JT... OT................................................
I promised you some answer, I will try my best to explain.
<<IQ, You have evolved into an excellent tactician with precision over the last two
years. Your long term strategy is clear, concise. Your short term supports/resistance
levels makes folly of them all. I really believe all the bears over the last few years
have propelled you to master your trading skills without being married to either side
of market. You are simply the best....>>
JT, I think it is due to this thread where I have to under watchful eye's that I made some good progress.
I give full credit if something good has come out to collective spirit I have created here, it is also due to the fact that every day detailed writing has helped me to think about issues a shade earlier.
Only time will tell if this exercise is in futility or had some good results, the fact that it has stayed active for now nearly two years speaks of great resilience of its host gg and the posters. The credit should go to 'unknown soldiers' like you who stayed course, remember that call when someone who did not know that difference between future and cash charged me of 917 on S&P.
Had it not been for your intervention and call to my broker, these guys would have succeeded in implanting a lingering doubt on the thread credibility. You called Ray, you got the trades and posted them here in real time, that was the first major challenge to the very roots of this thread. We survived it only because we had a trade confirmation available for every trade we highlighted here.
You may remember that I was asked to post real time, when I did that I was told that S&P was never there at 917 where I shorted and covered little below, the guy who put me through this ordeal unfortunately found out after being crowned 'guru' that future's trade at a premium/discount to cash, the guy did not know until than that 'what futures are'. I doubt it he would have ever challenged me if he knew that futures are trading at a premium/discount and when he thought 917 was not hit it was the cash he was looking at not the futures, SP99M is different than SPX.
That was the first eye opener for me, I realized that on SI 'guruship' is for a take awarded by 'innocent lambs to half specialists'. I thought it is only good for a poster to post a direction if he knows the market from a bird's eye view, Twin analysis of a global perspective and a domestic US view had to be interwoven on this thread day in day out. I did that so far diligently with my failings and problems. However, looking back I can say I try my best, it has worked for me may be it works for others, one thing is undoubted in the most difficult of circumstances I stayed the course. I am consistent with my approach and I don't mix a reference to exotic stuff in my calls. I see charts straight and look at it the way they have to be studied. Simple trend-lines, simple supports and resistance's and importance of moving average. Intermingle with these stuff TYX, global events, macro-economic fundamentals, strategic implications of flash points and performance of global indexes.
This I thought was a complete menu, I could see this market roaring up only due to TYX 135 was breaking on 8th Oct 98, that led me to go huge long. Next within that era of every day watching of ASEN contagion I could see that HSI play will be successful and HK government will harness the hedge funds when everyone else thought otherwise. I disagreed with WSJ analysis that resisted the intervention of Tsang in the markets, Idea stood on the side of Treasury secretary Tsang calling his policy to punish 'double play' as the right policy. I also remember my call on Brazil turnaround after a test of 5500, the index was at 8000 within three days of my call. Softbank and NOK.A or EMC or SUNW are the kind of stocks which have seen this thread flourished, Softbank at 61 was the best possible trade in last two months. These are only some of the exploit's without counting every day turns that I try to correctly interpret. This all is only possible due to honesty of purpose and unbiased interpretation of events.
Idea and the many other threads parted ways from that point when I came out successful from that infamous sad incident. Two clear groups were formed one 'Ike bashers' those who thought my model is suspect and tried to knock me out as a person on which lady luck is smiling. , Others who never really tried to know what was the dispute about and why I was irked remained indifferent, whilst some who trusted me, followed this thread quietly and fortunately the people who loved me far outnumbered the naysayers. This thread posts are reliable and to the point of magic only because of the fact, we speak from the hearts of the markets, the people like to know what I stand for, no one has unveiled the secrets of locals like I have, and I do it every day. The distance and charisma of calling the market from 6000 miles and correctly most of the time is something that has added an aura around this thread. I think all said and done had it not been Internet and people like you and many others who helped me at the time I was down and being attacked mercilessly. Idea would not be here today. The credit goes to my friends like Timothy Lamb, Chuck, Karun, Steve, OJ, Bri Fakuba, J. Kary, JT, Al Serrao Vish Kona and many others quiet soldiers who trusted me and believed in me. They gave me that confidence without which I could been out like many a good posters have been thrown out.
<<1,470 SPU is not out of question. I am interested how your model led you to this #
for area of resistance. Also, could you share with us your strategy for core holdings
in this latest developing blow-off phase regarding "core holdings"? Do I sell half
stock position and book profits before markets retest 200 DMA or use option
strategies?>>
The same principle which applied for 990 forecast, the 1130 forecast and 1330 forecast. It is the basing period extended forward when two highs are consecutively achieved, a suspect formulations but gives me ability to ride the market if the 'cup winners cup rally' continues. I remember that I called this rally in Jan as cup winners cup rally nothing could be more true than that forecast, CSCO TXN EMC SUNW all were the part of this huge rally. NDX BKX COMP SPM and SOX with PSE forms the core of my forecasts.
The portfolio remains invested in core stocks, I would think the strategy has to be to ride the thing up until 1130 is not taken out. However, the market does not move in straight line so as to benefit from corrections we can always sell some covered calls if we think that our profit objectives are achieved. Covered calls against core will only give you some protection against a slide not a total protection. It is only possible to protect your gains by using the monies received from 'covered calls writing to buy puts'. You give up your upside and buy downside protection. These puts need to be purchased if interim supports are broken, right now 1323 has established itself as one although I will like to see a double close to short the market until 1292.
The other option is to cash out here from the portfolio and buy outside the money calls, suppose you sell your core and get 100,000 $'s for it, now you can easily see that you may have made of huge profit if you were in NDX type of stocks. You can now use 25% of this money to buy July's calls on these stocks if you want to be in the run or cash out and sit for the market to correct, it will one day to test 50 days MA atleast. If fundamentals picture changes it can do much worst and go down to 200 days ma. I do it all the time but I keep my core intact.
I protect my core with insurance policies which I leg out with nimbleness, like I am long 1270 remnant of trade of 1280 and 1270 long contracts. 1270's I got them selling 2 to 1 1220's that is I was one 1270 long for every 2 1220 short when we tested 1270 on SPM. The portion I was long naked that is 1280 was covered but I left 1270's however I legged out of my short two 1220's on market reversal. Now I have a good trade 1280 which I covered, 1270 which I left is the losing trade but the cost is so low as I offset the cost with two 1220's. I will let 1270's go to waste, but days like yesterday were great we saw 2160 on NDX we shorted 1980 NDX knowing well that 1270 SPM will be in the money if 2060 is broken. We got 7 $ for that and covered the put of 47/8 towards the end of the session. Making a decent trade on the back of my longs. Puts and calls are instruments around which one should trade, one should not get frozen. At
certain point in time I do take profits off the table and use straddles very heavily to be a part of corrections.
I will again utilize the 1270 longs today if the number is good, I may sell 880 April BKX expecting that a second close above 900 on back of good number will take us much higher. On the other hand if number is bad I have a protection down and I will certainly sell 2300 calls on NDX for May to buy SPM1300. These are some trades I do and profit, but the best trade are proactive stance, keep thinking, try to see that you improve your returns to far better. Last but not least, one should always in a trending market buy outside the money calls in a correction, steep corrections are best way to enter for a day trader. It is I know only possible if profits are immense.
I think if NDX types of stocks are followed, undoubtedly we will see that most of these trades can be implemented. Instruments of options if rightly applied are most profitable. I also propose that using core is great as you can easily sell if your portfolio is NDX sensitive some 2500 calls in June and buy puts very near to money, above 2500 on NX you give up all profits but you will sleep right. The choice is yours the opportunities are immense. All this needs very quick actions nimbleness and knowing SPM levels well, the last is extremely important sometime market is being rattled by the its if you are not aware of your supports on SPM you will whipsawed, so this is the best I could explain. Please keep asking the issues which are not clear, we can mutually learn. |
