dragonfly28if you were following along last Thursday I
posted a few times that the bear long was meeting conditions for a
long trigger on ES when futures were at the morning lows and for
some of the time after the cash market closed. However, the market
rallied strongly enough that day to cause the conditions to go
away. Here's a link to that post, click to read it
Looks like you started here in early June and since that time
you've seen a lot of reversion to mean system trades. That said -
this year is a bear market and the systems are much more active
than normal year. In past years the systems could go as long as 1
or 2 months with no trades because the moves were not extreme
enough to trigger them. This has been a fun year with the
systems being so active - however there will come a time when we
won't see a trade occur for 1 or 2 months. And as Steve said - the
systems have exact triggers, on Thursday morning the bear long was
meeting conditions for a trigger, but by the close and rally off
the lows that day, those conditions were not longer being met. The
systems have exact levels that have to meet in order to trigger -
there's no subjectivity about them like we have when drawing
trendlines and patterns like coils and flags - if one indicator is
off 1 tick, no trigger. Whereas with a subjective trendline there's
wiggle room.
so again as far as the reversion to mean systems not catching
this move - the bear long almost did last Wed and Thur - but those
systems don't buy on strong closes higher, they buy on weakness.
Late last week we had huge intra day swings and reversals in price
that saw the market way down early and only to recover by the
close. And Friday's sell off, while painful, didn't go low enough
to cause one of the long systems to trigger - remember the SPX
retraced to roughly the 61.8% Fib area and found support - had
price closed below that, then we probably would have seen at long
trigger
the system are good but they are not going to catch every
wiggle
Posted by dragonfly28 on 18th of Oct 2022 at 09:36 am
Matt;
Well - I have been sick for the last week + so have not been
able to follow every post - BUT it would have been
helpful if that was at least mentioned somewhere in the daily
summary ? or was it and I missed that too?
sorry to hear about you being sick last week, sounds like you
are better now or mostly better and that's good.
as far as mentioned in a summary, it was covered on the trading
community. Steve does the newsletters on Thursday and he doesn't
really discuss the systems unless I ask him too. It wasn't
emailed out, was really no reason for it.
over a year the systems will have dozens of potential trades
that are meeting conditions intra day only to be lost by the close
- I call them ghost or phantom trades. I'll point them out but
there's no good reason to spend much time and effort focusing our
time on those - if anything they make people emotional because they
perceive it as a missed trade opp or something.
again guys try to keep emotions at bay, I know it's hard, it's
hard for me too. But thinking too much about why the systems didn't
catch a strong bear market rally over 2 days is based on emotion
and fear of missing out, and not on a disciplined trading plan. We
are trying to avoid and limit emotion (it's the enemy) not get
emotional about the systems
dragonfly28if you were following along
SPY sub systems - reversion to mean question? Matt ...
Posted by matt on 18th of Oct 2022 at 09:30 am
dragonfly28if you were following along last Thursday I posted a few times that the bear long was meeting conditions for a long trigger on ES when futures were at the morning lows and for some of the time after the cash market closed. However, the market rallied strongly enough that day to cause the conditions to go away. Here's a link to that post, click to read it
https://breakpointtrades.com/blog/post/379453/
Looks like you started here in early June and since that time you've seen a lot of reversion to mean system trades. That said - this year is a bear market and the systems are much more active than normal year. In past years the systems could go as long as 1 or 2 months with no trades because the moves were not extreme enough to trigger them. This has been a fun year with the systems being so active - however there will come a time when we won't see a trade occur for 1 or 2 months. And as Steve said - the systems have exact triggers, on Thursday morning the bear long was meeting conditions for a trigger, but by the close and rally off the lows that day, those conditions were not longer being met. The systems have exact levels that have to meet in order to trigger - there's no subjectivity about them like we have when drawing trendlines and patterns like coils and flags - if one indicator is off 1 tick, no trigger. Whereas with a subjective trendline there's wiggle room.
so again as far as
Posted by matt on 18th of Oct 2022 at 09:40 am
so again as far as the reversion to mean systems not catching this move - the bear long almost did last Wed and Thur - but those systems don't buy on strong closes higher, they buy on weakness. Late last week we had huge intra day swings and reversals in price that saw the market way down early and only to recover by the close. And Friday's sell off, while painful, didn't go low enough to cause one of the long systems to trigger - remember the SPX retraced to roughly the 61.8% Fib area and found support - had price closed below that, then we probably would have seen at long trigger
the system are good but they are not going to catch every wiggle
thanks for calling out the
Posted by retirefire on 18th of Oct 2022 at 09:43 am
thanks for calling out the phantoms ( intra day system triggers) when time allows
Love the systems. Look forward
Posted by timebandit on 18th of Oct 2022 at 09:50 am
Love the systems. Look forward to the next RTM short signal(s).
Matt; Well - I have been
Posted by dragonfly28 on 18th of Oct 2022 at 09:36 am
Matt;
Well - I have been sick for the last week + so have not been able to follow every post - BUT it would have been helpful if that was at least mentioned somewhere in the daily summary ? or was it and I missed that too?
sorry to hear about you
Posted by matt on 18th of Oct 2022 at 10:38 am
sorry to hear about you being sick last week, sounds like you are better now or mostly better and that's good.
as far as mentioned in a summary, it was covered on the trading community. Steve does the newsletters on Thursday and he doesn't really discuss the systems unless I ask him too. It wasn't emailed out, was really no reason for it.
over a year the systems will have dozens of potential trades that are meeting conditions intra day only to be lost by the close - I call them ghost or phantom trades. I'll point them out but there's no good reason to spend much time and effort focusing our time on those - if anything they make people emotional because they perceive it as a missed trade opp or something.
again guys try to keep emotions at bay, I know it's hard, it's hard for me too. But thinking too much about why the systems didn't catch a strong bear market rally over 2 days is based on emotion and fear of missing out, and not on a disciplined trading plan. We are trying to avoid and limit emotion (it's the enemy) not get emotional about the systems
Pray you are feeling better,
Posted by fundamentalvalues on 18th of Oct 2022 at 09:52 am
Pray you are feeling better, feel better!