Saltynuts,
Have you had trading education or mentoring to master trading skills from a quality source?
Thanks,
So, if recently discovered "edges" lose their edge...
- Thread starter Saltynuts
- Start date
Have you had trading education or mentoring to master trading skills from a quality source?
Thanks,
"The market changes" is an ongoing paradigm. IOW... "Keep doing what used to work and the market will eventually knock you on your ass". Up to the trader to be vigilant.
Turveyd,
What is the difference between live moving data and market replay that most platforms have?
market replay and backtesting provides confidence and comfort and less mental stress.
Turveyd,
Are you using indicators based method?
Is your method too simple such as cross over or if this , then that?
Is your method too rigid? My stop is always 20 ticks and my profit target is always 40 ticks when this indicator lines up?
What is it you are looking for?
this is a very big topic..
- first of all most people have the wrong approach to the market - it's understandable as when he begins he doesn't understand what the market is, so he looks at it as some sort of mysterious monster, and therefore he goes to the book store to read 'technical analysis 101', which takes the same perspective - a mysterious monster that emits mysterious signals that somehow can be captured by math formulas with no rhyme or reason.. then he hears about back testing and system trading, a very attractive idea - find some magic, let the machine make money while he lies on the beach.
- so this thread already discussed the problems with this approach - the self-defeating fate of any of these methods based on mystery discovered by back test.... inevitably any profitable pattern is discovered by thousands of people... they get crowded and become vulnerable to counter strikes (aka fails).. so the trader just keep going yo-yo between profits and losses, going nowhere.
- the other big problem with back test is it completely ignores the context, the back drop, the story of the day/week/month/year.... as if price moves simply because random people having random thoughts in an isolated environment, which can't be further from reality..... some day, when AI is advanced enough, and can back test price movement with every news release every viral social media piece etc, then we are talking about the discovery of the true human behavior in the market.... armed with that tool, you can go forward and trade it... because human mature does not change and your system won't self defeat.... but you can imagine the resource required to develop such a system... probably only available to some party like Google Deepmind, which currently is just too busy solving other problems... if they devote to the financial markets they will kill everybody else.... currently these HFs label themselves as AI.... they are really not... systems are terrible, can't even beat the index.
- which goes back to what I always advocate - you have to take the stories into consideration... examples in my 'trading is easy' thread.... there is no need for back test... impossible to do anyway due to the reasons above... you just need to get on the same page with the pro boys, which essential boils down to a few tricks - when the dumb money is long, knock them dead with price action and media manipulation; when the dumb money is flat/short, pull it up until they are long again.... you can observe this over and over with earning cycles and news cycles - the past few in recent memory being: China slow down, oil crash, inflation scare, fiscal cliff, yield curve inversion aka fake recession scare.... please do yourself a favor, review the play by play of these cycles from mid 2015, you will see how the pro boys play this game and hopefully you can get on the same side, and when you do this exercise, do this slowly, daily price bars, and very importantly, the daily news releases.....
- which leads to my final point, after doing the work above, most people probably still won't get it... it does require some analytical thinking skills and a minimum IQ of 120, preferably 140 (if you have 140 this stuff will come quite easy for you).... but the big silver lining is, dollar cost averaging on the QQQ doesn't require any skill, other than a firm belief that investing in America and technology of tomorrow will make you rich so you can stick to it thru the thick and thin.
dozu888,
Thanks for your thoughtful post. Very good and insightful read.
For the logical you presented, should this Only practiced on daily time frame? How about lower time frame for day traders?
Yes, your point on dollar cost average is EXACTLY what i am doing every two weeks my job pays me with the S&P500 index. I max this out to government limits. I am refuse to put all my eggs in trading without future retirement money.
the best time frame is the one that them pro boys use to unfold these stories, for earning cycles it's a few weeks before the release.. for fake recession scares it's a few months, for trade war consolidation it's been 18 months... and don't forget the back drop that currently the 10 year is yielding 1.9% while the SPY is forward yielding 5.2%... and this gap needs to close.... therefore you just need to be flexible.... no sense to pigeon hole into a certain time frame.
intraday makes the least sense... the big boys simply don't breath in this rhythm... I know somebody who is profitable intraday, but he still goes into each day with a bias, based on the longer time frame back drop... my view is that in a slow bull grind it's a waste of time... intraday makes sense only when you are so certain on the direction and you can just pile on and make a killing...forget trading 1 contract and sizing up gradually... I am talking about when you smell blood you put on 10-100 contracts and make your year in a few days... that's what intraday is for.
Developed scalping method that last week could do no wrong-many signals, and this week, very very few signals, is edge gone? NO, but ranges have changed.
Back testing is only as good as you program it to be, and time it takes for you to gather knowledge to ask market right questions, more than 10,000 hours of screen time for me.
And if I was to start over again, I never go beyond long term trading and learn insurance very well, options. Learning how to scalp and day trading is not worth what you lose in living life. The early years of long term it is easier to 100% in commodities, as account grows, concentrating on drawdowns worth more than profits you could have had.
I constantly read people "only" having some much money and can't do long term, that gives you more time to find a decent job, practice trading and accumulate more funds.
Many many many more millionaires/billionaires who do longer term trading than day trading against automation.
Back testing is only as good as you program it to be, and time it takes for you to gather knowledge to ask market right questions, more than 10,000 hours of screen time for me.
And if I was to start over again, I never go beyond long term trading and learn insurance very well, options. Learning how to scalp and day trading is not worth what you lose in living life. The early years of long term it is easier to 100% in commodities, as account grows, concentrating on drawdowns worth more than profits you could have had.
I constantly read people "only" having some much money and can't do long term, that gives you more time to find a decent job, practice trading and accumulate more funds.
Many many many more millionaires/billionaires who do longer term trading than day trading against automation.
Replay of Tick Data fine, just looking at closed M1 candles cheat, it can look like sell off has paused live, but closed you'll see the end result of that 1minute period, it's enough to make you from zero to hero.
Indicator ish, but I also have to read the live price movements to judge time to enter or bail.
My Stop is varied depending on setup and my target is never set, I manually exit when I think it's time, often too eary but sometimes too late also, it's tricky.
Looking for an ATM totally free 1
