Thread of the Week

A really great thread over at the Trading Blox forum.  Read here.

Best part was the comments by Curtis Faith in regard to "the characteristics of markets over time."  Curtis broke the markets into three classes:

1)  Fundamental Driven Markets - cleanest trends and easiest to trade;

2)  Speculator Driven Markets - perception driven and harder to trade;

3)  Aggregated Derivative Markets - averaging out effect dilutes momentum.

Plus, I always enjoy it when Curtis shares his Turtles experience.  His coffee story reminds me of a few trades from my Melba Toast story. 

Also, pay attention to Barli's mention of optimization and the effect lack of cash has on your results.  This is a very hard lesson to learn.  Most backtesting platforms will drop trades due to lack of cash.  Thus, you only see a sample size of the actual results.  There are a few solutions to this problem...but that's for another time.

Later Trades,

MT