Long and short positions based on the market
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     kyle
Member
Username: kyle
Post Number: 1
Registered: 01-2003Rating: N/A
Votes: 0
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| | Wednesday, July 02, 2003 - 09:19 am: | 
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Colin states on his daily email whether, in general, to take long or short positions based on the over all position of the market. For example, at the moment we want to see if the current correction is just that, or the resumption of a medium term down trend - as such is the point that until we move through a certain point we hold off all trading?
The hardest thing i find as a trader is not trading, something i'm trying to get better at - mostly as i see that is how one gives much profit back to the market - and i'm wondering what Colin's view is, along with the collective experience - do you just hang back during periods like this even though you see an opportunity to go long or short - and trade when the market is moving?
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spider
Member
Username: spider
Post Number: 788
Registered: 10-2002Rating: 
Votes: 2
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| | Tuesday, July 08, 2003 - 01:46 pm: |
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Yo kyle dude,
by definition traders trade.
Always remembering that deciding not to trade is a trading decision.
Your question gives the impression that you have not fully developed a trading plan.
My trading plan tells me when to trade, that way I don't have to think too much (as I am not good at it).
If my plan says trade, I trade.
If your plan sees a trading opportunity, trade it. Have your capital protection plan in place. If it turns out to be a turkey, bail out and protect your capital. If it is a winner, stay with it as long as you can (you are playing with their money now). Cut losses quickly, ride your winners with no fear in your heart.
All markets offer opportunities.
Sometimes the profit will buy a hamburger and not much else.
Sometimes the profit will get you a new Jag.
Be happy with whatever the market gives you.
The deal of the century comes along about once a week, so don't get bent out of shape if you miss one or two alone the way.
spider.
.
"The future belongs to those who believe in the beauty of their dreams."
Elanor Roosevelt.
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crossover
Member
Username: crossover
Post Number: 26
Registered: 02-2003Rating: N/A
Votes: 0
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| | Tuesday, July 08, 2003 - 04:55 pm: |
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Spider,
Silly question but any ideas on finding that deal of the century.
I notice on another thread that you are trying
Snifters system.
I am currently in the process of setting up the same sort of system and with Snifter away I am a bit lost.
I currently look for shares breaking out of consolidation or hitting all time highs and are looking at using Snifters ROC entry system on retracements for entries.
I am finding shares that are trending strongly dont retrace far enough on weeklies to get in.
I tried a day chart on ALN 2/7/03 AND SET MY STOP @5.29
but now Iam not sure that I should of put it at the more recent low of 5.53.
Would appreciate your input as although Ive followed the market for 3years and lost money on previous trades in the past,more recently Ive read Weinstein,Van-Tharp,Elder and Tate and reading IC forum I have made 3 recent trades being SIG at 5.47(ok)DOW AT.75(IFY)AND ALN AT 5.65
(IFY)AND I would appreciate your
honest thoughts
Currently risking half% on my stop losses and looking to pyramid on 2nd retracement once the trade goes my way.
Any ideas would be helpfull
Many Thanks
Crossover
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spider
Member
Username: spider
Post Number: 789
Registered: 10-2002Rating: N/A
Votes: 0
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| | Tuesday, July 08, 2003 - 05:50 pm: |
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Yo crossover,
Gotta be somewhere else so this will have to be short.
spider will steal a good idea from anywhere , anytime.
spider loves snifter dearly but, we don't look at trading in exactly the same way, although we agree on heaps of stuff.
spider trades new highs, snifter likes to wait for retracements etc, you get the idea.
You are reading the right books.
Don't get too hung up on indicators, price action and volume will tell you most of what you need to know.
Give yourself permission to gain experience (it takes time, and there is no substitute for time).
Preserve your capital while you are gaining experience.
At a time like this keep an eye on companies that are in a sector that people hate because this will change.
Learn patience and cultivate persistence.
Find someone who is doing what you would like to be doing, and drive them crazy until they teach you how to do it!
Celebrate!
Learn everything you can about why people do the things they do.
Study human history.
Appreciate what luck can do for you, and to you.
If this stuff is too general, ask me another question.
P.S. always ask heaps of questions.
spider.
.
"The future belongs to those who believe in the beauty of their dreams."
Elanor Roosevelt.
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crossover
Member
Username: crossover
Post Number: 27
Registered: 02-2003Rating: N/A
Votes: 0
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| | Wednesday, July 09, 2003 - 09:05 am: |
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Spider,
Very informative although a bit different than I expected.
Any reason on using new highs(is it that it confirms the trend).
By preserving capital do you mean to keep your stops as tight as possible(some say to give them room to move)so many different thoughts!
Celebrate?
Is there such a thing as luck in the market?
Thanks for your reply and as has been said before
it is great to have people like yourself and others on this forum to be able to turn to in times of self doubt and uncertainty.
Many Thanks
Crossover
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stan
Member
Username: stan
Post Number: 34
Registered: 10-2002Rating:
Votes: 1
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| | Wednesday, July 09, 2003 - 09:37 am: |
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g'day Crossover
'Preserving capital'
One can put a stop wherever - tight or sloppy.
Calculate how much capital disappears if
the stop is triggered.
Is this
less than 1% ?
less than 2% ?
Preserving capital in mathematical terms
can mean to risk no more than 2% of capital
on any one trade. Adjusting the number of shares
will vary the risk. This takes 15 seconds to work out.
Preserving capital in psychological terms can
mean to create a system that tells one when
to exit so that the trader is confident in 'pulling the trigger' to exit. This takes a lot longer than 15 seconds.
Preserving capital in six words;
do the maths - pull the trigger.
I may be telling you how to suck eggs,
but wanted to put my thoughts down anyway.
thanks stan.
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spider
Member
Username: spider
Post Number: 790
Registered: 10-2002Rating: 
Votes: 4
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| | Wednesday, July 09, 2003 - 02:08 pm: |
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Yo crossover,
Any reason on using new highs.
Good question.
Ever tried to push a large rock up a hill?
If it was a big rock and a big hill, you probably got to a certain point short of the top, and had to stop because you were exhausted. After a while the rock starts to slip back a bit and you lose some ground.
Luckily a mate comes by and offers to help, between you, the rock gets a long way up that hill before you are both too tired to push it any higher.
Meanwhile, a bunch of people who have been watching you, decide to join in (probably because they think there will be something in it for them).
Now that rock is really starting to move, IT GOES HIGHER THAN IT HAS EVER GONE BEFORE.
You know this because you can see the old marks on the ground where others have tried in the past, but failed.
You notice that you and your new mates, have moved the rock past the old marks on the ground, those that understand, start to get excited, some get a little frightened (they have never been this high before, they figure that they better get out before something bad happens and they get squashed by that rock).
The frightened ones leave , this causes the rock to slow down, maybe even stop or go backwards for a while.
All this activity has stired up a lot of dust. More people rush up the hill (they want to be part of the action, after all, no one has been able to push this rock this high before, they want to say that they were there).
Pretty soon the new dudes catch up with the rock and start pushing, away she goes, even higher. Some of the dudes who got frightened and left, come back to help push it even higher.
This goes on for a long time, with slightly more people coming along to join in than the ones who get frightened and leave.
Eventually, one day word gets out that the market for rocks has dropped off, and the fear takes over. Many people decide to get out, and the rock starts to roll down the hill, a hell of a lot faster than it went up.
The good bit is that you can see the change coming..... a lot less dust!
By preserving capital do you mean to keep your stops as tight as possible(some say to give them room to move)so many different thoughts!
You preserve capital by using stops for a position that does not go in the direction that you would like it to.
Also by not committing all your capital to just one or two trades. You have read the right books, go back and look at the various suggestions, pick one and back test it to see if it is right for you.
Celebrate?
If you want to last at this you have to have some fun.
And you must understand human nature.
Humans need and crave encouragement.
Who better to encourage you than you?
Mark your victories with a celebration.
Jesse Livermore knew how to celebrate, he used the money he made to live well, every day was a celebration of his skill. When he went home at night it was the home he built with the money he took from the market.The jewels his wife wore, the cars and the the yacht they rode in , all celebrations.
Everyday, when spider has been to the letterbox to collect the mail, he opens it with a beautiful, handmade sterling silver and amber letter opener. spider gave himself this gift to celebrate a job well done. Everytime he uses it, it takes him back to that time, and that excellent feeling returns.
Celebrate !
Is there such a thing as luck in the market?
If you don't believe that luck will play a large part in your trading successes and failures, then pack it in right now and save yourself a lot of pain!
Or better still, read "Fooled by Randomness" by Nicholas Taleb.
(For a concrete example, check out what happened to SNX today.)
Always remember that we are the luckiest people in the world because we have found this (trading).
Whether you know it or not, this is the ticket to your dreams. (This is a huge secret! Most people don't know, even the ones that are trading have not worked it out yet, so don't tell anyone, or they will all want to be free!)
spider.
P.S.
Don't take too much notice of spider at the moment. His best girl has been away for some time, and is not due back for a couple of weeks. spider gets a little crazy when she is not around.
.
"The future belongs to those who believe in the beauty of their dreams."
Elanor Roosevelt.
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crossover
Member
Username: crossover
Post Number: 29
Registered: 02-2003Rating: N/A
Votes: 0
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| | Wednesday, July 09, 2003 - 04:45 pm: |
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Stan,
Thanks for your comments.
I don't have any problems taking stops,Ive learnt it probably the most important part of trading just trying to get it right so I dont gie back to much capital but also that I dont keep getting stopped out.
Spider.
Classic post,I didn't think pushing a rock up a hill could have so much meaning.
Still waiting to celebrate.
SNX. Was that a footprint back in early May in the volume.
I agree about being lucky in finding trading as although it can be very frustrating and challenging I have finally found something I am very passionate about and enjoy being apart of.
I believe this is a ticket to my dreams just when they come true I'm not sure of
(Talk about a motivating sentence,that sentence of yours on luck and dreams made the hair on my neck stand up.
(The Ultimate Dream )
Thanks for your time,I'll hold of with anymore questions for another time.
Many thanks
Crossover
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