Simple Profitable Method - Take 2

[jimns]

What’s your experience of trading the Simple Profitable Method? Does it work for you? Have you fine-tuned it? Have you lost your shorts? (Or won your longs?)

For those who care, this is the thread for discussing all of that (and more).

OK - maybe you’ve never heard of the Simple Profitable Method. Then check it out at:
http://www.elitetrader.com/vb/showthread.php?threadid=76297 and we’ll see you back here in a month or two when you’ve finished reading it.

The original thread closed at 470 pages and, with over 400,000 views, it’s the most viewed ET TA thread of all time. But, if you’re going to really nail it, you’ll probably need to cruise through it two or three times.

Yeah, I know, everybody’s going to try to tell us that we really only have to read the first two or three pages to get it - but there are plenty of subtleties like why T28 (original moderator of the thread) used triangular moving averages instead of simple or exponential moving averages, why he shifted them two periods to the right, how he exits, why he exited ET, and what Mrs. H. has to do with all of this.

Who knows, maybe T28 or one of his alter egos will even show up to fill us in on a thing or two.

You (yeah, you!) are up first - let’s hear what you have to say.

jimns

 

[Allaces]

Triangular vs simple is a very slight difference, not enough to worry about

The only addition beyond the first few pages worthy of trial is the 3SMA+2

 

[steve46]

I have a comment here.

As some may know from my previous posts, I don't like to see folks scammed.

So, I would like to point out the obvious;

If you look at a chart using this "blog simple" MACD signal, you will notice that by the time the signal "hits" you have missed most of the move.

Sure you might pick up a few ticks, however, it is more likely that "you" are extending the move just a little bit, while someone else gets ready to sell to you. System vendors and folks who offer "free" info on the net have a term for this. It is called "eating their young"..... To check it out, look at the place on your chart where you normally enter using this "simple" method, then take notice of the place where the move loses steam. Especially if you are trading a futures index (ER, ES, or NQ) you will often find that your signal has you buying or selling into what we would call an "exhaustion move".

So, I would suggest that you ask yourself "when I take this signal, who is on the other end?" I will bet that often it is trader28 and those of us who know how to get a more favorable early entry.

By the way, there is nothing wrong with trading short term momentum. With a little tweaking you could turn that system into a winner, but not using MACD for your setup. Also, you would have to learn how to estimate daily range, so you can stay in long enough to overcome expenses. Trader28's ten minute time stop ain't gonna get you where you need to go.

I will bet that to the extent that someone is making money off you folks, there will be a lot of conversation, and accusations aimed at discrediting me. My suggestion is to take every comment with a grain of salt. Ask yourself "what is so important to these folks that they need to bury this comment?"

Also I wonder how many of you actually make money using this in its "original" form. My bet is not many.

Good luck
Steve

 

[Allaces]

Quote from steve46:

I have a comment here.

As some may know from my previous posts, I don't like to see folks scammed.

So, I would like to point out the obvious;

If you look at a chart using this "blog simple" MACD signal, you will notice that by the time the signal "hits" you have missed most of the move.

Sure you might pick up a few ticks, however, it is more likely that "you" are extending the move just a little bit, while someone else gets ready to sell to you. System vendors and folks who offer "free" info on the net have a term for this. It is called "eating their young"..... To check it out, look at the place on your chart where you normally enter using this "simple" method, then take notice of the place where the move loses steam. Especially if you are trading a futures index (ER, ES, or NQ) you will often find that your signal has you buying or selling into what we would call an "exhaustion move".

So, I would suggest that you ask yourself "when I take this signal, who is on the other end?" I will bet that often it is trader28 and those of us who know how to get a more favorable early entry.

By the way, there is nothing wrong with trading short term momentum. With a little tweaking you could turn that system into a winner, but not using MACD for your setup. Also, you would have to learn how to estimate daily range, so you can stay in long enough to overcome expenses. Trader28's ten minute time stop ain't gonna get you where you need to go.

I will bet that to the extent that someone is making money off you folks, there will be a lot of conversation, and accusations aimed at discrediting me. My suggestion is to take every comment with a grain of salt. Ask yourself "what is so important to these folks that they need to bury this comment?"

Also I wonder how many of you actually make money using this in its "original" form. My bet is not many.

Good luck
Steve

What planet are you trading on Steve?.. the idea that one of us could gain some sort of advantage by manipulating the minnows here on ET who collectively wouldn't add up to a mouse fart in tornado in these markets is patently ludicrous

And you obviously did not read the simple profitable method or you would know that the 8SMA+2 was used for anticipating the zero line cross and the 3SMA+2 was used as an almost instant re-entry in a trend

Jesus I wish evolution was more efficient at weeding out stupidity, where's the giant Earth impacting comet when you need one?

 

[steve46]

According to the site, 70,000 folks have access to the simple method. Some percentage are going to try it.

A smart person might make the rounds of sites like this and get a respectable group of adherent trying to trade that method.

Generally a method like that works some small percentage of the time anyway due to dumb luck, thus encouraging folks to put some money into the till. If it goes their way for a while, they tell other traders about their "success", building it up a little bit along the way. THATS how it works.

Frankly I thought it was a work in progress when it started. I do think that the OP deserves some credit for providing the basis for a protentially profitable system. That is about as far as I can go.

Thats all I have to add.

Steve

 

[kiwi_trader]

Quote from Allaces:

Jesus I wish evolution was more efficient at weeding out stupidity, where's the giant Earth impacting comet when you need one?

LMAO ... Thanks for one of the funniest lines I've seen at ET for ages. Very good.

But Steve is right. This is the sort of system that leaves n00bies bloodied and battered on the side of that great battlefield we call the market. It can be improved (there is nothing wrong with buying pullbacks in a push) but without improvement it is unlikely to create much joy - except amongst the predators.

Jeez Steve, why did you say that. You're betraying the longer lived ETers. You are so wrong. The system is fantastic ... can you guys please try a bit of evening trading - you'll find the system works fantastically well on the Hang Seng (IB symbol HSI).

 

[jimns]

Quote from Allaces:

.. the idea that one of us could gain some sort of advantage by manipulating the minnows here on ET who collectively wouldn't add up to a mouse fart in tornado in these markets is patently ludicrous

Agreed - Although the SMA thread has been viewed over 400,000 times, only a very few of the attachments in that thread have been downloaded more than 100 times. And 90% of those probably didn't understand what they were looking at.

jimns

 

[jimns]

Quote from steve46:

A smart person might make the rounds of sites like this and get a respectable group of adherent trying to trade that method.

Actually, I'm preying on the predators who are preying on the adherents who are trading the SMA.

jimns

 

[TSGannGalt]

I guess there's a lot of people trying to make a profitable system using TA.

I'm not going to bother reading a long TA thread but has anyone actually tested it? This is my opinion but to be called a system or a model, it has to be tested.

 

[ElectricSavant]

Yes Sir...quite revealing....

be careful now you better put on your "thinking cap"....

Quote from Allaces:

You know Baron actually asked me if I wanted to be a moderator.. but having a triple digit IQ ruled me out.. true story