when he said in Market Wizards that " The best trades are the ones in which you have all three things going for you: fundamentals, technicals, and market tone....if you restrict your activity to only those types of trades, you have to make money, in any market, under any circumstance. I am trying to develop an integrated method on a swing/position time horizon. Would appreciate all your opinions on what Marcus said.
Market Wizards was really a good read. Seems that maybe he forms biases based on one of those three things, but he won't execute unless they all align? Seems like a reasonable and smart long term approach.
He is speaking of three things. You mention these. In transferring knowledge from the expert and skilled, there is no bridge possible when it is done via a transcriber or somesuch. Thus the Wizards books do not do the bridge work. Many sources tell the same story you mention, so it is true you have arrived for getting the solution you desire. Ignore Nutinsider, please. Each part is found in a separate place. Once you gather some parts, then you can focus on letting the market take care of the details. All you do is go to the mailbox and get the checks. Fundamentals is a go/nogo matter. You build a quality Universe. Technical is an effectiveness and efficiency matter. Here you, eliminate time as a variable. This is done with a one pager (look up table) using a leading indicator of price. Tone is akin to exerecising. In a word, what you do is get in shape so everything looks the same, i. e., "they all look alike". This is where the "repeatability" issue is solved. From what you say you are most interested in getting your own solution. best of luck; it works out better than you have read.
NO. And it is a position trading consruct as the OP pointed out. It is strange to read a person writing that he "thinks" something or other about a space he will never occupy. The "Wizards" were written to sell books.
1) On "paper", it makes logical and rational sense to want to initiate trades when you believe "everything" lines up perfectly. 2) Marcus may have had his best years when trends were more persistent and coherent. Today's longer-term trends seem more volatile and that makes it tougher to get "bigger" profits while attempting to hold for a "longer" period of time. The "slop & chop" can be vicious. 3) Develop what you can but be prepared to shrink your time horizon and profit objectives.
It means that you buy things with good fundamentals that are going up and are not going down much on bad news
I notice the same things but I don't use them for actual trading. This is for long term trading (holding positions for months and years). Fundamentals = I imagine a reason for price values to change. Technicals = I look at the price graph and observe that price values are changing in the expected direction. Market Tone = How do traders respond to news? If bad news appears do price values rally? If good news is announced do price values decrease?