Haha, these are some great ideas. I will try to work some in as I animate more trades. Just a little update. Not much has happened the last two trading days. Just some normal movement. I trade longer periods than most people on this forum, so the updates will be a little more sparse. I will keep it updated as events occur though.
Closed my position in AREX today. Position: Short $ P&L: -$321 R Mult: -.77 Days: 12 Started to move against me fairly quickly. Had a little trouble sticking to my strategy on this one. The chart still looks good so I had to fight the idea of ignoring my stop. In the end I stayed disciplined. Summary: My closed profit and loss = -4750 My open profit and loss = +3872 Total profit and loss = - 878
Closed Position XRTX Position: Short $ P&L: -$24 R Mult: -.06 Days: 85 Very close to break even with this one. Major downside is the length of time held, opportunity cost.
You should be doing this on a simulated account and logging your observations. If you are really trading live with $30k this is very foolish and you will likely lose a lot of money before you come to your senses. I'll add that from the few trades I've seen, your strategy is flawed. You don't seem to understand what you are doing, and the only trigger you seem to have for exiting a position is this trailing stop which leaves a lot to be desired. Edit: I've just looked at your website and animated videos, and you really don't know enough to be paper trading. Devise or adopt a robust strategy first. Please don't trade live yet - you'll get hurt.
There is a great market lesson in this video. Who will be the first to spot it? http://www.youtube.com/user/AnimatedTrades#p/u/5/yOrl_cXxKfA
Agreed, he should be paper trading. One of the problems with using a stop, is that when the market is quiet and the flow of orders dries up, the Market Maker is free to run the stops. You recognize this on a chart, by a sudden long tail in the ongoing trend. THAT long tail is the clearing the stops, which means you lose your money. Generally speaking if you are buying stocks, like NASDAQ right now. Your first trend line average would be 10 to 15 degrees on your chart. As the volatility picks up, you gradually go in a long term trend to a 45 degree line. Whenever your underlying shorter term trend line moves to 70 degrees you should be exiting, as this is an emotional blow off. At this speed of 70 degrees as a trend line, you have only minutes to exit. Before the prices collapse again on you. A protractor from a geometry set, will keep you in a trend as you watch a price chart. You could read up on DARVIS boxes as well, another good one for long time trends.
I understand the risks. I may lose a large chunk of my money. Then you can tell me, "I told you so." I will be here humbled and broke. At least I will provide some benefit, people can learn what not to do. Fortunately, I am not even near the failure point yet. I am optimistic about my trading. I continue to learn and develop. You mentioned my Youtube video you said "find the trading mistake here." I think that is great. Learn from my mistakes and flaws. I certainly have a lot of them. Just like everyone else. There is a shortage of traders talking about results honestly(maybe not of this forum). Most will mention there winners and nothing else. Others will give out advice left and right, but hide their own trading from public view. Hopefully I can help to fill in this transparency gap a little. I have paper traded in the past, and it doesn't work for me. If it works for you, great. Personally, I can't not get engaged in any activity unless the outcomes effect me. It encourages me to read, think, learn, and grow as I dive further into any activity, not just trading. Theory and turning things over in my head is fine. Eventually though, I need to leap in and actually risk something. Even if that is just my ego or pride. Anyway, thanks for you post. I understand your warning and concern. Please continue to comment, offer criticisms, or advice. I take them seriously, they can do nothing but make me more aware and a better trader.
Ha, I was thinking that too. Darvis boxes were interesting to read about. Thank you for that. I will have to look more into it later.
Just out of curiosity, since you say backtesting doesn't work for you, why don't you play with a vastly reduced share size while you are learning and refining your strategy? Maybe allocate 3-5% of your account as "training" and trade with 5 shares. This will do a couple of things: 1) Allow you to get a feel of live market with far reduced risk. 2) Preserve a large chunk of your capital 3) Allow you to watch your system over a longer time period so you can evaluate it against various market conditions. My $0.02.