I am glad also that Lundy took his position publicly, because it generated some good discussion. I think his posture and statements were deserving of the ridicule they received. I have also begun to establish some long positions on the market for the longer term - 2 months plus for a long term account. I am in the Naz at about 1350 and in the S&P at about 950. My intention is a scale down of which I have about 1/3 in place. However, I think it may be some time before we see the S&P at 1000 again.
Easyrider, you are completely WRONG!!! Going long has nothing to do with buying a bottom!!! Picking tops and bottoms is a low percentage, risky business. It makes much more sense to buy rallies, stick with the trend, and go short on pullbacks. I dont think this is the bottom, I feel much is still overvalued....but I dont care is the point...I trade what my system tells me every day....sometimes its only for a few seconds, sometimes Im on a poisition for a few minutes. Who cares where the market goes, as long as my system continues to work in these odd markets.
Lemme splain: Most traders wait for a pullback before entering. Are you not calling the bottom or top of that pullback?If you are entering without waiting for a pullback then I guess its true that you are not calling a top or a bottom but I dont think that is the norm.
Gents, if you re-read my previous post you'll see I never meant to suggest that you couldn't call tops and bottoms, although for many it's a low-odds play. Of course P2 makes a very handsome living doing just that, but most fail miserably in that endeavor. All I was contesting was the notion that.... "Trading is all about calling tops and bottoms. Every time you go long you are calling a bottom. Every time you go short you are calling a top." Even on a long setup, when I buy the pullback, I'm still not necessarily calling a "mini-bottom" as all I want, from whatever price-point I bought, is for the stock to go up and hit my target before it goes down and hits my stop-loss, that's all, nothing tricky.
It does look as though your target, on the long trade, is at or just below your "top" call - within the relevant time frame (and possibly other parameters) of your trade - and that your stop loss is probably just below your "bottom."
Easy rider, dont be ridulous.....a bounce or pullback on an upward on downward trend is NOT a top or bottom, thats retarded. By your logic, each day there would be thousands and thousands of tops and bottoms in a stock. Read a book on TA...
In other words, every trade that includes entry rules, profit-taking rules, and loss-limitation rules inherently includes relative tops and bottoms. I have no trouble taking the "retarded" position that such a perspectives implies numerous tops and bottoms through a given trading day, presuming that the trader's time horizon is minutes or even seconds. I frequently trade off such tops and bottoms, on, say, a 10- or 25-tick chart, or even as read off the transactional "tape." Even a pairs trade or a straddle or some of the more complex supposedly "non-directional" options trades can be re-conceived along similar lines.