Discretionary trading is very tough. The vast majority who try it will fail. However, to suggest that no one has ever made themselves rich through discretionary trading is pure unadulterated malarkey.
Good trading is all strategy, whether you know it conciously or you are using your intuition, it's all strategy.
The best trading is all money/trade management. It's this department that you want to build your edge.
You are being way too simplistic. Define "little movement" - compare it to recent activity. A 10 point range if recent activity was averaging 25 points might be little, while a 4.5 point range would be to a 12 point range. And how many bars do you go back? How many days? What if the range is mostly along the upper part, what if this was recently? Or not recently? On what time scale? What if you are looking at 5, 30 and daily bars? What if you want to compare to other indexes? Check on the DAX or Nikkei for confirmation of a strange move? How close to hanging? Between 1393.25 and 1406.75? Closer? What if it goes out and back in again? What if it is twice? What if it zoomed up 30 points on news, and then returned 2 days later for a day? a week? Your method of systematizing is going to wind up a Rube Goldberg machine.
Hold on there- Success at this game is equated to the way an experiencied driver handles a car. A good driver knows subconciously when to step on the gas, turn right or left, release clutch pedal, change gears and hold a conversation without sweat. Now those driving operations were now carried with ease and without thinking even taking short cuts were learnt a long time ago using some guide to dos's and don'ts. When you find yourself trading at that level - subconciuosly expert-be it mechanical or discretionary perhaps you make a cent or two but its never perfect and never will be.
ohh i forgot - a mechanical system is discretionary - its designed a human according to his discretionary and irrational or rational thoughts - the only difference is if you automate order execution
What's the problem? Everything you just listed can be tested, systemitized and ranked in terms of probabilities. Add in a variety of exit strategies, and you're into maybe two days work at most. So when faced with a split second decision in real time, you'll have the probabilties right in front of you. Which is what trading is about: probabilities. Doesn't that beat the hell out of struggling with a decision every time a new situation arises? IMHO, it certainly does. I'm not suggesting that anyone test or trade complicated strategies. Mine are extremely simple. My point is simply that there are very few things you can see on a chart, or very few trading situations that you'll encounter, that can't be first studied with software. This isn't rocket science. We're dealing here with price, time and volume.
Quote from lindq: What's the problem? Everything you just listed can be tested, systemitized and ranked in terms of probabilities. Add in a variety of exit strategies, and you're into maybe two days work at most. It is hard to take you seriously. I am well acquainted with programming, and you seem not. You need to look up Rube Goldberg machine.
Okay, with your programming genius, which of the following...from your list...can you NOT program? 1. A 10 point range if recent activity was averaging 25 points might be little, while a 4.5 point range would be to a 12 point range. (What's the problem?) 2. And how many bars do you go back? (Easy) 3. How many days? (Easier) 4. What if the range is mostly along the upper part, (Simple) 5. what if this was recently? (Piece of cake) 6. Or not recently? (Okay) 7. On what time scale? (Duh!) 8. What if you are looking at 5, 30 and daily bars? (Is that hard?) 8. What if you want to compare to other indexes? Check on the DAX or Nikkei for confirmation of a strange move? (Come on!) 9. How close to hanging? Between 1393.25 and 1406.75? (Done in 2 minutes) 10. Closer? (1 minute) 11. What if it goes out and back in again? (Done on a Commodore 64, circa 1983) 12. What if it is twice? (Done on a Mac 128, circa 1984) 13. What if it zoomed up 30 points on news, and then returned 2 days later for a day? a week? (HINT: They can ALL be programmed, with the exception of your reference to 'news', in item #13, as 'news' is subjective to the trader. Although, with new algorithms being created that do reference news events, a programmer with greater talents than mine - and certainly greater than yours - could probably incorporate that as well.)
I'm with lindq: If you can't express it in such a way it's programmable, you haven't figured out what you're trying to do. Everything so far in this discussion is programmable, if you have the data. Trading (imo), is all about tilting the probabilities just a little bit in your favor. FWIW: I work to eliminate all discretionary decisions during actual trading, and reserve that for development.