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Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures

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To: Patrick Slevin who wrote (7042)	10/22/1998 4:34:00 PM
From: Tom Trader	Read Replies (2) of 44573

>>First of all, I think the system tends to correct when it is losing and just may send you a buy signal that you will interpret should be a short. If the system was truly a mirror it might not reverse it's signal.<< Not sure that I fully understand what you mean when you say this. >>The debate by the Ivory Tower dudes was that one could invert a variable in the system; by so doing, they theorized, one would turn a losing system into a profitable one. However, I am reluctant to think one could find the "right" variable to invert.<< I agree with you about the correct inverting of variables -- but my point is why do that at all. Just buy when the system says to sell and sell when it says to buy--then the inverting of variables would not be a factor. Of course one would end up using limit or MIT orders since most systems are designed based on entries and exits going through stops. >>Of course, this is my opinion and everyone has one. I have no psychological; problem with it at all. << I really don't have a strong opinion regarding it--I have never tried to use a system that way though I have inadvertently designed systems that seem to lose lots of money on just about every market that I have tested it on. I'd have to say that my problem is psychological at some level -- given that if I developed a system that had the parameters inverted in the first place and it then produced great results over a variety of markets, I'd probably think that I was a genius and look seriously at trading it. >>As a matter of fact, I am of the mind that Fred does the exact same thing. My recollection is that the P-Stop is a tool designed for exits, not entries. If Fred does not know this perhaps we should not tell him. Psychological damage and so forth.<< Hey you are right about this -- we better not tell Fred, for sure. I remember reading about the Parabolic in Wilder's book years ago but have never thought of using this in a system. >>Anyway, I started this week with a Bullish attitude but the systems had me selling. Time will tell if I continue to rely on Mechanical Systems or revert to Discretionary trading.<< I suspect that when all is said and done, you'll end up going the discretionary approach -- remember my fighter pilot and bomber pilot analogy. Pretty impressive market -- does not seem to want to go down and the the other averages did a whole lot better than the DOW on a closing basis. I am done for the day--talk to you guys tomorrow.

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