Scatty On The Markets... your questions answered here!

[destriero]

Lol

But seriously, a good question for any experienced trader is re risk management... how do you set stops? And #2 how do you add to winners/scale in? I'd actually prefer to get dests take on it, but scat and others, good topic.

(mine: for swings I scale in/out at 2day highs/lows, for daytrades, I usually do 40-100ish RTs daily, using .08-.2 hard or trailing stops, doing a sequence of 200-400 shares spaced .2-.5 apart to scale, then sell at 1st sign of weakness in the tape).

I'm not the best to ask, as I am always trading around some delta position, but each setup has a scale out target on (stat) vol or best case on my op-vol (peak PNL stress).

 

[Relentless]

Indirectly related but nonetheless...

Why is it most successful traders of financial markets have no desire to pass on their knowledge to anyone - be it family / friends / colleagues / whomever?

Greed? Selfishness? Tried but patrons were pain in the ass and wanted a quick fix?

Just curious honestly. Skilled traders obviously make good money. Seems a waste to let the knowledge simply die with them. Why not help / teach someone else and pay it forward? Then again - humans can be disgusting creatures.

Just always wondered. Thanks for the thread and knowledge in any case.

 

[Scataphagos]

I mean what is your trading style? I know KISS is your motto but other than that - position, swing, day, all of the above? Can’t ask pointed questions if we don’t know what you do.

"Day-swing" (as opposed to scalping). If you observe Price TA, style is the same regardless of time frame. "Buy support, sell resistance, chase breakouts..." Time frame per se isn't a factor. Holding period isn't pre-determined. Just go with what the charts are saying.

On a day-swing play on a futures contract, you might hold one position for most of the day... and depending upon your luck with counters you might hold it all day and even overnight.

A swing play on an ETF might last several days/weeks or more.... again with the counters and how you guess 'em.

 

[Scataphagos]

Good Evening Scataphagos,

First of all thank you for sharing your experience and wanting to give back to us retail traders just trying to maintain sanity on the trading journey.

I believe and trust Price Action Techniques: I have a problem/challenge with holding winners and cutting losses short.

Question:
1. From your experience as a Discretionary Price TA Trader, do you believe that letting winners runs and cutting losses short is "one" of a retail trader best things to do?

Thank you,

Of course you want to TRY to "let your winners run".. but the market makes that difficult because of "counters"... moves against your position and/moves against the trend. You always have to cope with counters... all of which start out small. Some are small and return to trend quickly, others get much bigger of course. The choices with counters are "ride 'em out" or "trade out and trade back in when indicated". Of the two, I prefer the latter.

 

[Scataphagos]

Indirectly related but nonetheless...

Why is it most successful traders of financial markets have no desire to pass on their knowledge to anyone - be it family / friends / colleagues / whomever?

Greed? Selfishness? Tried but patrons were pain in the ass and wanted a quick fix?

Just curious honestly. Skilled traders obviously make good money. Seems a waste to let the knowledge simply die with them. Why not help / teach someone else and pay it forward? Then again - humans can be disgusting creatures.

Just always wondered. Thanks for the thread and knowledge in any case.

Teaching takes a lot of time and there is no financial upside unless you can do it in a big way. "Trading schools" try to do that with having a large following and each student paying a significant fee for the privilege. Usually not worth it as we already know.

 

[Laissez Faire]

As an old timer, and particularly relating to index futures, do you feel price action/behaviour intraday have changed since you started trading? If yes - how so?

I seem to recall Marty Schwartz who was very successful day trading e-mini S&P 500 futures say in a newer interview that he no longer could day trade ES futures successfully in present date or something to that effect.

 

[qlai]

The choices with counters are "ride 'em out" or "trade out and trade back in when indicated". Of the two, I prefer the latter.

If you trade in and out on counters, wouldn’t that be more of scalping than day-swing?

 

[Scataphagos]

As an old timer, and particularly relating to index futures, do you feel price action/behaviour intraday have changed since you started trading? If yes - how so?

I seem to recall Marty Schwartz who was very successful day trading e-mini S&P 500 futures say in a newer interview that he no longer could day trade ES futures successfully in present date or something to that effect.

I think it's still the same except moves are more volatile and faster. I really don't like that, but what can we do? Traders have a "comfort zone" for "all whatevers" going on. When the market movement gets outside that zone, traders tend to do less well... me included. We now live in the age of the "interventionist market". I liked it better years back... but unfortunately, we ain't goin' back to Kansas.

Observe what happens after a Fed announcement or economic number. The futures usually THRASH back and forth several times.. 20 points or more in a minute or two.... and occasionally a lot bigger. I look at that and wonder, "how can I trade that"? The answer is that I probably can't, so I don't bother to try.

 

[Scataphagos]

If you trade in and out on counters, wouldn’t that be more of scalping than day-swing?

Maybe it's a definition thing. I think of scalping as "risking 2 tics trying to make 4". On a day swing you might hold the trade for 3 hours and make 30 points... sell out.. then buy back in later and hopefully make some more points.

There are two kinds of proper "sells" on a long position. 1, you're trying to sell into exhaustion to secure max profit... which is what you'd do at significant resistance. 2, you sell defensively. That is it looks like the up-action is finished and is now in a counter. Your guess is to not ride this one out, so you sell and hope it goes down enough so that you can buy back at a better price.

 

[qlai]

If you observe Price TA, style is the same regardless of time frame.

Can you speak of any resources/teachers that helped you with developing this style of trading? Thanks!