Successful Trading and Compounding - On Steroids

Discussion in 'Journals' started by gmst, Mar 24, 2012.

  1. The variations are fixed in the way that Elliott Wave is fixed into patterns like flats, triangles, etc. Only, instead of a few patterns like Elliott Wave, I have 55 of them and there is no subjectivity involved in interpreting them, so that, unlike e-wave, any two people using my form of analysis would reach the same conclusion. It is possible that this number will grow in the future as the market evolves, but it has been pretty stable. I would say that my approach is "wave theory meets quant trading". One possible area of research for me would be in trying to discern subvariations within the "wildcard" pattern. It's relatively infrequent most of the time, but better understanding of it could lead to additional profitable trading opportunities.

    I have another tool which enables me to classify price action with regards to time of day, so that is something separate. Since developing this tool, it has been a lifesaver in the sense that it has kept me out of numerous trades which would have been losers.

    Anyway, getting back to your situation, I am glad to hear you are acquainted with both of the approaches I mentioned. One other approach which meets the same "mutually exclusive and collectively exhaustive" criteria a lot of traders swear by is DeMark Indicators, although I am not personally familiar with them.

    There is a famous (well, to some people) image of Ted Williams, the greatest hitter of all time in my opinion, where he breaks down every possible pitch location and how it relates to his hitting success or failure. This is what you want to do with the markets because it directly applies to trading.

    http://www.thecrosshairstrader.com/2009/05/stock-traders-and-ted-williams-happy-zone/
     
    #51     Apr 7, 2012
  2. dom993

    dom993

    Of course, to each his own ... it works for me, contrary to everything I had tried before. For years, I had this "Cost of error" column in my trading log spreadsheet, which didn't do much in itself to motivate me to stay disciplined.

    The idea is similar to getting a ticket for speed limit infraction. Nobody likes it, but after a few most become more disciplined on that front.
     
    #52     Apr 7, 2012
  3. gmst

    gmst

    I like a lot of your ideas - especially your approach of amalgamation of subjective and quant trading, your emphasis on time of day, your approach of market classification based on "mutually exclusive and collectively exhaustive" criteria etc. These ideas resonate with me, as I currently employ first two above points and just few days ago have started looking at the third point. That Ted Williams image is very illuminating.

    Probably I will take a serious look on DeMark indicators in 2013. My aim for 2012 is to study and incorporate ACD principles in my trading, apart from flawlessly running the program that I have already developed. The whole idea of classifying market states into "mutually exclusive and collectively exhaustive" framework is a great idea IMO. Even though I don't really understand how you do it, but I guess it must be possible to partition market states in different ways - so your and my approach might differ. Definitely sounds like you are much further than I am as far as having a complete market framework is concerned. Good Trading.
     
    #53     Apr 7, 2012
  4. Will share once I spot something: generally not a good idea. If you spotted a true arb, would you publish it on the Internet or would you get as much as you could done before your counterparties got wise? If you found a temporary correlation or edge, publishing it could cause it to disappear.

    Spreading is not my niche. However, the suggestion to specialise is useful. If you want to specialise in spreads, do so. If you are trying to directionally trade futures then investigating spread relationships and trying to trade ES against CL is like proposing to fly two jets simultaneously, and attempting this before you've done your pilot qualifications.

    Similar diversions can be observed in your attempts to investigate ACD this year, another method next year, all the while trying to refine an existing strategy. I'm nudging you to start from scratch with your own thoughts, data from a market you wish to specialise in, and a commitment to logic and reason to ask the right questions.

    What is lacking so far is focus and a definite purpose. You would do better to focus on one market, one trading methodology (ie directional), and from that proceed to evidence based analysis.

    Until you know the questions you need to ask, you will not be able to filter the usefulness of other information which has been presented. You will not know until you test its validity for yourself...but again without knowing the questions to ask, how do you propose to do this? This is why many here sample, in the manner of a buffet, from all the information available however they do not get anywhere as they do not know what they are looking for or how to recognise when they have found it.
     
    #54     Apr 8, 2012
  5. gmst

    gmst

    You were making sense in your first two paragraphs. But going forward reading other paragraphs.... I had a Wow!

    Man, I must admit with this post you have cast a serious question mark on your logical abilities. Or maybe you were drunk when you typed this post out. In that case, I apologize. Think about it - You don't have a clue about my edges and my strategies, you haven't displayed your track record and you have the audacity to come and advise me and that too in such a confident manner - and when you have no clue about my edges. Wow!

    You said you are nudging me to start from scratch. Dude, let us assume you want to keep physically fit and have a well-laid out plan for cardio exercises and have actually been doing cardio exercises for sometime. How would you feel if I tell you that I am nudging you to start learning cardio exercises again - and my logic for saying this is that you are not focused since next year you are planning to incorporate swimming in your exercise regimen and also you plan to play badminton to keep yourself even more physically fit. So, I make an inference that you are not focused and lack a definite purpose. Can you see absurdity of my logic here. This is what you have done in your post above!

    Dude - you need to get this thing clear in your head. I have a fully laid out plan for my trading. I encourage you to re-read first 3-4 posts I made in this journal.

    Anyways, to dumb down the things so that you can understand them - when I say I would be closely studying ACD and incorporating it into my trading, the aim is to improve my trading performance and statistical parameters that capture my trading. It doesn't mean that I don't have a good plan or trading edges currently.

    You have lost complete credibility with me. This is the sharpest post I have ever made on ET. If you want me to engage with you in any meaningful discussion any further, you need to establish your credibility. Man, show up how much you made last few years in market, tell me (even if you want to lie thats fine) whether trading is your sole income or you work for JPM, GS, BofA-ML, MS or some hedge fund and if yes then in what capacity - Trader or IT Support or a BPO guy working in India? Man at this stage, you seriously need to bring something to table to re-establish your credibility. I am again sorry if you typed it out when you were not completely conscious. I would like to apologize in that case :)

    Cheers!

    P.S. You can take my post in a negative way or maybe if you are smart you will learn something from my post "about your behavior and way of talking, even if you might have noble intentions" so that someone doesn't fucks you like this in real world. (Sorry, but it is true that I have fucked you above by punching holes in your logical abilities on this forum so publicly :D).
     
    #55     Apr 9, 2012
  6. He lost all credibility with me when I observed him delete a call in the ES journal that went against him, but that was when he posted under the handle Blotto.

    I do think he talks a lot of sense, but I know who inspired him and I`m not sure if he actually walks the walk or only talks the talk.

    Not of my concern anyway. :)
     
    #56     Apr 9, 2012
  7. Still solvent?

    Haven't seen a profit n loss since 4/6.
     
    #57     Apr 13, 2012
  8. etile

    etile

    I am wrong roughly 50% of the time. And I'm doing fine. It's called speculation for a reason. It's folly to think you need to be right most of the time to make money. Better to be wrong most of the time, and press the shit out of my few winners. Taking losses... just a built in cost of the game. It's inevitable. Trying to minimize how often you're wrong I find to be counterproductive. I rather spend the time figuring when I'm on the right side of the trade and pressing the shit out of them than trying to perfect the entry point. If I'm wrong, so be it. There's nothing much like catching a nice wave with some size on.

    P.S. I find that those who try to perfect the system tend to be the biggest losers. The problem? They haven't gone accustomed to taking losers. Moreover, because they hit at a high(er) average, they don't go for the fences when the should. They get complacent. High average builds a false sense of security. When there is blood on the streets, buy with abandon!
     
    #58     Apr 13, 2012
  9. gmst

    gmst

    Yes still solvent, but this week has been negative. Haven't done posting yet as I had huge internet outages for last couple of days. I have just connected, will do a posting later, if internet remains OK.

    Have traded only 2.5 days this week, had to travel to another city as someone close passed away. Took only 1 trade that day with mandated risk 5%, but lost 15% on that trade due to miscalculation of stop point, in the hurry of getting to the car. Realized it when I was already 100 miles out. By the time, I got a chance to login again, I had already been stopped out.
     
    #59     Apr 14, 2012

  10. Zenster,

    deja vu.

    You got caught in a long sucker gap.

    " You do not want to be chasing the market and entering at very unfavourable prices.........."

    " A bad session due to human error or unanticipated factors can happen..........."

    ..................................................

    good advice, and lots of time to reflect on that.

    also suggest you tread very carefully going forward in any and all threads.

    Condescension and berating has no place in this forum.

    cheers,

    s

    :cool:
     
    #60     Apr 15, 2012