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This past week has seen a range of between 15 and 30% on stocks, indicies, forex. These are unprecendented moves. Last week we saw the AUD move in a 120 pip range in 15 minutes.First 100 to the downside then a reversal of 120 to the upside.The low for the week was 99.20 and one week later its 104.80.It hit 1.10 while i was away. The euro fell from high 1.44's to 1.41 and is now back to 1.44.5. The was a 500 pip move in the eur/chf.Rio tinto had a low of 63$ last tuesday to close in the 69's the same day and now is 73 after closing above 74 yesterday.
My point being that if you were trading with tight stops last week you would have been annililated.Its just not possible to trade that kind of volatilty continuously and be successful.Its all down to the superfast trading programmes. Once points are hit on the downside the SFT piles in the sell orders, cascading downwards.Same situation to the upside. Its not reasonable to put in a tight stop no matter which direction your trading. You would need to have such precise entry points to succeed.You may get it a few times, good luck, good skill sometimes but if you do it continuously you will get blown away.
Take the AUD last tuesday down 100 pips over 2 minutes due to disappointing employment number.Logic says after the fall it would stay down for a while, maybe days as lower interest rates were indicated> But no with in 15 minutes it was above the start point by 20 pips and has risen another 250 pips since. No body can make trading decisions that fast.It was all due to SFT.
Therefore, in my view the trading goal posts have been moved. More risk must be taken on.Wide stops will become the vogue.Smaller position sizes needed. Small accounts have even less chance than they did before. I would suggest that any forex account under 50k is cannon fodder.
Take someone like Melly who predicts armageddon. Last week when the dow fell below 10,000 the mellys of the trading world were getting short as they were telling themselves" this is it, finally market liquidation day is here" They would have been wiped out by friday.
Similarly the everythings going up brigade were devasted at the speed and depth of the correction.Did they buy at the nadir? Not likely.Here in Aust the statistics show that monday{yesterday} the rank and file bought back in.The market is down 45 points today.
Which forumites are buying today? Melly - are you shorting at this juncture?
I'd rather take a swim at the apex of the bermuda triangle.
My point being that if you were trading with tight stops last week you would have been annililated.Its just not possible to trade that kind of volatilty continuously and be successful.Its all down to the superfast trading programmes. Once points are hit on the downside the SFT piles in the sell orders, cascading downwards.Same situation to the upside. Its not reasonable to put in a tight stop no matter which direction your trading. You would need to have such precise entry points to succeed.You may get it a few times, good luck, good skill sometimes but if you do it continuously you will get blown away.
Take the AUD last tuesday down 100 pips over 2 minutes due to disappointing employment number.Logic says after the fall it would stay down for a while, maybe days as lower interest rates were indicated> But no with in 15 minutes it was above the start point by 20 pips and has risen another 250 pips since. No body can make trading decisions that fast.It was all due to SFT.
Therefore, in my view the trading goal posts have been moved. More risk must be taken on.Wide stops will become the vogue.Smaller position sizes needed. Small accounts have even less chance than they did before. I would suggest that any forex account under 50k is cannon fodder.
Take someone like Melly who predicts armageddon. Last week when the dow fell below 10,000 the mellys of the trading world were getting short as they were telling themselves" this is it, finally market liquidation day is here" They would have been wiped out by friday.
Similarly the everythings going up brigade were devasted at the speed and depth of the correction.Did they buy at the nadir? Not likely.Here in Aust the statistics show that monday{yesterday} the rank and file bought back in.The market is down 45 points today.
Which forumites are buying today? Melly - are you shorting at this juncture?
I'd rather take a swim at the apex of the bermuda triangle.
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Keep your drivel to just a couple of lines. The more you write the more you embarrass yourself.
C...L...U...E...L...E....S...S personified
C...L...U...E...L...E....S...S personified
Damn it !!!! I should have known better. I think I just broke a rib laughing from reading MrBean's post
so , melly are you shorting here?
I'm not surprised you at your response.Since you never traded a single contract in your life my entire post would have gone straight over your head.
I'm not surprised you at your response.Since you never traded a single contract in your life my entire post would have gone straight over your head.
even before flash crashes stops were a primary asset if you wanted to bring a market down quickly as they accelerate downward momentum, combined with artificial or exaggerated bad news, naked shorts, followed by panic selling and buying fear and inertia etc. I don't use them but each to their own.
again- melly ARE YOU SHORTING HERE?????????????????????????????????????
Dow = dead cat bounce
Will fall to 5000 within a few years.
Will fall to 5000 within a few years.
@ Mrbean
Yeah, massively long, how did you guess? Was it my numerous posts to JW that we're not in a "soft patch" but rather a deep recession? Or was it my incessant shouts on here that the banks are insolvent and most economic indicators are pointing to a contraction? Or perhaps my ongoing warning to the fanboy that it's not about ipads, it's about the Chairman resolving a banking crisis?
I shall be more careful with my posts in the future not to be so transparent.
(sarcasm off)
@ J2BLUE
In my opinion short of a catastrophic nuclear world war, we'll never see DOW 5000, EVER. The deflationary winds are blowing harder with each passing day and the most important person on the planet will do what he does best.....PRINT MORE FIAT. He can't now (I posted my predictions already) but sooner or later he will as he must. Markets priced in USDs don't go to 5000 in this scenario.
Yeah, massively long, how did you guess? Was it my numerous posts to JW that we're not in a "soft patch" but rather a deep recession? Or was it my incessant shouts on here that the banks are insolvent and most economic indicators are pointing to a contraction? Or perhaps my ongoing warning to the fanboy that it's not about ipads, it's about the Chairman resolving a banking crisis?
I shall be more careful with my posts in the future not to be so transparent.
(sarcasm off)
@ J2BLUE
In my opinion short of a catastrophic nuclear world war, we'll never see DOW 5000, EVER. The deflationary winds are blowing harder with each passing day and the most important person on the planet will do what he does best.....PRINT MORE FIAT. He can't now (I posted my predictions already) but sooner or later he will as he must. Markets priced in USDs don't go to 5000 in this scenario.
Menelaus:
I have no idea what i'm talking about! That's just what someone said to me so I thought i'd get some reaction from you lot!
I have no idea what i'm talking about! That's just what someone said to me so I thought i'd get some reaction from you lot!
so melly you are officially still short @ dow 10 990 and the ftse @ 5092 . You would be long gold @ 1836 since you dont like paper money.
Lets see how you go.
Since you wont admit to holding anything its reasonable to use these points as your bench mark. After all your short the market by your own admission.
Let the forum know when you exit.
Lets see how you go.
Since you wont admit to holding anything its reasonable to use these points as your bench mark. After all your short the market by your own admission.
Let the forum know when you exit.
Wrong again MrBean. Short since 12,500. Long gold since about $400.
Wait, wait, speaking of gold, do you realize that you are only about $850 for your prediction to come true in the next couple of months:
Mrben Joined: 25 Oct 03
Replies: 2828 25 Jan 11 03:09
Im with you there johhnie re gold.Im thinking the same as whippet, first stop around 1250, the lower and lower
I have a long range bet based on gold going under 1000 in the last 3 mths of 2011 and the first 3 mths of 2012.
Wait, wait, speaking of gold, do you realize that you are only about $850 for your prediction to come true in the next couple of months:
Mrben Joined: 25 Oct 03
Replies: 2828 25 Jan 11 03:09
Im with you there johhnie re gold.Im thinking the same as whippet, first stop around 1250, the lower and lower
I have a long range bet based on gold going under 1000 in the last 3 mths of 2011 and the first 3 mths of 2012.
Melly after timing? has this ever happened before?
He managed to short the dow at the exact top, and buy gold at almost the brown bottom.
In addition, he managed to MASSIVELY SHORT apple at $20 above the price that it was when he first posted on the forum. If that wasn't enough, he also managed to close his apple short to within a few dollars of the bottom, just before it exploded $90 to the upside!
It makes you wonder why this obvious sage of trading wastes time spouting nonsense on here if he is that good.
He managed to short the dow at the exact top, and buy gold at almost the brown bottom.
In addition, he managed to MASSIVELY SHORT apple at $20 above the price that it was when he first posted on the forum. If that wasn't enough, he also managed to close his apple short to within a few dollars of the bottom, just before it exploded $90 to the upside!
It makes you wonder why this obvious sage of trading wastes time spouting nonsense on here if he is that good.
Whippet, I understand why you are suffering from spells of delirium. This often happens to clowns, eeer, sorry, I meant immature children who pretend are traders and post this after a 600 point run on the DOW against the run of all market indicators. They inevitably get herded into positions where they get sheered:
Whippet Joined: 01 Oct 07
Replies: 5030 01 Jul 11 18:10
FTSE 7000, Dow 14000, Gold $1250, AAPL $450 from here.
I'm not aftertiming, I never posted to boast about taking those positions, I'm only trying to correct our local jester who's trying desperately hard to nail me to a position long after the party is done and the money has been looted.
Whippet Joined: 01 Oct 07
Replies: 5030 01 Jul 11 18:10
FTSE 7000, Dow 14000, Gold $1250, AAPL $450 from here.
I'm not aftertiming, I never posted to boast about taking those positions, I'm only trying to correct our local jester who's trying desperately hard to nail me to a position long after the party is done and the money has been looted.
Wrong again MrBean. Short since 12,500. Long gold since about $400.
the undisputed king of aftertiming strikes again.
melly - you are a monumental dckhead.
the undisputed king of aftertiming strikes again.
melly - you are a monumental dckhead.
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