ES Journal Archive (2006 - 2008)

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From the close-the-gap low of 1480.50 at 10:51 EDT, ES price action has been in an ascending price channel approximately 4 points wide rising approximately 4 points per hour. If the plodding ascent continues, at this rate, it will take about another 2.5 hours (until about 3pm EDT) to reach the resistance zone around 1500+/- at which I hope to go short for a 40-point ride down. Of course, we could get there sooner if the price action breaks out of the channel...or not at all if I'm wrong about the location of the zone. :)
 
Let us take a perfect example. I am long the financial stocks, Goldman and JPM as of last week because of a simple pattern that has occurred in those stocks as well as many other stocks. Value guys are all over these. UBS comes out this morning and says they will start beefing up their holdings with the financial stocks. Are they already long before the news? Was my model smarter than UBS? I don't think so. See what I mean?
 
All I know is how markets behave and apply that model across the board. Of course, I can look at the macro as a filter or catalyst. Nothing wrong with that. But I've proven I could eliminate it from my work and have more time for life.
 
Quote from wave:

It's telling me I should be short again here.
More...
Hmmmm...

I'm still long small size from 1481.25. Stop raised to 1485.00, two ticks below the bottom of the ascending price channel. Still looking to exit this long at 1495.25 and then to go short somewhere around 1500.

EDIT: Just added to long position here at 1486.75. SS on add-on is 1485.75 (1 point). SS on initial postion from 1481.25 is still 1485.00.
 
On the same note, there are traders that made 10x plus the fortunes of many fundamental investors with all this volatility in the markets. This is trading. An edge with a plan. If my plan says I need to make 2% a week and compound that then I really don't care how I get the 2%, as long as my business and profits are running according to plan.
 
The only fundamentals I follow are earnings. Earnings drive stock prices. When price diverts from rising earnings then you have value opportunities and vice versa. I run a daily scan based on a simple, qauntifiable formula. The Little Book that Beats the Market by Joel Greenblatt is a great book to read. This is how I create a "list" of value stocks. Top 100 relative strength are my growth, momo stocks. Am I really following fundamentals or am I just applying a quantitative formula based on simple EPS and P/Es and then applying the model to trade or invest in these stocks? Do I really need to have the eps filter or would I do justy as well throwing a dart on a board of stocks? You decide.
 
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