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

[Handle123]

I don’t think I ever heard this before from traders. What is there to memorize? You mean all the pre-requisites for a specific trade set up? I assume you can automate that into scans. Or you mean it’s overwhelming for students to take everything in at once?

Many who buy trading systems, those who made the trading system lack so much depth. I co-owned a brokerage for short time in the 90's, learned much as to what was needed by losing traders, they were often 1.5 trades a day from being breakeven trader. My student has losing days cause he didn't look at whole picture and should not have taken an otherwise viable signal, just cause 99% of it says yes, that 1% says no and don't take it. If you have to study hard at a chart to find a signal, chances are you should pass, good trades happen in beginning and middle of a swing, not at ends and not after topping patterns. I have learned to micro analyze for scalping.

I started trading commodities in 1985, 7 years after I started long term stocks, leveraged instruments trade differently in some ways than stocks, much faster. And learning to scalp is even faster now since ES is at 4400's, becoming more like day trading. I think scalping is by far hardest to master whereas longer term you have days to make a decision, scalping is micro-seconds. There is very much to memorize.

I tried teaching systems that already automated, have had to cut back thrice, he won't give up, so am re-designing something some years back and less he has to memorize, much more signals which he doesn't like, but when chart patterns have high percentages of reversals or pullbacks, can't keep buying/selling toward that direction.

... If there are many ways to screw up, what would you consider the top 5 and how would you guard against them?

1) "I just know this is going up", having an emotional response causes loses, like when traders start "hoping", they already lost. Some experienced traders are gifted.
2) Moving protective stops, trader could be taking loss personal, like how could he be wrong.
3) Not having the answers before the question, how many posts you read on ET where someone is in a trade and don't have a clue to where to get out with lose, profit or move the protective stop, due to not having a solid Trading plan.
4) They have money spent before making it, they have no clue what it takes to have profitable weeks or months.
5) They don't have something going on side whether full time job or part time or huge sum in bank to take off stress, they can't weather the storm.

 

[Handle123]

That's the kind of thing in which you can have high confidence and trade "bigger". I don't know of anything like that in my method, but some correlations are "very" high and should be traded bigger. (Too bad they don't occur all that often.) At such times the potential reward is great and worth additional risk IMV.

I don't particularly care for options, but I might learn to care if I had a 68/68 tool.

Trying to have buddy automate it, but much more difficult to automate options and should stock be called...then what. I have shut down 6 of 8 scalping systems to apply more funds to options. Long road traveled to design something that seldom loses, but now testing 3 other systems that seldom lose to boot, stocks so much easier than commodities, but commodities offer larger profits eventually. I run out of funds most days to cover all the signals, but I am very conservative of certain percentages must be in cash when options are negative. Never going to only be trading just options.

I still don't understand much of the Greeks, know a couple and they small part of system.

It's funny, 4 systems that seldom lose for me, I was originally going in different direction when was working on them. But now, design to trade options is easier.

 

[qlai]

It's funny, 4 systems that seldom lose for me, I was originally going in different direction when was working on them. But now, design to trade options is easier.

I assume you are talking about longing options, otherwise it’s not difficult to have “rarely loosing” options system.

 

[Handle123]

I assume you are talking about longing options, otherwise it’s not difficult to have “rarely loosing” options system.

The 4 systems that seldom lose for me, only one deals with options, others are scalping commodities which runs 24 hours a day seeking a pattern, long term commodities and swinging stocks. Some look for patterns and one is conceptionally.

Took me three years backtesting options to actually find something that doesn't lose more than 10% of the time only to discover it seldom loses.

@qlai , you must do well then selling options. There is always something to learn about.

 

[qlai]

you must do well then selling options. There is always something to learn about.

Well what I meant was that there are many ways to sell OTM premium with very high win rate by nature. That wouldn’t surprise anyone I think. But making consistent money buying options would be more challenging, imho.

 

[Handle123]

Well what I meant was that there are many ways to sell OTM premium with very high win rate by nature. That wouldn’t surprise anyone I think. But making consistent money buying options would be more challenging, imho.

I have friends that do OTM, they have losing year out of five, this style does not interest me in the least. Since I believe no one trader has a system that only traded by them, am sure others are doing what I am as I see volume come in.

 

[murray t turtle]

1. Counter trend? Sparingly and conservatively. After all, you've got the "wind in your face". Not the best way to try to make money.
3. Dojis are just short periods of indecision... may be found at trend turns, however.
4. I trade off of daily and shorter time frames. [6] No long term stocks for me
8. I generally don't concern myself with individual daily bars... though I'll make note of a 2x or 3x star pattern at the supposed end of a swing.

Good points + %;
except never spend all your money, even if in military/LOL., I do like some ETFs long term, not stocks,stox.

 

[nyxtrader]

1. Counter trend? Sparingly and conservatively. After all, you've got the "wind in your face". Not the best way to try to make money.

2. Don't care about "slope" anything.

3. Dojis are just short periods of indecision... may be found at trend turns, however.

4. I trade off of daily and shorter time frames.

5. I don't advocate "targets". "Let profits run", if you can.

6. No long term stox for me

7. Stops based upon chart and trade entry. Subjective (IOW, a guess.)

8. I generally don't concern myself with individual daily bars... though I'll make note of a 2x or 3x star pattern at the supposed end of a swing.

9. Yes, have traded commodities... not only for my own personal account was also at one time a CPO/CTA.

10. Megaphones are rare. Sometimes they seem to be forming only to abort before "completion".

Megaphones or broadening formations are everywhere....The market moves in a series of broadening formation. Hope you have a speedy recovery.