The human brain has one quadrillion synapses... and the best some can do is trade some canned TA-output.
I really appreciate your very thoughtful post. Trading is personal, often, what works for you won't work for me, and I am quick enough to very quickly determine if a scheme that works for someone would work for me. I am eager to try anything anyone presented on ET, e.g., I tried @SimpleMeLike's stare at the screen, just click, click and click method, or @VSTscalper's 1 tick, or @Handle123's dancing options around.... Another one I spent time exploring is @volpri's. I don't know how good he is but I have incorporated some of his approach into my tool box and they do make a positive difference. Scalping is not picking up pennies in front of a steamroller, that belongs to writing naked options when convexity works against you in a black swan event, a hard lesson I learned earlier. Best wishes and happy trading.
@SteveH, my guess is you are one of the big boys on ET, maybe you can give us amateur retails some pointers here and there on how to be a 1% in day trading? Thanks.
Thank you so much for reposting those @SteveH posts. And thanks @SteveH for your contributions to ET and your help. They are golden nuggets. I am adding them to my tool box as they may very well be the capstone I needed to push me over to the other side. Many of his statements are consistent with my experience, for example, as R:R increases, win rate decreases. I was trying to find the optimum R:R for max profit but couldn't and settled on a ~1:1 with 55-60% because I was comfortable with it. I will go back to sim and see if adding his other pointers could improve the outcome. I miss @NoDoji
@SteveH is great. I reviewed all his posts once and have his nuggets archived in a Word document - just like I've done with many other posters on ET. It was he and @comagnum who first made me aware of the concept of adding to a winning trade in a strong trend. Beautiful.
You are a good guy and my advice, if you haven't already done it, add them to your tool box. I think you will get there. One humble suggestion from another amateur retail: We amateurs have no ability to predict, in a market that is >95% random, may be we shouldn't even try?
A common theme in the Market Wizards series is that you need to find a style that suits you and that series also show there are multiple ways to make money in the markets. However, we need to be clear on the fact that for a specific market and strategy - there is an optimal way to trade. For example, if you cut your profits short because that suits you, well, I think that's just irrational and stupid and behavior you need to correct. You in this case being anyone who reads this. It was me at one point. You're an older guy, I think, so you're probably a bit stubborn and set in your ways. I guess we all are. I'll entertain you with how I myself have developed over the years. I've had the pleasure to speak with two separate traders who allegedly are great traders. Both of these told me of day trades they took in ES to the tune of 100 (!) points. That blew my mind at the time - a few years ago by now. How on earth can you hold a day trade for 100 points through all those oscillations and counter-moves? What if your small profit goes back to breakeven, right??? Well, I did the same thing this year and had a single trading day where I took home more than 120 points day trading ES on the short side. One single trade of more than 100 points. This was an outlier day/trade for me, though, but 20 + point profits are not uncommon for me these days. I've had a ton of 40-50 point day trades earlier this year. In fact, a few this week, too. Anyway, it's been a long process. One of these fine gentlemen actually offered to review my trades and one of the first thing he commented on was that although many were profitable I was getting out of them for a small profit after seconds or moving my stop to breakeven way too quickly. While also taking full losses. Essentially, my expectancy was negative. Why? I'm not sure, but I definitely think there was fear involved. Fear of what exactly? Completely irrational, but I guess I was fearing that open profit would turn into a loss. Anyway, his main message was that I needed to move away from the lower time frames and focus on the larger moves/trends on the 60-minute time frame. The gist of his system was trend following using the 60/15/5-minute timeframes. Of course, there's a bit more to it than that, but that was the gist of it. The funny thing is that my 'system' have not changed that much over the years, although I'm always trying to improve it and learn more. The main difference which have made a difference is that I simply have gotten much better at running my profits. In the past, I could just as well as now predict/anticipate a larger move, but I would invariably cut my profits short to play it safe. Also, I learned to take my (small) losses. Never again will I move a stop to 20 points and hope for the best. Eventually, I think I realized that in order to have a fighting chance at this I really needed to bring home some medium/big winners. This was a process as mentioned and I can tell you I really resisted his advice early on as I just wanted to became better at what I was currently doing. Finishing off this post with a chart. Why would anyone focus on capturing a small profit when they could focus on capturing a large profit? The funny thing is that the risk is likely the same for both trades. PS: Some may now say that not every day offers a big move and that's true. A big part of success in this game is knowing when not to trade and being able to stay on the sidelines when you don't know sufficiently what's going on. Learn to wait for those good opportunities and don't be broke when they happen. PPS: If you're still reading here, M, thank you very much for the nudge in the right direction.
Maybe we shouldn’t even try. You’re right. The odds are against us. That’s for sure. It’s the consequences that matters What if we fail for the next 10yrs ? What if we make it for the next 10yrs ? If the worst case is fine. Then give it a try. Not everything is random as you said. I know when to find volatility (Open, Close, News) Might risk a fraction of that IV and earn a multiple. What kind of volatility can we expect over 5, 15, 30, 60min ? Maybe we can accumulate small edges, Here and there to tweak the odds in our favor. Get the best of it and make the most of it. Pretty sure that trailing my profit with a 10SMA could increase my average profit by at least x1.5 SteveH talks about Qullamaggie and that’s what he does… I think it’s stupid to be proven right and not take the most of it. But yeah … Not easy.
You would likely need more parameters. For example: - Day of week - Action/structure on the prior day - Gap up/down open Etc. Just a suggestion.