Uhhhh, would you believe I don't have a phone?
OK, so I can't get that one past you! My entire trading system is on my web page which I will post again, but my philosophy has always been "the trend is your friend" and my own personal belief is that TA is nothing more than a psycholgical indicator of a particular stock or index at a specific time. There is no magic mathematical formula to buy and sell stocks with complete reliability, although I am sure there are some of you that will disagree with that. My goal when I set out to devise a system was to gauge the markets health in the simplest, most efficient, most reliable way possible.
Anyway, I had read somewhere through the years that if the NYSE new lows were above 30 for more than 10 trading days, that the overall health of the market was starting to deteriorate internally. I of course brushed this off as way to easy and if that were all one had to do to judge the health of the market, everyone would get out on the 10th day and the market would of course crash. So, along comes May of 1996, when I was sitting on top of 55% in gains for the year and feeling like I had the "bear" by the horns when all of a sudden, the bear broke loose and I had all but 5% of my gains wiped out in a 6 week period. After all my wounds healed (I was gored terribly), I decided that I wouldn't let that happen to me again. I spent months working with Adv/Dec, momentum, Acc/Dist and any other indicator that WOW could throw at me and then I started inventing some of my own. I think Brookelise summed up the feeling nicely a few posts back. No one wanted to be in the same room with me for months. Finally, one day, it dawned on me that MAYBE the guy was on to something. This was after all a barometer of how people felt about stocks in the market place at a given time. I spent quite a bit of time working with moving avgs until I came up with what I believe is the perfectly matched set to cause crossovers when you should be concerned yet not cause premature crossovers that might headfake you into buying or selling at the wrong time. What I came up with is what you will see on my page. It won't get you out on the top tick and it won't get you back in on the bottom tick, but it will usually get you out within 5% of a top and back in within 5% of a bottom and sometimes even better.
This solved market direction for me, but it still didn't keep me from holding stocks too long because they were "too cheap" and then watching another 15 to 20% disappear and panic selling just as they bottomed. This is when I devised my market selling strategy that would finally get the one thing out of my portfolio that was causing problems....ME! Now, I can go off to work without worrying and when I get home, if I was stopped out on a stock, so be it. It's an entirely mechanical system that takes the emotions out of the formula and I believe emotion causes more investors to fail than any other factor. Of course, I still have to pick good stocks, but that has never been a problem for me. I have been IN business or running someone elses business since I was 21 years old, so fundamental analysis (no it's not a dirty word) came very easy for me.
Anyway, this is getting too long, Hank Seng is down 15.4% as I write this and tommorrow is going to be another interesting day. Take a look at my web site and e-mail me with any questions so as to keep from boring everyone on this thread and I will start posting my Indicators and Systems on here like the thread says. Nuff said!
members.aol.com
Good luck to all tommorrow,
Ross |
