If one has a thoroughly-tested and consistently-profitable strategy and has the discipline to follow it, there is nothing extraordinary about a relatively high winrate, particularly if the plan keeps the trader out of chop. And even a barely-acceptable plan will cut losers quickly and let winners run. Unless the instrument is extraordinarily dull, the P:L ratio will be healthy. The difficulty is that few retail traders have any sort of plan beyond guess&hope.
Do you use mean reverion strategy? Waht y prefer flat or trend,high,low volatility periods? (for example you have ema(50) line price goes little down and then mean reversion to ema(50 back) So you will buy,sold when Short period CCi(7), or RSi(7) will overbought oversold?
If this is directed to me, I don't use indicators. I look at the trend or the range and plot the means (actually medians) of each, then trade reversals off the extremes, to put it in its simplest terms. For example, from two weeks ago (I believe this is the last one I posted): And these are examples of lateral ranges I posted last month: These were all posted before the open for those who liked to trade breakouts.
dbphoenix,yes my strategy mean reversion simillar To recognise range bounds can be used bollinger bands (2 standart deviations or diffren dnchian channel etc But howto identify where will by trend or flat, howto pick stocks?Do y using any filter?7(or just using your eye?What do you think about trend/flat indiactors,are they useless? Before start of trading do y checking historical volatility for last 2 days or 4 hours? Do y have any filters& for example if in previus 3 hours was strong trend or impulse,or big volatility you will not trade? Do ytrade only instrument with small volatility?
Sorry, I don't use indicators at all, nor do I consider volatility. No filters, either. Rather than repost a bunch of charts, I'll just provide this link: http://www.elitetrader.com/et/index.php?threads/the-foresight-thread.290361/
I believe that commissions and slippage are of no consequence as if you understand how the market operate, have the will and commitment to work out your trading plan (being intraday or swing) and have the discipline to apply it, you will finally make money. Problem is that you must understand how the market operates since if you don't you will have very small chances to be successful.
Hi galvinlee888, to be honest I am still working on it, I am relatively new to trading (only a year). I am generally profitable wit a good win rate (over 70%) and average profit of 0.5 to 1 point a day whenever I follow my rules and I am fully focused on trading. However, every now and then, unfortunately, I trade when I am not focused and when I do that, I do not follow my rules and this often lead to big screw ups. As I said I am working on it and I know that once I will have fixed this personality problem I will be fine.
Hi Vindago I don't want to come across as critical, but perhaps other inexperienced people reading your first comment should also bear in mind the second... FWIW I think commissions and slippage are hugely important, but I don't need to repeat my comments elsewhere on the thread.
Not sure, commission with a decent broker is around 2USD per 100 Stocks trade (buy+sell) which with a stock valued 50USD is equivalent to 2 ticks, I normally make at least 10 to 30 ticks in a winning trade so the 2 ticks that I loose for commissions are really not much, same for a loosing trade where (if I follow my plan) I might be stopped or I may get out at 10 to 20 tick, 2 ticks are a nuisance but do not impact my P/L that much. As for Slippage it normally have no impact on my trades as I trade high volume stocks and use Limit orders. So the problem, at least for me, is following my plan, when I do I make money consistently, when I don't I loose them. Commissions is the price I pay to be allowed to trade, nothing more...