Posted by patellee on 20th of Oct 2023 at 04:04 pm
My account has taken huge (embarrassed to say how large) losses
this week. I was looking good on Monday and was hoping for
some sort of relief rally to cover some of those losses.
There's no sign of a bottom and with back to back to back 50+
point down says I am thinking I should just cut bait. Can
anyone point me to technicals they are looking at for levels as the
next one I see isn't another 50-100 points away.
Posted by pintopower on 20th of Oct 2023 at 04:48 pm
imo, the next two possible steps below would be the trend line
for wave 5 of the diagonal and the next one is the gap below that
occurred between May 24th and May 25th.
Posted by skwan1940 on 20th of Oct 2023 at 06:20 pm
Everytime this type of thing happens I wonder why I even bother
with the reversion to mean concept. Why don’t I just trust
the old Wall Street adage “the trend is your friend”.
Hopefully this is W bottom on the daily chart.
Posted by mastermind on 21st of Oct 2023 at 02:44 am
The question is “what is the trend?”. Are you sure you can
always be on the right side of that? Not too many days ago it
looked like the trend had turned up.
Posted by skwan1940 on 21st of Oct 2023 at 04:59 pm
Well, not to me, the trend didn't turn up recently. I know
BPT publishes trend following indicators like the $NYSI 9 ema and
the $NYSI stochastics and those didn't confirm an uptrend.
Personally I use something like
13/34/54 EMA crossoversto buy/sell a 50%
allocation to stocks at a time (when 13 crosses 34 and when 13
crosses 54) and those didn't confirm an uptrend. Before I
rejoined BPT this year, I took 8 years off (I was a member years
ago before) to do real estate and this is how I invested during
those years and I was able to do ok by riding established trends.
Of course I never caught the bottom or the top. I think
what we are talking about ultimately is the holy grail of trading
which doesn't exist: when to do mean reversion and when to do
trend-following. Doing mean reversion is harder IMO because
you are a "pioneer" who takes the arrows (you are stepping up the
same time the big boys of Wall Street are) versus being a "settler"
who comes afterwards with your covered wagon to settle the land
(when a trend is established). Matt's mean reversion systems
are a courageous effort because in markets the mean reversion
rubber band can be stretched farther than folks can imagine.
One needs to be mentally tough to do it.
Posted by DigiNomad on 20th of Oct 2023 at 11:02 pm
The reversion to mean part of the systems trades worked out
fine...even this time. I took profits and moved on. It was
the wrinkle of the trend hold condition that spoiled things a
bit...for those that chose to hold.
Posted by DigiNomad on 20th of Oct 2023 at 04:16 pm
Yep, Matt made that point many times during the go go days of
last summer. It was always going to be hard to have a significant
pullback with the MA's all pointing up. But as they flatten out and
start to point down, the risk of a major move actually
grows.
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My account has taken huge
Posted by patellee on 20th of Oct 2023 at 04:04 pm
My account has taken huge (embarrassed to say how large) losses this week. I was looking good on Monday and was hoping for some sort of relief rally to cover some of those losses. There's no sign of a bottom and with back to back to back 50+ point down says I am thinking I should just cut bait. Can anyone point me to technicals they are looking at for levels as the next one I see isn't another 50-100 points away.
imo, the next two possible
Posted by pintopower on 20th of Oct 2023 at 04:48 pm
imo, the next two possible steps below would be the trend line for wave 5 of the diagonal and the next one is the gap below that occurred between May 24th and May 25th.
Everytime this type of thing
Posted by skwan1940 on 20th of Oct 2023 at 06:20 pm
Everytime this type of thing happens I wonder why I even bother with the reversion to mean concept. Why don’t I just trust the old Wall Street adage “the trend is your friend”. Hopefully this is W bottom on the daily chart.
The question is “what is
Posted by mastermind on 21st of Oct 2023 at 02:44 am
The question is “what is the trend?”. Are you sure you can always be on the right side of that? Not too many days ago it looked like the trend had turned up.
Well, not to me, the
Posted by skwan1940 on 21st of Oct 2023 at 04:59 pm
Well, not to me, the trend didn't turn up recently. I know BPT publishes trend following indicators like the $NYSI 9 ema and the $NYSI stochastics and those didn't confirm an uptrend. Personally I use something like 13/34/54 EMA crossoversto buy/sell a 50% allocation to stocks at a time (when 13 crosses 34 and when 13 crosses 54) and those didn't confirm an uptrend. Before I rejoined BPT this year, I took 8 years off (I was a member years ago before) to do real estate and this is how I invested during those years and I was able to do ok by riding established trends. Of course I never caught the bottom or the top. I think what we are talking about ultimately is the holy grail of trading which doesn't exist: when to do mean reversion and when to do trend-following. Doing mean reversion is harder IMO because you are a "pioneer" who takes the arrows (you are stepping up the same time the big boys of Wall Street are) versus being a "settler" who comes afterwards with your covered wagon to settle the land (when a trend is established). Matt's mean reversion systems are a courageous effort because in markets the mean reversion rubber band can be stretched farther than folks can imagine. One needs to be mentally tough to do it.
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The reversion to mean part
Posted by DigiNomad on 20th of Oct 2023 at 11:02 pm
The reversion to mean part of the systems trades worked out fine...even this time. I took profits and moved on. It was the wrinkle of the trend hold condition that spoiled things a bit...for those that chose to hold.
4200 is less than 25
Posted by DigiNomad on 20th of Oct 2023 at 04:12 pm
4200 is less than 25 points away. That's a HUGE level.
And SPY is not as
Posted by rbreese on 20th of Oct 2023 at 04:14 pm
And SPY is not as oversold this time down to 4200 area either as it was on past tests.
But isn't that positive divergence
Posted by mastermind on 20th of Oct 2023 at 04:17 pm
But isn't that positive divergence supposed to be a potentially good thing?
Yep, Matt made that point
Posted by DigiNomad on 20th of Oct 2023 at 04:16 pm
Yep, Matt made that point many times during the go go days of last summer. It was always going to be hard to have a significant pullback with the MA's all pointing up. But as they flatten out and start to point down, the risk of a major move actually grows.