The Sky is Falling: So what are you going to do about it?

[nine]

OK. So its a crash. And there is probably going to be a recession. And maybe it will be a depression. And some think it could last 10 years or so.

That sounds like the sky is falling to me. :innocent:

But we're traders, right? Day traders mainly. So we just keep on keeping on, right?

Maybe not.


Recalling that you can never know what the market will do next, but all you have to know is what you will do next, I thought it would be worth discussing this little problem. What do you think could change in the markets and have you any suggestions for responding?

==========================================

Here is one thought.

"I trade with the trend but wait for price confirmation at support and resistance before entering a trade. I am concerned that after this bottom we will get a dramatic reduction in market participation and return to the daily ranges (and maybe lower liquidity) of 2002/3 or earlier. In this case waiting for price confirmation may give up too much of the move (I like markets with a daily range of 60-100 points to give me profitable price action).

In this case we may need to anticipate reversal at the mas/s&r more rather than wait for price confirmation. I am thinking about scaling in strategies in case my preferred markets contract significantly. I found this to be the case with N225 up until the recent increase in volatility and suspect it is true whenever daily ranges drop into the 30-40 point range."

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[bnaimy]

Hey nine, well as you sayed yourself we are daytraders, so for use its just another day and the marked can crash as much as it like. The only thing now is that volatiliy is high and everybody have to change their methods to deal with the big moves, bigger stops and bigger profit targets. But when as you say, when marked gets calmer and participants get fewer, then just lower ur stops and lower ur profit targets, as if nothing have ever happend.

Thats my thinking of the situation 😎

But markeds that have been known to have very little range will definitly fell it when the markeds get to normal, it would almost fell like there are no one trading it 😱

But a interesting post nine, and i am sure there is alot of opinions about this topic.

With regards
Bashir Naimy

 

[wasp]

I think this volatility, for daytraders is an absolute blessing and should be embraced and milked to its full potential. I'd rather this than 'calm' as then the markets just flatline and profits are few and far between.

Viva la Volatility!

 

[rnicoll]

I think this volatility, for daytraders is an absolute blessing and should be embraced and milked to its full potential. I'd rather this than 'calm' as then the markets just flatline and profits are few and far between.

Viva la Volatility!

I was thinking the same thing; the market is MUCH more trending now, so if you spot a trend you should be able to follow it a long, long way. Keeps things simple. Beyond that, why do I care if it's going up, down, or making strange spiral patterns (okay, I'd care if it did that)...

 

[Stern-Capital]

we are profiting on it all the way 🙂
the Credit crisis help a lot in bringing larger and greater % of profits.

 

[nine]

You miss my point (or I made it poorly) dear friends.

Now is good. But in a week it will be over (lets say). And a few weeks after that the markets might lack intraday range and perhaps liquidity as well.

I believe that you never know what will happen. But that you should plan what you will do in the most likely scenarios so that when IT happens you know what you will do.

So, if the volatility dies I currently expect to drop STW (the taiwan index with 1/3rd of its earlier range isn't tradable by my current style), hold SPI (aussie) if it hangs in although I suspect it won't, and go back to HSI which I abandoned last August when the Big Swinging Dicks from Shanghai started playing in my sandpit and kicked sand in everyone's faces. HSI with 1/3rd of eoy volatility is my kind of market.

And today HSI is down to 1/3rd of its value in November 2007.

I also thought I might look at swing trading currencies again.

What will you do if November 20 is the day the markets die?



PS. The bsd's from Shanghai apparently went broke ... good f''''ing riddance.
PPS. This is good for a laugh if the sky falls today Hitler Gets A Margin Call

 

[wasp]

I will cry and hope I have reached my annual goal!

but srsly, one should be like water and trade the flow of the market and if it makes HrH's and HrL's and takes days to reach a climax and change direction, then so be it... trade the market, not ones goals...

That said, I trade FX anyhow and its all rather different!

 

[TomTom]

With markets the way they are for me I will be staying clear untill begining of november

 

[Bolimomo]

Any trader who worths his/her salt will not back away from this volatile/chaotic market. This market is what a trader can only dream of.

I have made more money day-trading in the month of September 2008 than all the months from Jan - August combined. And I have made more money in October than twice what I made in September.

Volatility is a trader's friend. I wish everyday is like Oct 24, Oct 10 or Sept 18, 2008.

 

[normbeef]

if your system no longer works ... build a new one that does !!

adapt to the changing conditions !!

thats what traders do right ??