S&p 500

[dww400 10]

Does anyone do things like follow the S&P 500( or any other chart ) I mean would buying on the low part of the curve and selling near the top be a good way to go ? Is it too close to the bottom now (to 500 and 300) Using stocks like the total market index and the 500 index.

[sevensa 10]

Does anyone do things like follow the S&P 500( or any other chart ) I mean would buying on the low part of the curve and selling near the top be a good way to go ? Is it too close to the bottom now (to 500 and 300) Using stocks like the total market index and the 500 index.

 

Yes, buying low and selling high is always a good way to go. Or selling high and buying low. The problem is identifying low and high realtime.

[dww400 10]

In the charts I keep looking at it seems like the pattern is repeating. I mean in a few weeks it will drop below about 675. and then it will start to rise again. The only thing I don't like is it's entering 500 and may not go lower or start to do something different.

 

http://money.cnn.com/quote/chart/chart.html?symb=spx&sid=3377&time=3mo&Submit1=Refresh

[sevensa 10]

In the charts I keep looking at it seems like the pattern is repeating. I mean in a few weeks it will drop below about 675. and then it will start to rise again. The only thing I don't like is it's entering 500 and may not go lower or start to do something different.

 

http://money.cnn.com/quote/chart/chart.html?symb=spx&sid=3377&time=3mo&Submit1=Refresh

 

Well, that is just how the market works. It doesn't know about your plan or what you think it should do and will do what it do. That is why you need to have a clear plan telling you why and where you will enter and where you will be wrong and what you will do when you are. Buying just because you feel it is low is not a real plan.

[dww400 10]

Does anyone think its a good idea to try. Buy something like total stock market index, probably pay around 450 and then wait about 2 weeks for it to go up to about 750.

Does anyone have any charts with things like this from some other bear markets, or what ever this mess is called. does it still go up at 450 or shoot to the side :|

Edited March 14, 2009 by dww400

[diablo272 10]

Spend time watching markets, and you might eventually find some kind of answer to that question.

[wjrusnak 10]

Your questions allow me to assume that you haven't done too much research on chart basics, such as resistance, support, trends, patterns, time and price, and so many other topics. What you're trying to predict is what each one of us here try to predict on a daily basis: Is price going to move higher or lower? No one here can spell that out for you and I'm sure no one wants to, especially if you end up losing your money.

 

I suggest you getting into some of the forum topics around here and getting some basic market knowledge. In addition to that, it sounds like you are in serious need of charting software. You cannot trade efficiently without having a graphical representation of what price is doing over time (unless you are extremely gifted). If you don't have a broker yet, try some of the demo platforms, which I believe can be provided by Interactive Brokers, TradeStation, or AMP Trading (http://www.ampfutures.com). If you are new to stocks and futures, you really need to learn what it is that you're trading. Plenty of that information is available at Investopedia (check out the beginners section: http://www.investopedia.com/university/buildingblocks.asp)

 

As far as getting a start to understanding price movement you can try a number of threads here. For instance, if you want to learn about a method known as Market Profile: check out http://www.traderslaboratory.com/forums/f6/. Also I am definitely biased toward the Wyckoff method of viewing the market: http://www.traderslaboratory.com/forums/f131/. Either way you need some basic understanding of what you're looking at and until then, you will only see random patterns. Remember what you're seeing: price of an underlying asset (or contract) changing due to the buying and selling of thousands of people. People buy when they feel its undervalued and sell when they feel its overvalued. Essentially you want to find out who is right and get on that side. Best of luck to you with your trading and more importantly with your trading/investing development.

 

-- Bill

[sevensa 10]

Does anyone think its a good idea to try. Buy something like total stock market index, probably pay around 450 and then wait about 2 weeks for it to go up to about 750.

Does anyone have any charts with things like this from some other bear markets, or what ever this mess is called. does it still go up at 450 or shoot to the side :|

 

Yes, this is an excellent idea to buy at 450 and sell at 750 two weeks later. This is 66% in two weeks. Assuming of course it does go up 66% in two weeks. I assume you did your research and found that 66% return in two weeks for the total stock market is completely reasonable and realistic?

[Mavrik00 10]

i would highly recommend the following:

 

1. Get yourself a DEMO account with Ninja Trader and Zen Fire Data. (PM me for the right people to call on this, i have references for you)

 

Ninja trader has TONS of free learning webinars held on line, so attend those and ask questions. You will need to learn how to USE the tools of this trade before anything else, and NinjaTrader.com will be a great resourse.

 

Again, PM me for a direct phone/email to the person who can set you up

 

2. Get a comfortable chair and some fresh coffee

 

3. Watch the markets from open to close, looking for price patterns and try to pick up on the personality of the market you wish to trade.

 

4. Find a mentor you can trust to educate you with the basic fundamentals you need to learn how to trade. (PM me on this as well, i can send you a few to consider)

 

The bottom line is that you will need to learn how to use your chart package, youll need to watch the markets consistently, and you will need a mentor that knows what to do.

 

PM me for referals, i would be happy to share my experience with other new traders...we've all been there before, and I always like to help.

[sevensa 10]

i would highly recommend the following:

 

1. Get yourself a DEMO account with Ninja Trader and Zen Fire Data. (PM me for the right people to call on this, i have references for you)

 

Ninja trader has TONS of free learning webinars held on line, so attend those and ask questions. You will need to learn how to USE the tools of this trade before anything else, and NinjaTrader.com will be a great resourse.

 

Again, PM me for a direct phone/email to the person who can set you up

 

2. Get a comfortable chair and some fresh coffee

 

3. Watch the markets from open to close, looking for price patterns and try to pick up on the personality of the market you wish to trade.

 

4. Find a mentor you can trust to educate you with the basic fundamentals you need to learn how to trade. (PM me on this as well, i can send you a few to consider)

 

The bottom line is that you will need to learn how to use your chart package, youll need to watch the markets consistently, and you will need a mentor that knows what to do.

 

PM me for referals, i would be happy to share my experience with other new traders...we've all been there before, and I always like to help.

 

Looks a bit overkill to me to need all this if your trading is done EOD and you are planning to hold for weeks.

[Mavrik00 10]

I guess you're right, but remember, swing trading has almost jsut as much risk, if not more, than lots of smaller trades taken during the day, so you could assume that you would want to spend the same time in preperation as you would as a day trader.

 

All the same, hope it helps, best of luck

 

Mav

[sevensa 10]

I guess you're right, but remember, swing trading has almost jsut as much risk, if not more, than lots of smaller trades taken during the day.

 

Care to expand on this statement and how you came to this conclusion? Why would risk depends on the type of trading you do and not about how you manage risk and use position sizing, regardless of the type of trading you do?

[firewalker 10]

Does anyone think its a good idea to try. Buy something like total stock market index, probably pay around 450 and then wait about 2 weeks for it to go up to about 750.

Does anyone have any charts with things like this from some other bear markets, or what ever this mess is called. does it still go up at 450 or shoot to the side :|

 

I suggest you listen to the valuable comments people gave to your question, most notably from sevensa and wjrusnak. This forum is one of the best I know and the knowledge on this site is very valuable, if you take the time to study and watch charts. But it's not going to happen overnight, and if you're serious about it it will require lot of work and time spent in front of the screen.

 

Otherwise you're just throwing darts at the chart and hoping you'll get a profit.

[86834 10]

Yes, buying low and selling high is always a good way to go. Or selling high and buying low. The problem is identifying low and high realtime.

 

Always good in hindside, but trying to pick bottoms and tops isn't the way forward. When learning to trade, my mentor always said to me 'don't try and be the first person to buy, and don't try to be the first person to sell....'

 

sorry, i just read the post and wanted to make the comment as it's something a lot of newbies try to do.

[gandalf33 10]

I agree with 86834.

 

A proper system is needed which delivers profits long-term, and self-training about seing markets make nice trends without you. Joining every wave is not the point (and very probably not possible).

 

As for the original post, if the author has observed this fact many times in the past (not 2) and is sure it will repeat, let him trade.

[sevensa 10]

I agree with 86834.

 

A proper system is needed which delivers profits long-term, and self-training about seing markets make nice trends without you.

 

I don't really understand what you mean with the section I have marked in bold. Can you maybe explain this a bit better? I see the markets making nice trends without me all the time and don't need a lot of training to see that. Much to my dismay, it just happens even with no effort on my side at all.

[gandalf33 10]

Well, it's pretty easy. Most of the beginners (like me at the moment) can hardly swallow seeing a rally/decline with them not being a part of the ride. Thoughts of 'is my system good? shouldn't I change my indicators?' arise and they are all wrong.

 

Just a thought that searching for an approach to buy low and sell high every time is looking for the holy grail (=leads to the grave) - you don't have to be on every ride to be (highly) profitable, that's what I meant.

 

Any further questions, hit me.

[sevensa 10]

Well, it's pretty easy. Most of the beginners (like me at the moment) can hardly swallow seeing a rally/decline with them not being a part of the ride. Thoughts of 'is my system good? shouldn't I change my indicators?' arise and they are all wrong.

 

That depends on the type of system, doesn't it? If your system is a trend following system, then you probably should change it if the market is "making nice trends" without you as you have mentioned above.

 

Just a thought that searching for an approach to buy low and sell high every time is looking for the holy grail (=leads to the grave) - you don't have to be on every ride to be (highly) profitable, that's what I meant.

 

How are you going to be profitable if you are not looking for an approach to buy low and sell high? Sure, you should not expect to be right every time and you should have an appropriate plan in place when you are not, but your approach still should be to buy low and sell high.

[gandalf33 10]

How are you going to be profitable if you are not looking for an approach to buy low and sell high? Sure, you should not expect to be right every time and you should have an appropriate plan in place when you are not, but your approach still should be to buy low and sell high.

 

Well, a quick counter-example would be betting on S/R breakouts. You don't care if you're at the historic low of an index when you bet on support breakout and it works out and you make a profit. This doesn't fit in your theory if buying low and selling high, does it (in thise case selling high and buying low).

 

It all depends what's buying low and selling high means to us. For me, it's not the example in the above paragraph, for you, it might be. As long as you make profit and I make profit, we can talk about it til infinity.

 

And, I'd like you to present to me here a trading system with which you won't miss a trend and be profitable long-term. Show me the holy grail I'll send you 50% of my every monthly equity curve growth.

[sevensa 10]

Well, a quick counter-example would be betting on S/R breakouts. You don't care if you're at the historic low of an index when you bet on support breakout and it works out and you make a profit. This doesn't fit in your theory if buying low and selling high, does it (in thise case selling high and buying low).

 

In your "example" you are still buying low and selling high. Typing it in a different order doesn't change the concept. 2 + 1 is the same as 1 + 2.

 

It all depends what's buying low and selling high means to us. For me, it's not the example in the above paragraph, for you, it might be. As long as you make profit and I make profit, we can talk about it til infinity.

 

My earlier question still stands then. You have said earlier that looking for an approach to buy low and sell high is a search for the holy grail, so I am confused how you expect to be profitable if you are not buying low and selling high? Or if you prefer... if you are not selling high and buying low?

 

And, I'd like you to present to me here a trading system with which you won't miss a trend and be profitable long-term. Show me the holy grail I'll send you 50% of my every monthly equity curve growth.

 

Not really sure where this request is coming from, but I suspect you have misunderstood something somewhere. But I do have a system that catch every trend based on my definition of a trend. It also catches situations which turn out not to be trends based on my definition of a trend, but it still is profitable in the end.