Do we have a trend in place, I just don't see one

My bad, the title of the thread is kind of incorrect. My question was if there is a trend in place from this point on, based on the FOMC.

Excellent advice Landis, much appreciate it. There is a reason that I did not lose more than what I did, I realized early on that I am fighting the trend and got out. Mean reversion works when following the trend. I agree that the trend has been in place for whole of the April.

There are some really hard headed perma bears on the ultra short boards on Yahoo and I have no plans to be one of them. e.g. FXP



Quote from Landis82:

The market has obviously been in an UPTREND since the March lows around SPX 1250; hence your system's inability to capture such an uptrend.

The title of this thread is incorrect.
Moreover, the fact that your "mean-reversion" formula of your system got clobbered fully CONFIRMS that a trend has been in place.

In fact, since the short-term low on April 15th back around SPX 1324, the market has stayed above the 10-day MA pretty much from that day forward.

I have heard several people here on ET ( S2007S ) talk about how this has been a "sideways" market, but I find that to be absolutely bizarre given that the stats show that the SPX is +10.8% from lows made about 5 weeks ago, and the IWM is +12.5%

The market was able to make a multi-month double bottom on the charts with the help of too much pessimism, too many shorts, too much cash on the sidelines, and a FED that was being very accommodative. Unfortunately, some people simply watch far too much CNBC and don't watch how the MARKET is responding to bad news. When it goes up on "bad" news, you know that you have a strong underlying trend to the upside.

So, if you want to stick your head in the "sand" and not be aware of the caveats of a "mean-reversion" trading system during a trending market environment, then so be it. If anything, you need to change the parameters of your "system", otherwise be able to recognize what kind of market atmosphere you are in and act accordingly.
More...

Excellent advice
 
Quote from ashatet:

I have been on a roll, but I have managed to lose 50% of my last 6 months intake in April alone. I am going to award myself with a trading freeze and a month long time off for that stunt.

Do you guys see a trend. I see that the expected return is 0, I have always been able to call the market trend, but now, nada, nothing, I just do not see a trend. Just curious what do other fellas do when you do not see a trend. I do not see trend in Indexes, financials, commodities, long term bonds or international equity.

Any comments and suggestions will be very much appreciated.
More...

ashatet,

Here is a chart of the $SPX.X....as it relates to the e-mini S&P (ES). At a minimum....we are in the middle of a Pullback....with the potential to turn into a Reversal....continue Downward. We did test the Resistance from the High back in 2000. So....is this the end of the Up Trend....who knows....not me. Definitely leaning down though.

VSTscalper
 

Attachments

VSTscalper,

Thanks dude. I agree from the TA standpoint that the long term downtrend is maintained, but I got a problem with the sovereign funds and if they start pouring money into equities, all bets are off. All that money has got to go somewhere and equities are the best action in town. Then DOW marches to 16K by the end of 2008 and shorts get crushed...

Quote from VSTscalper:

ashatet,

Here is a chart of the $SPX.X....as it relates to the e-mini S&P (ES). At a minimum....we are in the middle of a Pullback....with the potential to turn into a Reversal....continue Downward. We did test the Resistance from the High back in 2000. So....is this the end of the Up Trend....who knows....not me. Definitely leaning down though.

VSTscalper
More...
 
Quote from ashatet:

VSTscalper,

Thanks dude. I agree from the TA standpoint that the long term downtrend is maintained, but I got a problem with the sovereign funds and if they start pouring money into equities, all bets are off. All that money has got to go somewhere and equities are the best action in town. Then DOW marches to 16K by the end of 2008 and shorts get crushed...
More...

ashatet,

This is the $INDU (Dow)_Monthly that I put in the Tradestation forum on 4-16-08. Nice ride up move from 2003 to present time. I have no idea how far it may go....Up or Down....I just go by my indicators. I do expect at least a pullback.

VSTscalper
 

Attachments

Youl generally don't short a bull market unless you enjoy losing money. Some short sellers can make a small profit, but more will lose money. There are many factors in play that is keeping the market higher inspite of all the so called 'bad news'.
 
so what do you do in bear market, keep losing money. Tell that to people who bought Nasdaq in 2000. Need to follow the trend.

Quote from stock_trad3r:

Youl generally don't short a bull market unless you enjoy losing money. Some short sellers can make a small profit, but more will lose money. There are many factors in play that is keeping the market higher inspite of all the so called 'bad news'.
More...
 
Quote from ashatet:
I have been on a roll, but I have managed to lose 50% of my last 6 months intake in April alone.
More...
A trend only goes as far as the next bend. Fix your attention on the upswings and downswings of the market as a big meal ticket daily. This could be CL, YM, etc .. whatever toots your horn. Concentrate on using those ups and downs and you can really get your money making going.
 
Quote from ashatet:
Ditto, yes, I was 2X Short. I have my own mean reversion formula that I used, but as the markets moved away from me, I added to the losing position, just to lose more.
More...
Make sure you always remember this lesson. 9 out of 10 times adding to a loser will work out fine and you get out with a feeling you got away with murder. But the one time comes - sooner or later - that makes you regret you ever started playing the game.

Increasing your position is fine, just make sure the position is in the green in the first place. NEVER ADD TO LOSERS.
 
It depends on the size of your initial trade size if you can add to your position.

Quote from makloda:

Make sure you always remember this lesson. 9 out of 10 times adding to a loser will work out fine and you get out with a feeling you got away with murder. But the one time comes - sooner or later - that makes you regret you ever started playing the game.

Increasing your position is fine, just make sure the position is in the green in the first place. NEVER ADD TO LOSERS.
More...
 
You must log in or register to reply here.
Back
Top