How can someone blow up in day trading?

Discussion in 'Trading' started by traderzhangSan, Feb 27, 2010.

  1. henry76

    henry76

    there are some who make a good living simply from the bid ask spread , it is not a cost , simply part of the landscape of trading , if you buy and sell at mkt it may appear as a cost , but the guy on the other end of your trade is making the spread , a trader just like you , some pay more commission than others , but that is not the spread !!!literally
     
    #51     Mar 1, 2010
  2. How can someone not know how someone can blow up in day trading?

     
    #52     Mar 1, 2010
  3. TraderzhangSan,

    The market is not neutral usually.

    If you use symmetry for your win/loss, you can enhance lowering the losses and raising the wins.

    Arbitrary entires are not possible in the sense that this is a neutral action on your part.

    If you wish to use the logic of your opening post, then the post has a small deficiency. You ignored the trend when you entered. You also ingnored the two possible conditions of the market.

    Since you orient to the emphasis of not being able to lose much in scalping with equidistant exits that are triggered in the same manner, I will respond accordingly.

    To achieve not losing as a consequence of scalping stops being hit, minimize loss by the timing of your entry.

    Only allow the placement of a stop at the beginning of a scalpable level fractal trend. Only place the stop on the side of the market that is opposite to the beginning of the trend.*

    Your advantage comes from the ratio of the number of moves in a trend.

    The ratio of setting this stop for winning to losing is 2:1.

    For a specific scalping strategy (which you have), it is good to let the market tell you the magnitude of the scalps. Use a formula where by you know the volatility vs the market pace ( I use a sample of 1600). For any pace, always use the median/mode of maximum volatility. In this manner, you will always have a volatiity advantage on BOTH sides of your strategy.

    *This is a market sentiment satement.

    As you know trends overlap. This makes the beginning of a trend fall inside the ending boundaries of a prior trend. So the timing is at the point where trending discontinues and change (its orthogonal counterpart) simultaneously begins.

    As you will see as you progress, if you use these small caveats, the matter of using stops becomes academic since they are never triggered.

    To make the concept whole, a geometric limiting case may be used to always provide a wash exit. In my case I use a "green" horizontal line that anticipates the limiting retrace.
     
    #53     Mar 1, 2010
  4. Attached is a pertinent half cycle chart that illustrates my points.

    [​IMG]
     
    #54     Mar 1, 2010