For instance: ES today. Different platform from my other trades on another tread (I have more than one account). In the first chart. I started with 1 ES contract at the top Line green line. Added 6 more 1 at a time as price went against me (see all the other light green). So I am in 7 contracts at the bottom My stop is red bottom (7 in number) my exit is top red seven in number if it gets there. Not sure what my draw down was as this platform doesn't allow me to show it. But it was probably 1000 or maybe a little more at one point. The dark green line and arrow is wher price was when I took the snapshot. So, at this snapshot point I am in 7 contracts waiting for it to reach my target. My SL is in place. And has been in place. Next here is my exit being hit. (Top red) Exited all 7. $1602.00 before comm. are deducted. The dark red is where price was when the snapshot was taken. As you can see the SL is still in place as it was not cancelled at this moment in yet time. I got busy doing other things like eating ..late breakfast...LOL Here is a snapshot after I cancelled the stoploss since I had exited the trade with a profit. The platform also be to leave the trades exited trades showing so I did for visual purpose but at this point I am out of the trade. Tope red is the exit. lower red is price at the time of the snapshot. SL that was there is cancelled.
If those who read this @volpri -- truly understood what you have stated -- and could learn to execute it properly -- they would indeed have "an edge".
"Pearls before swine" or "casting pearls" may refer to: A quotation from Matthew 7:6 in Jesus's Sermon on the Mount: "Do not give what is holy to the dogs; nor cast your pearls before swine, lest they trample them under their feet, and turn and tear you in pieces." Not trying to be cute, or demeaning by quoting scripture but what @volpri has provided is perhaps the best "edge" -- no need to look further.
I have a half-dozen persistent edges. There is no better time (since the advent of listed options) to trade vol. There are SN tickers that I trade where the NBBO on complex spreads is often trading inside the NBBO on the shares. $0.5 per contract is the highest rate that I pay (mIRA). We're destroying the planet but vol-traders will be rich on our path to extinction.
Trade management. It allows you to be wrong and still make money. I used to just set static targets and stops based on market state at entry, but my results improved significantly when I started dynamically moving my targets and stops around based on the most current information.
I'm glad you said that. I would argue it's luck, or being at the right place at the right time, but is not an edge in itself. In other words, you cannot do a pitch to a potential investor and say that. There's absolutely no skill involved in that, you are at the mercy of the markets. I know you were just giving an example tongue in cheek.
What on earth made you start going long at the top there? Yes, the trend clearly looks up, but you're going long at essentially the previous swing high? Edit: I think I can answer my own question. There is that big bull bar you like to point out, and I know you like your bull bars favoring more upside.
Point is that it really doesn't matter if you understand the "edge" see @volpri above and see if the answer is not there...
Now why did I take these trades and why did I average into losing positions? Why was I willing? Two words: PRICE ACTION. Here is a marked up chart that maybe explains my rationale if you can read my writing LOL. WHAT I am betting on is that the channel is weakening and turn into a range near the open of RTH’s. But I need to see a little more confirmation besides the 41 bar range below. So, we get a final push up then a little more sideways action. Then that big exhaustive bar. How do I know it is exhaustive? Basically, I could detect no follow-through that would make me think this channel is continuing up. So, I take a chance and started going long at what appears to be the top of the range. As price drops I just keep adding. Why? Well LARGER context bullish (all night channel up). We got a good support level at that 41 bar range below. Chances are when the slide down stops I will be positioned for a move back up to the top of the range or at least for enough to get out with a good profit even if I BE on 1 contract (second entry) and lose on the original contract (first entry). Once I take my profit I don’t care what happens. Might even short again and probably would do so but then I gotta take snapshots and type and write of all this explanation for the first 7 contract trade so I just stopped trading. If I were wrong and my stop loss gets hit then I am out and and looking to double or triple up in the new direction and swiftly get my loss back and find myself in the money again. In such a case my original premise and bet was wrong and I gotta take the loss and get it back on another opportunity. One final note: Remember this is a long bull channel that has morphed into that yellow range at the top. Bull channels function as BEAR FLAGS if you were to look at this on a larger time frame. So....when a BO of the yellow range does come 70% chance it will be south. So, the longer the range goes on I gotta be careful taking long positions at the bottom of the range betting price will go back up to the top. The safer bet as the range extends further and further sideways is to be shorting at the top of the yellow range. Expected successful BO of yellow range when it happens IS SOUTH. By successful I mean a BO with follow through. However, if the opposite happens..i.e. the unexpected and the successful BO is out of the top of the range then odds are very high I will see two legs up in the form of a Measured move. Different ways to take this measured move. It can be the height of the yellow range up above the top of the yellow range for aggressive early long entries. Or, I can wait for the first PB of the BO of the top of the range and measure that distance from the top of the range to the PB and extrapolate that measurement up from the top of the PB for the second leg up. Thus I would enter long on the BO Pb betting on the second leg up.