What are your Trading Breakthroughs?

Quote from Slope Trader:

Hi TJ,

I mostly trade off of daily charts, trying to catch short-term trends that last a few days to a few weeks.

I note the current 10-period ATR when I get an entry signal and place a stop entry order, an initial stop-loss order and a limit target order to exit half the position all at the same time. All of them are placed based on fractions or multiples of the ATR. The final half of the position is a runner that has a trailing stop loss which tries to catch the larger moves.

Before this, my trades had always been all-in and then all-out, but the new approach has worked much better.
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Very interesting! Thanks for sharing.
 
Quote from jack hershey:

Now invent Legos.

On a lego plate, invent all the pairs of two price bars. Or on a sheet of paper draw the 10 cases.

If your mind works, you can do this. If you are not too lazy you can do this.

Here is the thing, no one can do it based upon the evidence found in the financial industry.

What is the smallest price volatility needed to draw all 10 cases?

Can you draw the briefest trading cycle?

Where did all that fake chaos go?

Why is there zero chaos in markets? Ans: all variables have granularity. So nobody can even take the first baby steps to learn anything.

work on a few sheets of paper for 30 minutes. this is work and time in action. No one has done the first 30 minutes of learning as yet and you type and type and type. Woosh..........
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Jack,

I believe that the market is 0% random. It is a rare belief that I have not encountered in many people. You are one of the people with this belief, and you understand the system too.

I have the belief, but I do not yet understand every part of the market's the system of operation.

I have attempted to only absorb concepts into my mind which can be applied to every single situation. I would like to have a system of parts and each part will never fail (0% risk).

I would like to learn what you have to teach. I have read several of the old journals, but sifting through an archive is much different than learning with peers for me, it is not as easy to absorb the correct concepts.

Here is my chart of ten possibilities of two bars. Here is my best attempt to answer your questions.

"What is the smallest price volatility needed to draw all 10 cases?"

One tick of price change is required for cases with the same length bars. Two price ticks are required for cases with one bar longer than the other, so two is my answer.

"Can you draw the briefest trading cycle?"

I used this definition for cycle: A series of events that can be regularly repeated in the same order.

If this is the case, a hitch with opposite colored bars is the briefest cycle?

---

Please let me know if you are willing to engage in the teaching process with me. If so, I will create a journal and do my best to help facilitate the learning process for anyone else who is interested in this material.

*Edit - The picture did not attach to this post so I uploaded it to the next post.
 
Quote from mmm:

I thought it might be interesting if fellow ET members describe the ideas and realizations that have allowed them to bring their trading to the next level.

Being able to take partial profits along the way increased the overall profitability of my trading tremendously, and boosted my trading psychology by having a larger number of small wins and fewer scratched trades.

-- M
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Mr M;
Jack Schwager Top Trading books [all] plus Proverbs.

A loss is pa rt of business :cool:
 
Quote from llIHeroic:

Here is my second drawing.
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Good work.

To allow yourself to pick up a colored pencil, you need the rules for picking up the pencil. Lets delay I posting the math for picking up the two colored pencils.


Drawing cycles with few bars and where the bars are least lenghthy takes a little more work.

I am glad you created the same set of names for the cases that we did in the past. Congrats.

I admire your noticing that some cases can use smaller bars than others.

To learn to take the full offer of the market, the system of operation of the market must be ccompletely known.

A one pager will suffice to describe the work effort required. By looking at the work tasks it is immediately apparent that about anyopne can do the work to create the system.

Below are some major time savers.

1. Acknowledge that all variables are granular. This is six words.

2. Acknowledge that the two important market variables have names: independent variable and dependent variable. This major time saver can be learned most easily by observing other scientific systems. Slowly let this soak in. Water is a good example. The system of water has some variables. Teaching about engineering often uses water for learning purposes.

3. Most all technical studies are done by taking into account the role of each independent and dependent variable. The general truth (principle) is that by knowing the independent variable, you can plug it in and get the value of the dependent variable.

We can use the following in trading: Y = mX +b. You see variables and constants. Variables are in caps (upper case); constants are in non caps (lower case).

4. Price change is the principle for making money.

Okay. this ends the first half of learning how to be an expert trader.

If a person does work he can become knowledgeable and skillful. Work creates knowledge in the form of long term memory and automatic behavioral actions.

Today have four breakthroughs.

BE DO HAVE
 
Jack,

Thank you for posting a lesson for me. I will not use colored pencils until I am aware of the rules for them. My goal is to completely know the system of operation for the market. I am encouraged to know that the work can be accomplished by almost anyone. I have the ability and the will to do all of the required work.

I will save this post as breakthroughs, thank you for helping me to move along at a successful pace. I have seen the granularity of market all market variables.

I have read that volume is independent, and price is dependent. I have equated this to someone coming to my town and placing an order for 1,000,000 gallons of milk. Price will respond. However, if $1,000 is offered for a gallon of milk, there is no dependent response of volume. The buyer could only purchase one gallon of milk, and the trading of milk would remain virtually unchanged.

I will continue to let this soak in. I hope that I am on the right track to learning this concept. It is a simple concept to understand volume is a producer of price change. It makes it easy to identify a goal of understanding the equation and the input which results in money (3 and 4).

--

I began to post in the butt handed to me thread because there is a large center of material gathered there. I will continue to focus my efforts there if that is the best way for me to keep learning.

I have attempted to expand my conclusion about price cycles in the drawing below.
 

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