This could be a really wild day. I am looking at these levels today: 760 to 768 789 801 817 to 828 very stiff resistance 851
This frame and the next will show the first charts that I look at everyday. I always look from the larger frame downward and I never trade against the larger frames. If someone is daytrading the 5 minute chart, they would consider the 30 and the 240 as their larger frame charts. If one is trading the daily as I do for position trading, one considers the weekly and the monthly for their basis. What this means is that if you miss a setup on the long frames that I trade, you must be patient for the next set up and try not to force the trade by shorting the bottom or buying the top. It is rather unlikely that a setup will be missed though when you trade long frames like myself because you have quite a bit of time in order to consider all the variables and risk. I believe I have now accomplished what I set out to do in this journal which was to demonstrate the negative aspects of daytrading. ie stops too close, stops too far away, chasing the market, indecision etc etc etc. I will continue to post, but the knowledge one will have gained here by watching me demonstrating failure should be very helpful. Good trading all--
Compare this monthly chart with today's posting of the monthly. I have been told that my tools are antiquated (RSI, BB, MACD). But it turns out that it isn't so-- http://www.elitetrader.com/vb/showthread.php?s=&postid=2074984&highlight=monthly#post2074984
when you say you're out of equities, do you mean that you are short as opposed to flat? you are dollar cost averaging by shorting every time there's a rally?
No. I am speaking of the 80 percent of my portfolio that is outside of the trading account. I have been in cash for a year and that money gets moved back into equities gradually as we drop.
2 areas am looking at right now. If intervention happens on usd/jpy, a strong break below of 780 and snap back above, a strong rally is in play. If no intervention, I wanted to see limit down before buying. p.s. I repeated that many times here - no limit down, no bottom.
If one were to take a position trade short here where the market is already oversold, that person would need to realize that a lot of pain could be inflicted prior to them receiving a financial gain. When you sell on an oversold basis like this, the correct stop is necessarily going to be well away from the market. In this case, the correct stop out would be 1075, a full 280 points away from entry! I'll put one contract on short here at 795 with a stop of 1075 in order to demonstrate.