bubba7 (Jack Hershey, I assume), you say to enter only winning trades, and yet the method you promote for beginners is a breakout method where many (maybe most?) of the trades fail quickly. your answer to that is to do wash trades, I agree completely and that is the essence of cut losers short, and let winngers run. however, it is not that easy for beginners to do wash trades. I do like the idea of sequences that you promote. what is 'OT'?
I didn't read the whole thread so I am not sure if anybody mentioned that. The whole premise is wrong since the biggest problem are exits. What I am saying is take the same entries and amateur is going to lose, the pro is going to make money.
estrader, here's an interesting quote: "A consistently bad performer can become a consistent winner by doing just the opposite... steady losses means that the price movement consistently stays within a trading range, and every buy and sell signal actually represents an overbought and oversold condition, predictive of a change in direction." Perry Kaufman, from "Commodity Trading Systems and Methods", pgs. 264-265.
Dear Brother Surfer, I don't believe fading oneself is ever a good idea in trading. I think it's always required to become better and better, to evolve yourself and your systems, until you know exactly what to expect. To fade yourself would just cause the opposite, wouldn't it? Niederhoffer didn't have a "losing streak", we was a loser. No matter how well he might have performed for how many years in a row - He ignored his stop-loss rules and kept holding on to his positions all day, until there was nothing left. He lost his fund ($100,000,000.00?) in 1 day, indulging in his delusions of grandeur, losing the money entrusted to him not only by his exterior clients, but by his best friends, relatives, family - You name it! He didn't have the discipline. He traded on hope = He was a loser. If he had been trading for a few months, I would have understood. But since he called himself a long-term, professional trader, this shouldn't ever have happenened. Remember: The first loss is always the best. The higher the balloon is rising from the ground, the harder it becomes to jump off. The fact that he as a self-proclaimed trading genius ignored that fact, proves his lack of awareness, stupidity and lack of discipline. I don't want to invest with somebody like that. Would you? This guy even wrote a book about how great he was, connecting trading with everything in the world - including sex - you name it. But what a farce. What a fool, inflated with delusions of grandeur. And he just wrote another book! LOL! I read them both, but never paid for either of them. Now he writes books - He'll probably go ahead and make a glittering career as a snake-oiling scumbag, like Ed Moore, Larry Williams and all the other notorious loser-blown-out-goes-teaching-others-how-to-do-the-same traders. I don't care how great his track records are, and he might have learnt from his mistake, but he was a loser, is a loser, and I would neither follow any of his advice, nor invest with him. Period. To ever compare yourself to somebody like him is, IMHO, a big mistake - Instead we should use these people to become aware of how not to be. All the Best, Brother... ~The Scientist
There are actually three levels of trading going on. Each is risk limiting and money made is the criteria for advancing from one plateau to another. The "rockets" beginners DO, are specifically calibrated as strong established trend trades. They end usually at S or R and after that there is no money to be made by beginners. Intermediates trade rockets or if a rocket fails immediately they stay in the slower paced trend and set the point 1,2,3 channel and ride it to its end. These ends are variously designated by a flaws. Beginners do have their wash flat exits cut out for them. there is no way to avoid requiring a new trader to not to learn to wash. I think it is like learning to do sacrifice bunts to move a bae runner along. Of course, the washing is a learning experience primarily for doing expert slalom stuff later on. Today (thursday) the pm (13:00 on) is the classic differentiator of beginners and intermediates. The BO on the midday took both in on the MACD and STOC and volume signals. The beginners left the short before 15:00 at point 2; and the intermediates stayed in patiently striving for point 3 and following the retrace signals. After point 3 the intermediates had a ball and then, at point 3, the beginners popped in again short on the rocket. They both rode the entwine to the end of the day. Working by plateaux is really the only way to fast track to expert and seamless continuous trading ahead of the herd. Staying out of the market is the hardest thing to learn of all. Beginners and intermediates only trade continuation strategies so far. Experts use both strategies (continuation and change) because they know market paces and they have a set of "blocker" indicators called flaws. Fast pace and flaws give experts the signal to use the change strategy which is based on reversals. All slaloming is done in that modus. It all becomes KISS as a person operates as an expert. In there almost all the time, being in the correct strategy, and just noticing when "flaws' pop up and reading the other side of the flaw card to take action. On 5 ES mini's it can average 1,000 bucks an hour. Translates to up to 3x daily H/L range per day.
if you want to fade yourself,how about having someone else do the exact opposite of your trade,then cover the first trade? then,of course, the original trades would go on a winning streak! lol
Dear Brother Bubba, As much as I honour and admire your posts, I have to strongly disagree with your notion that this is the opposite of "my stuff". I think exactly the same thing - For example, to quote you: "It is a monitoring setting where so many things can be going on and they are continually digested as "okay" - Is exactly the way I look at the market. I just try to go with the flow - I try to realize what exactly is going in the market at any given time, and I adapt. When the overall trend in my timeframe doesn't appeal to me, I go down to a smaller timeframe, or even scalping. But I always go with the flow, and never try to "fight" or "fade" the market, since I'm aware that the market is much larger than me - And all the other professionals out there, which many traders regard as their "enemies". There is no such thing as "enemies" in the trading world, at least not in index futures, for example. Everybody, no matter how big, has to follow their big master, the market, the underlying, the whole, and play by its rules. All we have to do is follow - and never worry about our living. Another quote of you said: "For experts, the action is two fold usually: the relaxing overature of taking profits and the secondary action of beginning the creation of another stream of profits.". Well, this is precisely the way anybody should look at trading. But to get to this stage takes long, long time bubba. Until a trader actually gets to the stage where he can continuously follow this cycle, he will first have to survive in the world of trading over the whole of the learning curve, without losing money - The only way to achieve that is to first train himself in a scary amount of discipline, suppress feelings, abide by strict, self-given rules of targets, stop-losses etc... There is no other way. To get to the mental stage of feeling and reading market flow and being one with it, which is what I can clearly read and recognize from your descriptions, takes a long long time and a lot of market exposure. Most traders are washed out of the game long before they get there, so they must learn the rules and trade by well-tested systems first - be they discretionary or mechanical. No way around it. I like to compare this with Martial Arts - In the beginning of my Karate training, for example, I had to follow strict discipline and rules for years - I had to learn all the forms, all the tactics of combat, how to block and how to fall properly. There was no way we could avoid going through this. Every Karateka goes through this. And none understands WHY all this happens, for a very long time! Eventually, I got to the stage where insight came into my mind. I learnt not only HOW, but WHY to do these forms. I was standing in our dojo and 7 dan (blackbelts) were asking to perform a kata. I performed the kata to the most of elegance sought in these forms. The next second, the dan would attack me - all synchronously - But I was continuing my kata, blocking all of them with a clear, peaceful state of mind and concentration. I was attacked from several directions, but instead of offering resistance, I just followed the flow, and I did neither lose balance, nor get hurt. None of the dan could reach me, since the kata was internalized so well that I had to endeavour no resistance, no fear, no anger and no question. I didn't even have to deviate from my performance of the kata itself. A small mission was complete, and ever since I understand the true meaning of kata and Karate itself. It is the same with trading, bubba. In fact, Martial Arts are as close to trading as anything I know of. It is about living a peaceful and balanced life by knowing not only how everybody else fights, but by knowing to fight so well that we don't have to. Until we can gain the privilege of truly understanding, we have to just learn and abide, and follow discipline in order to stay on track. There's no way around it. To assume that every, particularly starting or non-seasoned traders can understand all this, is arrogant and granduous, to say the least. No to mention to accuse me of opposing this perception. This is exactly what I was talking about. And by the way, capturing 26-28 points an hour sounds like a great gain, however I sincerely doubt that you can make these returns, no matter how well you can follow the flow of the market. Unless you're trading the Mini-Sized DOW, of course... Otherwise, I will greatfully ask you to be my mentor, since you'd obviously be aware of so many things nobody else is aware of. Sincerely, ~The Scientist
Cool! What style do you do? Maybe we'll catch up some day in a freestyle your style vs mine! Let's exchange dojo / club addresses & meet up! Training for Australian Team & World Championships soon... and you? Peace Brother, ~The Scientist