- USA TRADERS THREAD -

Easytimes, I agree with what you say, money can easily and very quickly shift back to high growth sectors on a sudden change of sentiment.

I'm not really up on EWP as it is very subjective and based on individuals interpretations. Having said that I'm not knocking it, because if it works for some and gives them an edge then thats great.

I was'nt trading the DOW five years ago when it was popping above 11000, but I have studied the charts at that time, and if history is any guide then a breach of 11000 in the future will bring very volatile whipsaws, which will make trading it a rollercoaster ride.

All though the markets are getting ever more sophisticated and derivatives are playing such a huge part in it now, simple human nature still plays one of the largest parts in its direction.

Greed and fear will ultimately decide its fate. If it goes above 11000, all those souls who got burnt during the tech boom, will want to come back in thinking they are missing out, sending the market up breifly again. Only to then get burnt again as the market falls as the volatile enivironment creates a fear and a snowball effect of selling.

The psyhcology of trading and controlling your own emotions is probably the most important thing to master, when you do, please tell me how !

One thing I have learned about the markets is that I still have much to learn, not only about it, but about myself.

My two favourite books are "Market Wizards" and "The New Market Wizards" both by Jack D. Schwager, they are both excellent and I highly recommend them.