Hello Les!lesm said:
Great to see you in action! How are you? How is your trading? Hope it’s all going well.
By the way, I have digested Phantom of the Pits, and incorporated some of the thinking into my approach, but in a kind of opposite way to the way he works. I figured out that he was a very short time frame player, and his T/A was limited which drove his trading style, rules and psychology. Oddly enough, some of his approaches are antithetical to my style which is fine (horses for courses), but the contrast was very useful, and highlighted some areas I made radical changes too (for the better). So thanks for that, it was quite constructive.
Thanks also for the salutation. Much appreciated.
Now down to the issue at hand: There’s nothing wrong with healthy scepticism and free and open debate. You know I embrace this as much as you do.
I agree that history has shown that certain methods are better in specific conditions. I have consistently supported this position in many of my posts, so you will only get agreement on this point from me.
The point I was making about the attempt to rewrite history was that there were some posts which were making out that their approach was the only one which has identified the imminent high, which was untrue. Several methods identified that the trend was at risk which is commendable. With respect though, I didn’t see any other call for a top from a month out with a specific +/- 1 trading day date, let alone call the index level (in this case within a point).
Now, I have also consistently held the view that any method has limited application, including all the techniques wavepicker and I use independently or in tandem. In fact I did say in several posts that EW, time cycles, and even straight charting are really limited to a minority percentage of conditions. I believe this to be true of most technical analysis approaches.
Having said that though, the beauty of EW and geometric/time cycle based approaches is that these styles have what I would describe as being fairly universal concepts which can be applied in a broad range of market conditions. Interestingly the strength of these styles is in their innate flexibility, and if a practitioner is thoroughly conversant with the discipline’s theory and practice, is able to apply a broad range of techniques and axioms to practically any market. The wisdom required is knowing when to use which technique.
As for random events upsetting patterns of trend, you are certainly correct, a nuclear war could inadvertently start tomorrow, an asteroid could bring on the next ice age, the sun could blow up… and other equally facetious events… but how likely are these events? I keep plugging the Douglas line that “anything can happen” and accept this.
Even the best looking forecast can fall to pieces instantly, no argument. The point I make is about probabilities and how to assess these in a dynamic environment where there are no certainties. This is the challenge for any approach. There is no holy grail, but there certainly are differences in the effectiveness of different approaches.
What I’m doing is welding together a range of disciplines and approaches in order to achieve the best mix of consistently profitable analysis, risk management, strategy, and trading style in an environment where the outcomes are unknown (all any of us have is our best shot method – its just that some methods work better than others). Will the geometric/time cycle based system work every time? No, of course not. The art is in knowing when to use it, and how. I have just demonstrated how powerful it can be in the right hands used correctly, that’s all. If that doesn’t peak serious players’ interest, that’s fine too.
Given that there was a lot of scepticism about the Geometric/time cycle based style in the past, and calls for a practical demonstration, I would have thought that pretty much picking the day from a month out, and the price from a week out would have been more than sufficient. Can this be done consistently? Behind the scenes you bet it can, and a select few have seen accurate prices come in, or accurate times, over and over. They know who they are. Do I believe in this style? You bet I do. What amazes me is when the peon brigade make fascicle comments like it’s an “each way bet”. What utter nonsense.
As for taking into account all events in the world, this is not likely. My appraisal is that we all have to sift through a deluge of information (much of it conflicting) and somehow make financial decisions based on our individual understanding. This is one method of doing that. It is not perfect because information is not perfect. But I’ll tell you, it’s a bloody lot more effective than a simple moving average crossover, that’s for sure!
Warm regards
Magdoran
P.S. Geez Les, we'd better stop this, or I won't get any work done! Mag
