Real Trading Strategies

[rs7]

My over the hill brother in law can bench press 430 pounds (about 10 pounds per year of life).

But he has not been able to trade profitably
He has been at it only a few months.

But he will be ok eventually. Because he has begun to have the discipline to:

A: Cut his losses quickly
B: Not trade unless he sees exactly what he is looking for.
C: Not add to losers ever.
D: Not let winners turn into losers.
E: He realizes (mostly from listening to me) that this trading environment is not good for daytrading, and he is intent on outlasting the bad times so he will be able to take advantage of the good when they again come around.

I would stress that this is not an easy market. It is essential to conserve your capital so it will be available when it can be used to your best advantage. A trending market. Preferably trending up. (It's just easier IMHO).

Peace,
Rs7

 

[vladiator]

Originally posted by rs7
My over the hill brother in law can bench press 430 pounds (about 10 pounds per year of life).
Rs7

That's very impressive. I'm aiming for somewhere close by the end of this year. They have a university benchpress meet here and I really want that T-shirt and a copper statue. Vanity-vanity...
Just wanna do it before I get old and can't do it anymore

 

[downtickboy]

Originally posted by daniel_m

Downtick, i don't think it's a totally crazy request you make, but it might be a little too much to expect people to share their strategies with a total stranger. You later told us a bit about the way you trade. By then though you'd already taken heaps of heat about the way you made your request. Maybe if you'd shared what you do from the start people wouldn't have been more receptive.

Good post daniel_m. You are right I should have stated my trading style earlier. I messed up there. I think I would have taken heat either way, but maybe less than I did. Even after I made the post about my style I continued to receive renewed criticism. At that point I had been completely honest about my trading, about my intentions for starting the thread, and the reasons why I wanted to stay on topic with the thread before it turned ugly like a lot of other threads. I thought at worst there would be no responses meaning nobody cared to start a meaningful dialogue on the topic. But people chose to pull out the bow and arrows so I defended myself. The stupid posts (including my replies) can all end. I don't think I have started out attacking anyone so far. I have only responded.

 

[downtickboy]

Originally posted by rs7

But he will be ok eventually. Because he has begun to have the discipline to:

A: Cut his losses quickly
B: Not trade unless he sees exactly what he is looking for.
C: Not add to losers ever.
D: Not let winners turn into losers.
E: He realizes (mostly from listening to me) that this trading environment is not good for daytrading, and he is intent on outlasting the bad times so he will be able to take advantage of the good when they again come around.

I would stress that this is not an easy market. It is essential to conserve your capital so it will be available when it can be used to your best advantage. A trending market. Preferably trending up. (It's just easier IMHO).

Peace,
Rs7

I just wanted to add something I have picked up and plan for now after seeing a bunch of big time traders blow out their accounts. Yes the market is a lot tougher now and you have to be a lot more selective because in my opinion the light volume makes it much less forgiving. A couple of bad trades can ruin your day where as a while ago there was enough volume and volatility to make up for a few dumb mistakes. Now it is all about dodging bullets all day long. There are some traders that I knew who made a killing while it was good. They got in to making a few million in a good year. Well times changed and their expectations did not. So they kept swinging for the fences until they lost a big chunk of their money. They also spent excessively. Now they are scraping by again to cover the basics because they blew all their money on fancy cars, ect. The lesson I learned is to save well when it is good so you can survive the bad times. It is another form of money management but at a macro level. When you are making good money it is hard to think ahead that it will ever end. The people I knew felt that they were just going to get better at trading and keep making more and more money every year. They never thought the market would get this stagnant.

 

[rs7]

Originally posted by downtickboy


....Well times changed and their expectations did not. So they kept swinging for the fences until they lost a big chunk of their money. They also spent excessively.

.... They never thought the market would get this stagnant.

Not necessarily true for all. Here is something I thankfully don't need to re-type from a while back (this is not all of it, but it addresses what you say):

Originally posted by rs7

As others here say, it is not easy. It takes time and the ability to understand that it is a career. A combined experience of highs and lows. The real satisfaction of a career comes from a progressive attitude to learn, work harder and achieve results. The time spent learning and improving, including the struggles, should be rewarding in itself. If not, then this is not a suitable profession for you.

Putting in the proper work can enable you to make enormous amounts of money. Working at trading means analyzing your trades, recognizing your strengths and correcting your weaknesses. It means being vigilant for what is working currently in each market environment you encounter.

Looking for things that negatively impact your trading is very important. Recognizing them lets you remedy them.

Traders incomes can be erratic so it is important to save during the good times to more comfortably get through the bad times. And there will be times that are either downright bad, or less than what you would require if you were to live hand to mouth. Either way, you need to retain a cushion, because hand to mouth doesn't work in this profession. Or any other in which your income is erratic, which is to say, essentially, any business or non-salaried job.

Overall it is a career with great freedom and hours. It should be done by those that find it enjoyable. If it is too stressful, then again, it is not for you.

If you trade with discipline and learn from your mistakes and successes, it can be one of the most financially rewarding endeavors anywhere.

Notice the repetition of the words "career" and "profession". You will find them constantly in the posts of those of us that have traded as our means of support. It is not a hobby or a lark. As the words imply, it requires effort and dedication. And sometimes heartache

By the way, I have a mortgage, a wife, two kids in college, one more yet to go in another year. I have car payments, have to pay all the usual bills, and taxes. I do not have >$10 million like the gentleman who posted just prior to me, but I have managed to live a comfortable lifestyle and enjoy my working time almost as much as my leisure time. That quality of life has a value I can't put a dollar amount on.

PS: Since I wrote this, my youngest boy has enlisted in the Navy. So thankfully, my expenses will be that much less

 

[AAAintheBeltway]

Originally posted by downtickboy


I just wanted to add something I have picked up and plan for now after seeing a bunch of big time traders blow out their accounts. Yes the market is a lot tougher now and you have to be a lot more selective because in my opinion the light volume makes it much less forgiving. A couple of bad trades can ruin your day where as a while ago there was enough volume and volatility to make up for a few dumb mistakes. Now it is all about dodging bullets all day long. There are some traders that I knew who made a killing while it was good. They got in to making a few million in a good year. Well times changed and their expectations did not. So they kept swinging for the fences until they lost a big chunk of their money. They also spent excessively. Now they are scraping by again to cover the basics because they blew all their money on fancy cars, ect. The lesson I learned is to save well when it is good so you can survive the bad times. It is another form of money management but at a macro level. When you are making good money it is hard to think ahead that it will ever end. The people I knew felt that they were just going to get better at trading and keep making more and more money every year. They never thought the market would get this stagnant.

This is incredibly important. I remember from some of the Market Wizards stories that many of them advocated taking a portion of trading profits and putting into Cd's , T-bills, real estate, gold bars, whatever, just so it is not exposed to the market. We never know what might happen.

 

[OddTrader]

Quote from nitro:

Trading is about having an edge and a set of market conditions that favors your strategy - period. Remeber this well, markets chage, and nothing lasts forever - try to find those traders that have survived 5, or preferably 10 or more years doing this - THOSE are the guys you want to emulate because they are the ones that have the "creativity" [for lack of a better word] to have adapted and have survived their "strategies" being "arbed" out, or simply the market conditions have changed.

This stuff you read about adding to losers and managing your money, etc, is for people that started trading two weeks ago and just read Van Tharps book or Douglass's book. The stuff about flipping a coin and managing your money to make a living trading is just inane.

It is incredible how many times the same generic answer gets given on these boards. TRADING IS IN THE DETAILS, and the details are not in indicators. They are in ever changing strategies that at their core give you an edge that you can milk until they stop "letting you." That coupled with your talent to interpret the story that is being told better than the guy/girl that is taking the other side of your trade - period. There is no shortcut to this state thru indicators, etc, only through the pain/joy of experience of trading day in and day out.

nitro

Thanks for the truth, Nitro.

 

[djinney]

Quote from acrary:

Here's one of my specific systems using 3 min. ES bars.

First trade of day is only taken in the direction of the open, so if the market gaps down, my first trade will be on the short side.

After that,

Buy at highest high of last 6 bars.
Sell at lowest low of last 6 bars.

Exit long at lowest low of last 4 bars.
Exit short at highest high of last 4 bars.

Close all open positions at the end of the day.

After every 1k per-contract in losses, increase the number of contracts traded by 1 until a trend happens again and the account sets a new equity high.

Not very exciting, but does make consistent money. Of course I have a large account, so I can withstand drawdowns from many losses. No edge...but I don't need one for this to work.

downtickboy,

you should really pay attention to what's been written above and work from it instead of getting sidetracked by other chit-chat in this thread. It's a good lead to a finer strategy.

I am not going to repeat this nor am I going to say more

 

[murray t turtle]

Quote from bigscalper:

trading success does not come from a specific method... comes more from having a plan for everything...

you must do many things correctly...

1) do you have a strategy for position sizing...

2) do you a method for measuring volatility...

3) cut your losses sure... but... where? how far do you let losers go against you... how do you decide how much to risk...

4) how do you add to winners... how much do you add... when do you add to winners...

5) how do you deal with a losing streak... how do you deal with a winning streak...

6) what plan do you have when a stock gaps right through your stop...

If you start designing a plan for some of these issues you will find that a strategy creates itself.

==============
Number 5] Handle a losing streak, in ES e mini;
cut back small, cut back quick, excellant reasons for that, like short trem/medium trend has usually changed.

Therefore if i dont cut back quick, cut back small ;
more ES emini losses usually follow.

Mod mentoned a winner ,buy low sell hi;
do that some , but more sell low trend, buy high trend

72]specific numbers like 72;
aim & usuall hit working about 72 hours aweek.

Posting is fun & work also, you always gain by sharing;
Bill Gates may not give away a million $ as elite trader said, he is right , its billions he is giving away .

 

[murray t turtle]

5]Handle a winning streak by mainly enjoying it;
still aim at working 72 hours a week.

And balance the ''you gain by giving away;''
balance that one with as my banker dad used to say''dont tell everything you know

Good points bigscalper nickname.