I am looking forward to learning more as you develop your thread- Link- http://www.elitetrader.com/et/index...tfs-buy-something-with-something-else.288757/ I think Renko is worth employing as another way to compare price action- Renko on a dropped down faster time frame may be useful- Something to explore- Got to go visit the grandchild!
Had the day off- spent some quality family time, and got back home this pm and watched the markets seem to hold the rally into the close-up about 1% . It's interesting that after making a high on Monday, the markets sold off across the board- but then rallied today-MAY 1. We have earnings- OIL higher- Dollar declining- and a lot of market interpretation of data- that I don't presume to listen to or interpret. Chart tells how the market is interpreting the results- of all the various data points that come into consideration. Reportedly the week's selling was on very high volume, and today's rally is on lower volume- But a rally/pause in the decline was a good way to end the week. Today's up move represents a 1st reversal attempt for the week- and it looks promising. But that is the nature of 1st reversals- After getting skinned up pretty good this week, I'm inclined to lick my wounds on the sidelines- but the chart's action should not be ignored- Seasonally, I think the general period of MAY- October is typically weak- historically - While November- April is typically much stronger. Perhaps this year seasonality does occur. But, I cannot rely on that- so I chose to think that things may rally a bit higher from here- To that end, I took some entries back in the market- PJP, XBI, HACK, TQQQ right at the last 3 minutes of the close- These are some familiar names- Had i not had the day off- as an EOD trader- I would have to put in buy orders for Monday- likely at a higher price move. I do not think this week's decline was necessarily the end of the "sell-off" a lot of folks are anticipating- It's obvious that the market has been wired pretty tight as the sell-offs of those trending stocks that disappoint are getting pummeled hard and fast. Using the boxing anology- (Big fight coming up) - I'm still stepping into the ring- but I am taking smaller position sizes as i feel I am on the ropes a bit with my recent losses- To stay in the ring- I have lessened my exposure with entering with smaller position sizes. This is being somewhat active- but adding a bit of defense with the net reduction of how much of the portfolio account is at Risk-
Went long today at the close in 4 positions- PJP,XBI,HACK,TQQQ. Reduced the position size of these entries for a partial position.
After a week of market sell-offs- Friday delivered a potential positive day across most indexes and sectors- That rally has been called a dead cat bounce by one CNBC pundit who believes the markets turn lower- with further declines in the weeks ahead. Note this snapshot of how the various sector-segments performed Friday- Just 1 spot of red in the bunch. - Available at stockcharts.com-market summary Currencies and commodities- not so bullish
Using myself as a generalization- I am a creature of habit- slow to adapt and slow to change. When it comes to a trading approach, I want to be as consistant as i can in it's application- but there are a lot of variables in my particular situation- work schedule is one- time to spend on focusing on trades is another- Several contributors here have pointed out other trade options- HEDJ, TMV, QQXT- and more- Recently I've had some losses on market weakness- This is not a complaint. Just fact. Although i do not have much free time- I did spend some time reading a recent day trader's journal here on ET- who was trading a specific market segment- NQ-and seeking to achieve consistency in his approach. These folks are light years ahead of my dabbling in the markets- they live and trade in a different universe- but there are some similarities that extend across all time frames I>M>O> and I think a lot can be learned by their approach, their struggle- and applicable to a slower approach-Also- their ability to execute in a disciplined response. Most of the comments the trader received did not reinforce his specific market approach- to his satisfaction. There is the specific technical approach- Identifying Support, Resistance- taking the appropriate trade- all open to interpretation on each time frame- But I think most of the comments were meant to be instructive- and well intentioned. The trader had a losing day, then missed out on a day where he would have gained large had he applied his approach- but he hesitated- was cautious- didn't have confidence to apply his approach. and he did not capture the trade because he did not step into taking it- The trader knew he would have both winning and losing trades- but failed to execute because he lacked a belief in his approach- and missed the larger opportunity- He blamed his hesitation on the doubts that the other comments had instilled in him. There were a lot of well-intentioned contributions to that thread- some constructively critical - Some technical- some psychological- These are all valid thresholds - that every trader should consider- I think the day trader does this baptism by Fire- and if they survive- deserve a lot of respect. Since i am not a day trader-and - I do not make my living based on my trading prowess- I am the lucky one- I can perhaps learn by your willingness to share the experience. So- Thank You for those that put it out there and are willing to share. That is also the value of ET- IMO- That is also WHY- YOU- the person reading this thread- and any other- is spending your time here- Looking for ways to make improvements - perhaps bored- perhaps searching for something more-......Perhaps you want to contribute to a discussion - to be a part of something larger...... Inn the end- it comes back to the reality that trading is ultimately a solitary endeavor. This trader traded only 1 universe- a single contract in the NQ space- One of the things I recognize in my own trading- Is that my success rate improves by taking WITH trend trades. One of the things I was impressed by only a single comment was that another trader mentioned that he made a choice to choose between different trading universes- He suggested he looked at a dozen, and made a choice between the better market segments. This is well worth thinking about- Recognize when the Tide favors one sector- and disfavors another - Don't be all about Biotech just because it worked for 3 years- What is working today? XLB- materials led the market today- It may be short term- but it should be realized that it is in favor. This points out that in times of market turbulence- when the trending fails and one needs to regroup- Maybe look outside the familiar box and think wider.
This Monday AM- markets look set to move higher-I will set limit buys to add slightly to Friday's entries, also entry in the materials sector
I added to XBI- PJP, TQQQ today- but I was not filled on HACK-I am surprised that it did not move higher as it has held up relatively well during the weakness- Nor XLB- but it started off higher- and I cannot see a pending order at all..... I think I rushed to head out the door- to get to work- and got sloppy on the multiple orders I was trying to place- I need to get up at 4:30 am If i expect to allow myself a 30 minute window to assess/place/confirm trades. Not likely ....... Long story short- I ended up selling 5 XBI for a small gain, bought 5 at a higher price- Was not my intention at all- Very sloppy- Thanks to Friday's entries- Account has moved back up a bit- Back when i started this thread- November 2014- I had a good deal of relative confidence- I also recognized that the momentum of a bull market was a good contributor to everyone's trading success- As long as you stayed on the side of the primary trend- you likely made some money. Pullbacks were all buying opportunities for something that was trending higher- "It helps to have a bull market to think one has a "method"- but can one adapt when the condition changes?" Early comment when I started this thread. Market's change- and traders need to recognize when something that always worked- starts to fail to always work- I think we learn this as winning positions see greater volatility moves- and as a successful strategy struggles to be break-even- or successful in a changing environment- This thinking is a carryover of my going back into positions that did well previously-but perhaps not so well anymore- Habit- what i wanted to bring up is the need to have a perspective of the wider universes that are out there. Much like the day trader that chooses to view and assess multiple markets to trade- instead of being locked into having to Find the trade within 1 universe- to take- AS an EOD trader- I need to have some flexibility- and a wider vision -Indexes are a good start- ETF's are the perfect vehicle . Some diversified exposures- Europe- Emerging mkts- What works - and where- Currencies- Dollar- Bonds- There is alot out there to select from- It all looks to be a lot of after hours review- TBT- looks to be moving higher- while the dollar UUP looks to be the inverse- I noticed that Copper CU- trades well with the China etf- correlation there- Quite honestly - I don't know if I hold the skill set and motivation to put in the time necessary other than being the trained Chimp to respond to a moving average line and a higher close - That's not hard to determine if you hold/view 6 positions or s0- But what occurs when you factor in a much wider universe to select from- It definitely seems like more work needed- more study- greater understanding- US Chimps respond to more bananas. This almost sounds like I need to be where i need to be- Developing a larger and more global picture- and perhaps the understanding will come someday. While the dollar vs the Euro is occurring- does Europe rally ? So, I'm inclined to put on a buy-stop entry on TBT moving higher- I'm actually viewing this on a weekly chart presently- On a final note- no position- I am encouraged that the Value Fund- BRKB made a nice solid up move today- Atta boy Warren!
Here is the problem. Take just one, the euro. You can spend a lifetime and not be able to trade it except for when you trade simple levels and momentum that a trader navigates very well without concern for the macro fundamentals. I would vote for becomimg a better trader. Whats wrong with making money in trend off of MA's? The question is rhetorical as you are a better trader than i. I would think the US sectors and leading stocks provide opportunity (though maybe all at once), most of the time. All the writers i read know a lot more than i yet still put on their pants and tie and shlep to work each day for income and benefits. Why dont they trade for a living? RiskArb07, is Gary Smith, a proffesional no bullshit trader who talks of his journey in "how I trade for a living" .I will not state here how much the book costs on Amazon but, he fortunately does not need a few bucks from us.
I now recall your post discussing company risk in stocks vs. etfs. Liquidity requirements for etfs often limit us. I wonder if they should. I totally bypass some specific commodity stocks such as Corn,soyb,weat,coffee,sugar and so on. At the end of the day the price settles with the underlying despite the lack of intra day volume to my knowledge. Spreads are wider but for longer holds , maybe not a problem. Also, i never looked at mutual funds for other products but seems easy to trade with IB.
I think it's to one's advantage if one has a sense of what one is trading an what may cause it to move in one direction or another- The currencies- and their relationships - to political and economic influences are perhaps open to speculation as to what will move them. For example- Pundits were talking a strong dollar a few months ago- and look at how it has declined- Look at a weekly chart of UUP, and then change it to EUO- Walking hand in hand. " Whats wrong with making money in trend off of MA's?" Absolutely nothing wrong- When trending. I tend to rely on moving averages on all time frames- for reference - direction- and momentum- One has to make the decision as to how much exposure to volatility one can think is appropriate- select a time frame that will support that level of RISK graphically. I don't trade on moving average crossovers-though- I trade more on price action as it behaves -with a drop under a moving average a warning sign that I may elect to respond to- There's a world of difference in exposure depending on the time frame one applies- Choose your charting preference- Price Action, SLA- Trend lines, Moving averages, FIB levels--Gann- many others I guess- and then choose a time frame to act on, and another for a longer view. "The question is rhetorical as you are a better trader than i." I don't know that to be the case at all-Not Relevant nor an accurate statement. Today was the icing on the cake in terms of being on the wrong side of the market- and achieving a new account low. But consider that I am not a "Better Trader" than you at all. But - becoming a "better trader" is my personal goal.- and is likely yours. One should not measure their relative sense of failure or success against another trader. That's a mistake- There will always be Traders that make more- or lose more- Traders that have more money- and traders that have less money- Traders that make a huge win- but perhaps took an inordinate amount of Risk in doing so- Other traders with large accounts have a distinct advantage to traders with smaller accounts. Trading is long term- It's not about what happened this week- or this month- It's not about some trader's big 100% gain A "Better Trader" is yourself seeking to compare and improve your present trading against the trader you were last month- last year- 5 years ago. Compare yourself only against some market benchmark- SPY, FXE, etc. if you desire a metric of your performance- but then compare the amount of beta- Risk and volatility- that came with that performance- That's the only fair metric that you or any other trader needs- Because, we all have different tolerances and willingness to take on and accept RISK- Would you prefer to have a 15% gain with a 25% volatility swing- or a 10% gain with a 10% volatility- Knowing what you are personally comfortable with in market exposure/volatility- and balance that against the net gain or loss you achieve in your approach - is what counts the most- What is "Better"- ? Better for me implies higher consistency in my approach, Even if the approach is losing during a period of time, if i can execute properly-, and take my losses as needed- I am being effective -in my execution- Then- Recognize when the approach is not performing up to expectation- adapt to the changing environment, and modify the approach- perhaps initially smaller position size- perhaps look to see what is working elsewheres- Also- managing the RISK in each position, reducing the exposure to leverage, to size- and eliminating careless mistakes in order placement- and stop adjustments. I need to work on all of these..... BETTER- for me - will be expanding my understanding of the bigger picture- and how to try to take advantage of it. "ll the writers i read know a lot more than i yet still put on their pants and tie and shlep to work each day for income and benefits. Why dont they trade for a living?" I think the answer to the question is obvious- It is easier to be an academic and do hind sight quarterback calls- than it would be to put yourself on the line and make that call up front- - IF you have such great trading prowess, Why not simply focus on executing your trading with investment monies- Why would you seek a subscriber base as income- That would be a major distraction to simply executing your winning approach for a select group of investment monies- Anyone managing a subscriber service- likely has found the subscriber service charges much more profitable than their own trading- and with virtually NO Risk! Ca-Ching! Additionally- Let me add my personal disclaimer- Last year I had a decent 12% +/- trading gain- with limited downside protection using a fast 2 hr chart- I had more losing trades than winning trades- but they were small- I learned to allow winners a bit of room to run longer- Doesn't occur all that often. That was fine- because i was hunting in a private FED hosted preserve- in a perfect season for my approach. This year, Hunting similar quarry, similar methods- has not worked out well. The tight stops have been executed as volatility has increased. Lack of trend momentum finds a trade looks good for a day or two, but then reverses. A prudent hunter would return to the lodge.....I am willing to hunt in the rain- to my disadvantage. A smart hunter would be looking for a different preserve. MY Trading account is Not my retirement account- It is a separate account- My trading account is the proxy for the time when I make the decision whether or not to actively manage my retirement account- Presently I am unimpressed with my abilities as a trader to position myself in the market gyrations- So, Vanguard- or a Robo account (Betterment.com) is high on the successor list. MUTUAL FUNDS are NOT on my list. I would recommend to not be at all concerned with how you perceive anyone else's trading - and simply evaluate your own progression against something like an Index. This will give you a more balanced perspective of your performance/Risk - and forget what the other guy made on such and such a trade- I will expand this on another thread..... Regards- Thanks for posting- I