Excuse me, I really should go to sleep, but for some reason I cannot. So I will post this and pay for it later I am sure
The "truth" of the matter is that candletrader is more right than he knows. A sharp professional (I would like to think I am a sharp pro) would use both the setups that he outlines. Buying pullbacks and selling the failures. This is called diversifying and as I recall, it was covered quite nicely by Acrary in some of his posts.
Since most of you folks will not take the 5 min necessary to research the subject let me make it crystal clear.
1. If you have the mental focus and discipline to handle the first setup (buying pullbacks on a trend day), then all you have to do is add the second "half" of the system (selling the failure/retracement).
2. The best way to do this is to have two accounts (one long one short). The benefit is that you are maintaining an extended presence in the market, so you have a good chance of catching some of the bigger moves.
3. On the negative side, IF you don't have a good risk management plan, you are going to go broke twice as fast.
4. On the negative side, IF you aren't properly capitalized, ODDS ARE that you will go broke sooner or later.
As always, I recommend that you TEST before you start throwing money at the problem. But hey this is ET, who tests when you can just start trading and then spend the rest of your day bitching and moaning about how hard it is to make money (while you go broke).
Good night
Steve
