Tuesday, September 13, 2011

Bearly There


We left the bears with a full frontal retracement today as prices rose alongside glimmers of hope driven by China's potential investment in Italian bonds and more US data on the horizon tomorrow, including retail sales and PPI. Out of the UK, we have Professor King speaking. Will he say something helpful or will the GOLs continue to knife BCS?

I must have sounded drunker than usual yesterday, but I discovered a new strategy to be in the market all the time more profitably without being a bear. Essentially, I need to find a way to buy profitably even with the bears' omnipresence. My idea is to use the 50% daily Fib level as a way to guess whether we'll have more bullish or bearish conditions the day after. I've noticed that the 50% daily Fib level has been quite accurate at indicating further upside or potential downside on the morrow.

So if we close above the 50% daily Fib, I'll continue riding until I see a bearish sign - such as flatlining prices or a news event that may increase volatility. And if we close below the 50% daily Fib level, I'll need to target buying the daily low of the following trading day. Right now, I'm going to use arbitrary percentages and previous support levels as price targets since I don't have a better way of catching a market bottom.

I have to give credit where credit is due. I first learned about a similar strategy by reading Ed Ponsi's forex trading book. He has a trend riding strategy where he uses - I believe it was MAs - as a gauge. [I added the evil bit about buying a dip and I'll try to sell at an arbitrary percentage in an effort to give the bears a retracement they won't soon forget.]

What do you think, HSFTs? Will my new Bearly There Strategy work? I'm going to try it out. Anything must be better than sitting through pins and needles with your capital all tied up through a financial mini maelstrom such as the Obama Jobs Creation Speech + G7 Meeting + two days of very light data.

+1.31% SBA
+1.42% Roth IRA (still haven't decided what to do about this naughty portfolio... Harry, are you there?)

+0.40% DJIA
+1.49% Nasdaq
+0.91% S&P


I was wondering why Shanghai and HK appeared to have sold off today, but it was because there was a bank holiday and they weren't even open. Duh! And I'm Chinese. I'm supposed to know this stuff. Uh oh... I forgot to call my parents even though we had dinner this weekend... I'm naughtier than my Roth IRA!

P.S. Ed Ponsi has openly denied being related to the scheme in case anyone's wondering.


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