Pyramiding: Playing with the market’s money
- Thread starter vivaskyliska
- Start date
There’s a group of traders who would agree. They are known as ‘futile traders’ and the simple act of trading has negative expectancy. It would be surprising to the uninformed how large of that sample of 100 traders they comprise. Futile traders are by their very nature uninformed.
Utilitarian traders would not be looking at the same charts in the same way as an order-anticipator. An arbitrageur would be interpreting charts differently than an sentiment-oriented technical analyst. A value trader would also interpret a chart differently than a bluffer. A dealer would look at it differently than a gambler.
The various participants, having different motivations, needs and goals from the markets will each have a different interpretation of the same charts and what it means to their individual circumstance.
Edit: I imagine there are those that wish everyone would think like themselves and others who embrace diversity as a strength. One viewpoint is exclusive the other is inclusive. One by definition operates at a higher order of understanding by virtue of ‘including it’s opposite’.
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You're putting his question into a real time situation for 100 traders to do as each one normally does in their favorite time frames. But he asked how 100 traders would view the current situation as to being in a range or in a trend. That's all. And to do so they would all have to voice their opinions based on the same time frame, now wouldn't they? But no matter what time frame is chosen, the answer in the given situation is so clear that100 skilled traders would agree. His claim was that such can be determined only in hindsight, and I strongly disagree. Please reread his question.
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And a 3rd signal? And a 4th? And a 5th? What about a trend that doesn't give any additional entry opportunities?
These aren't academic or stroppy questions, I was holding 5 long positions on the Dow before Christmas.
It is possible to be more aggressive without taking additional risk.
This reminds me of those scaling in threads awhile back.
I would put the full position on all at once and scale out not in.
Can't see how to be more aggressive without taking more risk,unless taking a larger position and decreasing the width of the stop which is going to kill the win rate.
I would put the full position on all at once and scale out not in.
Can't see how to be more aggressive without taking more risk,unless taking a larger position and decreasing the width of the stop which is going to kill the win rate.
I also believe in putting in the whole position at the first signal, that is, the maximum % of account capital I can stand, and many people use the familiar 2% rule for this. What I am talking about is not scaling in.
But I did try to put over clearly that although multiple positions are opened (some people would say on a "grid" basis) as price continues in the trend direction, no additional capital is EVER put at risk because you wait for the trend to make the first trade free before adding a second, and so on.
The concept took me a while to get my head around but I'm happy to answer queries on this as its obviously novel and unfamiliar.
I’m not invalidating your pov, most times I agree with it. I think the difference is how the various traders balance the information they see on their various displays (charts included) with the PV relationship at the HRE.
The various bias that traders have will determine how they process current market information. Some traders can only perceive in ‘hindsight’, others have taken hindsight and inversed it to experience ‘foresight’. One trader looking at a range bound day doesn’t see the multiple competing trends within the range. A btfd trader doesn’t see the signals that came before forecasting a markdown day. A novice stft trader doesn’t see the signals for a markup day.
There’s a diversity of opinions of what actually defines a trend here in ET, why wouldn’t that carryover in the interpretations of a single chart?
A buyer is happy when there are more sellers.
Not, once they become a holder.
And cease to be a buyer.