Here Are The What’s Working/What’s Not Working Poll Results

  • May 14, 2003
  • Rob Hanna


Thank you to all of those who emailed me with
your thoughts on

what has been working and not working recently. I’ve listed the most common
observations/themes below so that everyone may benefit from your insights:

The
Unofficial, Unscientific, Working/Not Working Hanna Indicator (as compiled from a poll of
members)

Working —

  1. Buying pullbacks — This
    was by far the #1 response.  It appears swing trade entries on pullbacks have
    worked well lately.      Note: The indices have now
    pulled back in an orderly fashion for the last two days.  Could some new
    entries be setting up soon?

  2. Intermediate-term breakouts



  3. Opening reversal     strategies

Not
Working —

(Not as popular — either people are shy about this or we’ve got a
lot of really strong traders at TradingMarkets.  I’m inclined to believe we’ve
got a lot of strong traders.

  1. Overbought reversal
    strategies

  2. Intermediate-term shorts

What is interesting is that all
the strategies that people mentioned to me were good solid trading techniques,
regardless of whether they were currently working or not working. So while many
short selling strategies have not worked well for members lately, but buying
pullbacks has worked well, it is important to realize that you need more than
one trick in your bag.

If I had done this poll three months ago, the
results would most likely have been completely the opposite. You would have seen
short selling strategies as the most popular, and people who were buying
pullbacks and breakouts would likely have been frustrated.

By having a number of techniques that you are
comfortable trading, you can change your focus as the market changes. This will
allow you to better contain losses, and hopefully even profit when your favorite
strategy falls out of favor for a period of time.  I don’t mean you should try
and become a jack of all trades. Most people will have a comfort level with a
certain style, whether it be playing breakouts, reversals, pullbacks,
etc. That’s fine.  Just make sure your strategies allow for playing both sides
of the market.

Dave Landry looks to enter
pullbacks in the direction of the Big Blue Arrow. Don Miller likes to have some
moving averages on his side, either long or short. Mark Boucher looks at breadth
& plurality of markets as well as the success of his trades to let him know
which side of the market to focus on.  In all cases, these traders have the
ability to trade both long and short.

As I mentioned Monday, I’ve
found that just by understanding what tactics are working best for me, I will
already know a lot about the market. When short candidates start triggering and
following through better than longs, that most likely means the market is headed
for another fall. Until then, the UUWNHI says to buy pullbacks & breakouts.

From an “official” market
standpoint, I still haven’t noticed anything of great concern. The pullback of
the last two days has, so far, been shallow and seems to be constructive. It
also seems to be a necessary consolidation before the Dow & S&P can attempt to
break through their Dec. 2 highs (a bigger challenge for the Dow).

Best of luck with your
trading.  Enjoy your weekend.

Until Monday,

Rob Hanna


robhanna@rcn.com

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