Catching Tails

OK, here is the correct buy signal I should have waited for. Channel breakout on what I perceive to be the threshold of wave iii.

It's shaping up to be a scrumptious inverted h/s pattern, but -1 for lack of discipline.

:D

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Quote from Handle123:


I think some of the best trades are always failures, generally cause smaller traders are afraid to take them. The trades that are hardest to take usually are more profitable than the feel good trades.
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Small traders do not know how to trade. That is the conclusion. And why they do not know to trade because:


1) Under Capitalized
2) Lower Educated ( lack of higher education)


They are gamblers. Gamblers just roll the dice. As for Elliott Wave, the indicator is outdated. It is used for the depression era during the 1930s. To become a successful trader, one must develop their OWN indicator and not used others outdated indicators. Those that used the outdated indicators are failure traders. Those that created their own indicator like HFT, are winning the game.


P.S my comment is replying to Handle123 and not OP. OP, continue on your elliott wave theory.
 
Quote from emg:

As for Elliott Wave, the indicator is outdated. It is used for the depression era during the 1930s. To become a successful trader, one must develop their OWN indicator and not used others outdated indicators. Those that used the outdated indicators are failure traders.
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I understand that by publicly showing my methodz, there will be difference of opinion. I have had GREAT success with catching the third wave when I wait for all indicators to show divergence and a huge green candle on the breakout.

I clearly miscalculated this time, as the trade grazed the mountaintops on friday just above my stop. I'm holding for now because some of my best trades did the same exact thing - push me to the point of wanting to liquidate before my stop, right before taking off.

What went wrong? Anticipating a breakout, rather than waiting for it to appear. This is my most persistent personality weakness with trading, and why I wanted to take it public, to get such a lashing for errorz that I will not do them.

The situation:

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My worst problem as a trader, by far, is not waiting for the very best setup. I'm open to suggestions....

:)
 

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Long BAC stopped out for 4.2% loss @ 9.28........

The good news: no slippage whatsoever thru Tradestation for an order this small.

The bad: The Market has taken disciplinary action against me for not waiting for the full setup.

:D
 
Good evening, my Elite Friends.

Monthly equity curve update for your enjoyment. The account, normalized for deposits, is up 7% for the year but I trade my worst when I'm high on a huge tail event. This is my #1 problem.

I'm surprised none of you busted my ballz for not waiting for a buy signal on that last trade. Perhaps you're waiting for me to get into a long drawdown.

:D
 

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And for something totally different, consider RIMM, the disaster chart, the management shakeup, the investor sentiment at an all time low.

And guess what - sentiment is typically at an extreme during wave 5, wave B, and wave 2 - all part of the basing process of a major trend change.

Here is the chart. Wave 2, to be valid, does not go below wave 1 so RIMM will be off my radar if it it goes below $12.40.

The buy signal will be a huge green candle through the 50 SMA (recall that BAC did just this after it bottomed on $5 earlier this year).
 

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Quote from emg:

Small traders do not know how to trade. That is the conclusion. And why they do not know to trade because:


1) Under Capitalized
2) Lower Educated ( lack of higher education)


They are gamblers. Gamblers just roll the dice. As for Elliott Wave, the indicator is outdated. It is used for the depression era during the 1930s. To become a successful trader, one must develop their OWN indicator and not used others outdated indicators. Those that used the outdated indicators are failure traders. Those that created their own indicator like HFT, are winning the game.


P.S my comment is replying to Handle123 and not OP. OP, continue on your elliott wave theory.
More...

Common Indicators are to help identify turning points, but they are not needed for entries, and really don't need to re-invent the wheel. Because newbies are uneducated, they will spend years to find out that re-inventing the wheel was a waste of time. I like using the TSI on all timeframes starting with monthly, then weekly, etc. Matter of fact, great thing about stocks is you don't need a lot of money to start, you find a stock to buy and in mean time you study. So even if you have say $2000, divide into five and use brokerage that charges by the share. Long term to me means exactly that, staying in for months to years so I can accumulate trends along with the gaps.

I use other people's indicators all the time, but I use them a bit differently than what the books say. The cheapest risk is at the extremes of monthly bar charts, now you can be aggressive if you have an account over 25k, but if it is less, I would suggest to wait for confirmation of either monthly or weekly flipping on other side of Ema 20, I luv the best trades showing divergence on the monthly, when TSI flips to up, I can start watching the weekly bar charts. I do have to risk the lows minus a few cents on the weeklies when applying a breakout of highs on weeklies. I don't use dailies for entry much.

And you are right, if you don't have a trading plan, you are a grambler. The concept of Elliott is not outdated at all IMO, it is just not understood well, but once one can identify first two waves, then one can get into wave three for the blunt of the profits and then tightly trail stops for completion of wave five. We could go back and forth all night on higher education, has little to do with well backtested trading plan.

But I believe that too tight of protective stops does not allow for upmost of profits.
 

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I really appreciate the (constructive) input. As you can probably tell, I'm an amateur. :)

And I LOVE the long term charts. Thanks for the insights.

The "tight" stop is something that would have saved my account several times in the past. I actually considered it a bit loose on this occasion, being below the most recent swing low.

I've gone through a few stages as a trader:

1. Subscription services (long option position trading) with mixed success

2. Self directed discretionary (long option position trading) with HUGE success during my first month (BP puts during the well blowout)

3. Slow account death as I "learned" from various gurus

4. Breakthrough as I asked for help from an Infinite Source, and EW was revealed as The Answer :)

5. HUGE success for a short period as I put item 4. into practice

6. Performance decay as I rejected EW and just focused on buy signals alone

7. Study of Trend Following / Automation in pursuit of "the perfect" buy signal

8. Ultimate Realization that buy signals / trend following on its own is still discretionary - systems don't last forever and OOS testing busted some of my hopes

9. Breakthrough #4 repeats as I ask, again, the Infinite Source for help and EW is the answer, again.

10. DECISION - EW and the third wave are it - the grail for my own mind. No longer interested in taking the easy path of buy signals, automated or otherwise.

EW is not good enough on its own - it still requires momentum confirmation and a tested buy signal.

Trading is the greatest challenge I've ever come across.

PS - Pattern43, if you drop that same junk in this thread about coveting, I will refute you vigorously from your own Book......
 
wide, i never learned ew and this guy hasnt posted since 09 but go back and read mup posts in the ew thread, he nailed it quite often intraday ,quick free lessons..and i think this guy is out on his boat lately but found him ablout 3 years ago,great source for trade setups,his trades,tells you why when and in and out,or on the sidelines, right(mostly) or wrong,scroll down on the right side of his blog,he posts a lot of formations, that the ew er's might recognize.. http://just-charts.blogspot.com/
 
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