how many times have we heard something like:
keep it simple
it can be as simple or as complicated as you make it
just look at this post by j_commisso:
what THE HELL is anyone supposed to do with that?!?! i'll take that stuff and file it away in the endless, "sounds nice, but have fun using it" category. for more of this, just visit this thread for page after page of quotes that will get you nowhere in trading:
http://www.elitetrader.com/vb/showthread.php?s=&threadid=8433&perpage=6&pagenumber=1
so now that i've made my point, now i'm going to prove it. take someone like me, who has been at this racket for 3 years and still doesn't know what the hell to do. when i say i don't know what to do, i mean i don't know which combination of everything i know to use. I'VE READ EVERYTHING ABOUT TRADING. the answers are within me, yes, but until i find a combination of everything that works, I'M LOST.
so here i am, trying to make money trading. as with everyone else out there who's struggling, look at all the things we must consider:
timeframe: do we want to trade 1 min, 2 min, 3 min, 5 min, 15 min, 30 min, 60 min, daily, weekly, monthly, or some other interval chart? do we want to use more than one? if we use more than one, why not use 3? which should be the entry time frame, exit time frame? how often do we want to be at the computer watching a trade, making decisions, entering trades?
time: do we want to use tick charts, bar charts, point & figure, something else. do we want to enter when we see a pattern, at fixed intervals, only at the close, etc.
entry: do we look use trendlines, moving averages, fade common patterns, new highs, new lows, pivot points, range breakouts, double tops, double bottoms, random entries, go with the trend, fade the trend.... make a system for trending, make a system for chop. is the entry important....is the entry not important.. stochastic settings x, x, x.....volume.....no indicators.....2 indicators........make up your own indicator....i think we all understand the bottomless pit of finding an entry.....
backtesting: does backtesting help? should you even do it? how far should you backtest? how much backtesting needs to be done? can you even backtest accurately?
stop loss: mental stops, having your stops only count if violated on a closing basis, no stops, stops based on multiple conditions... should you trail your stop. should you combine these methods for different portions of your trade....i could go on and on.
targets: some people like to use targets...some people don't.
trailing stops: should we trail a stop? if so, at what point? from that start? after a certain gain? only trail a stop on a portion of your position..... how far should u trail the stop? based on what?
win rate: should you go for a 70% scalping win rate....or a 23% win rate with big gains?
scaling in/out: now here's a great subject. some say add to winners......some say scale out as the trade goes your way. some say start with a full position and reduce if it doesn't go your way. if you add, how much? if you scale out? how much and when? i could go on and on.
risk per trade: how much risk per trade..some say 1% per trade....some say 2%.....some say it varies with your trading......some say use optimal f....some say a fraction of optimal f.....some say don't use optimal f at all.
charts: some people say use charts, some people say you don't even need to use charts. some people say create your own type of chart.
instrument: do you want to trade stocks...qqq, dia, spy......eminis....
well, i've typed enough here. you get my point..i could go on and on. anyone who's been at this for years damn well knows what i'm talking about. there are so many elements to trading and each element can be tweaked....and each tweak can be tweaked.....and then how do you test everything for optimal results when there are INFINITE combinations of everything??
there may be trading methods that are simple, BUT HAVE FUN FINDING ONE THAT WORKS.
keep it simple
it can be as simple or as complicated as you make it
just look at this post by j_commisso:
what THE HELL is anyone supposed to do with that?!?! i'll take that stuff and file it away in the endless, "sounds nice, but have fun using it" category. for more of this, just visit this thread for page after page of quotes that will get you nowhere in trading:
http://www.elitetrader.com/vb/showthread.php?s=&threadid=8433&perpage=6&pagenumber=1
so now that i've made my point, now i'm going to prove it. take someone like me, who has been at this racket for 3 years and still doesn't know what the hell to do. when i say i don't know what to do, i mean i don't know which combination of everything i know to use. I'VE READ EVERYTHING ABOUT TRADING. the answers are within me, yes, but until i find a combination of everything that works, I'M LOST.
so here i am, trying to make money trading. as with everyone else out there who's struggling, look at all the things we must consider:
timeframe: do we want to trade 1 min, 2 min, 3 min, 5 min, 15 min, 30 min, 60 min, daily, weekly, monthly, or some other interval chart? do we want to use more than one? if we use more than one, why not use 3? which should be the entry time frame, exit time frame? how often do we want to be at the computer watching a trade, making decisions, entering trades?
time: do we want to use tick charts, bar charts, point & figure, something else. do we want to enter when we see a pattern, at fixed intervals, only at the close, etc.
entry: do we look use trendlines, moving averages, fade common patterns, new highs, new lows, pivot points, range breakouts, double tops, double bottoms, random entries, go with the trend, fade the trend.... make a system for trending, make a system for chop. is the entry important....is the entry not important.. stochastic settings x, x, x.....volume.....no indicators.....2 indicators........make up your own indicator....i think we all understand the bottomless pit of finding an entry.....
backtesting: does backtesting help? should you even do it? how far should you backtest? how much backtesting needs to be done? can you even backtest accurately?
stop loss: mental stops, having your stops only count if violated on a closing basis, no stops, stops based on multiple conditions... should you trail your stop. should you combine these methods for different portions of your trade....i could go on and on.
targets: some people like to use targets...some people don't.
trailing stops: should we trail a stop? if so, at what point? from that start? after a certain gain? only trail a stop on a portion of your position..... how far should u trail the stop? based on what?
win rate: should you go for a 70% scalping win rate....or a 23% win rate with big gains?
scaling in/out: now here's a great subject. some say add to winners......some say scale out as the trade goes your way. some say start with a full position and reduce if it doesn't go your way. if you add, how much? if you scale out? how much and when? i could go on and on.
risk per trade: how much risk per trade..some say 1% per trade....some say 2%.....some say it varies with your trading......some say use optimal f....some say a fraction of optimal f.....some say don't use optimal f at all.
charts: some people say use charts, some people say you don't even need to use charts. some people say create your own type of chart.
instrument: do you want to trade stocks...qqq, dia, spy......eminis....
well, i've typed enough here. you get my point..i could go on and on. anyone who's been at this for years damn well knows what i'm talking about. there are so many elements to trading and each element can be tweaked....and each tweak can be tweaked.....and then how do you test everything for optimal results when there are INFINITE combinations of everything??
there may be trading methods that are simple, BUT HAVE FUN FINDING ONE THAT WORKS.
??