resources you can direct me to
I wish I had the perfect book to recommend as I did to Clappy. Unfortunately the book I learned from
amazon.com
is now out of print. There is an updated edition, '91, but I'm hesitant to recommend it without seeing it first. In this book you would learn about a variety of leading, coincident and lagging indicators. The problem is times change. Indicators that work at one time don't later. New indicators arise such as VIX and the Rydex Ratio.
Still what one must acquire is a mindset, a perspective if you will that results in nervousness near tops and mild euphoria near bottoms. These emotions are based on anticipation of course, but they do result in you being out of synch.
Most of my work is dependent on money/interest rates or sentiment. There are a number of indicators in each category. There is no magic crystal ball that I know of. You look at a number of indicators and using your judgement to weight them, go with a "preponderance of the evidence". The most I ever get is: "My best guess is that probably the market will ..." Perhaps a "slim reed" upon which to bet "real money", but that's the game.
Were they predictive of the enormous drop beginning about a week ago?
Well no and yes. Predict the day or the week or even the magnitude precisely - no. Some try and are fairly good. As Eastwood says "A man's got to know his limitations". I'm just not that good. OTOH, the last two days in Feb. I made what for me was a sizeable bet by selling naked calls, the first of which expired in May. The play was: sometime in March, April or early May, the Naz would fall "big time". Now you must understand this was just a guess, an educated guess maybe, but still a guess. In early March, while many were having a party, I was "sweating bullets" and dreaming of repair strategies. As it turned out I bought back the last of my profitable calls on Tuesday. But that doesn't mean that the next market call I may try will be successful. It's a game that if you aren't prepared to lose, you better not play.
When he was on AOL I used to watch Carl Swenlin at Decision Point. On SI, one resource you might consider is this thread
Subject 24052
To understand what is being discussed there you may need to do a little homework, but a plethora of information is presented.
Now after the tension of the last month, I'm just looking forward to a little R & R.
Not lurking ... just porchin'
lurqer |
