EGO CHALLENGE (26 Sept 2003)

Time to answer some of the questions that were asked on this thread yesterday.

* misctrader I only "add" to positions in certain situations (like I said before...only about 10% to 15% of my total trades for the year did I do an "add"), so do not get fixated on this style. Adding to positions where the price action is against your original trade entry price is VERY HIGH RISK. August is the month where the most "adds" take place for me. Now for yesterday, my bias going into the day after reviewing the previous trading days, was that we would probably have a narrow range with indecision of going higher or lower for the overall market. Kind of like a "pause and reflect" type of trading day. Take a look at the Daily chart for the ES for Wednesday and Thursday. Wednesday we had a good drop (22 pt range for the day), and Thursday we had more pullback (I think we had a 17.5 pt range this day). Now Thursday we had a smaller pullback then Wednesday so I felt that the drop in the overall market was slowing for a pause. My plan before the open was that Friday would be tight (maybe 10 to 12 pt range for the day), and that we would get some sort of push during the day to challenge the previous days pullback. As you can see I was LONG out of the gates yesterday based upon this plan, so when priced moved against my position I felt comfortable with "adds" at this point. Also, I know that the "open" has swings that eventually form into some type of trend. I speculated that the trend would be LONG yesterday and so my first trade worked good. My bias remained LONG through most of the day and then I changed my bias latter in the day and my final 4 trades to finish my trading were SHORT. In the end, I can say that Friday did turn out to be what I call a "pause and reflect" type of trading day and this worked for my daily plan. Now the reason I move my stops down when I do "adds" is so I do not get hit in big positions with crazy downspikes or stop running. I always want my stop around 4 pts away from my last "add" entry price. This has worked very good for me, but again I do not do "add" trading all the time. For some insight into my experiences doing this, my worst losing day ever was around $3800.00 (I was LONG with some "adds" small size and the Florida Supreme Court announced that Al Gore would get a state recount during the election). Another important thing when I do "adds", is that I am much more inclined to do "adds" to a SHORT position then a LONG position (looking back about 70/30 "adds" to SHORTS versus LONGS). IMO, bad news happens more often then good news during the trade day...sad to say.

BTW, if any of you run into Al Gore tell him he owes me $3800 plus commissions!
 
Clint also said one of the best statements for trading ever IMO!!!

Heartbreak Ridge - Clint as the Marine "Gunny" shouting at his bewildered soldiers, "IMPROVISE, ADAPT, OVERCOME!" :D
 
I was tape reading my a$$ off yesterday also. My mind and eyes were shot by the time I was done. BTW, great trading yesterday for you!!! :)
 
Great post! You are right, "add" trading is a VERY HIGH RISK style! Not for everyone, by any means.

BTW, I am a rated pilot so I do know how to fly. :D
 
Hi AMT, after you cleared up the "averaging down" puzzle, I have another question: It seems that your stop of 4 PTS is farther away than most of your winners (you take profits at 2 pt sometimes), that means you have to have a VERY high hit rate to make this work consistently.

Any comments?

Thanks!

Vienna
 
Quote from Grob109:



When I posted this I had not read anything after your post telling me off. I didn't comment on the chart duration; it was evident to many of us. But the way you chide and and talk doesn't make it easy for people to explain stuff to you, ever.
More...

Whoa...not sure where this post came from! I only made one post to you, the one you quoted just before this particular post where I explained how I had used AMT's numbers. I made no other post to you, and certainly no post "telling you off". You must have read some of the other posts to other people and figured they were directed to you.

You probably think of others as fitting into categories and how could they say any thing that is worth considering since they are in that category you assign to them.

Not sure where this came from either. We probably all categorize people in some fashion or another based on what we observe and experience over time with them. In fact, you appear to be categorizing me in this post, are you not?

Your trading methods are what they are. If you ever make an effort to improve them, you probably do it because of something that has been available to others for a long long time. You pass by a lot of good stuff by deploying your life style habits that kill anything getting to you in any way.

Let me explain something to you: I've been trading for over 30 years. I traded the stock index futures when they started with the Value Line Stock Index Future back in the '80's, and later the SP futures when they started. I've been improving, modifying, altering my methods for years. You don't survive for 30+ years in trading without changing and adapting to new circumstances. You don't survive as a trader with a closed mind. So how you arrived at the above statement puzzles me.

I asked the two guys who had fine performances from Friday some general questions. From there, I seemed to get some rather hostile responses from a couple of people, to include this one from you. Again, I'm not sure what brought on your particular hostile response, or some of these very negative types of conclusions that you've come to.

After 30 years of trading, you learn a few things, believe it or not. One of those things is to maintain an open mind, check ideas out to see if they have merit for your particular circumstances. I do that constantly. I also do that so that I can understand what my competitors are doing. For instance, if all my competitors are using one minute charts, I think I need to know that, study it, etc. Whether I use it myself is really more a function of my own style and what makes sense to me. But when large groups of people are trading with one minute charts or intraday charts in general, that has the possibility to affect what I do...so therefore I'm interested.

Understand though that I rejected 5 minute charts 20 years ago. I used to draw them by hand, before we had computers to do it. I think intraday charts in general take the focus off what to me are more important market factors. OK, that's my opinion. I didn't come to that opinion lightly or hastily. I have the same opinion of one minute charts. But, that's just my opinion....if you hold a different opinion then that's OK with me...that's what makes a market.

Anyway, I don't pass by alot of good stuff. I don't think I pass by much at all. I evaluate everything that I'm aware of to see how it works, how I might benefit from it.

OldTrader
 
Here you guys go again. You piss on a good thread with a real imput from a very good trader. Instead of trying to learn. Quit squabling with each other.
 
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