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Silent Service Method

  • #8,861
  • May 26, 2010 7:24pm May 26, 2010 7:24pm
Quoting golferfx
Mutual fund managers (smart money guys) are sitting at 3.5% cash...which is, er, uhm, alot of stock one would think.

Last time they had this low of cash allocation was the fall of 2007.

Look out below 401k'rs.


golferfx
Yeah, I am worried about several of my friends and their 401 k plans at the moment. The only thing they seem to understand is that they have made a hell of a bounce in the last year. I am afraid many of them will be hurt soon.
  • #8,862
  • May 26, 2010 7:39pm May 26, 2010 7:39pm
Quoting clockwork71
Yeah, I am worried about several of my friends and their 401 k plans at the moment. The only thing they seem to understand is that they have made a hell of a bounce in the last year. I am afraid many of them will be hurt soon.
It makes me sick to the stomach mate. People like my old man, worked his whole life first as a mechanic, then went back and studied to become an engineer to put 4 boys through school, trades, uni etc. Did everything right, lived by the book and is the epitome of the person behind all these 401ks/super funds who are going to get stiffed in their retirement. I am just thankful he and Mum own their home and live within their means many of their friends don't and are surely toast. They just come from a previous generation and have no idea what is coming....
  • #8,863
  • Edited 7:47pm May 26, 2010 7:44pm | Edited 7:47pm
Quote:InfinitySL
Anyways, as you know I enjoy playing devils advocate...You make some excellent points. Should be an interesting ride!

I appreciate the feedback mate, devil's advocate is just another name for thinking outside the box and it's definitely the key to keeping things in check

Saw an interview on CNBC today and amongst the jokes and rubbish they carry on with there was a guest who runs one of the world's largest futures exchanges. Part the way through the interview he produces a poker chip from his pocket and when asked wtf is he doing with a poker chip says, "I keep it in my pocket to make me ask myself whether I am trading or gambling before I open each position". No prizes for guessing why he's still in the game after 20+ years.
  • #8,864
  • May 26, 2010 8:39pm May 26, 2010 8:39pm
Is anyone else watching this?

It looks to me like a nice clean break and test of a S/R level, with a PIN. I have placed a sell order below the PIN.

Any thoughts on this?
Attached Image (click to enlarge)
Click to Enlarge Name: audnzd d.gif Size: 24 KB
  • #8,865
  • May 26, 2010 9:12pm May 26, 2010 9:12pm
Quoting clockwork71
Only 700 pips up? You need to go back and read this thread from the start my friend. lol
Lol, nearly got stopped out but I was watching the hourly and moved the stop losses back above 1.8450 which fortunately turned out to be almost to the pip resistance. Just retesting the trendline again as I type, hopefully before another big push down away from my entries so I can get back to all trades at breakeven. I'm enjoying myself here
Position trader - Anything intraweek is just noise...
  • #8,866
  • May 26, 2010 9:18pm May 26, 2010 9:18pm
Quoting jharvey407
Is anyone else watching this?

It looks to me like a nice clean break and test of a S/R level, with a PIN. I have placed a sell order below the PIN.

Any thoughts on this?
I'm short eurnzd and euraud and nzd has been weakest over the last few days, possibly a reversal is due? Just a feeling on my part.

I think this chart shows really nicely the value of this method. Round numbers are good to use but marking the most significant round numbers historically gives you a huge head start over shorter term traders. 1.8450 and 1.8200. Need I say more?
Attached Image (click to enlarge)
Click to Enlarge Name: eurnzd hourly 27 05 2010.gif Size: 40 KB
Position trader - Anything intraweek is just noise...
  • #8,867
  • May 27, 2010 3:13am May 27, 2010 3:13am
Quoting Arfer Daily
I'm short eurnzd and euraud and nzd has been weakest over the last few days, possibly a reversal is due? Just a feeling on my part.

I think this chart shows really nicely the value of this method. Round numbers are good to use but marking the most significant round numbers historically gives you a huge head start over shorter term traders. 1.8450 and 1.8200. Need I say more?
Arfer, you are crushing this thing
  • #8,868
  • May 27, 2010 6:32am May 27, 2010 6:32am
Quoting 4xAddict
Arfer, you are crushing this thing
Doing ok at the moment all the time that trendline holds...

Chris, is there any merit in the idea of taking profit on some of these stacked trades like my eurnzd when they reach a certain level? Maybe put a take profit at 500 pips up on each trade so as you go down you're taking profit as you go along or am I better to just keep trailing the stop behind the trendline and building the position with more trades until they all get stopped out together at the end when the pair inevitably breaks that trendline?
Position trader - Anything intraweek is just noise...
  • #8,869
  • May 27, 2010 8:22am May 27, 2010 8:22am
Quoting Arfer Daily
Doing ok at the moment all the time that trendline holds...

Chris, is there any merit in the idea of taking profit on some of these stacked trades like my eurnzd when they reach a certain level? Maybe put a take profit at 500 pips up on each trade so as you go down you're taking profit as you go along or am I better to just keep trailing the stop behind the trendline and building the position with more trades until they all get stopped out together at the end when the pair inevitably breaks that trendline?
Arfer, I have snuck into this trade at the 1.83 mark and it looks like it is hitting the 50% fib level of the previous high low on the 4hr chart in the 1.8110 area. If I were to add to this position would you wait for a retrace to the falling trend line or a pin bar signal on a retest of the 50% fib for entry?

Cheers.
  • #8,870
  • May 27, 2010 8:54am May 27, 2010 8:54am
Quoting 4xAddict
Arfer, I have snuck into this trade at the 1.83 mark and it looks like it is hitting the 50% fib level of the previous high low on the 4hr chart in the 1.8110 area. If I were to add to this position would you wait for a retrace to the falling trend line or a pin bar signal on a retest of the 50% fib for entry?

Cheers.
I am waiting for it to bounce or not at 1.80 and then I will add on at 1.82 without waiting for PA, I've got so much locked in that if I just enter now with a sensible stop loss and put all of my stop losses at that level behind 1.82 then I will be making a bundle whatever happens.

The trick I have found is to wait for your first trade to be at breakeven before adding on and then waiting for a retrace before entering with a sensible stop, that way you only ever have one trade at risk and after a couple of good trades you can't lose which certainly gives you the confidence to add on where you like.
Position trader - Anything intraweek is just noise...
  • #8,871
  • May 27, 2010 11:03am May 27, 2010 11:03am
Quoting Arfer Daily
Doing ok at the moment all the time that trendline holds...

Chris, is there any merit in the idea of taking profit on some of these stacked trades like my eurnzd when they reach a certain level? Maybe put a take profit at 500 pips up on each trade so as you go down you're taking profit as you go along or am I better to just keep trailing the stop behind the trendline and building the position with more trades until they all get stopped out together at the end when the pair inevitably breaks that trendline?
Honestly, I would pick a time frame and do peak-and-trough analysis. In other words, as it makes a higher high - take some profit, or all.....
  • #8,872
  • May 27, 2010 1:17pm May 27, 2010 1:17pm
Hmm, ok, so it's trending down nicely on the 4 hour but it could retrace anytime on the daily.

My stop losses are just behind the trendline and major resistance on the way down so that will take me out if it has to but with some of these trades being 600 or so pips up now it would be nice to take something off the table.

I can see eurnzd reaching support at 1.7450 ish before this retraces again though. I'd definitely take all profit there and look to reenter after that.
Position trader - Anything intraweek is just noise...
  • #8,873
  • May 27, 2010 2:08pm May 27, 2010 2:08pm
Nice to see a little bounce today.

Admittedly, I've missed a lot of the southbound action, waiting for a retrace and a decent place to put a stop. Hoping for another day or two of upside and an opportunity to sell.

You know what drives me batty the most?

Usually, you can take one trade or another on it's own merit, but with all the Euro noise it's pretty much the same move on any pair, regardless. So taking multiple positions on different pairs is just multiplying your risk.

Anyways, I'm just rambling on while I wait.
  • #8,874
  • May 27, 2010 2:31pm May 27, 2010 2:31pm
Quoting Low
Nice to see a little bounce today.

Admittedly, I've missed a lot of the southbound action, waiting for a retrace and a decent place to put a stop. Hoping for another day or two of upside and an opportunity to sell.

You know what drives me batty the most?

Usually, you can take one trade or another on it's own merit, but with all the Euro noise it's pretty much the same move on any pair, regardless. So taking multiple positions on different pairs is just multiplying your risk.

Anyways, I'm just rambling on while I wait.

The amazing thing is that the stock markets could very easily give up these 3% over the next couple of sessions. I am starting to hear a lot of noise about "black box trading" taking over. In other words, computers are driving everything. I hate quants.....too stupid to know they are. They are the same people that accelerated the move down 2 years ago. They will do it again I am sure.

It makes trading shorter time frames even more dangerous than usual, and that's saying something.
  • #8,875
  • May 27, 2010 2:35pm May 27, 2010 2:35pm
If you look at a few "positive pairs", in other words, ones that tend to rise on good news - we are forming 4 hour bearish pinbars that will close in 20 minutes. Chaos. Always look at the big picture guys, it will save your account.

Chris
  • #8,876
  • May 27, 2010 4:28pm May 27, 2010 4:28pm
Quoting clockwork71
The amazing thing is that the stock markets could very easily give up these 3% over the next couple of sessions. I am starting to hear a lot of noise about "black box trading" taking over. In other words, computers are driving everything. I hate quants.....too stupid to know they are. They are the same people that accelerated the move down 2 years ago. They will do it again I am sure.

It makes trading shorter time frames even more dangerous than usual, and that's saying something.
I'd like to posit a minor argument, just because it's fun "playing devil's advocate"

Looking at my charts, I see support holding across US equities and some of the major FX pairs, especially eur/usd. Basically the bears had their shot and couldn't break through. This leaves me with the opinion the the smart money (and their little black boxes) are willing to let the retail traders/investors bid price up to a better level from which to short.

Part of this could just be my own optimism, in that I'm patiently waiting for a good sell signal, and refuse to just jump on the sell train (especially considering how many pairs are at support).

But in regards to the HFT, I have a larger view that Wall Street may be greedy, but they're not dumb. They know that the general investing public will not tolerate watching their retirement/nest egg getting repeated plundered by a few lines of code running on a server farm within spitting distance of the exchanges for faster execution. My gut tells me that if there is going to be another big sell-off, the large specs know it's in their best interest to to make it an orderly sell-off, to preserve the perception of the markets credibility in general.

The alternative is that ordinary investors pull funds out the market simply because they're unwilling to lose what they've worked their whole lives for to a computer, and without their money, Wall Street has a lot less available capital to push back and forth.

In conclusion, it's my opinion that that we may see another automated crash or two, but overall it doesn't behoove the bankers to destroy what little credibility the US equities markets have left, and they know that if you slaughter the cow, you can no longer get the milk for free.

Anyways...maybe not the most coherent post, but like I said, I'm bored and waiting...LOL
  • #8,877
  • May 27, 2010 6:20pm May 27, 2010 6:20pm
Quoting Low
Anyways...maybe not the most coherent post, but like I said, I'm bored and waiting...LOL
Quite the contrary -- Your post makes total sense. Main street always tends to be holding the bag when wall street is done having their fun. Seems to happens every time.

To add another old expression to your post -- You don't kill the goose that lays the golden eggs...
  • #8,878
  • May 27, 2010 6:22pm May 27, 2010 6:22pm
Quoting Low
I'd like to posit a minor argument, just because it's fun "playing devil's advocate"

Looking at my charts, I see support holding across US equities and some of the major FX pairs, especially eur/usd. Basically the bears had their shot and couldn't break through....
Good post. I agree with most of it really. I understand that the bankers need that cash cow and need to do something. After all, most 401k's have done nothing over the last 20 years or so. We have an entire generation of soon to be retirees that are broke, or close enough to it to know they don't have much in the way of a retirement.

I also agree that we are setting up for a higher level to fall from. I am waiting as well.
  • #8,879
  • May 27, 2010 10:28pm May 27, 2010 10:28pm
Eurusd is doing nothing at the moment but I still think it's too far from the daily trendline to short right now. That long term weekly trendline is acting too. I can see it bouncing up quite hard before we see any more strong move down but who knows?

Chris, you know you talk about 'the trade that changed everything'. My eurnzd is definitely the one for me. This trade is going to change the way I trade forever. 7 open positions now, 6 at breakeven or better, I'll need a truck to carry my locked in pips not to mention the swap.
Position trader - Anything intraweek is just noise...
  • #8,880
  • May 28, 2010 3:20am May 28, 2010 3:20am
anyone else watching usd/jpy?
its sitting at trendline and 50% if i am not wrong..


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