S&P Chart

[Soverus Khan]

Anyone noticing the inverted H&S on the S&P chart?

How are you playing the swings Leth?

2-3 days is all I can stomach over the past few weeks.

[Leth]

Damn good question...

Im going to direct this answer (to the 2nd question) more towards new traders since the seasoned traders in the forum already know where Im coming from. I usually don't talk specifics about my personal trading, but in this instance, It might be a good thing. Maybe someone will benefit; if they do...great...if not, well thats great too.
As you may or may not have read in past posts, I trade long term swings as well as trade for a few people non-professionally. Ive been experiencing a small drawdown in the bluechip portfolio lately due to choppiness (everybody wants to be invested in the blue chips). I had 9 of 11 clients pull thier funds last week after they recieved thier quarterly statements even though losses were miniscule at best.
The S&P is starting to smooth itself out a bit in the overall long term bearish direction from what price is showing me at this exact moment in time. Also, my trade signals are getting less frequent. This is actually good because long term speaking, during a bull to bear transition (or vice versa), you tend to go from trades producing a good deal of losses, to trades that have more break even points, then to trades that become more profitable but still produce loses or break even points (a.k.a. trading reality); finally repeating the process all over again....this is how I know where I stand. Right now I'm starting to get better than break even again in the blue chips little by little; and as always, long term momentum (bullish or bearish) usually picks up right after people are the most fearful or greedy.
They never say it to my face, but I know people lose confidence in my abilities; its just the nature of the beast. Your a genius when your making money (which is easy in a bull run), but a dumbass during choppiness. And honestly, its hard trading bluechips on the short side in a bear market due to volatility created by bull investor bias. You can be profitable in a blue chip bear run, but not much when you trade long term like I do. Just to let everyone know, from my observations and short lived experience, tech stocks and growth stocks are easier and more profitable to short in bear markets.
Anyways, I have confidence in my systems even when they show signs of sourness. I stick with them because they eventually get sweet again. Money management is 90% of what a good trader does. I can't stress that enough to anyone that's new to the game. Its extremely difficult for me but I do it anyways because I know its the only way to keep my ass on the field. Blow ups are for losers, literally!
I suppose I should include some type of moral to the story...so here it is:
The bad news, is that you can lose alot of friends in this business when it comes to actually trading thier money and drawdowns, but the good news is.. you continue to gain wisdom. What I learned the hard way this time around is: Never do business (contractual or non contractual) with friends or non friends that can't afford to lose a buck or two. It is humerous in a way though, when they start noticing that your making good profits again, they all want to come back. As of right now, they all stay friends, but are never again clients. If your not a trader, you may find this hard to understand, but you will, I promise.
Now that I'm only trading for myself and two clients (who have made phone calls but have not threatened to pull funds...which I may refund to them anyways), its time to have some fun and focus on test driving some new trading vehicles (which really isn't that fun since I trade all markets the same way anyhow). If you could only see me now, my stress is less of a mess I confess. I feel like I can breathe again (if you dont count my pollen allergies).
OK, I admit, I shamelessly and selfishly used this post as an oppertunity to vent...thanks for listening (i mean reading).

[Soverus Khan]

Nice post Leth. I refuse to trade for friends or relatives. Some want non-stop explanations, others want 400% in a week. It is hard enough explaining a strategy to a fellow trader. Anymore, the farthest I will go is recommending a sector for a long term acount.

[aiki14]

Originally Posted by Soverus Khan

Nice post Leth. I refuse to trade for friends or relatives. Some want non-stop explanations, others want 400% in a week. It is hard enough explaining a strategy to a fellow trader. Anymore, the farthest I will go is recommending a sector for a long term acount.

I trade for 1 friend who has an IRA account here in the states but lives overseas. It represents less than 2% of her net worth so it doesn't result in any problems. I would be very reticent to trade for family or friends because of reasons put forth in the above posts. I like my family and friends, and wish the relationships to continue as they are, adding a fiduciary component WILL change that. In good times your a saint in bad a goat. I don't want to be sitting at the dinner table at Christmas and explaining to my sister in law why AAPL tanked.
I do however advise folks to seek out a good money manager or financial advisor and will help with allocation strategies, diversification, and the like, but never stock tips. I save those for forums, and I have lost enough sleep over that.

[Soverus Khan]

Exactly.

Pay a pro, not a relative.

You are a stronger man than I Leth.

[Leth]

none of them were relatives...just friends. I always knew not to do business with family. unfortunately, I just learned the lesson of not doing business with friends either.