Quote from Whisky:
I completely understand that you want to increase the frequency of flipping, as that increases equity exponentially if you have an edge.
Some very positive things have happened in this thread. Most of trading is done by traders using the "edge" concept or principle. wikipedia has some beginning level comments on what is associated with working through the conventional wisdom of edge trading.
There is also abundant information around that addresses tred folloowing or countertrend trading.
Both of the above center on data and inductive processes derived from data processing.
The 8 year old game does not use either of the above, but I did discuss it in terms of chance where I expressed in CW terms that coin flipping would give 2 out of 3 flips as winners and 1 out of 3 as losers, no neutral trades.
So there are two themes going on now in this thread. Logically, through iterative refinement each theme keeps improving and soon anyone will be able to actually follow along doing live trading. This can be done by providing as much advance notice as required for any trader who needs advance warning.
The main trouble is that overcoming slippage and commissions is rather hard for a trade-once-a-day trading method for most people. (as demonstrated in this thread, and more so with increasing size). And your potential coin flipping every 5 minutes for instance...would yield a potential net total of 81 tics per day (RTH only) in costs to overcome, just to break even, and a full focus for hours, which is not easy to maintain.
there was a little humor involved in asking an 8 year old to watch a 5 minute chart for 24 hours a day. Obviously, this is done all the time whereby different groups of people watch for limited periods all the time. SCT is traded on at least 25 exchanges around the world. trendfollowers have listened to Covel in cities of 71 nations, he says.
By watching during RTH and on a five minute chart, we found that the 8 year old did 20 to 40 flips in sets of three pairs where 2 out of 3 times the child had a winning flip. This comes from deduction using a hypothesis set that has specific parametric measures.
A titanic task to breakeven it seems to me.
I define the costs of trading as commissions an fees and giving up the spread. the psread is usually one tick since I use market orders for timing to ffset not having excellent timing. My partial fills are usually 1 second long as noted on my record (see past posts that show this 1 second range and see also the tick charts that can be synched with the partial fills to determine the profits on each posted print).
At this point trough to trogh trading can be defined in minutes per profit making segment. A minimum of two price movements are found in ALL holds. the order of the price movements is dictated, so we all know that the first movement is dominant and the second movement is non dominant.
By deductive reasoning we consider whether of not a dominant price movement exceeds a non dominant price movement. Will increasing volume move price further than decreasing volume is the question?
At this point this has to be proved by deductive reasoning. It has been in several ways but I will go further and prove more support for the deductions.
Running backtests or forward tests do not cut it because this is an inductive exercise
I have been receiving persistent coaching from someone I believe to be gifted at intraday trading with a no-nonsense method, and so far, I have failed miserably at the task of duplicating his results (not sim, not hindsight, not mental masturbation, but actual trading) despite my best efforts.
This history is not a problem. I gave Covel a gift a week or so ago. His mind determined it was gibberish (see Wikipedia). The 8 year old is using a cion flip at two points in the gift I gave him. The child is making money with half a gift. I meet with people who are being given persistent coaching, daily and they are trading making profits on each trade. This means that coaching can give either a profitable result of a non profitable result.
You trade from an inductive foundation and We trade from a deductive foundation. the 8 year old is using deduction based trading too. The child is looking at a screen and it has the volume on it and the script for PRV tells her within 12 seconds of the beginning of a bar, what the volume will be at the end of the bar. She has to flip a coin when she sees the trough, twelve seconds into a bar.
This is not difficult for an 8 year old to do. The transference is amazing. We know one thing about troughs. You thought, for example there could be 81 in a RTH trading day. By deduction you now know that is false. more reasoning will occur as time passes. 8 year olds know that there are 40 or less troughs in a day and I set the number between 20 and 40 and greater than 20. this is the beginning of forming in one's mind a thing called knowledge. Note that edge is the shorthand trader term for knowledge; traders form a 'hood as you know.
I currently feel that the subjective-intuitive-experience component that each one brings to the mix is a crucial determinant of the final outcome, especially intraday trading.
This is something that it is possible to get over or get past. Obviously, you need to put it off for a while. But do put it on your to do list.
