Hey bob,nanningbob » Sat May 03, 2014 11:03 am wrote:I will be coming to Nanjing around the 20th of June for about a week so let me know if your around.
James Roscoe » Mon May 05, 2014 2:25 pm wrote:Bob, when you put in a pending order that does not get hit. Do you leave that order in the market, or do you clear it out after a certain period of time.
An example would be gbpchf and gbpjpy. The D1 CSS is starting to angle down on the gbp, but it is still above .20.
A couple of times these two pairs have flashed the potential for a buy. So I placed orders to buy at price points where the H4 stoch would be in compliance with the rules.
So the question is, if price keeps moving away from my pending orders, do I leave them in the market? If so, for how long?
As a persistent student I would also like to ask again about which recovery system works best for you, and why.
Thanks for taking time to teach us your ideas, they have been immensely helpful.
nanningbob » Mon May 05, 2014 5:00 am wrote:James Roscoe » Mon May 05, 2014 2:25 pm wrote:Bob, when you put in a pending order that does not get hit. Do you leave that order in the market, or do you clear it out after a certain period of time.
An example would be gbpchf and gbpjpy. The D1 CSS is starting to angle down on the gbp, but it is still above .20.
A couple of times these two pairs have flashed the potential for a buy. So I placed orders to buy at price points where the H4 stoch would be in compliance with the rules.
So the question is, if price keeps moving away from my pending orders, do I leave them in the market? If so, for how long?
As a persistent student I would also like to ask again about which recovery system works best for you, and why.
Thanks for taking time to teach us your ideas, they have been immensely helpful.
Depends what I see in the market. RIght now this is one ugly market. Grab 10 here 20 there 40 there. If you catch a news event you got something But as I pointed out on page 40 its is a totally stalled market with a couple of trades here and there. Recovery works great right now because the market is so tight. Even though I placed some trades today they are about half the size of my normal trades. I just dont see the market going anywhere right now. So its a sit on my hands and grab something now and then.
To answer your question if a pair is in nice trend I will keep my pendings in place. If they are not I will clean them out and start over. RIght now trading from top to bottom or bottom to top on the TMA is giving me some trades. That is about all.
We have been playing JPY weakness for over a year now and it will continue. If you look at the weekly charts or daily charts you can see this pattern of selling at the beginning of the month and buying at the end. The problem is only going to get worse over time as Japan is hopelessly buried in debt. Greece blew up at 160% debt to GDP ratio and Japan is around 240%. USA is at 107% so even though more debt in the future will cause serious problems the USA is not there yet. USA simply needs to cut some spending and overhaul its tax system. Its problem is solvable but Japan has to depreciate its currency by at least 100% over a 5-10 year period to even have a chance to get out of the mess it is in. They waited way to long to address the issue. So bottom line is you will not see me buying JPY at any time. When sell situations show up I am very aggressive into JPY sells. Long term traders are selling and holding. That is those who hold onto trades for months or even years.Pipstubborn » Sun May 04, 2014 8:39 pm wrote:Bob, thanks for the appreciation note. Sorry for my hardhead to understand this comment but in simple and plain words to a small trader.... what this means to us? That the JPY will continue to weaken at a slower pace, been in range or get strong? so we can benefit by been in the right side of the equation on the long term?nanningbob » Sun May 04, 2014 2:40 am wrote:John Maudin writes concerning JPY:
Long-time readers know I am a huge bear on the relative value of the Japanese yen versus almost any currency, but especially the dollar. I have been saying for some time that I expect the yen to one day be at 200 and maybe even higher. But that journey is going to take a long time. Forty years ago the yen was at 357 (or thereabouts), and then it rose over time to the high ’70s last year, when it started to fall again. The chart below goes back 43 years. Think, by the way, how your businesses would react if the value of the currency in which you trade rose by a factor of four over 40 years.
The largest pension funds are no longer net buyers of Japanese bonds (JGBs). They are now selling, and that tide will swell with a vengeance, since Japan is rapidly aging. Further, the largest pension funds are starting to roll out of JGBs and into equities. Which makes sense, as who wants to own a 10-year JGB at 0.6% if inflation rises to 2%? What rational investor would choose to do that? Japan cannot afford interest rates to rise all that much. So there must be a good market for JGBs. But who will buy?
Two weeks ago, there was a day and a half when the Bank of Japan was not in the market for 10-year JGBs. For that day and a half, the bond market had zero trades. Even though they are buying in size every month with their latest aggressive round of QE, there are times when they are not “in the market.” The Bank of Japan is now the market. Think about that!
(See: reuters.com/japan-jgb.)
Given the reality of Japanese finance, I think they BoJ will continue to “hit the bid” in order to hold interest rates down. They will space out their buying more to keep those no-trading days out of public view. They will give us a song and dance from time to time to try and keep the valuation of the yen from rising too fast, but in the end they are going to monetize more in absolute terms than the US did in an economy three times Japan’s size. Perhaps as much as $8 trillion over an extended period. That’s the relative equivalent of the US Fed buying $30 trillion and putting it on its balance sheet. If you thought the Fed was going to do that, what would you do now?
What do you think Japanese investors will do when they realize what is happening? Buy equities, of course, but also diversify internationally. This move is going to play havoc with cross-border capital flows into all sorts of markets.
This is a brief synopsis of the Japan story. For a much fuller read, I point you to some of my past letters, or better yet, the full story in chapters two and three of Code Red.
It wont happen anytime soon. I sold my school and will finish. When that is all done then I might have some free time again for such things. FF there are also a lot of people who would hate such a thing. To me MM is just staying within yourself, your account, and your abilities.James Roscoe » Mon May 05, 2014 9:49 am wrote:Bob, is a thread about your money management still in the works? I think that is the true brilliance of all the 5.x and 10.x systems. I think there is a critical mass of people who are ready for your teaching on the subject between here and FF. I could pm a number of folks who would come here just to read that.
Regards
James
The recovery system was used in my 4.0 and 5.0 trading series. We were counter trading trend exhaustion. When we found reversal areas we would trade the range period. Sometimes price would burst back into the trend and we over came that with recovery trades. Worked quite well when you got it right. To recover back into the trend is no more than taking multiple positions into the trend which some guys are learning to do.James Roscoe » Tue May 06, 2014 6:37 am wrote:
After doing my due diligence on recovery I find that you have two methods.
1 1 2 4
1 3 3 3
which one do you prefer, and why?
@ Zimezoom, your very welcome.
Okay, thanks for taking to the time reply.nanningbob » Mon May 05, 2014 10:32 pm wrote:The recovery system was used in my 4.0 and 5.0 trading series. We were counter trading trend exhaustion. When we found reversal areas we would trade the range period. Sometimes price would burst back into the trend and we over came that with recovery trades. Worked quite well when you got it right. To recover back into the trend is no more than taking multiple positions into the trend which some guys are learning to do.James Roscoe » Tue May 06, 2014 6:37 am wrote:
After doing my due diligence on recovery I find that you have two methods.
1 1 2 4
1 3 3 3
which one do you prefer, and why?
However, to try to do recover trades when the trend is reversing could mean you are going to try to out last the entire possible trend to recover. That my friend would be a very very difficult thing to do. I have tried that and it is not worth it. So I do not try to recover trade against a trend reversal.
I will use multiple positions to get back into a trend but If the trend changes directions I will just close out and be done with it. I will recover trades that are ranging but that only takes a 2nd position or equal value. If price breaks out of that trend then I will usually close it out.
So I am not doing recovery trades with the exception that I will do one now and then just for practice.
