Tuesday, March 23, 2010
Too Many Trades spoils the profits
These three pictures are all of TNA. They 5, 15, 30 min charts. They all have their own DOMA (Dino's Optimized Mvg. Avg.) The all work quite well 5 min You will be trading a lot. 15 not so much and 30 even less. I like 30 the best. Since exchanges are open only for 6.5 hours 30 minutes is preferred than the hourly which still has its place. I trade the 30 min chart but keep an eye on the 5 minute and look at 15 min less often. More frequently than not the first signal after a long rally to sell will be bad the second one I take. I am long and will stay long until I get a signal to sell. We almost got one today and I will wait
This S&P 500 chart is very important one to me. Here I join the low to high. Drop a vertical line from the high. Divide that into 8 parts. Draw parallel lines to Low to High line at these 8 points. My friend Kazoom (one of the best) wrote me C++ program that works like a charm. That low to high line is often the 45 degree line in Gann theory. The main thing I watch here is how far from the LH line are we trading. If the index is too far up it will come down; too far down it will come back up. Based on this and its own DOMA we are no where near a top.
This week and all the way into first couple of days next week is window portfolio dressing for the funds. Very strong positive for the market. Then there is earnings another positive for the market. I am not planning on shorting this market any time real soon.