He's right about that. What's that tell you? If you are patient and pick your spots you can do OK. That's about the only thing a small-lot off-floor trader has going for him. You are going up against some pretty hefty market movers between the funds and folks like ADM, Cargill, etc. If you are trading every day, day in and day out my thought is they will eventually get your money. I've had some limited success lately just using price action and being patient with picking my spots to enter. I day trade the ES but I'm scared to death when I put on a trade in the grains.
Being patient and picking their spots is the only thing big-lot traders can do as well. The difference is some of them are using computers to generate their signals and don't have to deal with the emotional aspect of discretionary trading. For a lot of them it's all about statistics and risk management. Even if one can spot a big trend, like the one we have seen in grains, it doesn't mean there is a strong hand behind the move, looking to screw the small trader. Perhaps they are in because their system signaled them to do so. The flip side is that the steep sell-offs that usually follow the steep uptrends are also caused by their system signaling the exit. And when there is choppy trade, they are usually taking the losses. But then if one chooses to trade the discretionary way, the bottom line will also be all about statistics: average winners, average losers, winners percentages, average drawdown, etc. That's the point. I think that the markets are like a big cassino where we can either be the gambler or the house owner. And whether one is trading discretionarily or systematically these are the basic tasks: the entry point, the stop point, the amount to bet. Otherwise it's all about gambling and having some fun, while losing money in the long run.
The longer I trade the more I hate the words Gambling and Bet. I have written Money management system that tells me how much ot commit to a trade at any given time. It has served me very well. Definitely has kept me in the market and not off watching charts and hoping. If grains scare you, slow down and watch them. I watch grains for 3 months before I placed my 1st trade. I picked the craziest day to hit them. When the acreage report was released. LOL. I ended that up, but educated. LOL. Also, you can pretty much tell that a massive sell off or limit up was the result of a system going into gear...... Just watch them. See how they move. The ES is more of a crap shoot to me than grains. I trade the YM at times. Not lately though. Grains are giving me a vacation Though the 47 pt drop in SOY at the LAST 10 seconds of trading Friday caught me off guard. I Looked up and it was -14 then as soon as 1:15 CST hit it was down -47. LOL.
"How much you commit to a trade" is the amount you bet. Have you heard of "bet sizing"? I myself, on the other hand, the longer I trade the more I understand how the word "bet" is very appropriate. Trading takes place at the right side of the chart.
Heard of it and accepting the term for trading are 2 different things. On the other side, have you ever heard of trade sizing.... Let me explain myself. Ever since I was 6 I have understand and lived by this one phrase. Proverbs 13:2a "A man shall eat good by the fruit of [his] mouth:" And this one... Proverbs 23:7 " As a man thinketh, so is he" If you think of it as gambling, you will react to it as gambling. If you think of it as trading, you will react to it as trading. That is my belief and I still hate those terms...
So, the answer is, yes there are people who successfully trade grains with pure TA like anything else. Some understanding of fundamentals and seasonals will definitely help. I will go back to the board to try out a few more swing strategy on grains. I tried out a couple more yesterday and they seem to be back test well (especially if one just go long). I think the real problem I have is my account size. To play swing with the grains with daily charts I seem to seem to need 30-40 point stops at least, which is way too big for me. Maybe I will start looking into spreads or options for futures for better swallow. Thank you for everyone's responses so far. Happy New Year!
i make a living trading grain and livvestock, but i almost trade like 95 percent trades/ email me and i can throw a few of the good ones at you