It's a common misconception that all you need to do to be a winner is fade a consistent loser. How can that be people say, the market can only go up or down. The reason is the market moves to liquidate positions across all time frames. If you take the average retail stop in say the ES it might be 8-10 ticks. The market moves in such a fashion that it seeks liquidity and clears stops out in both directions across all timeframes. This is why it is relatively hard to put a trade on and not have it at least retrace to your entry. The trick is to work out who is being squeezed out and on what timeframe. GL.
As if majority are losing traders, do you fade the input provided by ETers?
- Thread starter OddTrader
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It's a common misconception that all you need to do to be a winner is fade a consistent loser. How can that be people say, the market can only go up or down. The reason is the market moves to liquidate positions across all time frames. If you take the average retail stop in say the ES it might be 8-10 ticks. The market moves in such a fashion that it seeks liquidity and clears stops out in both directions across all timeframes. This is why it is relatively hard to put a trade on and not have it at least retrace to your entry. The trick is to work out who is being squeezed out and on what timeframe. GL.
This will not work because the market actually has 3 directions - up down and chop. The phantom of the pits partially mentioned this and I spent a long time thinking about what he/she said. The question I would ask the phantom now would be about the "integrity in the chop" comment. I now think chop is just chop - no integrity, no pattern, no nothing. We would agree to disagree.
Good post DBPhoenix. I suspect there are stages beyond as well such as sahana. Money is a very poor motivator for a life.
I used to write that one must climb the foothills in view before one can see better mountains in the distance to climb.
I know I took a few years to prepare but never realized I couldn't make money from the start without blowing up until I started reading about how to trade. Then sure enough it became harder! LOL.
I used to write that one must climb the foothills in view before one can see better mountains in the distance to climb.
I know I took a few years to prepare but never realized I couldn't make money from the start without blowing up until I started reading about how to trade. Then sure enough it became harder! LOL.
You cannot find a consistent loser in general unless he is a maniac.
Math proof here
Excellent blog btw. I learned a lot by following it.
If that were the case, you need to analyze a poster (or group of posters) and develop an edge based on that. Moreover, If you reverse one losing input, it doesn't mean it's going to automatically be traded profitably. You still need to determine hold time, take profit, stop loss etc. When those factors are tossed into the mix you'll probably end up a loser as well unless you've properly analyzed all the inputs.
If you fade my strategy, you will probably make a lot of small profits at first, but if you are not careful, over time, you may end up with one really huge loss.
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If you fade the loser and you still loss, do you know why ? Slippage and commission
My comments had nothing to do with you or anyone specific for that matter. What are you talking about?
Well, if he posts entry, TP and SL, then your reverse, set TP to his SL and vice versa, then in theory it should work out fine.
BUT..........
You'll likely find the TP smaller than the SL, which is not ideal.
When you factor in comm's and spread you'll likely be losing like him.
Beating the game enough to cover comms and spread is the tricky part sadly!
BUT..........
You'll likely find the TP smaller than the SL, which is not ideal.
When you factor in comm's and spread you'll likely be losing like him.
Beating the game enough to cover comms and spread is the tricky part sadly!
I read about this broker, many years back, who having noticed its clients consistently lost had the "brilliant" idea to take opposite positions for themselves. They made tons of money until at one point they started losing heavily on gold as one client had opened a large long position in gold and it kept going up. So they were there waiting anxiously for the guy to close his winning trade so they could close their losing one. But weeks passed and nothing changed; the client had this huge floating win while their own loss kept increasing. So they started trying to contact him about his position and couldn't reach him. As it turned out, the client had actually had an accident and was in a coma. 
Having said this, IMO, some brokers probably do monitor their consistent losers to fade them, but it isn't certain to work or free from ..."accidents".
Having said this, IMO, some brokers probably do monitor their consistent losers to fade them, but it isn't certain to work or free from ..."accidents".