Trading approach adjustment needed

[murray t turtle]

That means if your TA works, your identified support breaks NEVER, you get NEVER stopped out and have a win rate of 100%? Sorry, but that's crap.
Is a 77% win rate not enough?

%%
BIGGEST problems include but not limited to.
1] Paper trading can help, but its nowhere near the real market.
777] One got $1,000,000 selling ''pet rocks'';
buy so many , many more got millions investing + market investing than trading /have to factor that IN.
As the years pass buy, ok,did fine on inVerse ETFs yesterday, but re-read#777
888] Sure Paul Tudor Jones is a billionaire; + inverse ETFs could help a bit , but picking single stocks + profit , frankly was so inferior profits back to my ETFs, medium + long term profits .
666] Oops , a 666= lower number;
some years go, they reverse split + never did well after that in TZA, not blaming them\LOL just saying
999] So few profitable bear funds , if you are not inclined to inverse ETFs dont worry about it!!
''100% paper gains in a few weeks ''?? Interesting, P T Jones only did near that % for few years, but it was real time gains .

 

[mervyn]

no worries, since you are long only, add more money to the account to buffer the drawdown.

 

[murray t turtle]

no worries, since you are long only, add more money to the account to buffer the drawdown.

%%
THAT can work well if your name is Peter Lynch, Fidelity ;
+ meanwhile SPY benchmark moving up in May/QQQ moving up/May/YTD...... .
Oops sorry real time SPy -LOL just lost a dime,weekly. / Back to Uptrends \;
+ ocasional inverse ETFs.............................

Losers add to losers -Paul Tudor Jones.
LOL/ SPY price just gained the dime back

 

[mervyn]

%%
THAT can work well if your name is Peter Lynch, Fidelity ;
+ meanwhile SPY benchmark moving up in May/QQQ moving up/May/YTD...... .
Oops sorry real time SPy -LOL just lost a dime,weekly. / Back to Uptrends \;
+ ocasional inverse ETFs.............................

Losers add to losers -Paul Tudor Jones.
LOL/ SPY price just gained the dime back

what did they say? cost averaging. spy & qqq only go up….

 

[Drawdown Addict]

That means if your TA works, your identified support breaks NEVER, you get NEVER stopped out and have a win rate of 100%? Sorry, but that's crap.
Is a 77% win rate not enough?

If you are just using TA to trade you are bound to failure. There is only one way to use TA properly and it is against it. Whatever an indicator signals, do the opposite.

 

[murray t turtle]

what did they say? cost averaging. spy & qqq only go up….

%%
Good + nothing quite like a good bull market Uptrend;
SH + other inverses can help on day like tuesday

 

[wxytrader]

The problem is support and resistance levels don't actually exist and are therefore un-tradeable. Carry on.

 

[oshjdf]

Hey folks,

I need your input on a trading approach:

I'm using a simple LONG-only strategy on the daily time frame. I buy at support levels, sometimes during a significant pullback, and other times during a minor pullback after a resistance break to the upside. I always keep it simple (KISS) with relatively tight fixed stop-loss (SL) and take-profit (TP) levels.

I've been paper trading this strategy for a few weeks in May with tremendous success. My winning rate is 77%. After a few weeks, I've achieved over 100% gains. I know this is highly unrealistic, but even if it were only 15% per month, it would be worth trading this way on a real account.

I've switched to my live account, adjusted the risk per trade from 2% to 0.5%, and started trading with real money. Currently, I'm down 8% in my real account and have stopped entering new trades.

I've tried to figure out what's causing this shift in performance and concluded that I'm mostly trading stocks listed on the NASDAQ or S&P. During my paper trading period, the NASDAQ gained roughly 7.5%. Just yesterday (my biggest losing day so far), it dropped 1.5% in a single day.

It seems like my trading results are acting like a highly leveraged future on the NASDAQ (or S&P). I believe my technical analysis is accurate as I can identify support and resistance clusters very well. On bullish days for the index, the support clusters work like a charm. But on bearish days, the same support levels rarely hold.

My thoughts on handling this:

• The market (whatever index you might want to look at) tends to go up more often than it goes down. So, I only need to survive the down periods.
• Reducing the risk per trade further from 0.5% to 0.1%. After a winning streak (e.g., 5 winners in a row?), I could increase it back to 0.5%.
• Instead of trading only US stocks, I could add some UK or Indian stocks. However, UK stocks might also be too correlated with US stocks.

Thank you very much for your input, folks!

Paper trading long-only strategy on daily time frame in few weeks and transition to live trading? Have you backtested before paper trading and if yes, what is the statistics? How does the strategy perform during bearish market?

I would like to see >= 200 trades in at least 6 months for day trading before I consider my strategy can dance with the market and backtest more data to find fault on my strategy. And my strategy is 2-way direction. Notice I use the word fault. The presumption of any strategy should be it doesn't work until proven otherwise with enough data.

Maybe you should pull hand break and backtest more before even paper trade.

 

[Jack1960]

You are gutting for punishment based on your approach. A system like yours simply does not work.

 

[legionx]

@Mr.Richter , the sting of losing has to become common/bearable. I would say keep at it. Duration of time gathering information on your win/loss; profit/loss ratio is important. Say at least six months? Monthly, Weekly, and Daily charts are a nice Topdown approach to long trading. Also, nothing is ever certain in this market, so words like "accurate, tremendous success, minor and significant" can lead to a false sense of security. How many years of experience do you have anyway?