Hmmm... let's see. A 'trader' who can't do simple division to come up with an average. Do you feel like an idiot now? I mean, you're an idiot, we know that. The question is, are you aware of it now?
Joe, I've had difficulty getting prayer to work. I'm thinking maybe I've been saying the wrong prayer. The prayer I've been saying is: "Please, God, please just get me back to break even on this trade and I promise I'll NEVER trade without a stop again."
Ummm... yeah, right buddy. Whatever you say. At least you developed the ability to play your video games with your left hand. That's something.
Okay, I will reveal what it is. In short. Let me know what you think of it. I think I finally found the ingrediënt that was missing from my trade plan. Okay: we all know the market moves in stages, bull to bear, and that market is random than non-random. Basically the market changes. Now, I discovered you don't need to predict the market to make money
But then how do you make money? SIMPLE. You predict volatility of the market. Okay work with me. You got a trading strategy, it works great in backtests, but then it stops working when forward testing. WHY? Simple: the volatility changed. Simply put, to have a successful trade plan you need to predict volatility. Without being able to predict volatility, you WILL fail. This is the single most important ingrediënt of trading. i might be overexagerating here but just want to say it's very important Exhibit A: Now what do we see here? Support and Resistance in volatile times. This is a different market condition compared to exhibit B Exhibit B: These is S&R in less volatile times. WHATS THE DIFFERENCE? Watch closely, I will explain. Look at the candlestick bars in Exhibit A. They slice through support and resistance like a knife through butter. Look at exhibit B. Support and resistance HOLDS. What does this tell us? A strategy based just on support and resistance will not work!!! Because of the volatility that is different in the past. Exhibit C: Traders watch news events closely? Why? Because of volatility! They don't know it yet, but they are using an advanced trading strategy. They are using the knowledge of news events to predict volatility! They look into the future and realize a time when their strategy is not functioning optimal, and they ADAPT with a volatility GAUGE. Conclusion: If you create a strategy that is profitable, but doesn't have a volatility gauge, it is doomed to stop working one time in the future. Every trading strategy need a volatility gauge. This is the (semi-) holy grail of trading. Predict volatility, then you don't need to predict the markets. I hope you have all learned from my epiphany. I never knew taking walks outside could be so productive.
Seems to me you're simply describing the difference between a trend and a range/slightly trending range. Both are very tradeable. In a trend, you buy pullbacks that find a resurgence of buyers or sellers above or below previous S/R level (this usually occurs at or near the 20-bar moving average); in a range/slightly trending range, you use stochastics combined with the failure to break through previous S/R levels to sell overbought and buy oversold price zones. This tactic also positions you nicely in case price does eventually break out of the range. I consider this an "edge", not a holy grail. It places the odds in your favor. An example of a Holy Grail would be a charting service that allowed you to look ahead 5 or 10 bars before putting on a trade.