Jack, who is ghost writing for you? Clearly that is the case, as the message was typed, not dragooned, see the trypo "whay" vice "what," and worse, it makes sense. I want the old Jack back.
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Trend Following dying?
- Thread starter JezLiberty
- Start date
Quote from Arthur Deco:
Jack, who is ghost writing for you? Clearly that is the case, as the message was typed, not dragooned, see the trypo "whay" vice "what," and worse, it makes sense. I want the old Jack back.
I am typing today, that is true.
Did you read that trend stuff from Covel the last few minutes? The funniest one was the one he posted a while back (and reposted here again). Roughly it says: "We are trend following and we decided to not do any short trading". I know, there is no data on whether shorts are better because of ther money velocity. This group mentioned how people do make more money holding a stock that loses value when it pays dividends is a good idea. They showed the price drop as a multiple of the dividend and said not to worry.
They suggest one of the six principles is to not average down when they are holding stocks long in down trends. Covel's examples of trend followers' acumen are terrific.
Lets say they hire someone like me.
I walk into the meeting in the cafeteria where the tables are pushed together and peanut butter and jelly sandwiches are stacked within everyone's reach. Milk jugs and paper cups abound. It's a Smucker moment.
I suggest that trends be monitored so that investments are not continued in downward moving instruments since short trading is against policy and policy can't be changed.
I ask for questions.
Someone says: Should we do the monitoring with price only?
My reply is that price only monitoring neglects to take into account the market's dominance characteristices. From now on only hold instruments making long moves when they are in a dominant mode.
I am not letting any cats out of any bags here; I don't want to go past beginner with this group.
Someone asks: Should we use pattern analysis or hire some pattern analysis guys to know if we are in the proper trend patterns?
I respond by letting them know that pattern analysts have concluded that when trend following is a policy, then the markets must be considered random according the pattern analyst's results. (See Covel).
I continue to introduce a concept or two
At some point, it is a good idea to use market variables to do market strategies and to do preparation of systems that monitor markets.
The sandwiches are being eaten and people are looking pensively over their cups of milk.
A ranking "decider" prompts me: We only use price to do research or analysis.
I hold up Covel's book I found in the research center. I hand him the book and suggest he check out "volume".
He hands the book to an assistance researcher who opens it to page 420.
The reasearcher says that we probably have to drop that idea. The decider agrees. CW reigns in this shop.
I take another tack.
Lets not use price at all I suggest. we can do trend following without price.
I shoot up a series of charts (on a screen that the CEO of TN would approave (in joke)) and everyone does the drills for 15 minutes equals a year (my old REPS simulation) using the corporation portfolio from years past starting with the original postfolio. As we forward trade, using sorting of the Universe, bean counters keep tabs on semilog charts.
I ask for calculations on how frequently capital doubles in terms of cycles.
I ask for the cycle rep rate.
I ask marketing if they can sell this to the public and give them competitive returns and keep the rest.
People begin to throw peanut butter sandwiches and milk jugs at the resarcher and the desider. They burn page 420 of Covel's book.
A co-op is formed and only the clients who like peanut butter are allowed into the co-op. The new firm is named "Buttercup" with permission of Hershey Foods, Inc. T shirts all around.
Paul Harvey later reported: The unlabelled indicators included volume........ and now you know the rest of the story.
So back to the solution to the industry problem.
Why doesn't anyone know how to make trends fit into the picture for making money?
Why do all the citations mentioned not have capable people to get this figured out?
Art, you know why....lol.......
Glad you are agile enough to type today. I do not read trading books (I stopped at about my thirtieth read) and I do not follow gurus (since I gave up on you). Interesting that your waking fantasies are of converting the "CW" finantical communoty. Mine are of boinking porno queens (the female kind). Also interesting that neither you nor your fantasy CW island have S/R in your lexicorn. Although I periodically get desperate for entretainment and relook at your stuff, I always go back to S/R. That part of my screen hasn't changed for years. In my CW view, it doesn't make a shit what volume does when price reverses, only that price reverses. Of course persistence of direction is the sine qua non of profitability. Volume doesn't figure in that persistence. Good health to you.
Quote from Trend Following:
http://www.trendfollowingtrading.com/whitepaper/Does_trendfollowing_work_on_stocks.pdf
"We decided to put a long only trend following strategy to the test by running it against a comprehensive database of U.S. stocks..."
I don't think long-only is what people generally mean by 'trendfollowing' - ?
Quote from Arthur Deco:
Glad you are agile enough to type today. I do not read trading books (I stopped at about my thirtieth read) and I do not follow gurus (since I gave up on you). Interesting that your waking fantasies are of converting the "CW" finantical communoty. Mine are of boinking porno queens (the female kind). Also interesting that neither you nor your fantasy CW island have S/R in your lexicorn. Although I periodically get desperate for entretainment and relook at your stuff, I always go back to S/R. That part of my screen hasn't changed for years. In my CW view, it doesn't make a shit what volume does when price reverses, only that price reverses. Of course persistence of direction is the sine qua non of profitability. Volume doesn't figure in that persistence. Good health to you.
I am relabelling H1 of the HS sine qua non. H1 is the reason price moves without interruption from R to S and vice versa (S to R; as in Covel's cited example of a company that only trades one way streets). fortuneately the earth is round and lpasare fun.
The zigzag world is between S and R and back again.
I always hear the drums beating (See T zones dom dom dom ...) at S and R where dom turns to dom in the opposite price direction on all FBO's.
Dom, nondom, dom ;dom, non dom, dom is the beat that always prevails.
the first paper had a pattern I know as Sym X B. The author chose it from six possibles because it happened more oftern....lol.... sophisitcation sophistication.
Do you think the pattern searcher could us pattern cases? I don't think so either.
The world is really stuck with this universal mediocrcy in the financial industry.
Nine cases and the search machine cannot find the singular universal trend pattern.
What if they froze the peanut butter sandwiches and had a meeting at the building I had the NPS take the fence down; you know where George' statue is on the front steps. The place where we hosted Museums Collaborative in 1976 to celebrate their combined contributions for the Environment. We used checkered tablecloths as a universal Americana thing.
The S and R are where the H1 comes into play and ends a trend. H2 happens and away we go making more money. I really like the nuance of the retraces. Even better I really dig how you know the difference between a retrace and a reversal in seconds after the choice comes up.
Here is a joke: how on R or S does a retrace become a reversal?
Hint: don't look in Covel, neither word is in the index.
From page 9:
Limited expectancy
With respect to long term trend following, short selling offers a severely limited mathematical expectancy. The price of a stock can only decline by a maximum of 100%. However, it can rise by an infinite amount. This is a significant disability to overcome.
Brilliant.
Limited expectancy
With respect to long term trend following, short selling offers a severely limited mathematical expectancy. The price of a stock can only decline by a maximum of 100%. However, it can rise by an infinite amount. This is a significant disability to overcome.
Brilliant.
Quote from Rodney King:
"We decided to put a long only trend following strategy to the test by running it against a comprehensive database of U.S. stocks..."
I don't think long-only is what people generally mean by 'trendfollowing' - ?
This Covel sourced stuff is a little limiting here and there. Around that quote there are at least a dozen other priceless beliefs.
We ought to have an Americam Idol of financial industry stars just to find out how slim the pickings are.
Quote from icarus618:
From page 9:
Limited expectancy
With respect to long term trend following, short selling offers a severely limited mathematical expectancy. The price of a stock can only decline by a maximum of 100%. However, it can rise by an infinite amount. This is a significant disability to overcome.
Brilliant.
The whole thing just dissolves into humor. the pattern tester proved that patterns like those searched for are not how the market's work.
OR'ing AND pairs is logic humor in the first place. Going to three bars must have been a real feat.
By using a sym as the first pair, it is like throwing in the towel as step one in a process. they must have figured more "next" possibilities existed.
The chart did have six possibilities..... wanna bet on why???? lol......
the question is this.....is the industry going to get past Lo, Harris, etc.....
It simply doesn't look like it.
Quote from Rodney King:
"We decided to put a long only trend following strategy to the test by running it against a comprehensive database of U.S. stocks..."
I don't think long-only is what people generally mean by 'trendfollowing' - ?
"Long Only" isn't a trend following strategy, it is a simply an undefined directional prejudice/bias.
"Trend Following" should be to determine the trend by strict definition and then trade the oscillations that occur inside that trend that match the trend direction. That would make too much sense though and wouldn't sell books or movies.
Quote from icarus618:
From page 9:
Limited expectancy
With respect to long term trend following, short selling offers a severely limited mathematical expectancy. The price of a stock can only decline by a maximum of 100%. However, it can rise by an infinite amount. This is a significant disability to overcome.
Brilliant.
Isn't it though.
Strictly defined bear trends are mathematically deficient right?
The disability is this whole line of thought.