Very good thread. Not that I agree with everything but I shouldnât have to. No edge = no success or even disaster In the past 20 years I've met traders with a 90% win rate and traders with a 40% win rate. Both groups made tons of money, they lived in luxury, they bought yachts and expensive cars and donated to charity. Their secret: they had an edge. I recently met this young guy who got a data-mining program and had a novel idea of how to evaluate and use its output. He made a killing in futures without having spent even one hour in his life looking at price action. Actually, he has not even traded before. He was just a damn good statistician and programmer. He automated his systems in Ninjatrader and in one year he could retire at 28. His edge was a proper use of a data-mining program. Very smart... I have met many who lost everything, some even their houses. The reason: they thought that the edge is gained along the way. Do not even think about it. You will be poor before you know it. It's like reading math you do not know and taking final exam for the course at the same time. This is what most losers do. Good luck to all.
Yes that's it. Also a horizontal line across a swing high or low can switch sides. Price is in an uptrend and then finally breaks the last swing low with some conviction. Price retraces its way back up to the level of that swing low and reverses down.
Finding an edge/ edges â pretty easy Plucking oneâs head out of oneâs butt and being able to repeatedly and consistently exploit that edge / edges â priceless â and will take as long as you decide Primarily a chart⦠and a mirror ================ Aside; If one is not approaching every day believing they will make money And If one doesnât have / or believes there doesnât exist â and edge / edges to do so Why in the hell are you trading in the first place? Rhetorical - of course ================== There are some edges we simply will never have access too - BFD Get over the edge envy - and put in the work to find the ones you can use RN
I have been involved in threads like these for years. especially with market surfer. I have been trading again after decade off. A pattern that worked back then still works great. My account is up 30 percent since december. (not a big account.) If I only stuck to the pattern it would be up even more. don't listen to the bullshit that t/a does not work. it can work... it does take time because you have to get very selective and know why things are happening.
Would you accept as a corollary "and don't mess with it"? I put on 11 trades (among others) in mid-January. These were all ITM debit call spreads upon entry. They all expired Friday. Had I left well enough alone, 9 of 11 would have expired profitable for a 13% net gain. However, I decided to exploit "trade management" tactics which meant I turned most of those trades into either condors or butterflies. I ended up with 3 winners and 8 losers, for a 37% net loss. Come on. I put on some nice trades, but I just couldn't leave well enough alone. Of course, my broker made more money along the way, too. Discipline is a BITCH.
For me the edge is the ability to make money on markets CONISITENTLY. I have been trading since 1993 without any breaks. First 12 years it was stock market then in 2005 I switched completely to Forex and CFDs. I am not making money but I am not a losing trader too over the period. I made money on periods of big volatility such as news releases or almost random entry with automatic reversal . What I trying to say is that you can make money on periods of big volatility with automatic or semi-automatic systems for a limited period of time. When market change is character then you will start losing with the same systems. So for me the edge is the ability to make money consistently (although with peaks and valleys) by making decisions when to buy and sell not using any systems but by your own discretion. Your own thinking , your own judgment. Your own management of trade - either you lose or win at that moment. Ask yourself a question : how did you make money. If it was a method that for example you buy when market crosses recent top after 2 points correction? Or you buy or sell if market takes todayâs high or low? If you do it routinely and make money there is still one annoying question â that EVERYBODY can do it and make money the same way. So you know that it CAN'T WORK in the long term. But it is very hard to acknowledge that to yourself. It takes years and not 4 or 5 (if you are retail trader trading from home or your day work) to master markets and read PA . And there is no guarantee too that after 10 years you will be profitable trader. So it makes me laugh if someone says that after one or two years they found an edge. After many years of trading I feel that I very slowly approaching to the point of being a profitable trader.
What you're missing is that not everybody can trade the same way, leaving plenty of opportunities for short term traders (scalpers, day traders and short term swing traders) that repeat consistently due to nature of price movement that occurs when much bigger players (hedgers, fund managers, etc.) put on and take off sizable positions to achieve their objectives of longer term trading and investing, and hedging risk because it's not prudent to simply slap a stop loss on a massive position. It's been estimated, for example, that day traders make up only about 5% of the on-line market participants. And they're all doing very different things. And most of them are losing money, so what most of them are doing isn't something you want to replicate anyhow. You want to learn to identify the price footprints that occur around areas of interest to the big players and hitch a ride with them. That's what price action trading is all about for us little guys and the reason it keeps working is because human nature has not changed since there have been liquid auction markets.
Figuratively speaking, the small trader should imagine himself as a hitch-hiker in the market. For the ordinary hitch-hiker, someone else supplies the car, chauffeur, oil and gas. When he thinks the car is about to go in his direction, he jumps aboard and rides as far as he thinks the car will go. When he notices the machine has been stopped by a red light, or is about to turn a corner and go in some other direction, or that the car is running out of gas, or the brakes failing to work properly, he steps off and figures he has secured about as long a ride as he may expect. All he has supplied in this transaction is a modest commission and whatever brains were necessary to observe and recognize the opportunity when to get on and off. Richard Wyckoff