You can have a "clear" strategy(ies), but have it not necessarily etched in stone to where you have to trade every signal. You have your setups, but you consider each in the context of the current market picture ... where are today's TL's, S/R confluence, what time is it when they're being hit? The market is dynamic, not rigid. I believe trading methods should be as well.
FWIW, over the years I have been with traders who, if you saw them on the street, would think they couldn't tie their shoelaces. And, those same people make money consistently...sort of the "Rain Man" phenomena. Several are trading with us now. At the same time, those who spend time developing strategies and techniques that "they" believe in can certainly do well. I've found over the years (decades, geez, LOL).... that those who tend to "overthink" this whole thing have the most problems with success. I'm not shrink or anything, but since there are no real "absolutes" in trading, I think with proper (and basic) tools (market access, capital, etc.) a good attitude and a love for simplicity pays off in the long run. Find out what works for you, enjoy what you do (I know, you've heard that line since birth)...but it has more meaning in this profession than in most, IMO. Yesterday, I was sitting watching AMZN after the bell (earnings etc.)...the beat it down 4 bucks or so...so I bought some, just on instinct, made a quick dollar on it..... I would never "teach" or even suggest such a thing to my traders, but it just seemed right. Did the same thing on AAPL a couple days ago, actually made 2.24 in 30 seconds....reminded me of the old Nasdaq/SOES days of 1990's. So, I like to think of it as "instinct with a plan" - and, yes, keep some discipline, know full well that that you are going to get beaten some times. I almost hate to get pocket ACES when playing Hold em', invariably I'll get beat by something stupid, LOL. Anyway, don't overthing this whole thing...have some fun, make some money. All the best, Don
here' s a provocative fact: 99.99% of trading setups DON'T work! Here' s why: Forget all technical indicators - MA, MACD, RSI..etc etc.. or trendline setups the market can ALWAYS get more oversold when you thought you' re buying at oversold, and if you happen to be a channel breakout buyer, well it can crush you and take out all your stops the next minute. It CANNOT work, because a stock can ONLY go UP or DOWN, it' s like Roulette red/black with the ONLY advantage being that you don' t lose when the table hits 0 'cause that' s when the stock doesn' t move... So no indicator in the world can predict the market. it all comes out to luck in the end if you use indicators: you could have a "winning series" where your Elliott waves work perfectly, you make 50% in 3 months, and think you' re the King of the World..just to get cocky enough to languidly stumble into a dull range or even worse a "back to beginning" bear phase, where all your "dip-buying" eats your profits... don' t we all know this? haven# t we all been there..? so why do 99% of traders still look for the holy indicator grail.. forget it! There are 2 things that could work: One is PairsTrading done properly, the other GapsTrading(but not fading gaps and having stops destroy your risk/reward; google a system called âgapstraderâ) . would appreciate qualified serious thoughts on the system
These things do work every single day, they just don't ALL work at the same time, taking each and every signal. But they do work, and the trick is to play the highest odds setups based on your market experience, and combine that with good money management (stops/targets/sizing).
ay,there's the rub.... "highest odds setup based on your market experience"... that is based on knowledge and feelings - however the market consists of numbers (and psychology of course), but in the end it's down to numbers. So it has to be based on mathematical principles "applied" intelligently. and there's only one that can apply: positive and negatives series, and Gauss reversion to the mean.. what other logical way could there be???
Quote from milimabuse: milimabuse is a spammer. http://www.elitetrader.com/vb/showthread.php?s=&postid=2513363#post2513363
I have never had a trading plan though I do have rough sketch of a money management plan. I just feel more comfortable moving with the natural ebb and flow of the markets rather planning trades. The downside is monitoring a large amount of data so as to move with that ebb and flow in step.
This could have been just me writing this story! Feels like some confrmation Im looking at the right things.. Ill bet you also play the chain store game; zoom in on retail reports for potential candidates to play on open etc. Do you? Sometimes I think Im thinking going a bit to deep into detail but other times it gives me graet oppertuneties. Not sure this fits this treath; perhaps make new one with trading ideas and stocks to play on the regular 0830, 1000 and 1030AM news stories. Zooming in on detail on the reports; stocks to play!? All Im looking for is some momentum just like you. Ive got my favorite stocks to play on ISM and ISM-non manufacturing as well.. Now do you? Other suggegestions please add!
Ive been studying trading for months now using real time data as well. Making multi pecentage every day on paper for weeks now using tide stops, mostly play volatile times. Just bought the fastest quad core, four 26 inch screens and very hungry to eat a lot of money from the table.. Not quite sure the stops I use are realistic enough yet. Read some confusing stories. What stops do you use on open related to price? What order best used; do you just hit market orders? Please let me know!