buying the highs

[TheBigShort]

The exact and immediate correlation between information and price is a false premise. Adaptation to new information is not instantaneous and at no point subsequently can ever be assumed to be complete.

This was very well written

 

[TheBigShort]

THERE ARE TONS OF MEGA CAPS ABOUT TO MAKE NEW HIHGS!!!! AAPL, AMZN, BABA, FB. ALL BIG RETAILS JUST MADE NEW HIGHS!!! I think this is THE crazy up leg before the end of the credit cycle. BUY BUY BUY!!!!

 

[murray t turtle]

It's at the new high for a reason. The underlying reason, a reflection of value, is more important than the price. Yes, the price might be high, but the question for any asset is what are you getting for the price? Buying a new high with strong volume shows conviction, both on the part of the new buyers as well as those short who decide to fold rather than hold.

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Works well,ET180, good points; just dont keep on doing it in a 2008 bear markets-not that i think you would. For those those that study trends much =makes a lot of sense. BUT only for strong stocks/uptrending ........IBD teaches this,[Buy Hi depending .....400 or 500 book page system] Nothing in my post would suggest buy on any Hi in bear market stocks like GE; it cant seem to get above 50%. NOT a prediction or stock tip.

 

[TheBigShort]

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Works well,ET180, good points; just dont keep on doing it in a 2008 bear markets-not that i think you would. For those those that study trends much =makes a lot of sense. BUT only for strong stocks/uptrending ........IBD teaches this,[Buy Hi depending .....400 or 500 book page system] Nothing in my post would suggest buy on any Hi in bear market stocks like GE; it cant seem to get above 50%. NOT a prediction or stock tip.

I think buying highs in bear markets could work to. Just maybe not stocks. Like if guv bonds/gold/biotech are rallying you could definitely go for the ride. Afterall, the money has to go somewhere

 

[mushinseeker]

TheBigShort.. I thought so too, this is why I tried it first on TLT as a "proof of concept" ie that if it works best in illiquid, it must work bad in liquid. I WAS WRONG vis-a-vis buying the lows.

 

[deaddog]

Somewhat similar to the method put forward by Darvas.

 

[jbusse]

Relatedly, buying 52-week highs works, on average:

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1104491

Pretty well accepted pattern among academic researchers.

 

[truetype]

Relatedly, buying 52-week highs works, on average: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1104491

Or used to work. That paper uses data ending in 2001!

 

[murray t turtle]

I think buying highs in bear markets could work to. Just maybe not stocks. Like if guv bonds/gold/biotech are rallying you could definitely go for the ride. Afterall, the money has to go somewhere

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TUSK has been in a weak sector; but could be a real big sharp[tusk type ]uptrend LOL

 

[optionsinvestor]

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TUSK has been in a weak sector; but could be a real big sharp[tusk type ]uptrend LOL

That's a very good point. Buying the highs of an individual stock where the sector is also making new highs should give you a better return. I'd say buying highs in a bear market will work too, but that depends heavily on your target and timeline. It's not going to be like a bull market where you buy the high and then you can leave your position there for months and just ride it higher. In a bear market, you can buy that high, but you will have to carefully monitor it and understand that the stock will not make huge gains before reversing back to the means.