Learning When Not To Trade

[axeman]

Yes.... but a synonym for chance is probability and
when you assign a number to it, such as 50/50, it
sure sounds like your speaking about probabilities.

After entry, you have a chance that price will go up.
You have a chance that price will go down.

But if you say you have a 50% chance of it going up
and a 50% chance of it doing down, your speaking
probabilities.




peace

axeman

Quote from bobcathy1:



axeman....
chance and probability are two separate things.

You have a chance of being killed by a meteor.
You have a 99% probability of it never happening.

When we use indicators trading, we skew the probability our way.

 

[axeman]

Aaaaaaaaaaah the advantages of RETAIL trading

Ok....gotta get back to sniping this punk at 400 yards
on Omaha beach


peace

axeman

Quote from rs7:



I'm sure you are right. But they got this policy about loading games....they are paranoid about polluting the network, or whatever. Ain't my machine, ain't my network. I just work here.

Someone got fired for bringing in a disc with a pornographic cartoon on it and sent it interoffice email. They know all and see all.
I work for Big Brother (with no Janice).

So we had to wait for 2002 to get involved in 1942? Hmmmm.

Peace,
rs7

 

[bobcathy1]

Fair enough axeman.

 

[profitseer]

Quote from wally_:



Successful trading without luck is impossible. But luck helps only those who believe in it. Or believe in themselves, which basically means the same: believing in one's luck. After all, no matter how good your strategy turned out to be in backtesting, there is no guarantee that it will work now when you need it most. So you take chances. If you succced it is not only because your strategy is so good, but also because you were lucky. It is hard to separate one from the other. One of my systems this month has had 10 winners out of 11 trades. Is it because it is so good or is it because I am lucky? I don't know, but I do know that those who think that they need a perfect strategy (I mean one that would be luck-independent, whatever that means) will most likely never succeed as traders. Trading is about luck as much as anything else in life.

A good system captures good luck.

 

[Corallus]

Quote from profitseer:

A good system captures good luck.

Exactly.

There's an old saying in sports, "Champions create their own luck."

Being a league bowler, I'll give an example from the game of bowling. In bowling, whether or not you strike when you hit the pocket always has at least a little bit to do with luck. Whenever round objects hit other round objects unexpected things can happen. You can throw a great shot and still not carry all 10 pins into the pit. On the other hand, it's possible to throw a bad shot that doesn't even hit the pocket and that shot could strike if you have lucky pin action.

Although there is definitely luck involved in any one single shot, the top bowlers always tend to rise to the top over time (over the course of a league season or over the course of an 8-game tournament). On the professional bowler's tour, the same bowlers often make the televised finals over and over again week after week. So in a game where any individual shot is affected by luck, either of the good or bad variety, the bowlers with the most accuracy, consistency, and strongest mental games are the ones who end up winning tournaments and league championships most of the time.

I think an analogy can be drawn to trading. Any individual trade is like any individual bowling shot. You can improve your odds by executing the trade/shot well, but there is always the luck factor. However, over time and lots of trades/shots, the top performers come out on top. In essence, they have "created their own luck."

 

[dbphoenix]

Quote from bobcathy1:

Fair enough axeman.

Sorry I didn't get back to you.

If you're interested in this sort of thing, you'd enjoy Fooled by Randomness by Nassim Taleb. Highly recommended.

--Db

 

[bobcathy1]

Yes, that book is on my to read list.
I found some of Trading in the Zone very interesting because they addressed that. Made me view price movements in a whole different light.

 

[monee]

Quote from prox:



Depends completely on your system and what it's weakness would be. A trend or MA cross system would get hurt in slow choppy markets, but a scalper might thrive in these times.

Generally I don't like to trade when:

I haven't had enough sleep.
I'm feeling an emotional high or low.
I'm talking on the phone or have guests.

otherwise, all market conditions are fair game to me.

Prox,
Great idea to define what conditions not to trade under.
I find trading under any of those conditions makes it very difficult to stick to a well defined plan.
I also find that if I have to leave before the mkt closes,somehow this is in the back of my mind and I am "under pressure" to make a trade and the results show.
Two other times to be very careful for me are Monday mornings and getting excessive sleep and feeling groggy.