There a saying that goes like this: " The man who has two watches never knows what time it really is. "
If you’re going to try to trade Quill’s system, then trade it, and ignore what anyone else says. But I’d suggest that you’d be better off just borrowing from him what you can and then to change what you have to to make it your very own.
If all of us were in a trading contest with the same starting account, I have no doubt that Quill would beat anyone and everyone who has ever posted in any of TMF’s forums. He’s that good. But his methods aren’t the easiest to put into practice for them with small time and small money. Also, he has a lot of ideas about wider investing topics that are sheer nonsense.
Quick comment: You’re options savvy. Quill isn’t, and he bad-mouths them wherever he can for having lost a bundle trying to use them. Options are an edge you have that he doesn’t, and it’s an edge you could have used to, not just to limit the damaged you suffered on BITO, but to have made a sweet profit.
Further suggestion (which l’ll amplify in a later post): HA bars are superior for identifying the trends. So, get rid of everything else in your charts. Secondly, to make money with options, you have to get two things right: the direction and the timing. If things are up and down, then simple calls and puts or combinations. If sideways, then straddles, strangles, etc. In short, you’ve already got the savvy and the tools you need to deal with any market situation without looking over your shoulder to ask Quill if you’ve done it correctly. For your purposes, both him and me are a distraction you should ignore.
Thanks Arindam, I appreciate the help. Could you explain to me one more time the rules for Simon Sez III? You said I was in wrong on the trade and I thought I was following the rules correctly.
Let me get a bike ride in, and then I’ll tape read the chart of BITO you posted. Also, I’ll say it again. You should seriously consider using your options strengths to make your money and to put this Simon trading stuff on the back burner.
I get it Arindam, I have been using options also but I am intrigued with this as another tool. That Weinstein book you recommended was worth every penny on helping me recognize tops.
In a couple of months, go back and re-read the book. You’ll be totally blown away by how much you missed in the first reading and how well Stan understood markets and how to deal with them.
His newsletter partner for a long time was Justin Mamis whose books, esp., The Nature of Risk, are also crucial reading.
Sorry this is not about bitcoin, but I would go with UCO and SCO right now . Huge price swings in crude and I’m thinking its going up from $69. IMHO…doc
I have that on my Tetter Totter watchlist Doc and Gush also. I can’t believe how cheap gas has become recently. With summer coming you would think it would go up but this market is nuts.
When I plot BITO with the version of HA bars I’ve currently settled on, then you’re right. There was no warning signal on Friday. Hence, Monday’s sell down couldn’t have been side-stepped. But when BITO is plotted with hollow candlesticks, Friday’s warning is loud, clear, and obvious, and Wednesday’s candle alone was enough of a warning not to put on a position.
So, do this. Rather than choose between those formats, plot BITO on a 2-month chart with either one. What do you see? That BITO has been going sideways since about 3/17. Up a bit, down a bit, but chop, chop, chop. That kind of price action doesn’t lend itself to being traded EOD. It’s an intra-day gig.
In the past, BITO has occasionally trended well in sustained, swooping curves. But not right now for the fundamentalist reasons of a huge amount of uncertainty in the currency and bond markets over Fed policy and actions, the farce over the debt ceiling debate, the unraveling of the US banking system, the continuing US foreign policy fiascos, etc.
Andy
oil inventories are down, OPEC decreasing production and summer travel coming adds up to it makes no sense why crude is drifting down. Thanks for GUSH. I’ll watch it. Regarding BITO, I was thinking the same thing that Arindam said about its price action. It needs more what I call wave action up and down over a week or 2 week cycle. IMHO…doc
By reputation on discussion boards where serious traders hang out --and not just us amateurs-- the SP5OO is a tough, tough contract to trade. That’s why I like fishing the backwaters where few venture.
I wouldn’t say it is as much “what you’re doing wrong” as becoming more aware of the challenges inherent in what you were trying to do.
Do you rock climb or raft? If so, then you’re aware of the rating systems used in those sports by which beginners can keep themselves out of more trouble than they are ready to manage by not attempting climbs or runs beyond their proven skill level. I’d argue the same applies to investing or trading.
I have done a lot of rafting but reading the river takes time and experience, the way you get that is by getting your feet wet and sometimes getting in over your head. Yes I have been in trouble rafting but I always came out smarter on the other side. Arindam, I like learning and am always up for a challenge. But my best lessons have been learned by doing.
Here’s my challenge to you. Prove that I haven’t coded your trading rules correctly and that I’m not giving them a fair back-test. Here what I say trading UCO & USO with your rules would have produced using 1500 days of data and an (-8%) stop-loss.
