Real Forex Trades

[RealForexTrades]

Quote from Brabed:

RFT,

One question, I noticed you closed out your Outlook trade a bit early. Do you still expect it to hit its target?

The Position (or, long term outlook) Trade is closed early this time, because the Position Trade Signal's Probability has dropped below the required minimum threshold of 65%.

I allow a lower threshold for the Position/Outlook Trade because it has the ability to extend over many months. Right now, it is Long over the next 1-7 months. At the beginning of the year (end of last year) it was Long over 1-5 months where it took out the 2300 range it projected from the high 1700 level. At the 2325 level it turned Short and it is now once again pointing Long through a 1 to 7 month window. The window’s time-frame changes dynamically according to which segment of monthly market data the system happens to be analyzing.

If the signal’s probability increases above it's required threshold, the profile will re-activate and its switch will be turned “On”. However, re-entry criteria is not the same as initial entry criteria – so there will need to be a sufficient number of pips being projected before a re-entry would be considered for that profile and the strength of the signal itself will need to be above the re-entry minimum threshold.

The Position/Outlook Signal is very much like a turbine jet engine. It takes time to “spool-up”. Once it spools-up, you either move out in front with it, or you run the risk of getting caught up in its jet blast trying to trade behind it.

The "original" target of any profile within the system is always at risk of being struck regardless of whether or not the parameters exist sufficient enough to turn the trade "On", or make it "Active".

I forced the system to try to look for the cream of the crop and not every trade that comes down the pipeline. Most of the time, it does a good job of that.

 

[RealForexTrades]

General Journal Note:

FYI and Heads-Up Notice.

Today, I will be doing some additional coding in the system, increasing the synergy between a few critical core level signals. An idea that I had testing a long time ago is prompting this alteration.

It will be a "critical" change, but it will not be one that will require the routine battery of 280 back-tests. In fact, when I'm done I plan to hit the ground running with just a couple of sample tests before going back into full Production level trading (live). No new components are necessary as all required components already exist - this is just going to be a fairly simple re-wiring of already existing components with some additional code to create a better synergy between the daily and weekly data.

If I get the work done by EOD today, then I should have the next profile ready for 3/22/06 to 3/23/06. If not, then I should have it ready for the 3/23/06 to 3/24/06 EOW daily session to close out the week. I'll be back online then.

 

[riskarb]

Quote from RealForexTrades:

Yes – the DNA stuff (which I technically define as a TCD – Transequential Contiguous Delta, a term I created)

Oy fucking vey... this qualifies as a UPN sitcom. Wait, wait, wait; TRANSsequential Contiguous Delta? Just checking. One "S" or two?

 

[hoangmphung]

Thanks for your detailed answer, RTF. I really appreciate it.

Your comments about trends and when they end remind me of Larry Williams. In one of his books, he said that a trend is going to end soon when its bars open and close near their extremes. And his pattern recognition approach seems similar to yours too. Of course, his operates directly on OHLC fields and yours on metadata and his methods (or what he disclosed) are quite crude compared to yours.

On some other boards, you talked about the apex/blade trades (non-directional trades in channels). I don't understand why you enter two opposite positions at the beginning and reverse the ITM one at the channel borders. Putting two limit orders at the two channels borders will do the same and save you some commision. Am I missing something here?

 

[RealForexTrades]

Quote from riskarb:
Oy fucking vey... this qualifies as a UPN sitcom. Wait, wait, wait; TRANSsequential Contiguous Delta? Just checking. One "S" or two?

Why - because it is not the old style "iron fly" that you are familiar with? You guys are amazing people. Anything you don't understand is a sitcom. Just how shallow can you be?

Here, let me slow down for you just a bit, before Scottie beams you up to never land.

Tran: short for Transitional because TCD’s are constantly in transition.

Sequential: because one follows the other in a non-linear sequence.

Contiguous: because the bars of data are adjacent to each other without a time-frame break. (Antonym: Non-Contiguous.)

Delta: because the difference between multiple price points is being measured in real-time generating a real-time variable measuring Magnitude between price points – which is what “delta” is all about.

In fact, if you are getting hung up on just one single term this system uses, then you are really going to have difficulty with the remaining 612 entries in its vocabulary and that only represents the "core" of the system and excludes the entire Metadata Vocabulary which is about 3 times the size of the core.

I've researched, designed, engineered, architected and built over a six (6) period, a new “language" that describes market behavior and that has zero connection with the conventional or traditional TA that you might be familiar with. You don't do that in a vacuum. So, yes – you would have to get up to speed in order to understand it, or why it was necessary to create it.

Make a complete fool of yourself if you must, its your party.

This is the kind of stuff that comes from Riskarb:

Quote from riskarb:
Define a unit. You can't trade cash w/o trading synthetically. WTF are you buying and selling?

And, on…

Quote from riskarb:
These "maggots" are the only thing standing between you and utter and complete destruction. Me and some of the boys at vt have a bet on how long you'll last. I'm rooting for ya.

And, on…

Quote from riskarb:
Let me know when you get your "Brokeback Fund" off the ground.

And, on…

Quote from riskarb:
Thanks Pismo. Sold the 30-wide iron fly for $4.00 risk credit.
Sold some TS Apr 180 straddles for 21.00 at 43% vol.

So, he knows what an “Iron Butterfly” actually looks like. Nice. But, if he knew why non-directional trading was not necessary, how much better a trader do you think he’d be. I suggest – much better.

Quote from riskarb:
TS straddle went out at $19.20 ask at 41-42% vol.

Miracles do happen.

Quote from riskarb:Vols have collapsed to 18%. The straddle is currently trading at 680. Offset 7 of the straddles and converted a few to 500-wide iron flies at a 30 tick lock. I'll offset the remainder on Monday.

Ooops! There goes one of the problems with non-directional covered trades using derivatives – but, hey. He’s still trying to figure out what a TCD is all about and because of that, he has to trade on a covered basis which seriously erodes his true/maximum/optimal earning potential per trade. But, rather than try to understand this, he’d be more comfortable with trading strategies of yester-year.

I thought this was: “Elite” trader.

Look guy – I used to trade the same stuff you now trade and a lot more: Iron Butterflies, Straddles, Strangles, Call/Put Ratio Backspreads, and a few of my own creations such as: Lead-In Straddles, Trailing Straddles, Single-Side Expanding Call/Put, Double-Sided Expanding Put/Call, Compression Bubbles Calls or Puts, Gamma Eclipse Calls & Puts and a couple more attempts at covering my butt and it all lead to the same exact problems:

1) De-optimization of maximum revenue potential per trade.

2) Theta Decay –vs- the need to generate revenue today, not tomorrow.

3) The inability to unwind and unload “gracefully” upon adverse market momentum to the weak side of the covered equation.

4) Volatility latency on “ghost” contracts – you know the one’s that seem to go from “GO” to all “Show” in no time flat without justification.

5) Somebody spilling coffee in the lap of a customer in one my underlying company’s just when I’m about to spank the cash register after wasting all week long to cash out – oops – too late.

6) Overly prolonged exposure to adverse news given the need to “always be in” and overly dependent on parent index momentum against the weak side of the covered equation. (there is always a weak side to covered derivative constructs)

And, a few others.

Look, I’ve got no problem with what you do as a trader. You obviously have some skills. But, there is one big difference between the two of us. I KNOW full well what you attempt to and I know that it is purely strategy based and born in the old concept of spread trading. Spread Trading by any other name is still, spread trading. I’ve got no problem at all with spread trading concepts and I used them for a few years back when I was trading Option Contracts, qqq, diamonds, and all that stuff WHEN it used to be “in vogue”. So, I really don’t knock what you do because I understand what you do and used to do similar myself after educating myself with Covered Derivative plays YEARS ago.

The problem I have with your post is that instead of ask intelligent questions as other wise people have done in here, you instead decided to take the same path that other uninformed individuals took from the very outset of their very first post. A negative tone, arrogant demeanor, and a very narrow mindset which in the end, leaves you less informed, more ego filled for having made the slight-of-hand attack and far more satisfied than before you entered the thread. Now, I’m pretty sure that spells you correctly and fairly.

There is far more than one way to skin a cat. You like non-directional spread trading of derivatives (which is a serious mis-statement, but I won't take the time to explain it here). Ok - that's fine. I've been there, done that and found something that I think is light years ahead. Ok - fine, respect that fact and stop injecting lunacy into another's journal. The Forex is NOT the Option Derivatives market.

I understand FULLY the market you trade. Do you understand FULLY, the Forex? That's a very fair question. You use "strategies" because you have NO clue about Direction. If you did, then using Iron Butterflies would not be the most optimal profit making spread trade type.

But, if you had a better understanding of the four (4) giants of trading:

Timing
Direction
Magnitude
Probability

You would be far more profitable and you just might get out of the equities markets and start trading currency pairs. I've been down this road a thousand times before with options guys/gals. I came from the Options Markets. That's where I was birthed as a trader. That's where I cut my teeth - broke a leg and gave blood routinely until I got it right.

Drop the attitude, and you just might learn more to add to your toolbox – or, you might not. Whether you do learn or not – is not my concern. That you do not cause me to analyze and correct you this way again, is my concern.

Now, do you mind – I promise not to interrupt your journal while you are trying to grow cash in a hydroponics farm of limited opportunity

 

[RealForexTrades]

Quote from hoangmphung:
Thanks for your detailed answer, RTF. I really appreciate it.

No problem - I really appreciate your honest questions and the intelligent way you ask them. It is clear to me that you've actually followed-up on some of the concepts that I've been talking about for years, now. Thanks!

Quote from hoangmphung:
On some other boards, you talked about the apex/blade trades (non-directional trades in channels). I don't understand why you enter two opposite positions at the beginning and reverse the ITM one at the channel borders. Putting two limit orders at the two channels borders will do the same and save you some commision. Am I missing something here?

Very good question and there is a very good answer!

All of the Blade and Apex Trades are "strategies" within the system's signal parameters. Let me get back to the coding tonight and I'll come back and answer this one when I'm done.

Regards.

 

[hoangmphung]

Another question so that you can answer them all in one go: I'm assuming that on each day, only a small portion of your patterns/indicators are matched/activated. That begs the question some patterns may be activated only a few times a year and if you only backtest them on 280 bars, would it be statistically valid? Or somehow all your indicators participate in decision making every single day? Which understanding is correct?

I begin to be really inspired by your posts. Hey, who knows I may be able to do the same one day For that to be even remotely possible, I'm trying to get as much from you as I can for the time being. Please bear with me.

Best to your coding.

 

[riskarb]

Quote from RealForexTrades:

Ooops! There goes one of the problems with non-directional covered trades using derivatives – but, hey. He’s still trying to figure out what a TCD is all about and because of that, he has to trade on a covered basis which seriously erodes his true/maximum/optimal earning potential per trade. But, rather than try to understand this, he’d be more comfortable with trading strategies of yester-year.

I thought this was: “Elite” trader.

Look guy – I used to trade the same stuff you now trade and a lot more: Iron Butterflies, Straddles, Strangles, Call/Put Ratio Backspreads, and a few of my own creations such as: Lead-In Straddles, Trailing Straddles, Single-Side Expanding Call/Put, Double-Sided Expanding Put/Call, Compression Bubbles Calls or Puts, Gamma Eclipse Calls & Puts and a couple more attempts at covering my butt and it all lead to the same exact problems:

The Nikkei trade was a $20k winner in 4 days. Apparently something was lost in your grade-school translation, but most don't confuse a win with a loss.

Look guy -- your predominant problem is your pathetic, albeit hilarious attempt at baffling these clowns with your Riemannian Manifold isometrically embedded in Euclidean Space Yada Yada Bullshit. Of course, the only response[other than mine] came from your own alias. I guarantee you never made it beyond the 12th grade.

Compression BUBBLES calls OR puts? Gamma Eclipse? OMFG, I am pissing myself. Dude, you win the Darwin Award of the Millennium. I'd be flattered that you took all this time to get my posts vetted with this elaborate response, but it falls flat due to your deficient intellect. Oh fuck, COMPRESSION BUBBLES CALLS! ROTFLMAO.

Go sell crazy somewhere else; we're all stocked up here. Nice scam you're running -- you may make a buck following the short bus around town.

 

[TMcKenna]

Wow RealForextrader, that was really something.
Riskarb has finally met his match, I mean somebody who actually understands what he does and even able to correct him.
This is going to be interesting.
I have no idea what you guys are talking about but I like it very much

 

[RealForexTrades]

Quote from riskarb:The Nikkei trade was a $20k winner in 4 days. Apparently something was lost in your grade-school translation, but most don't confuse a win with a loss.

I never said you lost money. Mine was an allusion to the timeline. You take 4 days to make $20,000.00. That’s great! You should be happy – I’m happy for you. However, my very first trade on this board took a bit more than 24 hours and it net a lousy 15 pips. But, that same trade net a cash return of exactly $120,000.00 gross and $108,000.00 after required 10% withdrawal per the Revenue Model specifications. That’s $12,000.00 spend-able pocket change on a single trade and it get better – much better. My last trade was several hundred thousand dollars in red ink, until I closed the trade for a 1 pip aggregate net gain. That one pip was worth $8,000.00 and it took 24 hours to net out of the market.

Now, I’m not trying to compare cash flow statements here, big guy – but we are not in the same league. I’m not even trading my Revenue Model’s max Cost Basis per trade at this time because I’m still (unfortunately after today) trying to work out some bugs in the system. But, even with the bug, I was still able to net out positive cash at the very least.

I’ve very happy for you for your $20k, I really am. But, please forgive me if I seek higher ground and higher profits along the way. We are not in the same ballpark, here – not even close. You trade the Equities Markets. This is not the Forex. Not, buy a long shot.

Quote from riskarb:
Look guy -- your predominant problem is your pathetic, albeit hilarious attempt at baffling these clowns with your Riemannian Manifold isometrically embedded in Euclidean Space Yada Yada Bullshit. Of course, the only response[other than mine] came from your own alias. I guarantee you never made it beyond the 12th grade. Compression BUBBLES calls OR puts? Gamma Eclipse? OMFG, I am pissing myself. Dude, you win the Darwin Award of the Millennium.

This says a ton about the kind of deviant, hypocrite you really are. Hypocrite – riddle me this: Where do you think the term and/or phrase Iron Butterfly came from?

That one single question blows your entire insinuated argument to shreds. What – do you actually think that Iron Butterflies exist on the Periodic Table of Elements? And, even it if did, do you actually think that it merely evolved into a higher life-form and named itself? When you BS gets deconstructed like this, it really paints you into the corner of silliness, does it not? Case in point: Somebody had to create the phrase “Iron Butterfly”, in order for your lame butt to be able to use it one day at some point in the future because one thing is absolutely certain, YOU were not the author of the original concept. So, you are willing to accept “Iron Butterflies”, but you cannot get your head around a simple concept like a 4 Hour Compression Bubble, or the more exotic Gamma Eclipse. But, “Iron Butterfly”, well that just makes all the sense in the world.

Do you realize how silly this premise is when you play it out to its logical conclusion? You mock a Name given to a mathematical construct that you have never seen before, yet an Straddle or a Strangle, you are perfectly comfortable with. How, non-logical, totally irrational and comical is that.

Lastly, you write just like the 12th grade that you alluded to in your feeble attempt at an insult. For the record, I hold three (3) college degrees (not merely one) and all of them are technical. I’ve been labeled by others over my lifetimes as a classic over-achiever. In my first career, I defended my country from the cockpit of a tactical combat aircraft. In my second career I worked with fortune 5, 1, 2, and global 1k and 2k, type companies as well as “other” entities that shall remain nameless in government, on their enterprise technology solutions. In my third career, I’ve developed a trading technology that makes your Iron Butterfly spread trades pale in comparison. A bit beyond the 12th grade, sorry.

Your arrogance precedes you as your very first post in my trade journal indicates, but that’s ok – I understand how that could happen to someone like you. You felt the need to be just like ALL the other naysayers in the world. This planet is filled with little minded people just like you who can’t stand it when somebody shows up on scene with more tools at their command. This world is also filled with people who once upon a time would kill over their belief that the world was indeed, flat. Your world maybe flat, Sir – but mine is definitely not. Your limitations are not my hurdles. Your lack of vision beyond what you already know, is not my failure to conceive new concepts, new ideas and the implement them.

I’m not here to argue with you. You are a total non-factor as far as I am concerned from this point forward – you won’t even show-up on my radar and you darn sure won’t make it on to my the HUD going forward with this kind of disrespectful trash talk. Because you don’t understand a concept, or because you have never experienced anything outside of your own domain of expertise, or because you can’t fathom somebody doing something that you wish you were able to do, then it becomes BS to you. Just remain outside of this journal if you don’t agree with, or like what’s being said.

I don’t understand what’s so hard to understand about that concept for people like you who love to come out of the woodwork with off-topic rants that are completely off the mark. You’ve got a journal – you made $22k on a trade. Be happy about it – there are a lot of traders out there who cannot do that. In fact, if the truth be told, very few can – so enjoy your skill and ability to create real wealth. But, don’t come into this domain that you know absolutely NOTHING about pretending that you are qualified to tell somebody that what’s being discussed does not exist because that is a huge mistake on your part.

How do think that human progress is made? How do think that someone once discovered the totally new concept of Spread Trading, when it was brand new? How do you think that all the 30 year old Technical Indicators out there in the common knowledge domain got discovered? How do you think the CPU driving your computer came into being, or the material for the fillings in your teeth? Where you think the F22 Raptor concept came from? What drove the decisions almost 20 years ago to design such a weapons platform? Do you think an engineer woke up one morning with a “bright idea”? Get real.

No human advancement has EVER been made in a vacuum. Not my TCDs and darn sure not your Iron Flies. Get over it.

I actually feel sorry for people like you – so much potential, yet so little faith, so little vision or and virtually zero leadership quality. With your skill as a trader pulling down $5,500.00 per day, you should be an open minded leader around here, not some clogged toilet bowl.

Drano.