Disagree as well. I think the skilled trader is able to profit even with random entries, so long as he knows when to exit.
I have never read a more self-contradictory post than the following one on ET. Just hilarious (if you know the meanings of "think" and "anticipate" are the SAME)! http://www.elitetrader.com/vb/showthread.php?s=&postid=3118476&highlight=anticipatory#post3118476 "Lately, I've been testing the waters with some anticipatory entries. For example, earlier when I wanted to short @ 103.30, that would've been an anticipatory entry, anticipating that previous S would hold as R, since we were in a strong down trend. I prefer to do the anticipatory trades in ranges, though, because there's low volume and less volatility to shake you out....."
I only read a few sentences of this thread but it seems this guy is on the right track. I can't tell you many threads I read where traders try to give advice like, "follow your rules," "stay disciplined," "move stop to break even after 2 points," "etc, etc." If you don't do something radically different than the crowd you will never win. The first thing you have to realize, and this is something that most wannabees will reject, is the market is nothing more than one gigantic fucking random number generator. That's it. It's nothing more than massive randomness with n trending toward infinity. A data pool such as that is a statisticianâs dream come true. Just think about it for a second. You have participants from all over the world meeting in one massive forum with competing or complimenting agendas and acting on those agendas, or planning to act on those agendas. Are they buying? Selling? Hedging? How much are they buying, selling, hedging, and when? How many participants are going to jump into the market at any given point? What is n at a fixed moment in time? No one in the world can answer these questions. And here we have person after person after person, joining ET and proclaiming things like "patterns," "divergences," "moving averages," "follow your rules," "stay disciplined." The correlation between all that stuff and profitability is ZERO. Here's the secret. 1. The market is random (not perfectly random) and you need to learn how to read randomness. 2. The human brain is irrational and emotional. You need to train yourself to think like a trader. 3. Accomplishing all of this is paramount to getting a PhD in whatever discipline you choose. Plan on it taking about 8 years.
getting in and out profitably,getting in and out negatively,learning to increase the size of the first and decrease the size of the second
Thanks for referencing the post where I demonstrated the value of trading what you see, not what you think. I thought price was indicating a down move ("I hesitated because price action seemed bearish"), and I placed an order that would let the movement of price prove to me whether it was bearish or not ("so I simply placed a sell stop @ .32.") I didn't think price could start moving up, but when it did, I decided to trade what it was showing me, instead of what I thought ("Then when price found buyers at that level and broke back up through .50, I added the buy stop @ .65"). So there I was with a sell stop and a buy stop in place at once, prepared to trade what I saw, not what I thought, and took 2.30 out of the move in 10 minutes. When you anticipate a level will hold and use a limit order to trade it, the way you then trade what you see instead of what you think is by placing a very tight protective stop in case the level doesn't hold, unlike traders who let their opinion keep them on the wrong side of price as a trade runs runs further and further against them, sometimes even adding to the loser.
notes123 If you tried to do this real hard you might get a clue about how good she really is. Could you even do this .......... http://www.youtube.com/watch?v=EeOqD3uMIRs http://www.youtube.com/watch?v=4NwP3wes4M8
I'd say the single most important characteristic that a trader can have is the determination to continue to learn and to be willing to spend the time and effort involved. To be successful you need to analyze your trades and see what works and what doesn't. You need to learn from your own mistakes. Everyone makes mistakes and the more you are engaged in analyzing what happens when things go well and when they don't, the better trader you'll become. You need to be aware of and analyze your own thought processes before you enter a trade and while you're in a trade. Also you need to be open to and eager to learn from more experienced successful traders. You don't need to reinvent the wheel. But you do need to learn on your own also by actually trading. And as far as actual trading realities when you're starting, you need to learn as soon as possible to cut your losing trades short. No one likes to lose any money. But you need to learn that not all trades will be successful and that hanging on to a losing trade hoping it will come back doesn't work. If you don't learn this most basic of lessons early on in your trading life you won't be successful. Period.