What is your edge ?

123. Nice. I took a look at this variation before but couldn't make it work. I'll take another look. Thank you :)


Quote from cornixforex:

Recent Euro action for example. :)

We made a swing low, bounced back up, then back down and stopped exactly at the same level. What could it mean? Obviously that some serious buying is happening at exactly this level and if they buy here, probably not to take a few ticks and get out (it takes huge size to stop price like that in EURUSD). All in a day that generally goes up during the whole EU trading session so far.

So odds are in our favour, all we need is give it a try... :D

Basically ALL action visible on the chart of any liquid market is institutional activity, because retail constitute so negligible amount of total volume that are hardly reflected at all. And institutions know their stuff... and we, little parasites know that they know... :D
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Quote from murray t turtle:

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Thanks;
markets can be tough. I am still trying to completely figure out the post that called LBR a book peddler[not that i object to that.............LOL

And then he ,mentioned thedifference between apple and airline markets:D Both of those can be tough markets, easy to lose money in them both.

Partial disclosure i like apples and airline food.:D
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LOL

I was just trying to point out that there is a world of difference between standing in a pit trading a low volatility product to trading a highly volatile product on a screen. Sure, both may be 'trading' but thats about all they have in common.



The dynamics are just too far apart. As for apples and airliners - well in my haste, I was just trying to say that an apple sales man couldnt necessarily sell airliners for Boeing or similar, although they are both sales jobs. Like Eurodollars and ES are different!

To bring that back on topic, there is an inherrant edge standing in a pit, yet the edge day trading momentum methods on a screen as she now preaches has much less of an edge. Surely she would use her knowledge of Eurodollars and interest rate relationships over time to make money?
 
Quote from TheBlackHand:

LOL

I was just trying to point out that there is a world of difference between standing in a pit trading a low volatility product to trading a highly volatile product on a screen. Sure, both may be 'trading' but thats about all they have in common.



The dynamics are just too far apart. As for apples and airliners - well in my haste, I was just trying to say that an apple sales man couldnt necessarily sell airliners for Boeing or similar, although they are both sales jobs. Like Eurodollars and ES are different!

To bring that back on topic, there is an inherrant edge standing in a pit, yet the edge day trading momentum methods on a screen as she now preaches has much less of an edge. Surely she would use her knowledge of Eurodollars and interest rate relationships over time to make money?
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The pit definitely is an edge. Lots of stories of people who can lean on orderflow because they know the otherside is smart or dumb. Or they can front run large orders just because they physically overheard a clerk take the order down from a phone call. Though this value is diminishing as everything goes electronic and to a more level playing field.

I thought about it a lot - my edge is that I wake up every morning and look at the markets. A lot of retail investors, 401k holders, etc don't do that. So clearly it must be an advantage for me. :)
 
http://finance.yahoo.com/q/ta?s=AMZN&t=5y&l=on&z=l&q=l&p=&a=&c=

This is the 5 year chart of AMZN. AMZN has a great business model. They are able to sell over the internet which reduces the need for retail outlets. They are able to offer free shipping to customers who buy a certain amount of product since it reduces the costs of shipping a bunch of items together. They took business away from the big brick chains like Barnes & Nobel which have been closing down their retail outlets. Both revenue and income have been increasing over these last 5 years which is reflected in the chart price. This is not a random coin flip. Shorts who bet against them have been losing money which is why short interest has decreased as they get stopped out.

However, even without knowing the good news about AMZN, if you know the trend for this chart which is up, and throw in some good TA indicators, you could easily make money.

http://finance.yahoo.com/q/ta?s=AMZN&t=5d&l=on&z=l&q=l&p=&a=&c=

And if we look at the 5 day, knowing not to bet against their fundamentals, we see longer term traders making money being long while shorts again taking it up the ass.

http://finance.yahoo.com/q/ta?t=5d&s=^GSPC&l=on&z=l&q=l&c=AMZN&ql=1

Now we compare the S&P to AMZN. Even on a day the S&P is down, AMZN is up showing that trading is not a coin flip. The people talking about random charts are incorrect.

Quote from kinggyppo:

food for thought:

http://en.wikipedia.org/wiki/Apophenia

attached is a cherry picked trending coin flip...........:)
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Quote from oraclewizard77:

http://finance.yahoo.com/q/ta?s=AMZN&t=5y&l=on&z=l&q=l&p=&a=&c=

This is the 5 year chart of AMZN. AMZN has a great business model. They are able to sell over the internet which reduces the need for retail outlets. They are able to offer free shipping to customers who buy a certain amount of product since it reduces the costs of shipping a bunch of items together. They took business away from the big brick chains like Barnes & Nobel which have been closing down their retail outlets. Both revenue and income have been increasing over these last 5 years which is reflected in the chart price. This is not a random coin flip. Shorts who bet against them have been losing money which is why short interest has decreased as they get stopped out.

However, even without knowing the good news about AMZN, if you know the trend for this chart which is up, and throw in some good TA indicators, you could easily make money.

http://finance.yahoo.com/q/ta?s=AMZN&t=5d&l=on&z=l&q=l&p=&a=&c=

And if we look at the 5 day, knowing not to bet against their fundamentals, we see longer term traders making money being long while shorts again taking it up the ass.

http://finance.yahoo.com/q/ta?t=5d&s=^GSPC&l=on&z=l&q=l&c=AMZN&ql=1

Now we compare the S&P to AMZN. Even on a day the S&P is down, AMZN is up showing that trading is not a coin flip. The people talking about random charts are incorrect.
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This is like arguing whether God exists, lots of spin, and no real proof either way. Personally, I don't think markets are purely random, my point is that even random patterns show persistent trends. If I buy at 5 and sell at 10, random or not I have made a profit.
 
Yes, random patterns can trend, but the difference is that I doubt my indicators or PA would work on a pure random pattern. For example, lets assume black jack is random, and you are on a winning streak or winning trend, by being able to also count the cards and vary your bet size you are able to employ an edge during that period to increase your profit.

For futures, let's say during a down trend, you use a trade setup based on your prior discovery or on a book to take a short trade. That setup is more likely to work as long as we don't hit longer term support. So your win% on even risk vs reward is high enough to allow you to trade profitably, and if over time you are able to trade profitably without letting emotions like revenge trading affect your system, then you can prove to yourself that you have both an edge and that the markets are not random.

Quote from kinggyppo:

This is like arguing whether God exists, lots of spin, and no real proof either way. Personally, I don't think markets are purely random, my point is that even random patterns show persistent trends. If I buy at 5 and sell at 10, random or not I have made a profit.
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Quote from oraclewizard77:

Yes, random patterns can trend, but the difference is that I doubt my indicators or PA would work on a pure random pattern. For example, lets assume black jack is random, and you are on a winning streak or winning trend, by being able to also count the cards and vary your bet size you are able to employ an edge during that period to increase your profit.

For futures, let's say during a down trend, you use a trade setup based on your prior discovery or on a book to take a short trade. That setup is more likely to work as long as we don't hit longer term support. So your win% on even risk vs reward is high enough to allow you to trade profitably, and if over time you are able to trade profitably without letting emotions like revenge trading affect your system, then you can prove to yourself that you have both an edge and that the markets are not random.
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Is that really an edge or profitable method?
 
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