Just read where dbphoenix was banned at BMT earlier this month for allegedly being a vendor. The charge seems bogus because the alleged book he was accused of selling (at another trading site !) was never being sold at Big Mike's. Regardless, leading up to the banning were accusations that SLA was all hindsight analysis and didn't work in real-time. I never got into the weeds of SLA because I'm one of those awful indicator people so I had my own homework to do. But superficially SLA struck me as potentially powerful. Was I wrong? Is there evidence backing the SLA approach? Please discuss.
Well as one of the guys who was going down this road, here is what I have come to conclude. First, there are two things going on, you're got Db trying to teach how markets work via supply and demand, and then you've got him distilling it all down to SLA, which in my opinion simply doesn't work on its own. Sure he might say that each person needs to do their own testing, so see how far above a RET to enter, how many points you let it go against you before you bail, where you will take your profits, but since SLA is suggested as a trading plan, having the entry, stop and target not be included is pretty much saying you do open heart surgery by just cutting open down the middle of the chest and sewing the patient back up... and of course figure out the stuff in the middle for yourself, based on your risk tolerance... LOL It also doesn't help that at TL, he even said that SLA was insufficient for trading a 1 min chart... but this is perhaps what day trading is all about. Then he also mentioned in someone's journal that you sometimes have to open up the 1 minute bar, to see what's going on inside at a key level. This advice, although not bad in my opinion, now makes all the backtesting on 1 min charts completely useless if you're gonna dig deeper. Of course 1 min RET entries work, but only after you've gotten the direction right, only once you've figured out where your important S and R zones are, etc, and only when the trend is really strong. Basically, you have to know you're trading in the right direction first and not just take any RET just because a line broke. I'm honestly not sure if DbPhenix trades at all. He has immense knowledge, so I doubt that he doesn't, but he certainly isn't using the SLA as he presents. Sure he trades at the extremes, sure he perhaps waits for price to come to his entry via some sort of RET entry, on a fast chart is my guess, not a 1 min chart, but even as he has said before, his risk tolerance is different than other's, and hence why he never shares his trades. Point being, if he does trade, and if he is profitable, I don't think he's using what he's teaching. A few people have come to his defense, saying they use some of the things he teaches, but they hardly ever show charts. I have yet to see someone post a week's worth of charts with all clear entries and exits based on the SLA rules. It simply can't be done as there are too many other sub rules or intuition that a trader uses that he has developed over the years with lots of screen time. The SLA, as presented, will only work during a nice and clean trending market where the moves are wide enough that you can extract 30 or 40 NQ points to make up for the many stops of 3 or 4 points that you are likely to have. But honestly, hardly anyone, even other posters who I respect as traders, are actually showing charts with clean entries and exits marked for any consistent period of time. I therefore cannot come to any firm conclusions about what anyone here is actually doing. Heck, even reading that article today about the guy in Japan who made 30 million in the past week said he only shares his winning trades on Twitter but never his losing trades... so everyone is full of shit if you ask me.
Good point. The most common answers to questions were "its trader's choice" and "what does your backtesting tell you?"
So this makes the method sound discretionary, not mechanical. That would explain why some had difficulty making it work.
I would venture to guess that nobody made it work. From what I could see, the guys who found it helpful actually said they used bits and pieces from what DbPhoenix teaches. But this means the system isn't being used. When something is so open ended, it pretty much isn't a system. I've got a great system for picking up women. You just have to stop and talk to them. It also helps to make them laugh. Now go forth and get as many women as you want!
Hmmm The guy spends all his time on forums then. He cant have time to trade and post so frequently. Not one person using his methods has made any money. Need I say more? Instead of wasting time reading his drivel, one would be better off getting the basics down, and just sitting in front of the screens learning. Most of what is on the internet and forums is BS IMO anyway. The guy is just an ego IMO who gets off on a following.
Even though his being a vendor was the reason given, if you read a few of the posts by BikMike to DB a few days prior, you could see that Big Mike was getting annoyed and was questioning DB's credentials and guru status. They had a bit of back and forth, and all of DB's elitetrader fanboys ran to his defense against BigMike. Bigmike has a really transparent journal where he posts all of his calls in realtime with statements etc and doesn't like nonsense. He was getting angry with DB claiming credit for market moves that he didn't call in realtime. DB would call a range, and then whether it broke out of the range, or reversed, or chopped up and down through it a million times, DB would claim to have played it perfectly.....in hindsight, of course. Big Mike assumed him to be yet another hindsight guru who can't actually make consistently good trades in real time and out of protection for his forum, used the vendor thing as the nail in the coffin. He's done this a few times too with other fake gurus. He's got form!!
I tried it, but slowly lost money overall unfortunately. In hindsight, the good days I had using the method would have been just as successful of using a moving average crossover. Pretty much everyone is full of it. I spent some time in trh tradeitdontdate it room recently. They all live in cloud cookoo land where they never call a trade, but as soon as there's a big move, they claim to have traded it making 50k for the morning. Nonstop fantasy talk about their ''lamborginhis'' etc lol After losing for 5 years plus and with all the BS out there, it would be natural to think it's not possible. However, I do know of ONE person who kills the market most days and has proven it to me in real time again and again. Unfortunately, I've no idea how he does it!