Quote from mizhael:
Okay, as I am worried about the market tomorrow (the market seems to be moving into a (temporarily?) bull sentiment, while my system is still net short at this moment), I am re-reading your post, and got confused.
What "more than one market variable" shall we use?
Do you mean market neutrality? What do you mean?
as you suggest, you are a n00bie; everyone is for a while.
Some people stay n00bies for a long time it turns out.
In a relaxed manner, you may wish to consider the markets and how they work.
Then you may wish to consider your potential relationship with the markets.
Recently asiaprop made a long comprehensive post and Dave Goodbody was criticizing me as is his custom. As I way of pointing out to dave what he was missing, I suggested that I would comment on the asiaprop post in a critcal way if he or anyone wished. It turns out each sentence in that post lacked a reality as the sentence related to how markets work and how a person can partner with the markets.
How markets work has not changed for a great length of time. That length of time would include the time that anything you could read was written and distributed.
Over 53 years, I have found that a good understanding of markets remains unchanged.
I partnered with the markets in 1957 and forward. I have never had to adjust my partnership with the market.
When you design your peartnership and all it accoutriments, you will find that is works in all markets on all fractals along as the givein market have enough liquidity to operate.
For me it came down to one paradigm and three applications of capital
ne for commodities and two for equities. About 7 considerations appliy when is comes to dealing with your partnership. they fit into the categories of principles, processes and techniques.
Principles apply to the market variables: volume and price.
Processes apply the thr order of events of the market and the trder.
Techniques are tools. As is well known tools are what mankind uses to extend himself in terms of his performance and outreach. Usually they make what he does more effective and efficient.
On Friday, when you posted you were worried about the market.
On friday, I looked at the close and could note what each fractal of any market I was following was doing, where it was in its order of events and where it would be going for the foreseeable future on all of those fractals.
As Asiaprop stateded in his long post, he has no idea of what anything is going to do and, furthermore, he chops off all price spikes to not see that part of the market.
I do not use statistics in any way. None of the things I measure have measures that have any more or less than 2 posibilities ever. If one possibility IS in play then the other is NOT. There is a common name for this: CERTAINTY.
As a n00bie you need to decide to use the variables of the market. Asiaprop does not. The EXPERT does not. They made their decisions and they get their consequences.
The OP is getting the consequences of using statistical analysis to trade. The results of trading can be characterized using standard terms.
For example, the worden Bros tested at and exhibitors booth at an Expo, a drag and drop logic formulation of PVT trading and got and annual Sharpe Ratio of over 60 (their highest ever recorded) by testing a porr stock universe (the NAZ 100). No one posting in this thread has an ATS that is working at a Sharpe Ratio of over 60. It is VERY CLEAR that if Worden Bros wuses their drag and drop Blox to make an ATS that they are not using probability in any way. They are using what has been referred to in this thread as logic. Asiaprop does not use logic as you see and he tells you.
Principles relate to the P and V of the market. they form a pattern. the pattern repeats on each market fractal. Repeating single patterns on all fractals result in the fractals becoming interlocking according to an order of events. An order of events is a PROCESS. A pattern is a PROCESS. Trading is a four part PROCESS: MADA which means Monitoring, Analysis, Decsion making, and Action. Monitoring is a rules based process, Analys is a rules based process; decision making is a rules based process; taking Action is a rules based process. All are binary (two choices for each rule) and the binary values are in the form of vectors. A vector is a math expression that ALWAYS has magnitude and direction.
Sit there and "get it" with respect to my answers to your questions.
Neutral means you can entertain either of two possibilities with a balanced viewpoint on which is at play.
If a person is trading stocks, he trades a stock every 2 to 5 days and makes 10 or more percent per trade. He objective is to do more of theses trades each year. Doing two such trades in 5 days is 100 trades a year at 10 or more percent per trade.
Then after a few years of this he ventures into trading commodities the same way. Last Friday for 40 ES contracts the first trade netted 10,000 dollars, the next 15,000 dollars the next 10,000 dollars, After that the market range lessened and the trades wee under 10,000 and more freqquent. At some point the capital required for margin was equalled in terms of profit.
the day ended with a channel being short, a traverse of the channel being long and a tape of the traverse being short. there were BBT's ot tapes visible and subs of BBT's visable too. thatis five fractals where volume leads Price on the ES and the YM leads the ES which simplifies trading agreat deal. there are alsoabout 12 leading indicators of the ES price so trading is done by holding on the right side of the market and reversing when you have the optimum signal so to do. As asiaprop said he removes the parts of the market data where ALL of these signals occur. He usues statisitics to do this very very stupid thing he explained to you that he does.
If you cannot undertand my post, you brain is telling you something. your brain is telling you to get off your ass and get to work.. Go the trader's Labitory and get the word on what you have to learn by doing drills to get your empty mind built.
Prologic gets a headache when he "reads" stuff like this. "reading" is NOT how learning to trade happens. DOING DRILLS IS WHAT IS REQUIRED. DRILLS BUILD LONG TERM MEMORY IN AN ORGANIZED MANNER CALLED "DIFFERENTIATION"
