Giving the long dollar trade another try

[Mr. Now]

I apologize for being hard to understand, both in content and motive for posting here from time to time.

Mr. Now doesn't see any citations of any academics in his reply to the OP, which is the item you refer to.

Mr. Now does not quote Tharp, Covel nor Elder.
Mr. Now in fact considers the Tharp stuff to be pure theory and possibly, empty calories.

Mr. Now has deep respect for the author Mr. Mark Douglas.
Understanding what Douglas is actually teaching may be difficult without 5 or more years actual experience trading. Certainly, his ideas have value, and may in fact be priceless in the hands of certain readers.

My intent in posting here-- specifically about trading-- is to catch the attention of-- and help, a few-- the very few that are actually doing the extremely hard work necessary to be successful at trading.

Mr. Now is no theorist. It is in fact ironic that you think this, since I am in fact skewed toward a very empirical approach.

Mr. Now notices that there are zero quotations of any purported theorists in the reply-post of mine that you refer to, above.

I read constantly. Any quotations Mr. Now cites are incidental to that process.

For example:

“Practice is the best of all instructors”
Publilius, 1st century Latin writer of maxims

“Experience is a dear teacher, but fools will learn no other”
Benjamin Franklin

Some of what Mr. Now is reading now:

THE LUCIFER PRINCIPLE by Harold Bloom
FATE IS THE HUNTER by Ernest Gann
REMINISCENCES OF STOCK OPERATOR by Edwin Lefevre (4th or 5th reading)

Again I apologize for being hard for you to understand, both in content and in motive for posting.

[Mr. Now]

OK, here is what I mean:

The short trade of say, QQQQ (QQQ at that time) before March 2000 is in fact leading out with a prediction. In this case, a valid prediction. The OP suggests "shorts in 1999". That is 3 months too early.

Why do that, when you can wait for price and volume to confirm your theories?

If you lead out in any size, you have to seriously consider covering when the position goes 11% or more against you. The alternative is to add to that losing position. How smart is that? To reduce risk, you must reduce size or get out completely.

Why put your self in that spot when you can just wait for Market to confirm your idea in price and volume before you act?

The trade idea is not stupid obviously. But initiating it in any size in 1999 clearly is.

Is 1999 the perfect moment? Clearly not. If you wait for (what you perceive to be) the perfect moment, the trade has a chance to work from the start. This is essential to confidence, and confidence is essential to long-term success.

Trading is a mind game. It is wise to consider the non-cash risks you are taking with your state of mind when you put on utterly reckless trades like this one.

Shorting is a game for professionals only. It is definitely not the mirror opposite of trading long.

[Mr. Now]

this appears to be spam.

[Mr. Now]

[ QUOTE ]

Quote:
Not stupid, yet definitely not long-term +EV.


This sentence caught my eye. Are you saying the commissions were too great long term, or are you saying it was definitely long term +EV to take the other side of his bet? Did you?


[/ QUOTE ]

OK, I choose to spill the beans here.

No. Mr. Now actually lost a *hitload of money "telling the market what to do" in 1Q2000. I shorted the living crap out of QQQ all the way up, and was forced to cover due to large and mounting losses as QQQ went parabolic.

I later watched the QQQ crater in the magnificent way. Because of the psychological damage, I simply stood there-- stood aside-- and watched.

I consider that experience to be tuition.

And worth every penny paid.

[tippy]

I'm out with 150 pips on 5 lots = 750 pips profit.

There is probably some more profit to be had, but I expected this trade to take a couple of weeks to reach this point, not a couple of days.

Looking for a spot to get in long the EURO in the 1.44 range.

[Rotating Rabbit]

Mr Now referring to himself in the third person and capitalising Now pisses me off so much I gotta post on this forum for the first time to vent off steam about it.

[CrushinFelt]

GOGOGO DOLLAR!

It's eating every currency alive toady (except the yen which is up vs. the dollar)

[tippy]

[ QUOTE ]
GOGOGO DOLLAR!

It's eating every currency alive toady (except the yen which is up vs. the dollar)

[/ QUOTE ]

Yeah, now the question becomes: Pullback or Reversal?

I'm guessing pullback. Commodities are coming down fast, especially gold. This is a good signal for less inflation. If we get less inflation, that allows the FED plenty of room to keep cutting. If the FED cuts, the dollar could fall right back down. CPI should be really interesting this week.

Of course it could also just be a minor pullback in commodities since everyone is speculating on them, especially the carry trade guys. If commodities start ripping up again, the dollar could also fall back down, even though this boxes the FED in somewhat.

Truly a tricky situation. The USD/JPY pair is out of whack with equities today, which is really confusing. I'm standing back and watching for a day or two.

[ItalianFX]

I'm guessing pullback too. I don't see anything that says there should be a reversal. We are still in the same fundamentals as we were before.

The dollar has fell so hard over the past few months that it was inevitable to have this pullback.

[Mr. Now]

Is 750 pips the monster move you are looking for?