Sounds this could become a rags to riches story, haha. What made you leave his firm? What's the name of the restaurant? The food must be good
Because I was long SPY and ES at the same time and I'm still long SPY with a nice profit. I bought more SPY on the way up too. Had I done the same with ES without even pyramiding on the way up, I could have 140 pts. profits. Basically with ES, I would enter as a position trade and exit on any pullback, where as with SPY I would add on pullbacks.
I was an intern only so I did not get paid much. After I finished school in 2003, I received a full-time job, in a different industry.
Okay here are the rules from Gary Smith's Book: For entries. 1. V-Bottom Upside Reversal. 2. Late day upside Price Surges. 3. Extreme momentum Days. 4. Friday to Monday momentum. For exit: 1% true selling day. Here is what I have in my chart. Daily chart of SPY/IWM, 13D BB with 1 std. On a weekly basis I like to see where the 65W MA is and where price is at compared to the MA. If yo pull up a 5-10 year chart of SPY, you can see that 65W MA has been a major S/R. As prices are moving up, I would like to see both IWM and QQQQ outperform SPY. The last two days IWM has underperformed SPY. If IWM doesnot outperform SPY on Monday, I'll start tightening my stops or I might sell part of the SPY that I have accumulated.
The problem many of us have including myself is that we trade too frequently. We try to go long and short thinking we can catch the up and the down move. Many times what happens is that had we stayed with our initail position we would have been much better off. We would have made more money, paid less commisions and so forth. In May I was short ES and it ended up being a good trade. I went to visit my mentor to tell him how I was able to short at the top. He pulls up a historical chart, puts up a long-term MA and tells me that I should think about covering the shorts and wait to enter long. His always said, the long-term trend is clearly up. Do not short. If the market is weak, just sit on cash--but do not short. How many times have we seen people make lots of money and said, "He made it during the bull market", and then there we were during the bull market but nothing to show for.
I have found that the trend in high-yield bonds work as a leading indicator. This makes sense because if the companies with bad credit can make the interest payment, then good companies should be too. High-yield bond funds make the top before the overall market does. When looking at the bond funds look for Morningstar's 5 star funds from a big fund family like PIMCO or Fidelity. Moderator: Can you please change the title to Doublea's Journal.
As long as the high-yield bonds are trending up, I'll look to buy on any pullbacks. I do not short stocks, only futures(and that has been my weakness). If you look at the historical performance of high-yield bonds, most of then topped in mid 1998. I define bubble when the stock market and top performing high yield bond funds start going in the opposite direction. In 1999 and 2000 the junk bond funds were unable to make new highs but the stock market was making new high. In beginnig of 2000 the junk bond funds broke down below the support. This was a warning sign. What we are currently seeing is the junk bonds breaking out of a trading range to the upside. I am bullish right now. I will liquidate my positions if there is true 1% selling day i.e. All four indexes down more than 1% on the same day.
Here is my list of funds that I look at on a monthly basis. http://screen.yahoo.com/a?cc=HY&proy=0/10&b=1&z=trfy&db=funds&vw=6
It looks like IWM has underperformed SPY and QQQQ for the last few days. Might be a good idea to buy some puts here.