Not sure if you're familiar with Hurst's cyclic analysis but when you take the mathematics to the extreme you realise that there wavelengths at work which are beyond our present detection, simply because insufficient time has passed for enough data to have formed to calculate the sums, or algorithms, or algae-rhythms, whichever you prefer. In other words, when trading we can only backtest/trade that which we know. And if we can only use the data we have available then we are effectively creating codes in a closed system, when in reality we are trying to trade an open system. These difficulties are particularly amplified when trading intraday, as the relative volatility increases as you progressively get into smaller timeframes. It's also helpful to note that the species of volatility that will usually catch out a code is the kind resulting from market suppression and its subsequent natural re-adjustment. Sometimes, it's a good idea to go back to the beginning and test a really simple code on a huge 24hr market, and see what happens to the projected outcome as you reduce the timeframe(s). In other words, see if the code will catch an elephant before going after the mice.
Ah, Fraulein Guggenbuhl, I was about the same age then as I am now. But as you can well imagine, my memory is not what it once was. But this brought back so much.
Well, that is a way to spend most of your time researching, programming, and backtesting....which is intellectually stimulating. It does require some special skills....stats, coding, etc. For the most part, trading over a several week timeframe can be boring. One option to consider: scalping the movers. When I was trading prop years ago, I remember having a blast with IPIX which was a wild mover on any security-related news event. This avenue will require you to subscribe to a scanner to see what the day's movers are going to be. Usually, this is indicated in pre-market trading. So to round it out - do all 3 : 1) longer term trading 2) automation 3) scalping That should keep you busy. Still bored ? Throw Options and/or Forex into the mix.
I'll make a wild guess from your post that you are still young, vigorous, and in your prime. A regime such as you propose surely would kill an old man like me. When I was young like you I did some of the things you advise. Some of them made me older fast. I still scalp, though, for the sheer fast-paced thrill of it. But I do agree about longer term trading. The joy of checking your portfolio twice a day at the open and near the close to make leisurely decisions off of a daily chart!
How did it work out with that French sculptor, BTW? I always wondered if you made the right choice about the other one. Hot relationships always got ME into trouble.
My computer likes to do that, it won't let me do anything, can't even access my account balance so I wait for the statement to come in the mail. Sometimes I can go spend and sometimes not... I notice that every time I start shopping for a new computer there is no spending money for it... hmmm, I wonder....
System trading has been one of the most enjoyable technical projects I've ever taken on. I glance at my trend following algo a few times a day from my 1.2ghz laptop. I run backtests at night when I'm unwinding from another day of keeping the plant going. I research winning system traders and their development / validation methods. And I don't ever trust my automation, but it beats the pants off my attempts at discretionary trading, every time. When I'm finally retired this process will continue, only without the employer and their plant, employees, and losing attitudes. I notice there's quite a few in here.........
Very good post. Here is a guy doing it sucessfully while still working. hats off to you. Most would of spent 90%of thier post on excuses and why it cant work EF
Thanks. Both systems made new highs today. I cringed when they both stayed long last week. I seriously thought the market topped last week. Funny thing is they're just coded versions of a very simple daytrading scalping method I learned from a DVD set I bought from one of the cheesiest websites out there. He had ads running about two years ago. I was new enough at this to still have an open mind so I spent the $700 (less than the cost of one college class, by the way). I hated the method but it killed, just absolutely killed, everything else I wanted to try. Everything I now do in the market is based on that simple scalping method from that ridiculous website.