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optionman's Account Talk
- Thread starter optionman
- Start date
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Steadygain
TSP Elite
G Fund is the best place to be in times like this.
Thanks man.
Thanks man.
Having a Trading Plan Part 1
Having a Trading Plan Part 1
3 posts today – Having a Trading Plan Part 1, Part 2 and then my Weekend Market Recap. Enjoy!
Having a Trading Plan Part 1
First let me say thanks to all of you for your kind comments about my last couple of posts and a special thanks to nasa1974 who posted his results. It’s always difficult to discuss financial losses so thanks nasa I appreciate you helping me drive the point home.
This is a bit of a follow on to my Stop Loss post last week. There’s one more step we should take. I said in that post we should have a plan. The next step is writing it down and following it. A written plan details why we got into a position to begin with and what we will do if it turns against us. The time to develop a plan is when things are quiet and we can study, observe and plan, preferably when the markets are closed. When markets are open and moving most people tend to act on impulse rather than follow any sort of plan. Discipline in the markets is a difficult task to master. Anyone can have a plan in their head, but writing it down and following it gives us the discipline we need to help us not to deviate from it.
So what should a plan include? There are several components to a trading plan depending on the market you’re trading but for the TSP there are really only 2 essential components. They are:
1. Your reason for entry, write down your reason, cut and paste in a chart and save it on your computer or print a copy if you prefer, whatever works for you. If things don’t go as expected this becomes a learning tool and you can use it to learn to trade better. It gives you an opportunity to review your trades and see what you may be doing wrong or what you could do to improve results. I always have a written plan in place when I trade.
2. Your Stop Loss. At what point will you get out of a losing position in your TSP? Is it based on the daily NAV? a support or resistance area of a chart? both? Write it down and remember stops can only be adjusted in the direction of the trade (or in this case up), never against it. Once your plan is in place, stick with it.
This seems simple and it is. Try it and you’ll find it’s very effective. It forces you to study the market and work up a plan rather than act on impulse. Once you have a plan in place there is generally no real good reason to deviate from it. The only reason I would deviate from mine is if one of my signals or a chart pattern changes suggesting a reversal was very probable at that point and in my case I occasionally anticipate a reversal based on my signal system with some degree of success and will act on it.
If you are trading stocks/ETFs etc. you will want to add entry price, and target (see my trade example below).
This is a copy of a trading plan for one of my recent trades that I posted on this very thread a few weeks ago. This plan was used for selling ACTL short. I made the trade on 19 May 08 (see post # 226)
Market: Markets are overbought, sentiment is not supporting recent rally and this is Post Options Expiration (POE) after a strong up week
Sector: Semis are overbought (OB), they shot way above the top bb on the weekly chart
Stock: ACTL isOB and up against its top bb on both weekly and daily charts, strong resistance in the $17.00 area and closed with a doji candle on the weekly, latest histo bar is down plus the daily chart has bearish divergences on histo and macd making this an attractive short
Earnings: NA Short Interest: 6.73%
Action: Sell short at the open for $16.89, target $14.00, stop $17.22
Notes on above trading plan for TSP Board Members:
1) I tend to look at the market overall, then the sector, then the stock or ETF. It gives me a better picture of what’s happening not only in the market, but in the sector that the stock or ETF I’m considering trading is in.
2) When the SPX moves up or down significantly during the last three days before the expiration Friday, there’s a strong probability that it will move in the opposite direction the following week, hence my note above on POE.
3) bb indicates bollenger bands, as an option trader I use them as an indicator of overbought and oversold conditions
4) Earnings, I generally will not take a directional trade right in front of an earnings announcement and in many cases will close out trades if earnings are approaching so I want to know when the last earnings date was. If the last earnings date was recent and the next earnings is in the next few months I just write NA because I don’t plan on being in the trade that long. The only strategy I employ for earnings announcements is a neutral option strategy and then only when the stock and option meets certain parameters and I expect its earnings to cause a big swing in either direction.
5) Short interest: I like to know what a stocks short interest is when I enter to see if there is a possibility that I could get caught in a short covering rally if I’m planning to short the stock.
I write these articles with the intent of keeping them much shorter than they end up being. I actually had to cut out a portion of my stop loss article because it ran over the allowed limit of characters and this one will likely do the same so I’m breaking it apart here. See next post: Having a Trading Plan Part 2 posted immediately after this one.
optionman
Having a Trading Plan Part 1
3 posts today – Having a Trading Plan Part 1, Part 2 and then my Weekend Market Recap. Enjoy!
Having a Trading Plan Part 1
First let me say thanks to all of you for your kind comments about my last couple of posts and a special thanks to nasa1974 who posted his results. It’s always difficult to discuss financial losses so thanks nasa I appreciate you helping me drive the point home.
This is a bit of a follow on to my Stop Loss post last week. There’s one more step we should take. I said in that post we should have a plan. The next step is writing it down and following it. A written plan details why we got into a position to begin with and what we will do if it turns against us. The time to develop a plan is when things are quiet and we can study, observe and plan, preferably when the markets are closed. When markets are open and moving most people tend to act on impulse rather than follow any sort of plan. Discipline in the markets is a difficult task to master. Anyone can have a plan in their head, but writing it down and following it gives us the discipline we need to help us not to deviate from it.
So what should a plan include? There are several components to a trading plan depending on the market you’re trading but for the TSP there are really only 2 essential components. They are:
1. Your reason for entry, write down your reason, cut and paste in a chart and save it on your computer or print a copy if you prefer, whatever works for you. If things don’t go as expected this becomes a learning tool and you can use it to learn to trade better. It gives you an opportunity to review your trades and see what you may be doing wrong or what you could do to improve results. I always have a written plan in place when I trade.
2. Your Stop Loss. At what point will you get out of a losing position in your TSP? Is it based on the daily NAV? a support or resistance area of a chart? both? Write it down and remember stops can only be adjusted in the direction of the trade (or in this case up), never against it. Once your plan is in place, stick with it.
This seems simple and it is. Try it and you’ll find it’s very effective. It forces you to study the market and work up a plan rather than act on impulse. Once you have a plan in place there is generally no real good reason to deviate from it. The only reason I would deviate from mine is if one of my signals or a chart pattern changes suggesting a reversal was very probable at that point and in my case I occasionally anticipate a reversal based on my signal system with some degree of success and will act on it.
If you are trading stocks/ETFs etc. you will want to add entry price, and target (see my trade example below).
This is a copy of a trading plan for one of my recent trades that I posted on this very thread a few weeks ago. This plan was used for selling ACTL short. I made the trade on 19 May 08 (see post # 226)
Market: Markets are overbought, sentiment is not supporting recent rally and this is Post Options Expiration (POE) after a strong up week
Sector: Semis are overbought (OB), they shot way above the top bb on the weekly chart
Stock: ACTL isOB and up against its top bb on both weekly and daily charts, strong resistance in the $17.00 area and closed with a doji candle on the weekly, latest histo bar is down plus the daily chart has bearish divergences on histo and macd making this an attractive short
Earnings: NA Short Interest: 6.73%
Action: Sell short at the open for $16.89, target $14.00, stop $17.22
Notes on above trading plan for TSP Board Members:
1) I tend to look at the market overall, then the sector, then the stock or ETF. It gives me a better picture of what’s happening not only in the market, but in the sector that the stock or ETF I’m considering trading is in.
2) When the SPX moves up or down significantly during the last three days before the expiration Friday, there’s a strong probability that it will move in the opposite direction the following week, hence my note above on POE.
3) bb indicates bollenger bands, as an option trader I use them as an indicator of overbought and oversold conditions
4) Earnings, I generally will not take a directional trade right in front of an earnings announcement and in many cases will close out trades if earnings are approaching so I want to know when the last earnings date was. If the last earnings date was recent and the next earnings is in the next few months I just write NA because I don’t plan on being in the trade that long. The only strategy I employ for earnings announcements is a neutral option strategy and then only when the stock and option meets certain parameters and I expect its earnings to cause a big swing in either direction.
5) Short interest: I like to know what a stocks short interest is when I enter to see if there is a possibility that I could get caught in a short covering rally if I’m planning to short the stock.
I write these articles with the intent of keeping them much shorter than they end up being. I actually had to cut out a portion of my stop loss article because it ran over the allowed limit of characters and this one will likely do the same so I’m breaking it apart here. See next post: Having a Trading Plan Part 2 posted immediately after this one.
optionman
Having a Trading Plan Part 2
Below are my exit notes for when I exited the trade which happened to be the same day:
Reason for Exit: Stopped out and I don’t understand why since I was stopped out at $17 .075 while my stop order was a limit stop at $17.09. Contacting broker to get answers.
Results:Shorted on 19 May for $16.64, covered on 19 May for $17.075 (-$0.43 or -2.61%)
Good/Bad:
Bad: Rather than letting my order get filled I chased the stock and got the low of the day. In the future place orders using the OTO orders with the primary order a limit entry and other a stop.
Bad: Used a higher than authorized stop based on entry. If my entry would have executed as I originally had it, (and it would have if I had placed an OTO order) my stop could have been placed at $17.16 as planned and would not have been hit.
Place orders accordingly and do not chase stocks.
Good: Although it should have been better, the stop loss was almost acceptable, stick to 2% or less.
Exit notes for TSP Board Members:
1) I contacted my broker and found out that ACTL hit an ask of $17.09 which just happened to be the high that day so my stop triggered.
2) I show my entry and exit results.
3) I keep a record of what was good or bad about each trade so I can learn from my mistakes and improve future performance. Notice I also write what changes I need to make to improve.
This is just my method of using a trading plan. There are many others out there. You can develop your own but the whole idea is twofold, (1) writing your plan down and sticking to it and (2) learning from your mistakes so you can use them as a tool to improve your trading performance.
I could have just as easily picked a winning trade to review with you, but I wanted to show you that even though sometimes everything seems to line up for what should turn out to be a good trade things happen that are beyond our control and we have to be ready to deal with them and move on.
This may seem somewhat simplistic and it’s not rocket science, but it is a matter of being committed to your own success if you trade your own accounts.
Please read the next sentence very carefully. It’s not about how much you make in your winning trades, it’s about how much you don’t lose in your losing ones. That sentence is the key to successful trading. You can make a lot of money in winning trades, but if you give it all back plus some in your losing trades what have you accomplished besides making your broker happy? Nothing! Having a written plan helps us to overcome this and cut our losses. OK, enough about that. I hope my stop loss post, nasa’s comments and this follow on post drives home the point and you understand just how important it is to have a written plan in place. Remember the trade above, it turned out to be a losing one, but I limited my loss by having a stop loss in place and although I’m obviously not to thrilled that it hit within one cent, it happens and you have to move on.
Now let me quickly tackle one other issue. There are those who are not market savvy and or don’t have the time or interest in studying the markets and there’s absolutely nothing wrong with that. Many can’t study the markets because their jobs will not allow them to and others are not interested. For those in that category I advise you to find a system you like and follow it for a while or review the recent past results of it and determine if it may be right for you, feel free to follow my system and IFTs, even if you only want to do it as paper trades for a while. I post my IFTs based on my system free on this thread prior to making them.
If not my system try and find one you are comfortable with and follow it for a while to see if it meets your investment criteria, but whatever you do please don’t go on hunches or gut feelings. I had a hunch or a gut feeling may work a time or two, but will eventually lead to significant losses. This is not play money, this is money we worked hard for and now we must make it work hard for us or at least keep it safe until it’s time for it to get back to work.
This would be a good time to reiterate my challenge to all TSP participants and systems. Please see my very first post on this thread for my challenge. If you have your own system or are following another feel free to use mine as a comparison and see if you can beat my results. There are a few members out there that it appears will be tough to beat and perhaps some will remain ahead of me, but I expect to remain somewhere in or near the top ten throughout the year.
This challenge helps you and me. It forces you to want to beat me so you can say I told you so optionman and it challenges me to stay on top of my game so that doesn’t happen so good luck my friends.
BTW if you’re looking at the weekly autotracker numbers, please make sure you scroll all the way down since the autotracker placed those of us who joined this year below those who were in since before 2008. And if you are wondering why my numbers above don’t match the auto tracker it’s because I didn’t start posting my trades until the 17th of Jan 08 shortly after joining this board. I was in the F fund on the last trading day of 2007 until the 15th of Jan 08 which gave me a + 1.59% gain, add that to the autotracker number for an accurate record of performance this year.
optionman
Below are my exit notes for when I exited the trade which happened to be the same day:
Reason for Exit: Stopped out and I don’t understand why since I was stopped out at $17 .075 while my stop order was a limit stop at $17.09. Contacting broker to get answers.
Results:Shorted on 19 May for $16.64, covered on 19 May for $17.075 (-$0.43 or -2.61%)
Good/Bad:
Bad: Rather than letting my order get filled I chased the stock and got the low of the day. In the future place orders using the OTO orders with the primary order a limit entry and other a stop.
Bad: Used a higher than authorized stop based on entry. If my entry would have executed as I originally had it, (and it would have if I had placed an OTO order) my stop could have been placed at $17.16 as planned and would not have been hit.
Place orders accordingly and do not chase stocks.
Good: Although it should have been better, the stop loss was almost acceptable, stick to 2% or less.
Exit notes for TSP Board Members:
1) I contacted my broker and found out that ACTL hit an ask of $17.09 which just happened to be the high that day so my stop triggered.
2) I show my entry and exit results.
3) I keep a record of what was good or bad about each trade so I can learn from my mistakes and improve future performance. Notice I also write what changes I need to make to improve.
This is just my method of using a trading plan. There are many others out there. You can develop your own but the whole idea is twofold, (1) writing your plan down and sticking to it and (2) learning from your mistakes so you can use them as a tool to improve your trading performance.
I could have just as easily picked a winning trade to review with you, but I wanted to show you that even though sometimes everything seems to line up for what should turn out to be a good trade things happen that are beyond our control and we have to be ready to deal with them and move on.
This may seem somewhat simplistic and it’s not rocket science, but it is a matter of being committed to your own success if you trade your own accounts.
Please read the next sentence very carefully. It’s not about how much you make in your winning trades, it’s about how much you don’t lose in your losing ones. That sentence is the key to successful trading. You can make a lot of money in winning trades, but if you give it all back plus some in your losing trades what have you accomplished besides making your broker happy? Nothing! Having a written plan helps us to overcome this and cut our losses. OK, enough about that. I hope my stop loss post, nasa’s comments and this follow on post drives home the point and you understand just how important it is to have a written plan in place. Remember the trade above, it turned out to be a losing one, but I limited my loss by having a stop loss in place and although I’m obviously not to thrilled that it hit within one cent, it happens and you have to move on.
Now let me quickly tackle one other issue. There are those who are not market savvy and or don’t have the time or interest in studying the markets and there’s absolutely nothing wrong with that. Many can’t study the markets because their jobs will not allow them to and others are not interested. For those in that category I advise you to find a system you like and follow it for a while or review the recent past results of it and determine if it may be right for you, feel free to follow my system and IFTs, even if you only want to do it as paper trades for a while. I post my IFTs based on my system free on this thread prior to making them.
If not my system try and find one you are comfortable with and follow it for a while to see if it meets your investment criteria, but whatever you do please don’t go on hunches or gut feelings. I had a hunch or a gut feeling may work a time or two, but will eventually lead to significant losses. This is not play money, this is money we worked hard for and now we must make it work hard for us or at least keep it safe until it’s time for it to get back to work.
This would be a good time to reiterate my challenge to all TSP participants and systems. Please see my very first post on this thread for my challenge. If you have your own system or are following another feel free to use mine as a comparison and see if you can beat my results. There are a few members out there that it appears will be tough to beat and perhaps some will remain ahead of me, but I expect to remain somewhere in or near the top ten throughout the year.
This challenge helps you and me. It forces you to want to beat me so you can say I told you so optionman and it challenges me to stay on top of my game so that doesn’t happen so good luck my friends.
BTW if you’re looking at the weekly autotracker numbers, please make sure you scroll all the way down since the autotracker placed those of us who joined this year below those who were in since before 2008. And if you are wondering why my numbers above don’t match the auto tracker it’s because I didn’t start posting my trades until the 17th of Jan 08 shortly after joining this board. I was in the F fund on the last trading day of 2007 until the 15th of Jan 08 which gave me a + 1.59% gain, add that to the autotracker number for an accurate record of performance this year.
optionman
Market Recap:
TSP: YTD +8.00% Position/Allocation: 100% G fund as of 5 May 08.
Market Recap:
My mid week update covered Monday through Wednesday. Thanks to all for the comments even to my friendly perma-bull--Birchtree.
Thursday: Oil fell to $126.00 a barrel on Thursday (almost a $4.00 drop) and the 1st QTR GDP was revised upward. With such a fall in oil (using the market rises when oil falls argument) and the upward revision in the GDP one would think the market would rally strongly and it did, at least until the afternoon where it began giving back some of its gains. Remember it was just a few weeks ago when oil hit $126.00 and the markets were tanking as a result, well now all of a sudden $126.00 seems to be OK, Hm do you buy it? I don’t. So although the market did rally and close higher, it couldn’t close near its highs. IMO day traders are pushing the markets around and have been for a while. When the big boys step in, I continue to believe it will be on the short side driving the market down.
Friday: A fairly tame and flat day, nothing really worth noting.
Week Ahead:
I remain extremely bearish and would not be long stocks (or in stock funds) in this market environment nor would I be in bonds here. I remain 100% G fund expecting this downward move to continue in both stocks and bonds. I expect momentum to pick up and drive the stock market down far and fast soon taking out the lows made earlier this year.
As always I could be wrong, it certainly wouldn’t be the first time, we will soon see.
Thanks for stopping by. I’ll try and get a mid week update in after the close Wednesday.
Trade Well!
optionman
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
Ed Seykota
TSP: YTD +8.00% Position/Allocation: 100% G fund as of 5 May 08.
Market Recap:
My mid week update covered Monday through Wednesday. Thanks to all for the comments even to my friendly perma-bull--Birchtree.
Thursday: Oil fell to $126.00 a barrel on Thursday (almost a $4.00 drop) and the 1st QTR GDP was revised upward. With such a fall in oil (using the market rises when oil falls argument) and the upward revision in the GDP one would think the market would rally strongly and it did, at least until the afternoon where it began giving back some of its gains. Remember it was just a few weeks ago when oil hit $126.00 and the markets were tanking as a result, well now all of a sudden $126.00 seems to be OK, Hm do you buy it? I don’t. So although the market did rally and close higher, it couldn’t close near its highs. IMO day traders are pushing the markets around and have been for a while. When the big boys step in, I continue to believe it will be on the short side driving the market down.
Friday: A fairly tame and flat day, nothing really worth noting.
Week Ahead:
I remain extremely bearish and would not be long stocks (or in stock funds) in this market environment nor would I be in bonds here. I remain 100% G fund expecting this downward move to continue in both stocks and bonds. I expect momentum to pick up and drive the stock market down far and fast soon taking out the lows made earlier this year.
As always I could be wrong, it certainly wouldn’t be the first time, we will soon see.
Thanks for stopping by. I’ll try and get a mid week update in after the close Wednesday.
Trade Well!
optionman
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
Ed Seykota
FogSailing
Well-known member
Thanks for your posting Optionman...
It was a good week even though I was only part way invested this week...but a little gain is better than none..part of my contining 2008 experiment. My question is.."look in your crystal ball" ..Will the market tank and by how much. Elliott wave theory says it will, but when? If it does, do we fall quickly in a major way or in smaller steps..to 1335, possibly down to 1270 (or lower) again and retest the March lows.
It appears to me that the market is more stable than it was in March, after all, we already know oil is going to go up.up.up...and as been suggested, we overcame the initial wall of fear about rising oil cost. The question is "Is $120-126 a barrel going to stick, or will we begin to trickle higher. If oil stabilizes, it would seem to me that markets should also stabilize, but again...Elliott wave theory still presupposes a downturn..and we still have a credit crisis, a mortgage crisis, the Iraq war, a damaged dollar..and high prices for oil..hmmmm...
It's always fun to try to figure this stuff out...but in the end, we can only make a decision about what's happening now..it's a shame but that's the game.
GL to you in your investing...
FS
It was a good week even though I was only part way invested this week...but a little gain is better than none..part of my contining 2008 experiment. My question is.."look in your crystal ball" ..Will the market tank and by how much. Elliott wave theory says it will, but when? If it does, do we fall quickly in a major way or in smaller steps..to 1335, possibly down to 1270 (or lower) again and retest the March lows.
It appears to me that the market is more stable than it was in March, after all, we already know oil is going to go up.up.up...and as been suggested, we overcame the initial wall of fear about rising oil cost. The question is "Is $120-126 a barrel going to stick, or will we begin to trickle higher. If oil stabilizes, it would seem to me that markets should also stabilize, but again...Elliott wave theory still presupposes a downturn..and we still have a credit crisis, a mortgage crisis, the Iraq war, a damaged dollar..and high prices for oil..hmmmm...
It's always fun to try to figure this stuff out...but in the end, we can only make a decision about what's happening now..it's a shame but that's the game.
GL to you in your investing...
FS
FS---Although nobody can say with any real degree of certainty I can only offer my opinion based on my system and market analysis, having said that, I believe the market will soon tank. I believe it will happen fast once it begins and that we will see new lows sooner than later, but I don't want to guess how low because if we are seeing a bear market unfold, this may just be a step down followed by more. Trade well my friend.
optionman
Don’t be that guy!
After a strong up day Thursday SPX broke down and closed below a significant support of 1375 Friday. By now you have probably heard or read about the record oil surge Friday as well. I continue to believe a good portion of the price of oil is pure speculation. Sy Harding wrote a great column about it in his weekly newspaper article. Here’s a link to it for those interested: http://www.streetsmartreport.com/comm3.html
I continue to expect momentum to pick up and drive the stock market down far and fast soon. I remain 100% G fund expecting this downward move to continue in both stocks and bonds.
Bullish or Bearish? Long or Short? Up or Down? ………
We sometimes get hung up on the terms and will often do just the opposite of what we should be doing just to prove we’re right. It’s the ego again. Ego is probably the single most disadvantages thing in trading.
Don’t be that guy!
The guy that says I’m bullish and I must be right so I’ll hang on until I’m proven right even if it costs me 50% of my account and takes me 3 years to recover. I’ll show them!!
The guy that sold AOL short at $2.00 and held it while it rose to $80 or $90, what did he have to gain? Look at the risk vs. reward on that one.
The guy that says well I’m down this far what do I have to lose? Well, a lot more is what. Remember you can always get back in and there is no commission at least in our TSP accounts.
The guy that doesn’t use stops. Use stops and when in doubt get out!
The guy that doesn’t use some sort of well thought out strategy or system for being in the market to begin with.
The guy that doesn’t have a plan and doesn’t know when to get out if a position goes against him.
The guy that doesn’t follow the optionman’s system, OK I just threw that one in for fun to see if you were listening.
The guy that lets his friends buy stocks while the markets are falling or sell short while the markets are rising. Did you know that somewhere between 70 and 80 percent of all stocks move in the direction of their respective index? So going against them you have between a 20 and 30 percent chance of a successful trade.
Don’t Be That Guy!
Don’t let your ego get the best of you when good judgment is needed. That’s like saying here I am, I’m an idiot and I’ve decided to give away my money.
Thanks for stopping by. Have a great week and I’ll see you back here next weekend. Trade Well!
optionman
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
Ed Seykota
After a strong up day Thursday SPX broke down and closed below a significant support of 1375 Friday. By now you have probably heard or read about the record oil surge Friday as well. I continue to believe a good portion of the price of oil is pure speculation. Sy Harding wrote a great column about it in his weekly newspaper article. Here’s a link to it for those interested: http://www.streetsmartreport.com/comm3.html
I continue to expect momentum to pick up and drive the stock market down far and fast soon. I remain 100% G fund expecting this downward move to continue in both stocks and bonds.
Bullish or Bearish? Long or Short? Up or Down? ………
We sometimes get hung up on the terms and will often do just the opposite of what we should be doing just to prove we’re right. It’s the ego again. Ego is probably the single most disadvantages thing in trading.
Don’t be that guy!
The guy that says I’m bullish and I must be right so I’ll hang on until I’m proven right even if it costs me 50% of my account and takes me 3 years to recover. I’ll show them!!
The guy that sold AOL short at $2.00 and held it while it rose to $80 or $90, what did he have to gain? Look at the risk vs. reward on that one.
The guy that says well I’m down this far what do I have to lose? Well, a lot more is what. Remember you can always get back in and there is no commission at least in our TSP accounts.
The guy that doesn’t use stops. Use stops and when in doubt get out!
The guy that doesn’t use some sort of well thought out strategy or system for being in the market to begin with.
The guy that doesn’t have a plan and doesn’t know when to get out if a position goes against him.
The guy that doesn’t follow the optionman’s system, OK I just threw that one in for fun to see if you were listening.
The guy that lets his friends buy stocks while the markets are falling or sell short while the markets are rising. Did you know that somewhere between 70 and 80 percent of all stocks move in the direction of their respective index? So going against them you have between a 20 and 30 percent chance of a successful trade.
Don’t Be That Guy!
Don’t let your ego get the best of you when good judgment is needed. That’s like saying here I am, I’m an idiot and I’ve decided to give away my money.
Thanks for stopping by. Have a great week and I’ll see you back here next weekend. Trade Well!
optionman
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
Ed Seykota
Braveheart
Member
Re: Don’t be that guy!
Classic Post Optionman. I moved from the F Fund Friday to 100 G Fund. I know we only have 2 moves per month but I got in the F Fund at $12.05 and split at $12.12 my fear was seeing it go below $12.00 so for those in the F Fund I hope it hits $12.25 again but I was just sick of the - days so Friday it gained 3 cents I thought it would be more but who cares that worry is gone. I was looking at the I Fund and thought OK with Oil out of control this is a World Wide Crash waiting to happen and I do want to be part of it so the G Fund was the only play. The S Fund is overpriced so the risk/reward wasn't there. I am no expert but there is no charts for the market and $150+ oil and Israel vs. Iraq so things may get real ugly than anyone imagined.
Best of Luck to All - Braveheart
After a strong up day Thursday SPX broke down and closed below a significant support of 1375 Friday. By now you have probably heard or read about the record oil surge Friday as well. I continue to believe a good portion of the price of oil is pure speculation. Sy Harding wrote a great column about it in his weekly newspaper article. Here’s a link to it for those interested: http://www.streetsmartreport.com/comm3.html
I continue to expect momentum to pick up and drive the stock market down far and fast soon. I remain 100% G fund expecting this downward move to continue in both stocks and bonds.
Bullish or Bearish? Long or Short? Up or Down? ………
We sometimes get hung up on the terms and will often do just the opposite of what we should be doing just to prove we’re right. It’s the ego again. Ego is probably the single most disadvantages thing in trading.
Don’t be that guy!
The guy that says I’m bullish and I must be right so I’ll hang on until I’m proven right even if it costs me 50% of my account and takes me 3 years to recover. I’ll show them!!
The guy that sold AOL short at $2.00 and held it while it rose to $80 or $90, what did he have to gain? Look at the risk vs. reward on that one.
The guy that says well I’m down this far what do I have to lose? Well, a lot more is what. Remember you can always get back in and there is no commission at least in our TSP accounts.
The guy that doesn’t use stops. Use stops and when in doubt get out!
The guy that doesn’t use some sort of well thought out strategy or system for being in the market to begin with.
The guy that doesn’t have a plan and doesn’t know when to get out if a position goes against him.
The guy that doesn’t follow the optionman’s system, OK I just threw that one in for fun to see if you were listening.
The guy that lets his friends buy stocks while the markets are falling or sell short while the markets are rising. Did you know that somewhere between 70 and 80 percent of all stocks move in the direction of their respective index? So going against them you have between a 20 and 30 percent chance of a successful trade.
Don’t Be That Guy!
Don’t let your ego get the best of you when good judgment is needed. That’s like saying here I am, I’m an idiot and I’ve decided to give away my money.
Thanks for stopping by. Have a great week and I’ll see you back here next weekend. Trade Well!
optionman
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
Ed Seykota
Classic Post Optionman. I moved from the F Fund Friday to 100 G Fund. I know we only have 2 moves per month but I got in the F Fund at $12.05 and split at $12.12 my fear was seeing it go below $12.00 so for those in the F Fund I hope it hits $12.25 again but I was just sick of the - days so Friday it gained 3 cents I thought it would be more but who cares that worry is gone. I was looking at the I Fund and thought OK with Oil out of control this is a World Wide Crash waiting to happen and I do want to be part of it so the G Fund was the only play. The S Fund is overpriced so the risk/reward wasn't there. I am no expert but there is no charts for the market and $150+ oil and Israel vs. Iraq so things may get real ugly than anyone imagined.
Best of Luck to All - Braveheart
Weekly Update
The short term trend on the SPX is down. The rally that began in March reversed on May 19th. The significance of the reversal is not only that it happened right at the 200 day ma, but that it is now trading below its 50 and 200 day ma’s and those ma’s are now descending.
I remain extremely bearish. My market analysis suggests there’s a strong possibility that we will see a capitulation bottom soon. SPX may bounce a little higher from here, but if it does it will meet resistance at 1370-1375 and likely be turned back down.
AGG representing the bond fund is extremely oversold and will likely bounce also, but the weekly and daily trends are clearly down so I would wait for a trend reversal there also.
Position: 100% G fund.
Trade Well!
optionman
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
Ed Seykota
The short term trend on the SPX is down. The rally that began in March reversed on May 19th. The significance of the reversal is not only that it happened right at the 200 day ma, but that it is now trading below its 50 and 200 day ma’s and those ma’s are now descending.
I remain extremely bearish. My market analysis suggests there’s a strong possibility that we will see a capitulation bottom soon. SPX may bounce a little higher from here, but if it does it will meet resistance at 1370-1375 and likely be turned back down.
AGG representing the bond fund is extremely oversold and will likely bounce also, but the weekly and daily trends are clearly down so I would wait for a trend reversal there also.
Position: 100% G fund.
Trade Well!
optionman
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
Ed Seykota
Weekly Update
SPX needs a good drubbing and my signals and analysis continue to suggest we will soon see one in the form of either a capitulation sell off or a momentum driven sell off that leads to a capitulation. Look for momentum to pick up and a strong sell off to ensue on high volume accompanied by a spike in the volatility index $VIX. Note that on Friday we had a high volume down day with volume very close to the levels on the January and March bottoms, but volatility although rising remained low. If SPX does happen to bounce up from here I would expect a reversal back downward around the 1340 resistance area.
The trend in AGG representing the bond fund is down as well.
I remain 100% G fund.
Trade Well!
optionman
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
Ed Seykota
SPX needs a good drubbing and my signals and analysis continue to suggest we will soon see one in the form of either a capitulation sell off or a momentum driven sell off that leads to a capitulation. Look for momentum to pick up and a strong sell off to ensue on high volume accompanied by a spike in the volatility index $VIX. Note that on Friday we had a high volume down day with volume very close to the levels on the January and March bottoms, but volatility although rising remained low. If SPX does happen to bounce up from here I would expect a reversal back downward around the 1340 resistance area.
The trend in AGG representing the bond fund is down as well.
I remain 100% G fund.
Trade Well!
optionman
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
Ed Seykota
Corepuncher
Well-known member
Re: Weekly Update
Wholeheartedly agree with your down prediction, volitility and resistance. Rock on! A big "Baaaaaaaaaaaaaaaaaaaaaaaah" of approval.
Wholeheartedly agree with your down prediction, volitility and resistance. Rock on! A big "Baaaaaaaaaaaaaaaaaaaaaaaah" of approval.
FogSailing
Well-known member
1317 is starting to look pretty low... I hope to be able to jump back in to 100% stocks in July...we'll see..Thanks for your continued counsel to this forum..
FS
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