This post is in reply to eichler's post to me over on SI...
To:LG who wrote (320)
From: eichler Tuesday, Sep 18, 2001 5:32 PM
View Replies (1) / Respond to of 329
Hi LG,
Very informative links on FAE's...very nasty devices!
Hope you are well and doing well in the market too. I've cut back my involvement in trading quite a bit but am still making plays here and there mostly in Penny Stocks. I think it is good for me to stand back and get perspective on occasion. I have a tendency to overtrade when I'm too focused on the market. I'm thinking that when it comes to trading, sometimes less is more! I keep coming back to Patience being the most important trading factor for me. If I can't maintain a discipline of Patience, I will have to schedule regular Time-outs to regain and retain Patience. <gg> Was this ever an issue for you in your early years of trading?
Best to you,
Eichler
Howdy eichler: Since we are one in the same, I am surprised you asked me a question...LOL Me, Myself and I (irene)...<g>
In my early years (mid to late eighties), one had to be much more careful with trade selection as a few thousand shares could cost a few hundred bucks in commissions each way. So, it paid to do your homework and I never over traded...<g>
The tools we had at our disposal then were minimal compared to what we have today, just fifteen years later. In some ways, I think there is so much information folks have a hard time making up their minds. I am glad I started when the only person I could really rely on was "me". It forced me to do strategic thinking and extensively back test my ideas and theories prior to using them in real trading.
I did use Prodigy (DOS based) in the eighties, but I did not participate in the discussion boards. I did not know they existed. I mainly used Prodigy to acquire information. I also subscribe to the online Dow Jones News Service and Data Service. I used the Dow Jones Market Analyzer Plus software and the Technifilter Plus software (both produced by RTR Software) for "end of day" analysis. For real time feed I used BMI’s FM side band data delivery and a hand held QuoteCheck for mobility which was also fed by a FM side band data feed delivery. My first investment computer had no hard drive with only two 5.25 floppy drives. It had an 8088 processor with ever bit of 640K memory...LOL
Prodigy provided one of the first online brokerage services as well. For the most part I was really a position trader and rarely entered and exited a position in the same day.
I suggest you try my technique. Find three indicators that work for you. I use Stochastic, MACD and Dir Movement, with all the parameters optimised. Analyze the indexes and equities in a multiple time frame format using those same indicators in all time frames. This is not easy, but it keeps you from over trading and gives you a composite perspective.
I would spend less time providing charts for others on SI and spend more time doing analysis for yourself.
Start each analysis by working down in time. First take a weekly look followed by a daily look to get an overall perspective and to generate long and medium-term trend lines and to identify current trend direction and any significant price action support resistance levels. Then, start the timing analyses by working down the following intraday intervals: 130, 65, 30 and 15-min noting SRLs and where you indicators are at each interval and comparing them to the other levels. This will allow you to begin to see the interrelationship between the indicators of the different time intervals. On rare occasion I will look at the five-minute bars, mainly when an issues is highly volatile or to make sure I have positioned trend lines as exacting as possible. I can’t stress getting trend lines as accurate as possible enough. That is the single biggest flaw in most of the analysis I come across. Well that and seeing patterns wrongly identified or that don’t exist...<g> Both will have you looking for price action inflections in the wrong place or even expecting the wrong break.
I suggest you use this technique the night before each trading day on issues you have identified as prospects. I use a variety of methods to find prospects, but most of them are sentiment based. If you are gong to trade you need the issue to move. If they are not moving you can't make money with them in the short-term, they are investments...<g>
Of course, the best prospects are the one’s you’ve come to know well and read well. Keep in mind these relationships are always on a honeymoon that is destined to end. Use this technique to narrow down the prospects and choose five. Pick possible entry and exit points for the next day for each choice. Track them all the next day and let the market and your indicators tell you what to do. I usually take a position in at least three. Cut the loser and under performers so you can focus on riding the winners. Of course you need to keep an eye on a few key indexes and indicator equities just to keep you from being blind-sided by a major market move.
It is not easy, but it will make your day zip by, this I guarantee.
Regards,
LG
God Bless America
