000 per fund and then invest $10-$500 per month dollar cost averaging into each funds - I believe they allow automated bi-weekly investments with the no load mutual funds, but I am not sure if that can be done with the stock funds? Maybe start out with 5-10 of various mutual funds that allow for no cost dollar cost averaging investing, and then adjust the quantity of funds as needed or as the newbie investor learns more about the funds?

Why not just do something like this? Can still make good money and that money would be fairly passive money, no? With my stock market investments, I seem to be striving for a certain level of passive money, personally, if possible.

Post: #95

(09-29-2013 08:52 AM)Nemencine Wrote:  jayjuanGee, and others

i read your post here and there...For those interested in investment, i will say that the best person for you to address these specific kinds of question to is WESTCOAST. You can also check out his thread here: INVESTING ADVICE. It offers tip and advice towards your investment-oriented mindset.

Thanks Nemencine. I had seem some of WestCoast's postings related to finance/investing, but I had not seen the RVF thread that you pointed out. I have been reading several of the threads on passive income and investing and of course looking at some other financial guides that are pointed to in the various RVF threads.

I will read through that thread that you pointed out in the near future to see if it touches upon some of my questions and concerns - though I have a few other RVF threads on my "to read" list.

Post: #96

There certainly seems to be money to be made in the "3D printing" companies.

For example, Arcam is up 871% over the past 12 months http://finance.yahoo.com/echarts?s=ARCM....;range=1y?

Post: #97

Time to buy Tesla?

http://qz.com/131743/teslas-bloated-stoc...ng-a-fire/

Post: #98

The best advice which has been given already is index funds. All my IRA money is shifted in and out (but in 90% of the time in) of the S&P completion index (VEXMX is an example of a tracker). Its up about 20% this year.

I like to gamble also with other money. It seems ridiculously easy but I just look for penny stocks (<$2.00) that have a decent amount of volume and tons of beta. I only buy things near their 52 day low. Bought NAK at 1.44 and sold at 1.81 yesterday. 23% is great for two days . The relatively high volume along with a stop limit will help you from losing your shirt while waiting for a 2-3 day runup.

For the record Im currently out of VEXMX with the govt shutdown and debt ceiling coming. Ill jump back in after that shit resolves.

Post: #99

Anyone buying energy stocks now?

Post: #100

thinking of buying sdrl very very soon. 15% dividend too