Fear and The Market 1 of 2

Something that is an handicap you can exploit as an advantage. Each time you have great fear write it down, write also what the market did. After you have enough historical datas, look if there is a significant correlation : then you have a technical indicator of your own

 

I'm glad you enjoyed the post. Yes that is another fear I...missing out. I tried doing that too, dropping down timeframes. If I were you, I WOULD NOT DROP DOWN timeframes, (IF YOU'RE NOT USED TO IT). You may be causing more damage. You'll go from being a marksman, to a "tommy gun". I'm not going to say yo won't do better, but I would concentrate on staying with quality trades, dropping timeframes won'e solev he problem. Pretend that you're a venture capitalist worth BILLIONS and you only look at a few deals a day. Try that first.

 

Glad you enjoyed it. I guess that means, there will be more on the way. Happy 4th

 

See my replies to your post (in the quote above), starting with "RAMOUTAR SAYS". I have also enclosed (below) a scaling strategy for a swing that I'm in now. You'll see what I mean when I adjust not EST, but add E, and adjust ST, feel free to refer to the QCOM daily when looking over the journal.

QCOM (scaling swing trade journal)
ST=short term (profits taken on failed patterns)
LT=longer term (profits taken at target on continuing patterns)

6/18/03

Bot 500 @ 34.70, stop at 34.10 ($ .60 risk) next entry 35.90 (or a target if pattern fails, $1.20 reward) LT target $38.72

risk= .60, reward = 1.20

I will use ST target if pattern fails. If pattern continues I will continue to average up and use LT target.

6/19

Bot 500 @ 36.50, new average price = $35.60 stop at $35.08 ( .52 loss) new ST target & LT target are the same, $38.72

risk= .52, reward = 3.12


7/2

Bot 500 @ 37.08, new average price = $36.09

raise stop to $35.24 (.85 loss) ST and LT target reduced to $38.18 (re-evaluated supply on daily)

risk = .85, reward = 2.09

7/3

I raised stop to $36.58 for 1,500 shares , target still at $38.18 will pick up last 500 at $37.90 if stock trades higher and takes out highs from 6/19. 7/1 and 7/2

On Monday, if I buy last 500 shares at $37.90 my avg cost will be $36.545. My stop will be raised to $37.15.

On 2,000 shares, if stopped, I get $1,220, if target is reached $3,280.


If stock doesn’t trade above the three highs, I’ll hold at 1,500 shares and my average cost is $36.09 and stick with $36.58 stop a $735 profit.

This is one of my swing trades. I provided to you as an example. NO FEAR here, I've planned for the worst. PM me with more question if you need blt! Happy4th.

 

I'll need to hire an editor. Was it a pretty post, or pretty good post?

Be well.

 

Right on!

 

You need to rework your rational for trailing stops. It is incorrect by any rational reasoning.

I suggest you disconnect from any postion considerations and deal with market conditions only.

My assumptions include the consideration that your exits are not related your buys or your stops. At least that is what I hope.

It is hard to believe that you leave as much money sidelined as you do. It will be very difficult to come up with a trationale for that whne you get to that consideration.

How will you ever get to optimizing your money velocity if you throw all these road blocks up?

 

Start a journal...

... also...

Too long... just hit the point and say...

Fear comes from the unknown...

Fear needs to be overcomed by confidence...

Confidence comes from knowledge and experience...

Knowledge and Experience leads to understanding, acceptance, respect and control(management) of risk.

Too much writing defers the point of a text...

 

Thanks, Bubba. Remember, those trailing stops are on a scaling swing trade. Not an all in position trade. On scaling positions I add as the backfill is put behind me, this gives me more secure stops. I use the same method when scaling on a intraday basis. This method has proven to work well in the context fo corresponding trend, especially in a position that has tighter intra day ranges. This scaling strategy also allows me to build a position more cautiously, rather than go all in on 2,000 shares at one time. The example I provided was to answer a question posed in the preceding post. The velocity of money is dictated by the velocity of the vehicle its riding, not the money and risk management strategy. At this point in the QCOM trade I have nothing to lose (if I am stopped out), and everything to gain (if the target is met). The flipside would be to expose myself for 2,000 shares off the bat, and increase my risk. Thanks for the exchange.

 

I said in an earlier post that I needed and editor, you'll be the first one I come to . BTW, can you sum up "War and Peace" for me??