The reason you don't skip is called market risk. Assume the market goes up or down in a big move and you are on the wrong side of the trade, you are going to get hurt. To avoid this problem, one can day trade after reports are out speculating on market direction. Assuming you have an edge, you will win more than you lose. Problem then becomes psychological in making sure you take your stops and letting your winners run to their targets.
Please listen carefully. I trade QID and QLD, right? QQQQ, the powershares ETF, is its underlying. If I'm long QLD, logic says I'm short QID. You see? I can admit in the case of pairs that aren't too strongly correlated, you'd need to do that, but we're talking about QID and QLD. See if you can follow this? We are oversold. Go long QLD, right? Why short QID when going long QLD will do the same thing? How 'bout this one? We are overbought. Go long QID, right? By going long in QID I am short QLD <i><b>because they are the same underlying, so you don't have to short anything.</i></b> Do you follow me now? I've tried explaining this zillions of different ways, and I guess it only applies when the securities have the same underlying. Like with SPY. If we are overbought, you go long SDS and are automatically short SSO. If we are oversold, you go long SSO and are, in essence short SDS because you have the same underlying. You don't have to waste your commission money. In the case of spuriously correlated pairs, like the BAC XLF pair trade I heard a talking head do, by all means, you'd probably need to be short the overvalued and long the undervalued, but that is not the case if they had the same underlying. Does that explain things better for you? Anyone else?
And the man of the hour is: That's right, ME. My QDOS was a lot lower going into this year, now I've jumped by about 40% from around 1600 to 2200. It's a measure of net activity impact, and it's only useful if you're actually comfortable with your real name being out there on the internet for people to read.
Hope you are still following this thread. As you have stated, it seems to me that we have had the B2B, pt2, pt3, and the resumption of the R2L. I am currently waiting to see when the commercials are going to cap this move with accumulation of shorts. Do you see with tomorrows newspaper today a possible full traverse of this long channel or a possible range extension? ...maybe even a few R2L traverses before the end of the Bull retrace? Thanks. Today was interesting as we broke the left line of the rising bull wedge in the SPX. The QQQQ and INDU still have that left wedge line to challenge in the days ahead. Also wondering what the actual catalyst will be that will resume the Bear market...
After reading more carefully, I noticed you did mention it will take just 3 traverses. Does this include the dominant and non dominant. Thanks.
QLD Projection: 47.904989355737 QLD Close: 51.2999992370605 QLD Projection: 52.076364066384 QLD Close: 51.2999992370605 QLD Projection: 50.3527623494467 QLD Close: 51.2999992370605 QID Needs to drop 0.106575063209566% Up Threshold is $ 22.9744597407592 on QID 65.5430711610487% of the time we, have been fairly valued in PTQQS Looks like QLD still has some room to run, and when tomorrow comes and we keep rallying, I'm sure QLD will be predicted to go even higher.
As you see on the attached chart there a lot of wiggles on the Bull retrace of the Bear depression. The depression started off with a point 1 of the depression. The dominant move down ended at point 2. Then the Bull retrace began. This in terms of time is a replay of 1929, etc. (shown in grey). I put in the point 3 for 1929 and that gave me the container for the whole depression which lasted many years going into WWII where it ended by the war. Sorry about the scale limitations; the chart is asymmetric because of scale choice. As you suggest, within a Bear deppression or Bull retrace of the depression, there are many different fractals and each of these fractals have complete building blocks of orderly P,V movement that is fixed in stone. Within the Bear depression and the bull retrace there have been many faster completed building blocks composed of just what you described. Now we go into the longest leg of the depression. At the top you see the years scale. the 1929 depression 's last leg took over ten years to complete. A lot of financial weeding goes on in depressions. I was born in 1933 and did not start trading until years later. For me this event started in late JUNE of 2006. Any movement within a container to go across it from R 2 L (right trend line to left trend line) is a dominant movement. Going from left to right is a non dominant movement. Volume shows this sentiment during the crossing from one side to another. A short crossing of the Bull retrace cannot be the last crossing; it is, in fact non dominat. The last attempt at crossing is a dominant effort and it does not succeed. by looking closely at the attachment you see the last nondominat crossing is followed by a partial dominant going up to where point 3 occurs. This is the FTT of the Bull retrace of the Bear depression that has begun. We are now on our way to the RTL of the Bull retrace. First you will see the nondominant retrace to the RTL of the last long failed attempt to get to the LTL of the Bull retrace. As the trough of volume occurs, after that volume will begin increasing as the first leg of the trip to the RTL of the Bull retrace is completed. Two things follow to complete the BO shortof this last long FTT within the Bull retrace. there is a nondominant long briefly (to point 3 from point 2) and then a FTT to complete the BO movement on that fractal level. it is going to be like the longs that come along as segments give reprieves on the way to the RTL of the Bull retrace. There does come the time however when a lot of shorts on a lot of fractal levels, concurrently are concurrently occuring. These important moments allow a lot of profits to be taken. As containers steepen, then the non dominant moves become horizontal and no profit segments are available. This is not wasted time since being on the right side properly allows you to catch the quick reversals just as the leading "tells" give you reversal signals out of the status values that come to ends. Most time is spent holding as segments complete. This is all measured by status. End effects announce the signals for reversal. every reversal is a simultaneous buy/sell signal or a simultaneous sellbuy signal. This is the moment when the non stationary window moves to the right and the past before it goes into the archives. Non stationarity is NOT measured by fixed look back times (see the common mistakes of Trader666). At reversals the look back is zero time. I tried to suggest the ratio of three to one for the movements relative to nested fractals. This may not have been informative for most. People often trade on a given fractal and it is important to understand how many fractals they are trading from the outer economic envelope. In the current TA thread you can read that no posters know anything about the nesting of fractals or even where the current market is. MTA doesn't know either and they are making up the Fall tests....LOL... As Mike said today by iphone, there will not be a paper option on level 3. The level 3 will be fun this year. (I'm not an SME for level 3). So we are in an overlap period from the Bull retrace completion (final FTT) to the crossing of the Bull retrace RTL. After the RTL is reached then free fall begins and high voume (and volatility). See the attachment for the 1929 example of the freefall after the depression trendline is in place and theBull retrace iscompleted by the BO of its RTL. Historically, you can read the calls on the '87 which was called a crash. At that time the "rally attempt analysis" of WJO'N was popular. It failed four times before the crash and corectly designated the recovery a couple of days before the results were posted in the IBD. In 2009, the platforms are really souped up and the "tells" lead quite nicely so there are no surprizes unless you are using the myths of the CW.
I don't know what to say to this. It appears you superimposed, wait for it, <b>STRAIGHT LINES</b> onto someone elses' chart. Jack, if you want to say the market will go up, just say it. Multi-Decade old history has no bearing on the current market. I think the most you'd want to go out is 15 years, because that's when the age of technology starts, and when we have a more complete historical record of current events. The causes are not the same, even as it states at dshort.com, but about the only thing I agree with is that there is a fundamental, psychological tipping point from the depths of a depression to the most grandiose optimism. It is only on that point that I would agree with the site you pulled this image from. Paying $400 per share for AT&T (Old firm called Bell Telephone) back then (1929 split adjusted price approximately from what I recollect of historical documents at the time) is still just as stupid as paying $400 per share for AT&T today.
Elewhere I commented on the chart scale chosen. The chart was posted on ET. As is known, I work from a paradigm. The hypothesis set uses four key words: Increasing, decreasing, continue and change. Hence the straight lines which represent the four words. To be clear, increasing and decreasing are shown as slopes. Continue is the extension of a straight line. Change is where one line segment is replaced with another segment. What is nice about this is that V and then P are annotated with line segments that are "tells" from the market and all "tells" are 100% certain. Using sets of binary vectors on nested fractals creates certainty at the smallest observable level. Then level by level, where level means fractal by fractal, the building blocks are put together. The ratio of movements, fractal to fractal, is 3 to 1. Think through why it has to be an odd number, for example. Wonderfully, trends, (profit segments) are repetitive so a person is not reacting to the market but instead anticipating What Must Come Next (WMCN). There is a major choice in trading. You chose to deal with the contemporary scene and its context. (many others took advantage of the AT&T breakup by doing their homework on a vastly different level than you) I did not entertain your approach. I chose to use science and logic theory. Everything I use was dictated by the markets. Over the short period of 53 years, the application of science and logic theory has not changed. Papers continue to be written on the advances of science and logic theory; fortunately, they continue to confirm my approach. The repetition of market crashes and depressions is part of the global culture. Settings and causes change; that is a priori. What does not change is how the mind works. Any mind is capable of learning and creating a long term memory resource that solves, rationally and logically, the opportunities presented. In the case of markets, which is not rocket science, the rough equivalent of trading is driving a car. Read my document entitled Dr Hu, where you will find the over 20 illustrations of how the mind performs in a parallel way to driving a car. This depression has the standard turning points of all depressions. Depressions are slower fractals than market crashes which are on relatively faster fractals. The beginning point of a depression is in the prior Bull economic market. A period of overlap ensues. At some point the overlap ends (and it was measurable) and the envelope of the depression can be provisionally established. (Meaning you always know the right side of the market) Later the envelope is made most certain by mechanical processes. For a hypothesis based system with parametric measures, this phase of establishing the depression is happening. Therefore, those involved in critcal thinking generally choose to make their analysis results available. In the past, it was my custon to suggest the next annual set of legs (legs are observable price/volume movements that have definable slopes and velocities). My most recent was for 2008 and done in December 2007. This period we are in now has several very negative connotations and any detailed commentary would be considered incendiary. During two stints at EOP, I was restrained from connecting A to B because of the panic aspect involved. During one of those it fell to me to dismantle WIN, since it ws an inappropriate non solution. The steering committee involved 500 leading CEO's in the US. In terms of establishing the envelope of a depression, that point has now been reached with the advent of the end of the Bull retrace of the Bear Depression. This is the scientific process using applied logic theory at work on a serious contemporary concern. I posted the '87 example and the media posted the turns based on the method used then. There are abundant references on the sequence of that process unfolding and the calls though the period. What is very important, for a trader, is to have the foundation and building blocks in hand and operational for this period of market behavior. The reason I say this is that there will be times when mistakes cannot be corrected easily. To be more specific, there will be cascading and during cascading stops will be hit and passed and no related fills will be occurring even with consideration to FIFO. Various locations, like dark pools, and invitation only networks will be stepping into "outside" markets to prey and get advantages. One of the myths of money and risk management is using stops. Unfortunately, someone of opposite orientation has to fill your stop or if absent the stop is not filled at that value. Client preferential treatment is a common and undetected convention during these times. To avoid the negative aspects of cascading, it is a good idea to get used to always being on the right side of the market. Look at the "closing rally" thread yesterday. Don't expect a moderator in ET to step in and make an editorial warning to readers. Do a survey of the man in the street who has a financial advisor. For some reason a lot of people have not done well over the last couple of years. It may be because the advisors are not competent. Go to the MTA site and listen to the video for test preparation; is there any way in the world a CMT could be competent? Probably not. So the scenario comes down to the majority having the same view and very few people facing them to facilitate their exits from being on the wrong side and then getting really upside down. If a lot of people get upsidedown in given IB's, the IB's will not be performing properly either. In the near past, several people I work with had the experience of holding through about a 90 point move during one day (26th or27th of FEB). What they saw from the right side of the market was others really taking a beating that those people had no recourse to stp out of the market. After their stops were passed, these losers had to wait in line for the market to find a price where someone would face their exit long after their desired exit. They were way upsidedown and their IB's could not get them out. Today traders have to have a substitute for money management and risk control that is not the conventional since the conventional doesn't work during cascading. The maintenance of orderly markets lies with Reagan's committee at the end of the passing the buck line. Recently, these people and their organizations have been doing several unprecedented things and not enforcing reporting requirements. There is an almost daily rehersal of "hopefulness" being broadcast by the media whenever the media is granted an interview. The questions are like yours and you opinions. So unfortunate. Upsidedownness in many venues is now on the table. It is a good idea to have an immunity to this. By being on the right side of the market when your IB has to deal with a disorderly market, you have the greatest advantage to survive. Either you keep your positions or you settle with the IB on a prorata basis when the IB is teminated. Obviously a lot of people will not have to handle their mistakes or be called to task because of the mess that makes them small fish. Looks like a multi IB situation to me.
Your reply to my request was probably the best post I have read in the past 6 years. I am currently playing the lateral trend that the FTT has created. When we break and reach the RTL of the bull retrace, I will look for the accumulation and hopefully be able to play the non dominant retrace and the pt 3 of our first leg of the bear resumption. After that it will be a real downer.... YOU ARE ON FIRE with you latest posts. Thanks.