It's too easy to get fooled into thinking you are doing better, or worse, or whatever... it helps a lot to have numbers to compare.
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kserra's emini trades
- Thread starter kserra
- Start date
Quote from peterfigliozzi:
Strive for some quantitive measure of how you are doing in each part: entry, managment, exit (not P/L, that's the overall result of all the parts combined). This way when you change things you can have a better idea of the results.
For entries I use the "BS Ratio";
management: % winners passed/ % losers cut etc.
exits: % MFE captured
This sounds like a good idea, I like your point of how analyzing all of these numbers allows you to take a look at the bigger picture of things instead of just focusing on the profit and loss section.
Right now just looking at things in hindsight it is clear to me that this week my biggest problem was entering early and impulsively trading. When I enter early it is usually off of the 3 minute chart, while this works sometimes rarely do I get a substantially better fill than I could have just by waiting. Also as a result of entering early I enter on a lot of false signals. This is what is causing me to get killed this last week.
Im going to do some more analysis of my trades this past week, looking at what I did wrong and then planning on how to fix these problems. Then I will paper trade until I feel comfortable with my level of discipline and confidence in my system.
You hit the nail on the head.....patience{discipline} and confidence in your system....I have said you don't have a system. It won't come overnight, or off this board......Find the patterns that you see over and over...at least once a day or more..and that also produce points most of the time...You need a long term trend indicator such as 18 ma or ? as I have said before......don't risk your money until your system works most of the time....80%???90%??? The old crap about if you win just half the time, you can really make money with money management..Sounds great, but in the meanwhile, your confidence is shattered by the losses, as emotion is most critical of all the trading tools you possess.... Losses damage confidence...in the system and yourself... I am not a good trader, but I have a great system...4000 hours and 3 years later...Within the last 2 weeks the system has improved to where I never thought it could be....I always look for improvements....the basic system doesn't change....I try to find earlier and better entries....they are there every day... .I truly hope you make it in this business....If you take it lightly, they will eat you for lunch...Either use a point target or go to breakeven when the trade allows and ride until you wish...You will find that you are better off with a point target exit when you see it on the screen. There is nothing wrong with exiting when you see 3 or 4 points on the screen..it is easier to up the contracts instead of battling for more points....forget the fill price, just concentrate on cancelling the stop.
Quote from kserra:
Crossover Reversal system
Indicators: 5 and 10 period volume weighted moving averages
Pivot levels for the day
Timeframe: 3 minute chart
Entry: 5 and 10 volume weighted moving averages must crossover each other, Trade is then taken 1 tick above the previous bars high
Stop: Stop is placed at the low of the previous bars high
Reward to risk: 1:1, however all gains are pressed for as much as possible by use of a trailing stop. The trailing stop is set to breakeven after the initial profit target has been obtained.
Reliability of signal: The signal appears to have a profitability of about 60%-70%,
Other: The system performs poorly on trend days, but tends to not take too many trades on these days. The system performs nicely in a wide range bound environment. I tend to stay away from the open mainly the first thirty minutes of the day, however I like to look for a good reversal around 10 o clock. Another good time for trading is around 130 when everyone comes back from lunch ( i do not trade from noon to 1:30) there is often a reversal here. Finally at the last hour of the day there tends to be some good signals as well.
Notes on system:
During periods where the moving averages remain very close together no crossover signals are taken. The fact that the averages are so close together signifies chop, thus no trend can be ascertained from this information. Also S/R numbers are used via pivots and any other numbers that prove to be significant during the day, these number help determine how to press the profit targets and when to take what you have. Here is an example of some of the trades, the system has taken this is taken from 8-12-2003, the following trades are pretty good especially the last one. I feel like this graph represents a good cross-section of the type of trades the system experiences, there is your standard trade and there is also an outsized gain. THe only thing not represented here is a stopped out trade, but you can easily see where the stops have been placed.
Note: I am west coast based therefore all the times displayed on my charts are three hours off. Please add three hours to see the true time.
Kserra,
I am also online (some days) at Futurestrades NihabaAshi mirc site.
Is the 3 minute chart the only chart you look when entering trades? Do you watch multiple timeframes?
Regards,
Dave Scott
Quote from wdscott:
Kserra,
I am also online (some days) at Futurestrades NihabaAshi mirc site.
Is the 3 minute chart the only chart you look when entering trades? Do you watch multiple timeframes?
Regards,
Dave Scott
I currently look at the three minute to mainly to wake up to a possible trend change occuring. I then take my MA crossover signals from the five minute chart, however this past week I kept trying to trade reversals off of the 3 minute which resulted in lots of trades where I was merely trying to fade the trend, which is very dangerous and ended up in lots of losers.
I occasionally look at higher time frames, but do not seem to get much out of them.
Quote from porgie:
You hit the nail on the head.....patience{discipline} and confidence in your system....I have said you don't have a system. It won't come overnight, or off this board......Find the patterns that you see over and over...at least once a day or more..and that also produce points most of the time...You need a long term trend indicator such as 18 ma or ? as I have said before......don't risk your money until your system works most of the time....80%???90%??? The old crap about if you win just half the time, you can really make money with money management..Sounds great, but in the meanwhile, your confidence is shattered by the losses, as emotion is most critical of all the trading tools you possess.... Losses damage confidence...in the system and yourself... I am not a good trader, but I have a great system...4000 hours and 3 years later...Within the last 2 weeks the system has improved to where I never thought it could be....I always look for improvements....the basic system doesn't change....I try to find earlier and better entries....they are there every day... .I truly hope you make it in this business....If you take it lightly, they will eat you for lunch...Either use a point target or go to breakeven when the trade allows and ride until you wish...You will find that you are better off with a point target exit when you see it on the screen. There is nothing wrong with exiting when you see 3 or 4 points on the screen..it is easier to up the contracts instead of battling for more points....forget the fill price, just concentrate on cancelling the stop.
Why not just program your system (or have someone do it for you) and have the system trade itself ? If it really is a good system, automation maybe a good solution.
Anyways I would have to disagree with your point about you cannot win with a system that only averages 40-50% win. Mathematically this is possible, and as long as the user of the system is willing to tolerate the losses the system can sustain itself.
However I do agree with your point about confidence, and I believe a similar idea was recently pointed out in the new Journal that has shown up around here called "Winning in the Eminis".
Trades for today
All trades from this point on will be paper trades unless otherwise noted. I will be working on being disciplined before I go back to live trading.
Only did one trade today but I feel I managed it pretty well (although it would have been nice to catch the massive sell off)
Trade #1 Short @ 1138.25, cover @ 1136.5 +1.75 pts
12:08: Took this short after we broke out of the range, originally I had a long bias and was looking to get long only several minutes before this trade showed up. I was patient with my entry and did not try to enter early. Took profit when they were given to me, however my profit target was actually set to 1135.00 so exiting early hurt me here. once again this was a situation where multi contracts would have been to keep running, but hey Ill take what I get.
Overall trade rating: 7 out of 10 - exited earlier than expected profit target not reached.
profit/loss on the day +1.75 pts
Profit/loss paper trading +1.75 pts
Prety happy with this trade, but like I said catching the sell off would have been really great, but IM not going to kick myself over it.
All trades from this point on will be paper trades unless otherwise noted. I will be working on being disciplined before I go back to live trading.
Only did one trade today but I feel I managed it pretty well (although it would have been nice to catch the massive sell off)
Trade #1 Short @ 1138.25, cover @ 1136.5 +1.75 pts
12:08: Took this short after we broke out of the range, originally I had a long bias and was looking to get long only several minutes before this trade showed up. I was patient with my entry and did not try to enter early. Took profit when they were given to me, however my profit target was actually set to 1135.00 so exiting early hurt me here. once again this was a situation where multi contracts would have been to keep running, but hey Ill take what I get.
Overall trade rating: 7 out of 10 - exited earlier than expected profit target not reached.
profit/loss on the day +1.75 pts
Profit/loss paper trading +1.75 pts
Prety happy with this trade, but like I said catching the sell off would have been really great, but IM not going to kick myself over it.
Attachments
Did quite a bit of analysis this weekend concerning my past trades and I found some new information concerning my trading.
I found that I am most profitable on trades that revolve around levels (generally pivot, sometimes support and resistance via eyeballing the chart) and that when I trade against these levels I tend to have a much higher profitability rate. In addition to this I noticed that pretty much all of my losers from last week resulted from early entries, it just so happens that all of these early entries never were confirmed by my MAs, so essentially they were trades that never should have even been taken.
I am going to try incorporate this info into my trading from now on. I believe that not trading has given me some perspective on my errors. I feel that when I am able to recognize my errors it is much easier to fix them.
I found that I am most profitable on trades that revolve around levels (generally pivot, sometimes support and resistance via eyeballing the chart) and that when I trade against these levels I tend to have a much higher profitability rate. In addition to this I noticed that pretty much all of my losers from last week resulted from early entries, it just so happens that all of these early entries never were confirmed by my MAs, so essentially they were trades that never should have even been taken.
I am going to try incorporate this info into my trading from now on. I believe that not trading has given me some perspective on my errors. I feel that when I am able to recognize my errors it is much easier to fix them.
Quote from kserra:
Did quite a bit of analysis this weekend concerning my past trades and I found some new information concerning my trading.
I found that I am most profitable on trades that revolve around levels (generally pivot, sometimes support and resistance via eyeballing the chart) and that when I trade against these levels I tend to have a much higher profitability rate. In addition to this I noticed that pretty much all of my losers from last week resulted from early entries, it just so happens that all of these early entries never were confirmed by my MAs, so essentially they were trades that never should have even been taken.
I am going to try incorporate this info into my trading from now on. I believe that not trading has given me some perspective on my errors. I feel that when I am able to recognize my errors it is much easier to fix them.
Let me contribute what I believe is a gold nugget for trading..
U keep on referring to your losses as errors or mistakes... thats a big problem.
A mistake is when u hit the wrong key by accident or screw up an order accidentally.
When u place a trade.. u are making a decision based on all the facts given at that exact moment.. the fact that u get stopped out is not a mistake or error. If the market doesnt do what u thought it would do.. again that is not an error. When u look at individual trades success one at a time.. whether they turned out profitable or not is not a matter of doing the right thing or making an error.
Another falacy.. is believing that when u lose $ its because u made a mistake and didnt follow your plan. In reality its not a mistake.. its just that your plan really is not clear enough for u to follow.
Because a handfull of your most recent trades worked using a certain technique.. that should not give u enough evidence that they will continue working. If u keep on doing this.. u will end up curve fitting a system simply based on your most recent performace. When the market changes its rythem u will get smoked.
Hope this info helps.. it sure helped me.
-MIKE