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Strategies & Market Trends : Analyze The Trade: Home of the T/A Archive -- Ignore unavailable to you. Want to Upgrade?

To: Ta_Bo who wrote (178)	11/17/2001 1:09:22 PM
From: Dominick	Respond to of 232

Great Post Ta Bo. I started trading the weekly time frame about a year ago. I got tired of starting my day as a Christian and ending it as an atheist. I'm a lot more successful but I still have bouts of impatience to contend with due to my type A behavior. I still use stops but they are based on weekly bars. You indicated you let your losses run,( loss of half your paper profits), because of your longer term analysis, I'm wondering have you abandoned using stops? Thanks, Dom@welcometothelongtermclub.com

To: Ta_Bo who wrote (178)	11/17/2001 2:29:20 PM
From: aldrums	Respond to of 232

Bo, I also enjoyed your post and have a similar question to Dominick's. Just for fun I pulled up the weekly chart of SEBL. According to my calculations if you went short on the break of the weekly uptrend on 11/17/00 you would have entered at approximately 88.20, if you were to put your stop at the last swing high that would have been approximately 119.90 that would have been a stop of 32 points. You could also have put your stop just beyond the high of the 11/17/00 weekly bar at 104.30 for a stop of 16 points. Either way the trade would have been successful, even though the stock did rebound all the way to 104.25 before finally breaking down. What I am trying to figure out is if this post is really about trading the weekly swings or if it is about buying and holding (or selling and holding) until you feel general market conditions have changed. It seems that trading these huge swings would be difficult unless you used smaller time frames in which to place your stops. I have been pretty successful in reading the general market trend, but not as successful in my day trading, so your post intrigues me. For instance, I really thought within a couple days of the market bottom, that it was the bottom, after watching low after low for the last 18 months. I think this is because I have watched so many capitulations in shorter time frames I think I can pick one out on a daily chart when I see it. In fact it seemed incredibly obvious to me. I picked up Investor's Business Daily a few days after the bottom and their commentary confirmed my suspicions. Looking back, I should have fully invested and bought stocks (which I didn't, duh!) and put my stops at the market low. This has taught me a valuable lesson, which is to always go with my gut opinion and damn the torpedos. We all know that things ended badly for Jesse Livermore. More recently, Victor Niederhoffer blew up because he felt his opinion of the market was more important than stops. So if your post is about staying with your opinion on general market conditions and swing trading, I would be interested in hearing how you integrate both. Alex