Disillusioned

This is a great forum.

Bert,

I know where your're coming from. Disillusioned and wondering whether its worth continuing. I can tell you I was at the same point you are 5 years ago.

In fact I was at that point 3 times, each time after suffering severe and consistent losses. I can tell you it's just not worth it.

Do yourself a big favour, close your account, and concentrate on a proper career where you form relationships and where you can depend on a paycheck at the end of the month.
Your relationships, your health, your bank account, and your future will be better for it. Not to mention, if you have a family, they will thank you for it.

It's just too stressful, lonely, unhealthy and unrewarding an activity. As a business, well there are much better businessess to be in. Selling trading software, courses and advice might be one of them. Certainly seems to be a lot around.


Good luck.
 
Bert there are many good posts in here but I will leave you with one thought that I am sure many with disagree with.

the shorter your time horizon on stocks the less chance you have to make money consistently.

The question really boils down to whether you want to make money, or whether you just like the excitement of trading. If you want to have better than market returns year after year then the only indicators you really need are moving averages.

People will sell you blackboxes all day long, because that is how THEY make their money. If the systems were so good they would keep it a secret and make their money in the market.

Do yourself a favor and increase your time horizon for trading.

Follow these simple rules and you will make money consistently. It truly is simple, but for some reason everyone makes it difficult by trying to find the holy grail. I used to be like that as well.

1. if the russell 3000 drops below its 150ma start considering selling any longs you have and do not buy any new long positions until the price and 50day moving average is above the 150 ma. and the 150ma is at least flat or rising.

2. if the russell 3000 drops below its 200ma start considering shorting some stocks. You should not be long in anything at this point.

3. When the overall market looks ripe for buying (50ma over 150) start selecting stocks that have consolidated for at least 60 days which have just moved above their 150ma and 50ma. Make sure the stock's market sector is also close to the same technical position as your stock.

4. Check you risk vs reward on every stock based on support and resistance. Only trade stocks with at the very least have a 2:1 ratio.

5. Make every trade worth the exact same amount of money. Choose a number between .5 and 2% of your portfolio and stick with it. If you have a 100,000 dollar account and you don't want to lose more than 1% then you have 1000 to lose per trade PERIOD. If you have 2 dollar downside risk in a stock then you can only buy 500 shares max. Don't be afraid to place an order for odd lots. If you have 1.79 downside risk then buy 559 shares. Commissions are cheap, and besides you will be trading much less under this type of system so your slippage will be much less.

6. Hold the stock as long the 50ma is above the 150ma, or at the very least hold the stock as long as it is above its 60 day moving average. (most mutual funds add to their position when the stock price comes close to their 50ma so you don't want to get stopped out before the next move up.

7. Make sure the stock you purchase has at least 60% institutional sponsorship.

8. Don't trade any stocks with volume less than 400,000 per day.

9. Turn off CNBC and Bloomberg. All news screws up the decision making process.


The best stocks are stocks where the 50,100,150,and 200 day moving averages are very close together. These are coiled springs ready to unwind. Find them and keep them in a watchlist. Buy half of your position on a breakout, and the other half on the pullback.

I use 5% of my portfolio for fun and exictement. I use 95% for guaranteed money making. In the beginning of a bull market you will see the above scenario. Good stocks will have their 50,100,150. and 200 day moving averages all in the correct order and they will actually stay like that for the bulk of each current bull market. It is the true definition of letting your profits run.

Good Luck!!!
 
Bert,the last 2 posts are the reality of trading for a living....

I will promise you that 99% of the people who attempt to make a career of trading fail.Its a very very long road,and there are no shortcuts.

i dont know where you live,but if it is one of the major cities,why dont you seek employment in some sort of trading enviorment??

The last poster was 100% right IMHO...Lenghten the duration of your trades,look at weeklies and dailys asnd MAYBE the hourlys..

Whatever you do,dont waste your life sitting in front of a screen all day long.The battle is won before the war begins,and trading all day long will only put money in your clearing agents pocket..not yours....

Treat trading as a hobby,albeit a very serious one.Trade smaller,and try to make it a pleasurable experience....

And here is the real clue,which I avoided for years in my never ending quest for the mythical patterns,formations of the market...

Read William Oneils Book,over and over...Take a look at HGSI,Investors buisness daily,and their ranking systems.Look at Zacks #1 stocks.

Start there and you have your first edge.Its not sexy following someone elses fundamantal research,but it works..From there,decide if you want to be a "breakout" trader,or reversal trader.Come up with some good money management and position sizing.Add in some other simple analysis that can be easily backtested.You dont have to be a systems trader,but you should have a systematic way of approaching things

That is all i have to say,and that is 27 years of experience and making every mistake known to man speaking..
 
Tao, I big-time appreciate all the time and effort you've spent on this thread. I will give it serious consideration. Obviously, the only one who can inevitably decide is me, but I'm taking yours and many other posters' thoughts into the ol' noggin.

I am glad I haven't lost money in the markets, yet am equally disappointed I haven't progressed anywhere near--at this point--like I expected. At the same time, it's apparent from many that this is a long-term game. I will add that though I work near-full time at another job, I've spent an average of 40 or more hours each week studying for the past year or so in addition to what I did before I got more intense.
That alone, obviously, doesn't guarantee anything. However, I cannot say it's been due to excess laziness on my part.

Thanks again.
 
Holy Grail--good stuff from you as well. The longer-term outlook might well be beneficial [though I don't think I'd sit long enough to allow the 50dma to cross the 150d, no offense; but I get where you're coming from. I could adjust those parameters for my temperament].
I would add, though, the support/resistance stuff seems very abstract much of the time. Maybe that's due to my viewing it from such a short-term perspective, where it's not maybe as applicable. Taken longer term, there's probably a zone where the S/R could come into play more likely.

fttrader, thanks for the warning; I have considered it!
 
Quote from taowave:


But i still ask why candlesticks?
More...
The latest issue of Active Trader has an article about candlesticks that basically said they are worthless. My take on them is like all of the moving averages, stochastics, fib lines, etc., etc., they are meaningful because we give them meaning, i.e. they are self-fulfilling prophesies.
 
that's a good point. If a lot of people pay attention to MA's (eg, they often decide to buy when a stock moves back down toward the 50dma), there is more of a chance for an up move just because it's creed is followed. Perhaps it shouldn't be used to go long as much as it's a wariness point for someone who's short(?)
 
You must log in or register to reply here.
Back
Top