bbmat... having read your stuff on several forums/threads, bro... I gotta tell you: you don't impress me one bit! And I bet many others agree. Post something substantive... show us your skills, acumen and insight before constatntly picking on and putting down others's opinions! Constructive criticism? I'm all for it! That is what debate on ET is about; and much of it leads to self-improvement and growth. But so far the sum total of all your posts add up to one impression on my part (and others'): BLOWHARD! No offense... but re-read your stuff! Now, can you point out anything you have contributed other than contrary criticism with little or no support for you views. Remember this bbmat... opinions are like a**h*les... we all got 'em... and that includes you! ICe
Very well, lets get back to it when I'm done with my work. It was just my first trial. By the way, although it was only $0.0039 per share we had averaged 70 round trips a day so our capital was not that great. Our Net average return on capital was 1.8% per day (with 4:1 leverage) non compounded. If we were to compound our returns we would be looking at somewhat between 1400 to 1600 % annualized. Can you much that? And its just a start! As I mentioned, we are building family of Robots to run this algorithm with the goal to have 2.5% daily return. And also, when I mentioned 82% success rate that was including commissions of $0.005 per share. If I could get clearing at around $2.5 per trade (with average lot of 2000 shares) then my success rate would be 95%. Sounds better now? And one last thing: Did you know that Fibonacci set is just a small representative of the whole slue of similar reoccurring sequences. And funny enough, they all produced approximately the same results when I tested them side by side. As the matter of fact, equally spread horizontal lines also produced similar results. You can try it for your self. You know why? Because of Gauss distribution curve of price fluctuations! Why did you think your toss of a coin strategy produced those results? Regards
I trade exactly the same way. Sometime you win and sometime you loose, as long winners are bigger than lose, you are all right. Take whatever market gives you.
Dr. Bogdan, I think you might be on the right track with your Sentiment driven trading system. I believe in your intent to build a scientifically based and tested unconventional system and not some get-rich-quick type of scheme. But before you get into further detail (i.e. if you wish) I would like to know two things: 1. What is your competition in this field? What do you think the "Big Guys" like Goldman Sachs or Merrill Lynch are developing at the moment? How far ahead of you they might be? They sure have the data that you have. Do you think that you are so good and ahead with your project that there will still be some profit opportunity in your system? 2. I still don't understand why do you share your system with us. What do you expect from this forum? You trade since 1993, but you registered here one week ago. Why? And I also have one suggestion, let's drop that argument about trends, because it doesn't really matter whether trends do or do not exist, the far more important question is HOW TO BEAT THE MARKET? You are attempting to find just that with your system and that's why we want to hear more about it. P.S. Happy New Year to everyone
Before the idea of the existence of trends is dropped (as neutrino suggests) perhaps you should debate someone who's been successful using only trends and price action. I'm very new at trading and therefore I have no authority on the subject. For that, I seek the experience and guidance of those who have demonstrated success. Gary Smith has those credentials. An excerpt from the inside flap of his book: In a sentence, Gary uses price action and trends. He wrote his book prior to the 2000 decline, so I had wondered whether he was hit by the market decline. Well, it just so happens that he is a poster on the Fearless forecasters forum, and, after reaching financial goals, is going into semi-retirement. Here's a recent post about his favorite pattern (trends) that's quite a good read: http://www.traders-talk.com/mb2/index.php?showtopic=4065 Regarding fibonacci, I'd also like to defer to the experts: http://www.fibtrader.com A quote about Joe DiNapoli: One would get the impression from your studies that this stuff is hocus pocus. Don't you think guys like DiNapoli would have been debunked if this was the case? Neutrino has a couple of great questions for you for which I'll look for your response. And like him, I'm very interested in your findings and methods. I have one additional question: Have you published your findings to the scientific community for scrutiny by your peers? If so, where can we learn about the findings?
Thank you neutrino. Yes, you are right, I feel embarrassed by not knowing that ET existed. Michael Domka from IB pointed it out to me about two weeks ago (as I mentioned we execute our trades through IB API). I'm not to much of a web surfer my self and, to be absolutely honest, I did not think that there would be anybody who would be interested in somewhat unconventional methods of thinking. But I was wrong. It looks to me that many of you guys have a desire to push the envelope. That is great! Now, let me address your very valid questions: 1. I don't believe that by sharing everything I know with you guys I would harm my research in any way. I'm not the type of a person who is very protective of his knowledge. In contrary, by sharing my thoughts I hope to form a group of volunteer researches that would study the subject and share the results openly. Think, how would anybody know about all these TA indicators if nobody shared the knowledge? We already have too many TA book/system writers whose solo purpose is to profit from their books. What I want is to ignite as many of you as I can. I have only a handful of researches that contribute to our development and, believe me; we are just scratching the surface. I hope, neutrino, that you agree with me that the time of lonley wolfs creating little systems for their own little profits is gone! If we want to compete with the sharks we need to become a big school of fish! Which brings me to your second question. 2. I'm fairly aware of all sorts of research efforts that BIG boys involved in. Yes, they have data, No they are not smarter then us! Yes, they have more money. No, they are not efficient with it! The beauty of the Sentiment driven system is that it would work better and better if more and more people will follow it! Not like other systems that self destroy themselves if they are overused. I hope I cleared a few things. Letâs continue our dialog. Regards
Dear NET: I have published 6 books but unfortunately, non of them in English. Professor Sarah Inkpen is working with me right now to help translating one of my books "Decision making by associations". We will be done in 2 -3 months. If it is any cancelation you can go to Washington patent library and run a binary search under my name. I have about 16 international patents there. I also have about 5 patents in Canadian patent office and about 11 in Europe. Those patents were not about trading but rather examples of associative thinking in different fields. In trading I'm just trying to implement the methods that worked well for me in the past to see what can I achieve. I run a small company were all the proceeds go to fund our research. We are not big but we are a lot of fun! You can talk to people that are involved with us. I don't want to publish my site here because a lot of people could think of me as a cheap shut. I'm not.
This is an extremely interesting thread. Thanks for initiating it. Hope you don't mind moi asking a few Qs. 1) Were you able to establish why your system that had an accuracy of 80% plus degraded to lower than 10%? Was it just one of those losing streaks that all systems encounter at some stage? Or was it because you violated the rules of the system? 2) From your spraedsheets looks like your system is based on DiNapoli Levels. Is that correct? If so have you added a lot of other stuff to create your own system? 3) I can't remember if you argued against or for trends, but IMO all systems based on Support & Resistance (like Fib levels) are in essence Counter Trend systems. I do think that "the trend is your friend" is one cliche that has been blown out of proportion. Happy 2004 to all ETers!!
Call it greed, a violation of the rules, and inexperience, then after experiencing losses, the progression of mistakes spelled out in the original post. The system: I entered or exited trades by using a previous day's low and the pre-market high for the fib calculations (or visa versa, depending if I was closing or opening a position). At that time I was only trading my ROTH (long trades only) account, and the general direction of the market was down. I tried to capture intraday pullbacks to enter the trade. I would use a similar technique once the opening low was in place to project forward for an exit point. Since I had no faith that the instrument would continue to rally after a bounce (bear market conditions), I exited pretty quickly. Also, if I worked with an instrument that was experiencing steep sell-offs, I would use a fib projection to get an idea of where the next low would occur (from the previous day's low). Sometimes I would hedge the bet by placing the order lower, or significantly lower than the projection. I was able to pick up trades on stop runs this way. So, the net profit on a trade was typically thin, but after a couple month's of this the account was actually up 50%. The failure: As the market was turning from bearish to bullish, I found myself exiting out of positions that really took off, which bothered me (greed--i.e., trying to get out on the top tick--by exiting with profit at the slightest evidence prices were starting to decline, not using trailing stops, and general inexperience). I stopped using the system and started trying different methods. It's not that the system failed, I failed to adapt myself and the system to a changing market. Also, I was actually day trading, and an expert I followed at the time convinced me that day trading was a losing game. So, I tried to develop a way to position trade and swing trade. Another factor is that I learned to trade during a market decline, and didn't quite believe the positive momentum I was seeing as the market changed (beliefs over TA, and failure to adapt to a changing market). Those position and swing trades that I was "trying out" in order to not day trade, were against the bull market (i.e., after March). It was also about that general time frame I opened a general account so that I could short stocks (what timing!). That is correct for one of the spreadsheets. I learned about dinapoli levels later, so that is the newer spreadsheet. Prior to that (with the first spreadsheet) I experimented with modifying the retracement percentages, because stronger stocks tended to not reach a retracement level, while weaker stocks would go through them. I basically picked highs and lows off of charts for a particular instrument and then observed where support came in on the next impulse or corrective wave. I would then use the box that was most accurate with previous reversals. The projections of the highs and lows (outside of the retracement areas) are calculated from the high and low, whereas dinapoli uses three points in his calculation. I argue for trends (that they occur). Since I had never traded in a bull market, I used bear market techniques; i.e., I shorted resistance (I was not using the fib calculator at this time), then, when a breakout occurred, (not believing it was for real) I waited to see if it was a fake-out. I could not "believe" the strength of the market, so I ended up holding positions against the market. The 23 out of 25 losing trades is a great argument to support trends and technical analysis. Had I used the very same TA to identify breakouts (i.e., instead of shorting resistance, waiting for the break to go long) I would have taken the opposite side of each trade, and been looking at better than a 90% win rate. Believe me, this is a painful realization. This experience helped me understand how people lost money during the sell-off from nasdaq 5000. I can imagine traders buying support just to see it get taken out--severely. Then, figuring prices "just had to come back," holding and hoping. TA says if support is broken, prices are going lower--the "trend" is down. TA also says if resistance is broken, prices are going higher--the "trend" is up. I ignored that and became a hold and hoper, i.e, you did say "the trend is your friend" but I fell into the trap of fighting the trend. Let anyone who does not believe in trends take a position going the wrong way. After they get their head handed to them on a platter, they can make the argument that trends don't exist.