Hi folks,
I can't remember where but I have heard of a test that was done in the
FX market a few years back. The details might be slightly out but it went something like this...
A successful spot trader had two lights placed on his desk, one green & one red. If the green light came on he was to assume he had a long position at the current market price, if the red light came on he had to assume he had a short position at the current market price. Once either light came on he had to trade that position accordingly.
Interestingly, he was able trade these random entry positions successfully simply by immediately cutting the positions he didn't like and holding on to the ones he did like.
Can anybody point me toward a web site or book that mentions this test? Was it Market Wizards? I just can't remember. I'd like to mention it in my upcoming book but can't really do that without some sort of reference....
Cheers,
Alex.