The ACD Method

Also, I'm not say screw the trend...mean reversion is where its at. I'm not going to start fading the ES and adding every 10 handles that it goes up and and say "its due for a correction etc. etc"

I trade stocks intraday, I have no idea what works on a higher timeframe or in other instruments. Look at Crude oil for godsake, that thing wreaks momentum!

I made quite a bit of trades using ACD and other approaches that entailed selling near lows and buying near highs. I kept a record of these trades and noticed something very interesting. There was a clear pattern. Even when we were falling out just a month or so ago, the results were not that different.

Does this mean I think momentum trading doesn't work. It prob doesn't matter what I think, I just think momentum trading is very hard to day in STOCKS(INTRADAY). I simply looked at whatever data I had collected and discerned a pattern. I'm not a FADER now. Just trading what i see.
 
Quote from Shanb:

Also, I'm not say screw the trend...mean reversion is where its at. I'm not going to start fading the ES and adding every 10 handles that it goes up and and say "its due for a correction etc. etc"

I trade stocks intraday, I have no idea what works on a higher timeframe or in other instruments. Look at Crude oil for godsake, that thing wreaks momentum!

I made quite a bit of trades using ACD and other approaches that entailed selling near lows and buying near highs. I kept a record of these trades and noticed something very interesting. There was a clear pattern. Even when we were falling out just a month or so ago, the results were not that different.

Does this mean I think momentum trading doesn't work. It prob doesn't matter what I think, I just think momentum trading is very hard to day in STOCKS(INTRADAY). I simply looked at whatever data I had collected and discerned a pattern. I'm not a FADER now. Just trading what i see.
More...

Yes, but your mind is the one telling you what you see, not the other way around. It's kind of like this: You show any random chart to two traders, trader A says the charts shows we are going to the moon. Trader B says the chart shows we are going to crash. It's the same chart! LOL. People see what they "want" to see. I'm not criticizing your decision to fade, I'm just commenting on your learning process. I sense the frustration in your posts over the last few months as with Kurt "Olive Garden".

I always tell traders when they are first starting out to be be super careful because the habits they pick up early on, they keep them for life. They are very hard to break. So make sure you are forming good habits.
 
Quote from Maverick74:

Yes, but your mind is the one telling you what you see, not the other way around. It's kind of like this: You show any random chart to two traders, trader A says the charts shows we are going to the moon. Trader B says the chart shows we are going to crash. It's the same chart! LOL. People see what they "want" to see. I'm not criticizing your decision to fade, I'm just commenting on your learning process. I sense the frustration in your posts over the last few months as with Kurt "Olive Garden".

I always tell traders when they are first starting out to be be super careful because the habits they pick up early on, they keep them for life. They are very hard to break. So make sure you are forming good habits.
More...

I guess I need to go back to the drawing board! Shucks can't believe that wont work out.

Maybe I need to keep telling myself to ignore that little excel spreadsheet that I've been logging hundreds of trades in. It's telling my the trend ain't my friend. The trend of consistent inconsistency in a strategy is surely random. Maybe I need to fade that data and keep buying into them highs!!
 
Hey Maverick,

You mentioned that newer traders should be conscious regarding bad habits. Any tips on how to form some good ones? Suggested study for some of us newer folks, or reading beyond Logical Trader. Time management/concepts to focus on?

I'm always interested in improving myself, and if I'm at risk of forming any bad habits, I'd love to nip it now.
 
Quote from Quon:

Hey Maverick,

You mentioned that newer traders should be conscious regarding bad habits. Any tips on how to form some good ones? Suggested study for some of us newer folks, or reading beyond Logical Trader. Time management/concepts to focus on?

I'm always interested in improving myself, and if I'm at risk of forming any bad habits, I'd love to nip it now.
More...

Read this guy's entire blog.

http://traderfeed.blogspot.com/

His books are outstanding as well.

Also read Nassim Taleb's book too.
 
Quote from Quon:

Awesome, thank you very much!
More...

BTW, Brett use to be the trader psychologist at Kingstree Trading in Chicago, one of the largest and most successful prop firms in Chicago.
 
Quote from Shanb:

So what is the trend trader to do in a market like this? He would get chopped up playing momentum in this environment. Learning to recognize the environment and not fight the tape would probably help.

Yesterday we had some strong moves in many stocks...fading would've been a losing strategy if one is fading momentum. I sat back and did other things while that was going on, looking at a chart and seeing if something is going up, down, or sideways ain't that hard!

For me it is harder to make money when its going up or down for some reason, everyone is different right!
More...

2 minute opening range of vxx, vix derivative what was the premarket in spy and just about everything else telling you this morning?
 

Attachments

Spy had a wide opening range on the ten minute chart, guess what? so did just about every chart in the index. Pull up the oex and look at each ten minute chart, they are just about all the same. What does reversion to the mean really mean to a new trader. Its hard enough to make money without all these complicated fu*&in investment banker terms. ACD is supposed to help you with your bias and keep you from being the "faceplate on the train" otherwise what is the point?

Somewhere in market wizards is a story about a guy starting on the floor back in the day, and he is getting out of a losing position over and over again. I forget the exact quote. This escaped me the first time I read it, the point was they were trying to induce muscle memory aversion to losses, wrong get out, wrong get out, trend, ride that till the end of time. All the great ones have that same ability and even some of the great ones blew out. Its all in Larry Hites' chapter in market wizards, that's all you need really. What's my bias for tomorrow right now, up/green why? cause the es is up that's why....:)


http://people.brandeis.edu/~yanzp/Study Notes/Market Wizards.pdf
 
"Valuable indicators: if a market doesn’t respond to important news in the way that it should, it is telling you something very important. Secondly, when a market makes a historic high, it is telling you something. No matter how many people tell you why the market shouldn’t be that high, or why nothing has changed, the mere fact that the price is at a new high tells you something has changed"

Larry Hite Market Wizards

sound familiar?
 
You must log in or register to reply here.
Back
Top