Start of a new bear market?

[pdp-brugge]

I start this new thread because I have just viewed the last webinar from Dr. Elder.
Although Dr. Elder is normally bullish minded, in his latest webinar the tone was very clearly bearish.
He predicts that the current bull market (that started in 2009 and had 3 parts) has come to an end.
The last (third) part from this bull market started somewhere November last year and ended this week on Tuesday.
Dr. Elder is clear about it: we are going to face a bear market for minimum the next 6 months.
According to him, the presidential elections are a determining factor.
If Obama wants to get his reelection, he has got to do something to the economy.
The problems is that the FED is afraid to start QE3.
If Romney would get elected, then this bear market would come to an end.

I am a novice trader and had only 1½ year experience.
There are a lot of more experienced members in this forum.
I would like to hear their opinion.

PdP

[adam ali]

How did Dr. Elder describe the bear market to come? Most investors classify a bear market as a 20% decline. Is this what Dr. Elder is expecting over the next six months?

[ernsttanaka]

I start this new thread because I have just viewed the last webinar from Dr. Elder.
Although Dr. Elder is normally bullish minded, in his latest webinar the tone was very clearly bearish.
He predicts that the current bull market (that started in 2009 and had 3 parts) has come to an end.
The last (third) part from this bull market started somewhere November last year and ended this week on Tuesday.
Dr. Elder is clear about it: we are going to face a bear market for minimum the next 6 months.
According to him, the presidential elections are a determining factor.
If Obama wants to get his reelection, he has got to do something to the economy.
The problems is that the FED is afraid to start QE3.
If Romney would get elected, then this bear market would come to an end.

I am a novice trader and had only 1½ year experience.
There are a lot of more experienced members in this forum.
I would like to hear their opinion.

PdP

PdP,

I think you did great work developing a variation/addition to Pascal's method with your combo-mf. You have backtested it -- and are now executing it in reality. I think Elder's and the others should have limited place in your mindset. Don't worry too much about the prognosticators -- "the method will win and not the opinion".

I personally execute my option method by the rules -- and allow me some 'smart' freedom to make discretionary decisions. For instance my method says to make an adjustment when my position delta hit a certain value. When hit - I might wait with the adjustment till we move - par example over a recent high. That way I am not making my adjustment and see the market take that as a sign to turn on it heels.

I learn from Billy over the years that he allows himself similar 'freedoms'.

Please keep posting your daily updates, maybe you can add a monthly recap of the results.

Thks,
Ernst

[pdp-brugge]

Ernst,

Thanks for your words.
I'm going to make work of a track report for the combo-mf.
Yesterday (Friday) I got hit real hard due to the fact that the combo-mf turned long EOD Thursday but then everything went really down again.
It ended with the combo-mf again in cash EOD Friday.
I think it is all part of the game those whipsaws.


Adam,

Dr. Elder did not made a prediction of how steep the bear market decline would/could be.
He expressed that it probably would not be as deep as 2008 but most likely more than what we had last summer.
He isn't talking over a small pullback but rather a very large move down spread over several months.
The webinar can be viewed at http://www.elder.com/product/detail/w20120410.
He charges a fee of $ 49.00

PdP

[senco]

PdP,

I would echo the sentiment expressed by Ernst. Myself, I try as much as possible to follow backtested strategies, and I ignore the opinions of prognosticators. In fact, I make a conscious effort to ignore my own opinions if I have any :-)

CXO Advisory group tracks predictions made by about 60 well known ‘market gurus’ whose opinions are expressed in publicly available material. As a group, on the average, 48% of their predictions proved to be correct. The best are at a prediction win rate of about 65% .

At any point in time you will find some prognosticators – as well as anonymous traders - that say ‘bull’ and some that say ‘bear’.

Will Dr. Elder’s prediction materialize? I do not know. No one does. When I trade a system or follow an indicator I know it will not be right all the time. But the indicator or system do not have an opinion that needs to be proven right or wrong - the intention in using them is to make trades with the expectancy of positive results over time. It might be better to follow over years a trading system based on Dr. Elder’s indicators than to follow his expressed opinion at random.

At this point in time, indicators with long backtested history I look at indeed signal warning, and are on the verge of pulling the full exit trigger for long positions. Pascal’s 20DMF turned short. We may be just at the start of a bear market. Or we may not. Next week or next month the indicators may show something different, and I will act accordingly.

[Rembert]

The bear is contained ... for now.

[pdp-brugge]

Let's see what happens April 24...
Will the first domino trigger the huge descent of the entire market?

http://www.marketwatch.com/story/par...ort-2012-04-12

PdP

[Rembert]

I'm just guessing like everyone else ... but my feeling is this will be a normal 5-10% correction and not the start of a bear market. I have to agree with what has been said earlier tough. No need to guess ... just follow the rules of your trading systems/strategies.

http://marketsci.wordpress.com/2012/...zing-the-bear/

[Charl]

The bear is contained ... for now.

I wonder how long this BEAR can stay under water ?

[ernsttanaka]

Pdp,

A couple more random thoughts related to your MF-Combo posts.

It is my understanding you enter a trade the moment your signal flips. At times this is when, very short term traders are expecting a contrarian move against the new set trend. Giving you instant pain kind of directly after trade entry.
How about finding a better entry method to protect you against this.
For instance you could enter in a break out over the first 5min high, or 15min high. You could enter close to the range of the pivotpoint support zone (for a long) or close to the pivot point resitance zone for a short.
But several other come to mind.

A book I read years ago - which I liked for a description of a formula which help you calculated the size of your "bet'/trade.

I also liked reading details of the "Turtle" method. They gave me some good insight in entering a trade, managing risk and adding if and when a trade was working in their favor. U can find the turtle method nowadays for free on several website.

BTW before I get everyone reacting that the Turtle method doesn't work anymore, that is not what I am trying to say. My interested is in the thoughts behind the method, I am interest in how a great trader thinks, not on what ever he might think on a particular moment in time.

TTY all Monday AM

Ernst