I am advising the trader to use a system that signals a trade entry only when there is a sufficient expectation of a profitable difference between present and near future price.
Jack. I wouldn't be so confident about predicting that ho-hum reaction pattern if I were you. FVX and TNX have been creeping up this morning. The fix may be in. I would not be surprised to see half a percent.
But how does one come up with that expectation. The only way that I can see is to make up a future price. Whether I think oil is going to infinity doesn't make it so and if I think that coffee is going to pull back from its recent highs doesn't mean it will. You go long both markets because there is no way anyone can accurately estimate what p1 or in that case d will be for any trade. My system showed that it has a positive d with a 52% win rate. Actually other systems that have a lower win rate, like 25% can actually work better because they cut their losses and make big profits on their winners. I asked when I first entered this thread if you were looking for someone to predict the future, you answered no. But to come up with D or p1 you need to estimate a future price, which I don't know about other people but I am not very good a that. My system wasn't guessing at the future price all it was doing was saying that the 50 dma will continue to stay above the 200dma if not the trader will get short.ng at the future price all it was doing was saying that the 50 dma will continue to stay above the 200dma if not the trader will get short. Hank I don't know how you think the 50dma and 200dma are "curve fit" they are the most generic indicators I could think of and believe me there are much better indicators then MA. I know this because I currently work for a small hedge fund that uses trendfollowing as its primary source of profits. ANd you use the the terminology "riding the wave on your website" what is that if not trendfollowing?
I agree that there will be a smaller reaction today. If the series is muted so be it. In the extreme the run up to 2:00pm will not be flat but just a creep. Putting the vibs on an inclined carrier is not unusual these days. The world is a global market now and "Greenspans" do not matter much any more. There are many different global occurances that do the ho hum thing nowadays as well. Unfortunately the US economic process or whatever is at very extreme points in various sectors so we have contemporary market that are just a continuing grind to pull down profits in relation to the daily h/l's. What can i say. I knew the typing was going on so I posted the answer as soon I finished typing it.