The current day trading mode is short all rallies. That has worked extremely well for several months but I have a strong feeling that this methodology is coming to an end very soon.
My sense is that while things are indeed bad, they are not as bad as many analysts would have us believe and with 40% already shaved off indices, a whole lot of bad things are priced in at this time. There are some tremendous values out there now and Monday I am going to begin rotating cash into them. I'll still do my day trading, simply following the momentum, but I feel it's time to begin investing again.
Hope everyone has a great weekend
Bob
On Sat, Oct 4, 2008 at 10:32 AM, Jim White
<jwhite43@xxxxxxxxxxxx> wrote:
This trade would obviously have resulted in a loss if held from the open to the close. I also tracked 10 individual stocks that met the condition and experienced similar results - a loss at the close. So there appears no value here for buy and hold traders however for day traders it may be a different story. All stock indexes and 7 of 10 stocks exhibited upward movement from the open with opportunity to capture day trade profits. The value may be in indicating the initial direction from the open, a valuable indicator for day traders.
I personally believe that day trading is the only sensible way to trade in these uncertain times. I continue to research and develop trading techniques for the short term. The latest with great promise is a Trade Permission indicator which provides a trend comparison for two time frames in one indicator, giving advance warning of direction reversals. The theory is that the rate of change of two different trend indicators can forewarn of price reversals. It has been extremely reliable in the FOREX markets. More latter.
Jim
----- Original Message -----
Sent: Friday, October 03, 2008 6:21 AM
Subject: [RT] next day trade
The major stock indexes yesterday met a condition in which the next day (today) is usually a major up move from the open to the close. I have not yet documented the reliability of this trade but it appears to be a good one. More later.
Jim White
Pivot Research & Trading Co.
PivotTrader.com