Registered: Mar 2002
09-07-12 03:44 PM
Quote from FJMcC:
Just strarting to incorporate some of the methods into my trading. No question that a lot of good signals and R/R setups come along when using Fisher's framework.
The one question I have is about the time spent above/below and A level before confirmation. Throughout his book he repeatedly emphasizes that "good" trades aren't available for very long. He goes as far as to call the traders who take their time at certain levels the market's equivalent of the casino bus people. Then I am supposed to wait X minutes after a breakout of a Y% of the ATR to "make sure" I am right? That doesn't make a lot of sense to me.
If someone more experienced could comment on this, I would really appreciate it.
The word here is nuance. You need time to confirm price. But once time confirms, you want to see follow through. I believe most traders ignore time in almost every aspect of their trading. And example of this might be trying to buy the low and the market is just sitting there and not moving. They need to get out. If a market is going to bounce off the lows, it needs to quickly, not slowly.
If a market is going to breakout, it shouldn't play nice and wait for everyone to get on board. This is really where experience pays off though because there are always exceptions to the rule and times when you have to realize the subtleties.