I imagine that was fascinating. Ya totally agree with the above. Interesting that we traders place stop losses on all our trades yet rarely anyone asks where they populate in the book? We only get 5 or 10 rows deep of limit orders in the book but there are thousands of levels held by the broker. And the other side as well. Markets moves towards orders so natural clusters of large pending orders attract price like gravity. This is also not available to us retail guys. But like surf said , not necessary for profitable trading. Just makes it a lot easier.
Well, you apparently don't even understand the basic of trading: 1 trade is irrelevant. As long as you don't understand that you should not trade anymore. Mathematics, statistics, probabilities and even trading are only accepted as realistic on basis of a statistical relevant number of observations. So to proof anything you need more than 1 trade. 1 trade does not proof anything. Even not luck. Luck is an exceptional event. So luck can never be a series of trades that is profitable. Luck means that you received something where as the expectations to receive it were very low. Trading is receiving something where as the expectations to receive it were very high (based on your tests). That's why trading should ban luck completely if possible.
Someone I know personally has been in capital management for a long time and has been averaging a solid return, has recently become mega rich by investing into bonds of a new bank startup that was in need of investment capital, was it luck that he met owner of the bank or was he destined to eventually strike it big? Luck is very important to get rich. Trading will not make you rich if you do it properly (risk management), but occasionally you may happen to strike it lucky, nothing to do with your system, you just happened to be at the right time at the right place. BTW you can carry on telling me I am clueless, I don't give a shit
I use only a small part of my capital to trade. Every week I put away part of my profit and use the remaining money to grow my account again. I do this already several years now, and till today every week I was able to put away some money. That proofs that it's not about luck at all. Because if it was luck I would have some awfully good weeks but also many awfully bad weeks, which is not the case. I make money, every week, over and over again. About your rich friend. Take a way the money he made with these bonds and see if he will be able to repeat this lucky shot again. The answer is probably NO. He was lucky. Take away all my money. Give me $ 5000 to start trading again and I will repeat what I did the previous years. It was not luck, it was a systematic mathematical approach which is self adapting to the trend in the market. At the start central heating could only be switch on or off. So most of the time it was or too cold, or too hot. Till one day somebody invented a thermostat. From that day on, the temperature was always good. The thermostat adapted automatically the heat production depending on environmental conditions. My system has a thermostat too. An important reason why some people stay blocked in a certain situation and cannot improve their trading,is because they are stubborn, not open minded, have too big ego... They don't even want to think about what others might tell. They already know everything (they think). That's the biggest handicap to become successful. Nobody knows always everything, even the smartest man on earth does not. I still learn, but that is not a good reference as I am not so smart. So for me learning is obvious and still necessarry.
I am still trying to get my head around why some people believe looking at past prices to make trading decisions isnt worthwhile. Lets take a very simple value approach and use a car auction as a market. If I specialise in buying a certain model of car of a certain age/condition and I frequent the auctions every day for years then suffice to say I know where value lies for this product. I know when prices are cheap or expensive compared to where most business is done over a long time period. So if I wait around for prices to be cheap compared to value and start buying can I reasonably expect prices to increase in the future to somewhere around the most accepted price over the longer term? Maybe I am wrong and prices fall further, I then sell at a loss or buy some more. If I know the average time prices take to recover over the long term this may help my decisions. I totally fail to see how past prices cannot help me make trading decisions.
you're correct due to the fact that it isn't silly at all. I happen to know that what I state is true.
There is no such thing as luck. I will be posting some analysis of last Friday's action showing that proper use of TA would have the day trader looking long, not short. Yes, it's in hindsight here, but it wasn't to me as I was watching in real time and had analyzed the same way at the time.
Read posting 274:Friday long ES at 1891, and out at the close. Must admit this is a new record for me. No luck, just follow the system. And yes I wrote that one. You don't have to confirm what I already know and do myself. The man who invested in bonds from a new bank was lucky, not the trader.The man had no past data from this bank or bonds as they did not exist before. So nothing to analyze. Don't cut and paste in such a way that the essence of the posting is left out.