Gold is NOT acting like the bounce is done with. I was early in starting to build my short position, a mistake that has already been corrected. Will re-visit this trade at higher prices. Joe K. made a few grand off shorting gold regardless, so no real harm done, right?
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an alternative browser.
You should upgrade or use an alternative browser.
RM's occasional market calls...
- Thread starter Rearden Metal
- Start date
I have something semi-useful to say: It is possible to enhance returns on long-term positions by using shorter-term swing trades to add and reduce size as appropriate. For example, in ADT I was taking off a little bit when it was down at the bottom of the range. Now that ADT is back at the top ($44.69), I'm adding some size here.
Quote from Rearden Metal:
I have something semi-useful to say: It is possible to enhance returns on long-term positions by using shorter-term swing trades to add and reduce size as appropriate. For example, in ADT I was taking off a little bit when it was down at the bottom of the range. Now that ADT is back at the top ($44.69), I'm adding some size here.
This worked great in this situation but had the range broken after you scaled out and begin the hard drop you been expecting, you could have missed the big drop on your best size, all because of a quick short term trade.
I see what you mean, but in this case I'm only intending to hold my 'best size' for very short time periods, and only while it's near the range-top. As soon as it even gets down to mid-range I start reducing.
I'd never expect to have 'best size' on when and if I get the desired plunge.
I'd never expect to have 'best size' on when and if I get the desired plunge.
Quote from Rearden Metal:
I see what you mean, but in this case I'm only intending to hold my 'best size' for very short time periods, and only while it's near the range-top. As soon as it even gets down to mid-range I start reducing.
I'd never expect to have 'best size' on when and if I get the desired plunge.
Unless you are expecting a long term consolidation before the plunge, it makes no sense to me, perhaps I'm missing something obvious that was mentioned in the past.
I will hazard a guess: Mr. Metal's is making a tactical swing trade with part of the position within the context of his long term market view, which he initially expressed. With most stock related markets, expected value goes up after a decline, and down after a rise, so his tactics seem to account for this. His longer term view might be for a fall, but over a short duration, rises tend to follow declines, even in bad stocks.
Quote from MrN:
I will hazard a guess: Mr. Metal's is making a tactical swing trade with part of the position within the context of his long term market view, which he initially expressed. With most stock related markets, expected value goes up after a decline, and down after a rise, so his tactics seem to account for this. His longer term view might be for a fall, but over a short duration, rises tend to follow declines, even in bad stocks.
Bingo!
Quote from Daring:
Understandable after a plunge, we have not plunged yet.
OK, I'm gonna cut you some slack and assume that this is the first time you've ever encountered a trader mixing time-frames on one single position, which is a pretty advanced concept after all.
So even though both trade categories are the same basic thing (=ADT bear positions), there are two separate things going on here:
Position#1-Base size: Long time-frame position, holding for eventual plunge due to competition catching up with the company.
Position #2-Additional size, added at top of range: Short time frame position, holding only until the stock drops back down to mid to low end of range. The intention with this additional size is NOT to win the lottery with a plunge to the mid-30's <b>once</b>, but to pick up a buck or so profit <b>many times</b> as the stock is pulled back down into its accustomed range. I am not willing to consistently hold this much size for months. The trade is designed to be taken off after a day or two at most.
The confidence I have in position #1 (that ADT is doooomed) enables me to comfortably put on bonus size with position #2, however these are clearly two separate trades with two separate time frames and two separate profit targets.