million dollar system.

Discussion in 'Strategy Building' started by silk, Aug 4, 2002.

  1. silk


    Can it be this simple? Only buy stocks that have ascending short term moving average and are above the average. And vice versa, shorting stocks that are below decling moving averages.

    I have had huge success so far this year and am up 7 figures day trading. I however had a huge blow up on friday, i averaged down in stocks that were falling (i.e. stock was below a moving average that was descending). This is really the only way you blow up. Size up against the trend. This has led me to analyze my success this year and make some changes.

    Starting tomorrow i'm going to start a new policy of not buying stocks that are trending down with any size. And absolutely will not average down until there is evidene of trend reversal. This should stop me from losing 100k in a day again.

    There are times when i will still buy a stock that is in a downtrend.

    I will do so when the stock begins to show positive relative strength versus the futures. Or i may buy a crazy gap down (i trade NYSE). Also i will buy if i see a big short seller stepping down and i think there arn't more sellers behind it. But i will use a mental stop in these cases. A false trend reversal is a very negative sign.

    Other than the above, i'm going to stick to what has made me 7 figures this year. That is playing with the trend. I will buy stocks displaying relative strength and short those showing weakness. Once you establish a trade, you pile on as it goes your way and monitor for signs of trend reversal. This is the best way i have found to make money.

    Best ways to lose money..... Bottom picking...Buying stocks making 52wk lows and shorting stocks making new highs.

    Anyone else concentrate on only going with the trend. What problems have you encountered?
  2. nitro


    I will feel qualfied to answer when I have made 7 figures.

  3. Can't argue with your returns, although $10,000.00 is seven figures. You know... I'm not saying anything...I'm just sayin'

    One of the Cardinal Rules of Trading is "do not average down". But you're proving that one wrong.

    Oh well, it's been a rough year for Cardinals everywhere.

    Aside: I can't even begin to imagine the amount of money you'll make once you become a Member, then Senior Member, then ...dare I say it... Elite Member.
  4. I assume you trade with a prop firm

    and have been trading successfully for many yrs?

    hopefully you will find time to post more often here

    good luck to you ...
  5. have been a tremendous windfall to those

    who followed the MA's methodology as many listed
    stocks that fell below their 10 day EMA's

    went on to crap out into July 24th

    I assume you made most of your profits

    in the month of July ...

    gosh ... I wonder how Tony Saliba did

    ( he made millions in the crash of 87 )
  6. OK Silk, I'll take the bait.
    What is the interval on your moving average (1 minute, 1 hour, 1 day,1 week??), and is it simple or weighted and how many bars.

    How long are in you in an average trade, and what size account are you using to make a million.

    (This from a guy who has lost much more than 100K in his personal account, know the feeling)
  7. Silk,

    I can help you with risk management. The next time that you consider loading up heavy against the trend, just wire 100k to my account and the next day, I'll wire 95k back to your account. :p
  8. trader99


    Hmm... It might be that simple. But I think in trading as in life, it's actual execution that counts not some technical indicators. Are you able to hold onto your winners when you do? I think any number of technical indicators/systems will work fine as long as in real life you are able to hold onto winners and cut losers. It's easier said than done.

    The deepest truths in life and trading are probably very simple. But carrying it out faithfully is something else?

  9. Publias

    Publias Guest

    Can it be that it is allll soooo simple :) The market has told me it is...

    90-95% of my plays are with the trend, if not on the immediate TF than the one just above it...

    The only time I have a problem is when I get in my own way, much in the same way as you did on friday...

    PEACE and good trading and continued success to you Silk,
  10. nitro



    Are you Commisso?Is this your new handle- Publias?

    #10     Aug 4, 2002