The Ultimate DAX Scalping Discussion Thread!

It is easy to take your losses (it should be). But do you let your profits run long enough? It was very difficult for a mastertrader like Marty Schwartz (read "The Pitt Bull"), so I suppose it is for nearly all traders (maybe except George Soros). We all love to take profits.
I think the solutions are:
1. Think more long-term.
2. You must have a opinion where the market is going - and why.
3. You should not focus so much on profits, but instead treat this like a game of chess (or poker). That will calm your emotions.
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Or maybe we should all be scalpers.
 
Quote from Baruch:

It is easy to take your losses (it should be). But do you let your profits run long enough? It was very difficult for a mastertrader like Marty Schwartz (read "The Pitt Bull"), so I suppose it is for nearly all traders (maybe except George Soros). We all love to take profits.
I think the solutions are:
1. Think more long-term.
2. You must have a opinion where the market is going - and why.
3. You should not focus so much on profits, but instead treat this like a game of chess (or poker). That will calm your emotions.
---
Or maybe we should all be scalpers.
More...
You think being a scalper will alleviate these problems? LOL! It will amplify them! :eek:

The upside to (good) scalping is minimal losses, minimal drawdowns, smooth equity curves, possibility of no or rare losing days, ultimate control, possibility to use a lot more leverage (because of very small stops etc), and ergo possibility of much larger profits, more money velocity, more trading opportunities, higher hit rate etc etc.

The downsides? There are many! As I detailed, scalping, at least in electronic markets, is the hardest form of trading. The odds with commissions, plus spreads etc, are badly against you. You are subject to lots of dick-swinging by the big guys, you're pinching pennies in front of bulldozers all day long! You really need to constantly watch out not to have your head swept by flying knives, watch every tick on several markets, and make ultra-fast decisions, all of which takes enormous practice and energy. And I assure you, if you are still prone to emotional (re)action - as most beginners are - then you are very likely to develop stress symptoms, such as stomach ulcers etc!

To me, scalping isn't really that stressful (anymore), but it sure does drain your energy at times! Quite often I am completely exhausted and tired after 2 hours of scalping! Sometimes I don't trade at all! It is a very high-performance kind of sport, and I think if you really want to do it, the way to go is to start in much larger timeframes and work your way down systematically. Don't start with scalping, it's not good practice! But that's just IMHO.

Anyway - ORDER THIS *NOW* : :)

http://www.amazon.com/exec/obidos/t...f=sr_1_1/103-1068160-4928613?v=glance&s=books
 
People never change - as Livermore himself said it. I LOVE the book (the best ever written about trading), but Livermore also wrote a very good book, "How To Trade In Stocks", just before he shot himself.
 
Quote from Baruch:

People never change - as Livermore himself said it. I LOVE the book (the best ever written about trading), but Livermore also wrote a very good book, "How To Trade In Stocks", just before he shot himself.
More...
Reminiscences is indeed a classic, and one of my favorite books (not only for trading). It's certainly got a lot of value to it, in terms of realizing the thinking of "stock operators".

But what fascinated me most is that there were people out there actively scalping REMOTELY for tiny amounts, in and out dozens or hundreds of times a day, by reading the quotes, time&sales (back then : ticker/tape - why do you think it's still called tape?), and absolutely NOTHING has changed in scalping since then, and all this happened like ... What? 120 years ago? :eek:

Amazing. Just amazing. I just read the book again this afternoon. It's a true classic.
 
As some of you might know, I am a long-time practitioner of martial arts, now several years of Shotokan-Karate, and while keeping me fit & alert, it has also enormous qualities in the pursuit of discipline. This is what makes it so valuable to me as a trader. But there are many more things and philosophies that make the spirit and rules of Karate very applicable indeed to the art of trading. I have been going through my archives and here are a few of the major rules of Karate...

How much of this you can successfully apply to your trading depends on nothing but the extent of your personal abilities to understand, to be creative about your actions, and to translate concepts from other areas of life into a specific, new area.

As for myself, I have found a myriad of inspiring rules and analogies in the world of martial arts which greatly apply in trading.


I would like to invite those here with a sharp mind to find their own ways of interpreting these concepts, translating them into the trading world, and posting some inspiring results on this thread. I know there are many good interpretations, myself I have found applicable ones for each of those rules. I will post my own interpretations later on. Here we go:


Karate is not only dojo training.

Don't forget that Karate begins with a bow and ends with a bow.

In Karate, never attack first.

One who practices Karate must follow the way of justice

First you must know yourself. Then you can know others.

Spiritual development is paramount; technical skills are merely means to the end.

You must release your mind

Misfortune comes out of laziness.

Karate is a lifelong training.

Put Karate into everything you do.

Karate is like hot water. If you do not give heat constantly it will again become cold.

Do not think you have to win. Think that you do not have to lose.

Victory depends on your ability to tell vulnerable points from invulnerable ones.

Move according to your opponent.

Consider your opponent's hands and legs as you would sharp swords.

When you leave home, think that millions of opponents are waiting for you.

Ready position for beginners and natural position for advanced students.

Kata is one thing. Engaging in a real fight is another.

Do not forget (1)strength and weakness of power, (2)expansion and contraction of the body, (3)slowness and speed of techniques.

Devise at all times.
 
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