A modest proposition: Let's sell 100 cars at the market!

Discussion in 'Journals' started by Lucario1106, Aug 2, 2014.

  1. A modest proposition: Let's sell 100 cars at the market!

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    Finally, I think this might be it: To wit, a wary naive I might be.

    15 years as a trader and small CTA I've swum upstream again a market tide since 2008 with a market underbid with "cheap money" , vis-à-vis, Keynesian support. The plethora of 3.30pm ramps, indiscriminate rally's on bad news and other nefarious price action have led us to this point, far, far beyond which logical tenets of aggregate demand proponents would have us believe. I don't know if we've seen the top, but we finally have a market to trade. Sidelines be you no longer!

    Before you assail me, I prey you understand that I too have IRA's and have benefited much from the "prosperity" as intended. I yearn (not alone I suspect), however, for the return of unadulterated capitalism; Where a natural market clearing is the end result of poorly allocated capital and that, in disguise, prosperity nor "wealth effect", is independent of efficient markets.

    This thread is for my benefit, to hold self-witness to trading correctly through the bear market. To understand that the greatest reverse rally's will always occur in down trends and to use technical analysis to support positions. To protect client capital above all and to have the wisdom to change opinions when the market demonstrates otherwise.

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    My background: I'm an ex-programmer and have recently left full time employment to pursue trading full time. I trade my own book and client accounts.

    Strategy: I trade intra-day trends or revision to mean scalps on a discretionary basis. Its not complicated; I follow the volatility and try to be "in cycle". I believe, if you listen, and remove yourself from personal biases, you will succeed. Bet big when right. Bet really big when right.
     
  2. Curious as to what made you decide that the bull market was over - I am of the same opinion, but still cautious as to calling it a bear market.

    Must have taken a lot of discipline to not trade on the long side since 2008?
    Are you a perennial bear?
     
  3. The problem with this logic is that there is no way of knowing if you are right until you close the position and calculate your profit/loss. In fact, always assume that your trade will be a losing trade.

    Now if you are saying bet big with your profits that's another story.
     
  4. +1
     
  5. Yes, indeed, the only time to be largely engaged, in backed by profits. Nary on ones own capital. The rote example for the market exit of all minor players.

    A perma-bear I am not: Rather I am "perma-long-volatility"; As you know, markets go up a staircase an down a ladder. This has been my frustration for the last few years, not the direction.
     
  6. toolazy

    toolazy

    you believe that volatility increased for good.

    what makes you think that ?

    asking because my models are predicting low volatility for a while longer.

    also frustrated because my swing trading gets no signals for 1 year now :(
     
  7. Seasonally, I don't think Volty has increased "for good". My best expectation is a little more of a drive lower in equities next week, followed by a sharp snap-back, but not great enough to penetrate the old highs. This, I'm betting, will be the best time to short. Anywhere in 1950-1975 looks solid for a 6-9 month swing. Targeting the 33% Fib as a start. It will be rough and bumpy, and hopefully make for great trading.

    Still, as noted earlier, stops above the all time highs are prudent, but be aware that a "piercing" high and reversal is still on the cards and would make for the short of all our lifetimes.
     
  8. The only way to solve this problem is to look for your particular trading setup in dozens if not hundreds of stocks (domestic and international), indices, currencies, commodities, bonds, ETFs, financial sectors, etc...

    It is a big mistake to concentrate only on one or two financial instruments, you will only waste your time while waiting for a trading signal.
     
  9. Re: xelite777

    I'm tempted to agree, but would be remiss to not digress....... and I hate to mention this, but the (risk on / risk off) correlations running through the market. Consider the following case on a simple Friday NFP report in the last 5 years:

    Beat: Sell USD crosses, sell GC, Pound the Bills and then panic buy equities all day and even more so into the close. Special points for going bananas into month end, or hit all power ups into quarter end (just look at any chart for the last day of the quarter for the last 5 years to confirm). This has been the best trade in the last 5 years.

    Miss: Sell USD (Moar QE!), Buy GC (Inflation!), Sell, then Buy Equities (The classic Friday Trap!)

    Lopsided and one-way. The reason for the initial post is that things have reversed. Let's see how it plays out.
     
  10. Didn't get much of a back-test this week. They tried hard on Wed but it was sold hard in the afternoon and again on Thurs.

    Big support at 1900 on the Spoos but overnight it looks heavy. Don't be one of the people that says "I could have sold at 1900" in a few months. A correction is coming.

    Short YM, NQ, ES, AUD
    Long GC
     
    #10     Aug 8, 2014