Satuki @ Home

Hi Satuki,

First, thank you for your wonderful tips on trading and for your informative blogs. It is nice to see a profitable trader sharing some of their genuine wisdom online. Please keep up the great work!

May 6 was absolutely brutal and an example of what the markets are capable of. In fact, I was running an automated strategy on a live TradeStation forex account, which was completely wiped out (and then some) due to issues with the platform and data connections. From what I gather at this website, you yourself do not run any automated strategies, but I encourage your followers who use TradeStation to read my article at http://www.autoforexer.com/logs/tradestation/us... before automating any strategies. Given your trading style, you will most likely disagree with my strategy itself but that's besides the point.

Hopefully this can spare someone somewhere the same headache/heartache I had to go through.

Yours in trading,
Autoforexer

I believe in machine trading and I am working on it. May 6 was an exception. A lot of stock transactions were ordered to be reversed. I would imagine what could have happened to an automated strategy there.

That the massive drop was caused by some glitch is a cover story, a myth. It was a panic sell pure and simple avalanched by the automated triggers in trading algorithms. In fact, the fact that much of it is automated by computers probably even dampened the situation, back then when trades where done by a screaming pit trader and phone calls, the mass panic would not have been subdued so quickly, fear would have taken over completely. But since machines do not experience fear or greed they quickly triggered massive buy orders at some point and the situation reversed before the human observers even knew what happened.

I had to read your sentence three times to make sure I understood it right when you claim that the fundamentals do not support another bear market? So you believe this economy has sound fundamentals to sustain a continued bull market? That's pretty amazing anyone would believe that, well I know the CNBC talking heads at least pretend to believe that…

I did not say that we would see a sustained bull market from here. There are three directions in the market, up, down, and side-way. I am leaning toward side-way.

the fundamentals now are worse than they were at the beginning of the 2008-09 bear market, if that results in a sideways market, I'd claim a miracle.

What a claim ! Care to support it with some facts?

I am seeing a side way market just right now. Do not tell me what will happen in a few years. I only care about what will happen in the next few weeks.

You sound so sure that the market is heading right down from here. I doubt it. S&P500 weekly and monthly are still in a visible uptrend.

Ok you only care about what happens in few weeks why are you talking about the s&p monthly and weekly being in a visible uptrend blah blah blah….you should be looking at a daily or even 60 min chart if you only care about a few weeks time frame. If I look back two or three weeks I see we are off on the djia over 600 point in three week time, and one day we drop 1000 points in 20 minutes biggest drop EVER intraday.. I guess we have different definition of “sideways” and not too mention we drop 300 points since my post, but nevermind that you want some facts on the fundamentals of the general economy….

Where do I start….unemployment still 10% (17% by some more realistic measures) lackluster GDP growth, lackluster real estate recovery(with real potential for another leg down), economy is maxed out with stimulus effects left and right and on life support, interest rates must rise, dollar strengthening etc….and I haven't even touched upon what is happening overseas!!! where countries are going bankrupt, and unwilling to pay their obligations. What facts did you offer in your post to support a sideways scenario? None.

I can't predict what market will do in a week or two, I'm not that smart maybe you are. But you are a day trader mostly I gather and day traders are too busy looking at 1 min chart of BIDU to know what is going on big picture, and that's perfectly fine, day trader don't care what direction market is going. I'd love to see some facts supporting a sideways scenario maybe I can be swayed by your argument since you provided none. But to say you only care about couple weeks and support that by bringing up the trend on the monthly chart is lunacy. By the way many oversees market already confirmed new lower lows, and I think US markets may follow. But i don't expect a day trader to be concerned with what the Australian exchange or the CAC is doing…. BIDU just made a doji on the 1 min! wooohooo!

Also, why did you alter your original post? Can your site posters also go back and change the wording on our posts, just to even out the playing field? In case I want to change what I write like you did although you didn't change the general context I recognize that.

I look at 3-5 min charts most of the time. And I do use 60 min and daily charts sometimes.

There is nothing wrong to use a weekly and monthly to support one's short-term swing trading. What matters is how much weight you give them in your decision making process. In my case, it is safe to say that the weekly is more important than the monthly.

The 300 points after your first posts does not mean anything becuase it bounced back around 500 points after the hideous drop. I already mentioned in my blog post that we would experience violent fluctuations in the next few weeks.

I agree with the facts you brought up. But they are known to everyone and the market basically has ignored them since March 2009. So I would not put too much weight on them. Lack of significant bad news is one of the reasons that I see a side way(dull) market for a while.

I never change the general context of my posts. I removed “what a claim!” becuase I thought it was unfriendly to you. That is all.

BTW, we'd be all ears if you can talk about what you think about other countries. I have thousands of readers. They might be interested.

I disagree with you that the sovereign debt issues where known to everyone 13 months ago wow we just learned 5 days ago that it was a really a $1 trillion “problem” two weeks ago we were told it was a $50 billion problem, oops someone forgot to carry the one… Unemployment… still at 10% 13 months into the “recovery” still is the operative word here – everyone knew we would still be at 10% today? I didn't I expected maybe a slight noticeable rebound maybe 8%. Everyone knew that the housing recovery would be this tenuous? I sure didn't but I guess you did. Everyone including you knew that second qrt GDP would actually fall? The markets forward looking mechanisms took it higher on certain expectations that the recovery would be more robust in housing and employment among many things. The market doesn't take 13 months to price in something so it's not that those things have been “ignored” as you claimed.

As far as commenting further on other countries that is out of scope for this website, this is a day trader website and your readers I would assume are for the most part day traders or aspiring, if they want to know that kind of stuff they are looking in the wrong place. If they want to get good tips on day trades this is good place.

Your article caught my attention because of the title, but I was disappointed because it really didn't answer the question. Al you said is “you think there will be lack of bad news” but that's a superficial statement with no substance, just a gut feeling, different than facts.

oops meant first quarter GDP being short of estimates, not second. Darn I wish I can go back and change my posts…

You can edit all your posts provided that they do not have any replies yet. Here is how you can do it. Just sign up for a Disqus account, which is totally free. That is it. Follow the link below

http://disqus.com/comments/

How's that sideways market trend working out for ya? Still see a sideways market? We have had a pretty vicious sell off since my post, some 800-900 points now, I suppose that also means nothing. I expect a bounce here soon, but I guess we will have to see.

look at the chart carefully. The drop is only about 10% from the top. A 10% drop after a 80% rally from March in 2009 means what? it means nothing.

According to your theory, which is “The fundamentals now are worse than 2008/2009.' If it holds, then we would see DOW drop below the 6000 mark soon, right?

I still see a side way market until the monthly breaks.

Make up your mind. You care only about a few weeks time frame, go back and read your own post when you state that. Now you are bringing up the 15 months chart again.. we can play that little game for long time if you keep adjusting your window, again if I look at a 3-4 week chart it is craziness to say that we are going sideways. Also its not my theory, I ave you facts to support it, your call is a theory, actually not even, just a gut feeling.

I just hope non of your thousands of readers got hurt following your sideways call, although you have disclaimer, but still some people who don't know any better are easily influenced.

First off, you read my post carefully. I mentioned to my readers that they needed to unload long positions when the market bounced after the first drop.

As a day trader, I do not even need to argue with you about the fundamentals because they do not carry much weight in day trading.

However, when we talk about “fundamentals”, we do need to look at a longer time frame, right? We are not going to talk about FA based on a 5-min chart right? So what is wrong with using a monthly here?

As I mentioned in the previous post, what matters is how much weight you give to it. So do not bring this “monthly” argument of yours again. It is very weak.

Since you are so bearish, is it safe to assume that you have been shorting the market since 7000,8000 or 9000? Do not tell us that you started shorting the market around 11000. Of course, we won't know it until you post your trades in real time just like I do.

Most of my readers are way smarter than you think. They trust me because I am one of those very few people who post their trades in real time instead of blah blah blah……………

Boo! I'm back, hows that sideways market working out for ya? We have now dropped 1,300 points on the DOW since my post, pretty much straight down with some sucker rallies in between, not bragging that I was right and you were wrong, but don't say I'm being childish for disagreeing with you, or that you provided no facts to support your claims.

Remember that you only care about a few weeks? Do you have short term selective memory? Good luck with your sideways market… who would have thought that I'd be up 35% shorting a sideways market! Boooyaaa

It indeed broke down. But the side way market lasted for almost 6 weeks. What part of “a few weeks” do you NOT understand? I guess it is you who have a short term selective memory.

The stock market indeed broke down. But If you knew how to read charts, you would not say “the market went straight down 1300 points”.

Now, open the 60 min Dow chart, you can see that a standard rectangular trading range started on 5/14 and ended on 6/30, when the market effectively broke down. How long did it last? It was almost 7 weeks, right? Now let me ask you this. What part of “a few weeks” do you NOT understand? Do not answer it. That is just a rhetorical question.

One thing I am sure is that you are absolutely not a technician. So stick with your FA. And we would appreciate some quality comments on FA

I said you were childish because you came here and bragged about it every time there was even a small drop. It was not becuase you disagreed with me. Can you even read?

The stock market indeed broke down. But If you knew how to read charts, you would not say “the market went straight down 1300 points”.

Now, open the 60 min Dow chart, you can see that a standard rectangular trading range started on 5/14 and ended on 6/30, when the market effectively broke down. How long did it last? It was almost 7 weeks, right? Now let me ask you this. What part of “a few weeks” do you NOT understand? Do not answer it. That is just a rhetorical question.

One thing I am sure is that you are absolutely not a technician. So stick with your FA. And we would appreciate some quality comments on FA

I said you were childish because you came here and bragged about it every time there was even a small drop. It was not becuase you disagreed with me. Can you even read?