Stock Options Journal

[fulani]

Originally Posted by Egun Mogaji

Hmmm......Elucidate with examples I hear you say....
Well.....how long is a piece of string?
In the first instance, I might have missed the dates of the thread, but my position, that too much analysis can blow you out still stands.
I don't want to go in to long discourse about this. We can be here all day.
As with life, as with trading, there is more than one way to skin a cat.
Small sized investors, Big sized investors.....
It's a dick thing that one. How long is a piece of string. Mine is bigger than yours and all that palaver. Tick by tick, or candlestick, or is it a trend? Or where is price?
Why do you need the underpinning issues? Price is up or down no more no less.
It's like trying too much that one. To make it seem more complicated than it is really!!!

There is fundamental analysis, and there is technical analysis. And within those two groups are a plethora of different systems trying to do the same thing...determine Price.
But PRICE is KING.
Fundamentals is using a humbug of reports, news and whatever else to come to a conclusion. What is price going to be.
Technical Analysis on the other hand, using indicators, and price to tell what the market is doing.
Traders then take whatever position they deem fit.
Remember one thing. There is only ever three things certain about price. It is buying,or it is selling and the other when it is undecided.
Elucidate with examples....
Forecasters, Analysts and all the baloney that is the financial press....only do one thing. tell you what has happened after it has happened. Sometimes they tell you what they 'think' is going to happen, but may or may not happen. But price would always tell you what is happening.
As the thread was dated, I couldn't use that period to tell you anything we don't already know. It has happened. It's in the past.
But would you be going long on the GBP/USD now? Unless you have deep pockets....
That it rained yesterday is not an indication that it will rain tomorrow, though it might.
But it might not. You could argue that it depends where you are and whatever else....it is still the same thing. You would use a few indicators...the clouds, the wind, what the meterologists say to come to a conclusion, which may or may not be right.
Now with trading, you could be a scalper, a swing trader, or an intraday trader or a trend follower. Everyone is trying to do the same thing. Tell what price is going to be. But the fun part is you cannot tell what price is going to be until AFTER it has happened.
As with everything in life, there is more than one way to achieve the same thing. It is one of preference. Whatever works for you is fine. But too much analysis can cause paralysis.
Breakout trading, Breakout fading, trend riding, decreased volatility greakout, carry trade, news straddling......it is all the same thing. Trying to tell what price is going to be before it happens.
And there are those two afflictions of man...fear and greed.
Price never goes in one direction for ever.
Like I said, we can be here all day.
And anything else would be a red-herring.
Fundamentals might work sometimes, but as the credit crunch crisis has shown, PRICE is the king. Bear Stearns thought they had the market cornered, but they realised too late that whatever you have is only worth as much as anyone else is willing to pay for it.
Nothing that is happening today has not happened before. The markets have been there as long as year dot. It would be there long after i'm not here anymore.
It is how we deal with what we are confronted with that determines everything else.
'Welcome to Hell' comes from trying to make sense of all the nonsense.
You don't have to believe anything I say at all, just think it through.
Just follow the market and don't try to beat it.



I rest my case.

Hey Egun Mogaji... I like your piece.

A couple of years ago I attempted on this tread to gather our brethrens who actively trade securities to help others posting reasoned advice. But I soon learned that folks prefer to wax on with 'trader lingo'

Yawn!!

I'd like to know what those traders have been up to lately...

[Ejonigboro]

Hey Fulani, long time. Funny u put a post up, I've remembered our exchanges on this forum quite often over this Credit Crunch period. Last we conversed, we mentioned how the theme in The Economist for a number of yrs before December 2006 had been about the Credit Boom, and the impending Gloom that will arise when this credit started pulling out of the markets. That's nearly two yrs ago :-)

Its obvious The Economists was bang on the buck on that one, so much so that even the NSE Allshare Index was only making those great Market Returns because of Margin Trading ( Credit ).

I also remember your Gold Call back then, what a trade that was for your Client, he must have offered you the hand of his daughter in marraige :-)

There is no doubt that Egun's assertion that Price is King is abosulutely correct, but he must also acknowledge that Fundamental Traders and folks with deep pockets are the source of Market Correction. Cases in point is Andrew Lahde, made a killing shorting Asset Backed Securities and, Contrarian Investors everywhere, who go through assets with a toothcomb in other to find opportunities on the Short or Long side.

I know you read The Economist, so u must have come across the Article in the Finance and Economics section about Momemtum Trading ( a strategy that adheres to the doctrine of Price is King) in this week's edition. It writes very well on the interaction between Fundamental and Technical Analysis.

[Obugi]

All,

I put my posts on this thread as a means of throwing out my stock/options picks for discussion. I've provided what I believe are practical trades that can be readily acted on by anyone. I believe in sharing, I hope I've given as much as I've learned on this thread.

My trading posts are located on ClearStation. My rules on starting my portfolio were:

1. To trade exactly as I do in my trading portfolio.

2. Hold no more than 5 positions at any given time.

3. To make a profit on the year.

ClearStation retains all trades and calculates profit on a 90-day basis.

My portfolio is located here:

Obugi's ClearStation Portfolio

It's been an interesting year. One could encapsulate the entire year in one trading word - DOWNTREND. Anyone who spotted the enormity of the economic crisis in the USA and how it would affect the stock market......and then ACTED on that knowledge, made a lot of money this year.

I just happened to be lucky, maybe the conditions were just right, I don't know, but never in my entire time trading have I made as much profit as I did in 2008. The thing is just dumbfounding. It's now that I understand how brokerage firms can pay their workers those bonuses. Granted, I've been trading equity options but still....1600% is nothing to sneeze at. The funny thing is, I know I'm not as half as good as I could be. Just in the last week I learned some more stuff about the market that me wanna holler.

Anyway, my CS posts are there for anyone to see. It's been a great learning experience. I hope those who feel that anyone needs special qualifications or three heads on their shoulders to trade can now let others drink water and drop their cups in peace. All that is required is perserverance , willingness to learn and prudent risk taking.

For those interested in trading, just know it....you can do it.

I'll probably do a few more trades on CS, and then close out for the year. Next year is going to be even better.

Wishing everyone a good New Year. Like she would say, "It's Been Real."

! Get Yours !
Obugi.

[fulani]

Originally Posted by Ejonigboro

Hey Fulani, long time. Funny u put a post up, I've remembered our exchanges on this forum quite often over this Credit Crunch period. Last we conversed, we mentioned how the theme in The Economist for a number of yrs before December 2006 had been about the Credit Boom, and the impending Gloom that will arise when this credit started pulling out of the markets. That's nearly two yrs ago :-)

Its obvious The Economists was bang on the buck on that one, so much so that even the NSE Allshare Index was only making those great Market Returns because of Margin Trading ( Credit ).

I also remember your Gold Call back then, what a trade that was for your Client, he must have offered you the hand of his daughter in marraige :-)

There is no doubt that Egun's assertion that Price is King is abosulutely correct, but he must also acknowledge that Fundamental Traders and folks with deep pockets are the source of Market Correction. Cases in point is Andrew Lahde, made a killing shorting Asset Backed Securities and, Contrarian Investors everywhere, who go through assets with a toothcomb in other to find opportunities on the Short or Long side.

I know you read The Economist, so u must have come across the Article in the Finance and Economics section about Momemtum Trading ( a strategy that adheres to the doctrine of Price is King) in this week's edition. It writes very well on the interaction between Fundamental and Technical Analysis.

Funny you mentioned Andrew Lahde...my office is close to his in Los Angeles..

I remember that article... I also remember a recent article about the future of finance!! It is scary out there.