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     fibonacci
Member
Username: fibonacci
Post Number: 163
Registered: 10-2003
Rating: N/A
Votes: 0
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| | Thursday, December 07, 2006 - 02:50 pm: |  
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Good afternoon everyone,
When an uptrend pauses near a previous high is there any significance as to the position of that pause in relation to previous top.
In this graph there is a symmetrical triangle straddling resistance from previous top but this general question also covers other forms such as a narrow rectangle just below or just above a top.
Colin, you have mentioned this situation in the past. Please feel free to join in.
Is there any statistics to back up any conclusion. If so where?
For those who help, thank-you.
John
You've got to
know when to hold 'em
know when to fold 'em.
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spider
Member
Username: spider
Post Number: 2521
Registered: 10-2002
Rating: N/A
Votes: 0
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| | Friday, December 08, 2006 - 12:34 pm: |
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Hi John,
I not sure if this is the answer you are looking for.
If you have already thought of this, then just disregard.
Traders have memories.
Even traders who are not chartists look at charts.
The most obvious thing on a chart, is when the price action is approaching a previous high.
Traders are easily 'spooked'.
Traders know that other traders are looking at the same things they are looking at, and they are wondering what those traders are thinking.
Traders get nervous.
Traders are suspicious.
Traders are greedy.
Traders are optimists (they want stuff to go up, and it makes them uneasy when it doesn't).
Traders have memories.
Trading 'long' positions is a lot like
pushing a rock up a steep hill.
spider.
A very steep hill.
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fibonacci
Member
Username: fibonacci
Post Number: 164
Registered: 10-2003
Rating: N/A
Votes: 0
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| | Saturday, December 09, 2006 - 08:41 am: |
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Much appreciated spider.
Wise words are always helpful, wish I could write like that. They could be new insights or reinforcement. No matter as we all lose sight of the way it is sometimes.
I used the term "indecision" deliberately as many [older?] promoters used "consolidation" or "distribution", giving their readers the impression that THEY knew which way it was going to be resolved.
I've mostly attempted to buy as prices emerge from retracements but this search for an enhancement[?]is because in my short term trading it's been obvious to me that my entries are often too late
In particular I'm looking for narrow rectangles or narrowing trading ranges which often have a high proportion of relatively narrow range days.
My question is about the POSITION of that indecision.
Previous post showed indecision straddling an old/previous high. This graph has it occurring after a breakout -hard right edge. Others occur just below a high.
Do different positions have different probabilities?
John
You've got to
know when to hold 'em
know when to fold 'em.
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spider
Member
Username: spider
Post Number: 2524
Registered: 10-2002
Rating: N/A
Votes: 0
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| | Saturday, December 09, 2006 - 01:26 pm: |
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I've mostly attempted to buy as prices emerge from retracements but this search for an enhancement[?]is because in my short term trading it's been obvious to me that my entries are often too late
Hi fib,
interestingly I'm usually a bit too early, and sometimes this costs me a bit of money, as I get shaken out of the position (sometimes a few times) before it goes.
Being early can really test you.
For starters, it makes you want to change; adjust; your rules to wipe out the anomaly. Fatal thinking!
Secondly, it requires that I shake off the hurt of losing money (and, in a state of mild mourning) make the decision as to whether or not to re-enter the position.
I guess what I am trying to say ,is that these patterns are in the eye of the beholder, particularly on a daily chart.
For this reason it is always wise to take a step back and look at the weekly chart.
I'm amazed by how often I do this and I am more/less excited about a particular position.
It's a lot like getting the focus right on your big screen projector.
It has been my experience that different patterns emerge in different types of markets. On the surface, the patterns may look similar, but there are driven by the overall mood of the market.
This is where heaps of experience comes in handy.
You just need to see the same things happen in similar circumstances, over and over again, and then you trade with more confidence.
In short, you just need to survive long enough to see things start to repeat themselves, and then act on them.
Learning chart patterns alone, will not do it for you.
You need to have been there when it happened, so that you can identify the mood of the market.
I know that this sounds a little strange, but I also know that there is no substitute for experience.
Learn how to survive so that you can eventually make money out of your experience.
What we need is a chart for all the times that traders gave up just before their hard earned experience was about to make them independent.
spider.
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deon
Member
Username: deon
Post Number: 2
Registered: 12-2006Rating: N/A
Votes: 0
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| | Sunday, December 10, 2006 - 07:22 pm: |
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hi fibonacci,
if you were to look at the weekly chart of the xjo you will find that several times in past 2 years the index has paused near the previous fresh high after suffering a correction, i havent got stats to back anything but i have found that if there is a consolidation near the all time high (or any high), and price action breaks out of the consolidation - theres a very high probability the target of the consolidation will be reached - with the expectation of some resistance at the last high. have a look at stock code ALL and see if u can spot a flag and spot the last all time high.
trust this answers ur question
btw.. im still learning 
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fibonacci
Member
Username: fibonacci
Post Number: 165
Registered: 10-2003
Rating: N/A
Votes: 0
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| | Thursday, December 14, 2006 - 07:31 am: |
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Good morning spider,
Thanks again for reply.
A casual observer might assume that it wasn't what I was looking for. Upon reflection it was probably exactly what I needed as a reply.
Sorry about my delay in replying. Reflection does take longer these days but the delay actually reflects one big hindrance to my trading, ...being able to consistently able to give it my fullest attention when I want to. This time my wife and I are minding our very active 3YO grandson for a week or two.
Every statement you made is relevant. Experience hard earned?
RE: Weekly comment. I totally agree. In the 80s I kept many weekly charts drawn by hand. On IC my initial watchlists are from weekly charts and starting there I look for daily setups. E.g. Start with "AUS WEEKLY VERY STRONG UPTREND IN BLUE SKY" then "F7" to look for daily entries. I find there's less changing of mind than if I switch to weekly later.
I have survived a long time and 98% of my shares are in long term but For some imponderable reason I decided to take on the challenge of short term trading and that has many more intricacies than I would have thought.
It's obvious the smoke hasn't clouded your vision.
Again thanks and seasons greetings to you and yours.
John
You've got to
know when to hold 'em
know when to fold 'em.
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hilarius
Member
Username: hilarius
Post Number: 1982
Registered: 04-2004
Rating: N/A
Votes: 0
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| | Thursday, December 14, 2006 - 07:46 am: |
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Good Morning
Attending to trading when I want to !!!
What a deep issue !!!!!!
I want more from life than trading
If I trade I want it to be fun when I do it (with the appropriate amount of discipline as well)
The rich seem to be able to make selections and then leave their portfolios alone while the profits roll in
Spider seems to aim for that
I go through agonies during retracements
The rich don't
But the problem for me is that some retracements turn into disasters and I seem to need to understand why my stops get hit
The answer to it all seems to lie in diversification and position size, but when the whole market tanks I don't want to be in that situation anyway
To be or not to be that is the question
Whether tis nobler in the mind to suffer the slings and arrows of outrageous fortune
Or by opposing end them
I find my biggest fear is the fear of being caught napping, while the rich are napping on their ocean cruises with not a care in the world
How do I get my mind to that same place
Spider ... you are needed on the Gold Coast
Hilarius
PS the times when I seem to need to be discipline frequently seem to conflict with the times when I want to be doing something else
I guess that shows lack of discipline
I come in peace to share my thoughts and to shine my candle light on possible long term opportunities
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fibonacci
Member
Username: fibonacci
Post Number: 166
Registered: 10-2003
Rating: N/A
Votes: 0
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| | Thursday, December 14, 2006 - 10:49 pm: |
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Good evening hilarius,
"..needing to UNDERSTAND why my stops get hit" [emphasis added.
Now there's a deep issue!!!!
Sure there's a reason but unless you can know at time of entering trade what the reason [for possibly getting stopped out] will be, what's the point. It just is.
Diversification, to me, at times, includes having an appropriate balance of "shorts" in periods of uncertainty to reduce market risk. Given that we're in a long term bull market the appropriate level can vary e.g. in most recent pause shorts were about 1:2 longs. Only stocks in weekly downtrends were considered. This reduces stress for me.
....and living on the Sunshine coast helps give me other life to enjoy when I don't WANT to trade.
Recent INDECISION and resolution.
John
You've got to
know when to hold 'em
know when to fold 'em.
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