That is the perfect question - and a question that I find that many new traders can't really answer. It is a whle lot easier to find a way to get what you want out of trading vs. trying to see what you can get out of trading.
OK, since you asked (sort of)...for an answer....just try this, this is what works for our people: 1. Opening only orders (at first, enter 10 stocks, try for 2-3 fills each day). 2. Next, pick 2 or 3 listed stocks as your core group...trade them day in and day out. "Read the tape"...look for "trade throughs" and the like. 3. Always envelope your stocks, all day long, buys and sells (very important in todays market). 4. Look for the MOC imbalances, trade accordingly (look for buy imbalance on long stocks, sell imbalance on short stocks, either cover immediately or ride for a while after the indication....depending on which side you're on. You're suffering from "information overload" - much like giving a guy a decision on buying a suit, with more than 2 answers, it never works and his mind goes on "tilt"... Step away from the game, clear your head, and make the decision to listen to your self, not everyone else. If you think that what I say makes sense, then follow that, if you don't then don't...but try to to make sense out of the basics....were in this to make money, and the easier the methods, the better. I've traded options, futues, equities....the whole thing, and right now, I feel the biggest edge is trading equities. Not just speaking as a firm (since I can trade whatever I like, anywhere, anytime personally), I choose stocks. Good Luck... Don....
GG, I think Don's advice is excellent. You know I did a whole thread on "keeping it simple". Yet if I remember correctly I tried to avoid specifics and tried to convey the importance of attitude and consistency. Don suggested using a single strategy. The two most successful traders I know use a single strategy also. I will even divulge their "secrets"...unlike others, I don't think giving away a "secret" is going to affect me or them one bit. Trader A: He makes a list of the strongest and weakest stocks that he wants to trade. He uses volume and relative strenght (I believe one day RS). The next morning, he will buy stocks that were strong on the previous close, and open down. He will short stocks that were weak the day before that open up. He will do more shorting in a down market with an up opening, and more buying in an up market with a down opening. That's it. Simple. Trader B: He looks at Insight all day long... a program that you can enter parameters and it will find the stocks as you ask for them. I realize that trading at home you will likely not have an Insight machine. But his system can work anyway if you can watch a screen full of quotes. He watches for extreme movement. When he sees a stock make a very dramatic move, he will fade the move. If a stock suddenly drops, he will buy it with the belief that it will at least get a bounce. He will short a stock that moves up very dramatically in the belief there will be at least a temporary pullback. He only trades listed stocks this way, and puts in pretty tight stops. Now both these guys make millions a year. But their buying power is enormous, and they can and do occasionally average "down" in instances their positions go against them. But they can hold positions multiple nights. The guys they train on their desks cannot, so these guys will not let their "students" ever average down (or up in shorts). The guy that fades the open never looks at charts. The guy that trades dramatic intraday moves will look at charts only if he is considering holding a losing trade. In both cases, they essentially do not use any technical indicators. A third trader that was also great....(he taught Steven Schonfeld how to trade); never looked at charts. He bought strong stocks and shorted weak stocks. He put in limit orders to buy strong stocks that dipped 25-30% off their highs of the day and shorted weak stocks that bounced 25-30% of their move for the day. He would enter his orders early in the morning and late in the afternoon. He would put in stops and let his winners ride. He would always be flat at the close and come in fresh the next day. He traded like a robot, and I don't think he even knew how to bring up a chart. He no longer trades only because he is no longer alive. Having said this, I am certain there are people here who know who this guy was. They will affirm that he was a consistent winner. I don''t know how his "system" would work in this trading environment. But adapting to the market is something all experienced traders do. The ones that develop this abilily faster are the ones that survive best. Good luck, and say hi to your mom, she is always good for a laugh. I think she is Aphie, but someone told me she was really Thunderbolt. Anyone's guess. rs7
Alpha, I like your style bro! Feel free to attempt to convey my messages in a more linear-rational way whenever you please; for I feel you could do a WHOLE lot better than I... MarketSurfer, It was only until I was able to tap into the "space-between" the left and right sides of my brain that I was able to tap into my true potential in this little microcosm of life It is nice to be understood every once in awhile... PEACE and good-trading guys, Commisso BTW Surf; NICE signature! Ahhh surf the minds eye
Gordon, I have shown you a system that works. Look at the charts -- what is the problem here? Clear your head and don't fill your thoughts up with 20,000,000 ways to trade. Find a system that will keep you alive and start trading and you will work it out for yourself in the end. IMO, your biggest problem isn't lack of knowledge but FEAR. Only you can conquer your own fears.
Gordon, You're having the problem I think most people have when they start trading. This seems to be a lot of trader's learning curve: 1. Decide they want to trade 2. Read a lot of books, ET, whatever, they just learn a lot. 3. They then start trading, and start bitching that books are useless when they start losing. 4. They realize that they have to consider their own self first. 5. They throw away the books and trade the way that fits their personality. At least this has been my experience, and it seems you are stuck between three and four, because while you read all the books, you refuse to trade. IMO the only way to learn how to get out of your own way is to trade. I don't think you're going to get that zen type of understanding of market movements without participating. It just doesn't happen because you don't care enough abot the movements. And yes, I know you paper trade, that doesn't count. Good Luck, I hope you get there soon. MUChris
Gordon, I want to try and explain to you and the others around here that claim my posts are too "vague","general", or even "mystical" (that one always gives me a chuckle)... Recently I have gotten a little heat from you and a few others about posting vague "generalities". Now heres the deal, I can't spoon-feed anybody any specific objective method for entering the markets because quite frankly I DO NOT EMPLOY any. My method of entering the market is subjective, intuitive and improvisational. It has taken countless hrs playing and studying this game to get to this point. I am now at a stage in my journey where my "right" brain will process the "flow" of the market and send an unmistakabe message straight to my belly. I now posses the will and courage to strike on it. I rarely ever "think" in any kind of rational way -- while in the midst of action. Essentialy it is fair to say that I simply GUESS! For instance today I sold 32.75 the ES as she came up to close her gap ---- tomorrow I may wait until she contracts just above or below the "closing" of the gap and then buy the break -------> how can I explain in a logical-linear way what goes into the decision making process if I don't know exactly myself? My "method" of entering is subjective ------> now here is the logical/objective methods I employ, but even these are subjective in a way and should NEVER be taken as absolute... 1) Position Management; Now I know this is a cliche, but one of the truest "maxims" you will read in these countless books on the game is "Ride your winners/Cut your losses". I was never ever interested in a high win %. I play a game of odds and not probabilities. I want to be more right than wrong NOT right more than wrong. I aim for low win% and high R-gains. Right now over the last 23 sessions I have only had 8 winning days BUT my winning days come in 9.8 times larger than my losing ones. Do the math -- that is a true mathematical "edge" on the macro-level. I hold on tightly when in a position going my way and I let go lightly when one isn't. ----->As soon as I enter the market I place a stop and an add. If the add gets hit I then I go and adjust the resting stop to reflect my initial exposure -- and place an order for my objective. Then I wait. 80% of the time I stay commited to the objective I look for and the other 20% I will get out early if the market tells me she is more than likely not going to accomodate me with what I "want". Now that is something objective and logical that I can convey BUT my entries are not. As for "simplicity" does it get any simpler than that?<---- I will continue this post a little later if you still want to hear of some of the other objective/logical elements of my game... PEACE and good trading, Commisso
Sadly though I suspect he will just continue to look at the charts for "the answer" BTW; I liked your post on the FEAR thread... PEACE and good trading, Commisso
well, thanks for the response.. but actually, i've read all the books AND i've been real trading for 3 years. however, after i lost more than i thought i would, i stopped. if i lost a lot of money trading for 3 years, why would i just continue doing the same thing? obviously, i need to stop and get myself organized. otherwise, i would probably just lose all my money.