What kind of information do you use for creation trading strategy?

V

Volfixtrader

Right now we have so many influences on price behaviour of any instruments. And there are no the one important impact, but there are a lot of minor.
1. We can't say that the most popular indicators work good because they are mostly late or hurry up. Combination of various indicators just decreasy of probability of signal, but not the quality.
2. We can't say that news work because we get them late and there are a lot of insiders who are in positions.
3. We can't exactly say that volumes work correctly because there are a lot of derivatives for instruments.
4. Any individual forecast: prices should go from ...till ... because: support level, trend, breakthrough point, MA crossing est.

What work good on my opinion (still work):
1. Statistical patterns: price + volumes.
2. Accumulation ranges.
3. Seasonic patterns.
4. Trends still work but markets become more and more effective
5.Probability and statistics (like if price move 3 days in the row in one direction, next 1 or 2 days might go in the other)

What kind of information do you use in creation trading strategies (if you have them formal)? Could you share ideas (I'm not asking about your rulles and principles :)

Thank you.
 
Volfixtrader said:
What kind of information do you use in creation trading strategies
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There is a saying the seasoned veterans say to the bright new people, "the issues is not a lack of good ideas, but deciding which ones to do"*. I think the same thing applies 3X here. After going through many profitable strategies, I am using only one.

Sure I can make money swing trading sector baskets, stock breakouts, etc., but I only have so much time, capital and effort to allocate.

Many people develop strategies like architects, but once they meet the builder, and look at feasibility and costs, those designs are often not realistic or certainly not the best and need to be tweaked.

In other words, it is not an edge until you can consistently implement it. One has to take the FULL path to executing orders in the market to validate the strategy. ( And please bright new folks don't take an untested strategy and tactics into battle!) Hope that helps.

*Alonzo Church of UCLA, of Church's theorem, was well known to tell grad students who came to him with "novel" ideas: "Come back when you work out the details."

PS: The reason I am pointing out what the greats do, is because people are literally in competitions with "World-Class" traders over MONEY. So you really need to get your major league mindset on, if you want to succeed consistently and over the long term. It is not intended as an ad verecundiam (appeal to authority) argument, but rather a data point of what world class people do.
 
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You are looking for something that works. Probably not going to find that. Look for something that works half the time that makes you more money than when it doesn't work.

Develop a strategy that keeps losses small and gains big. Work on reducing the size of your losses and increasing the size of your gains.
 
Volfixtrader said:
Right now we have so many influences on price behaviour of any instruments. And there are no the one important impact, but there are a lot of minor.
1. We can't say that the most popular indicators work good because they are mostly late or hurry up. Combination of various indicators just decreasy of probability of signal, but not the quality.
2. We can't say that news work because we get them late and there are a lot of insiders who are in positions.
3. We can't exactly say that volumes work correctly because there are a lot of derivatives for instruments.
4. Any individual forecast: prices should go from ...till ... because: support level, trend, breakthrough point, MA crossing est.

All that you have discounted, those are exactly are in my automation. Just cause you not solved the puzzle, others have.
More...
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Bad_Badness said:
There is a saying the seasoned veterans say to the bright new people, "the issues is not a lack of good ideas, but deciding which ones to do"*. I think the same thing applies 3X here. After going through many profitable strategies, I am using only one.

Sure I can make money swing trading sector baskets, stock breakouts, etc., but I only have so much time, capital and effort to allocate.

Many people develop strategies like architects, but once they meet the builder, and look at feasibility and costs, those designs are often not realistic or certainly not the best and need to be tweaked.

In other words, it is not an edge until you can consistently implement it. One has to take the FULL path to executing orders in the market to validate the strategy. ( And please bright new folks don't take an untested strategy and tactics into battle!) Hope that helps.

*Alonzo Church of UCLA, of Church's theorem, was well known to tell grad students who came to him with "novel" ideas: "Come back when you work out the details."

PS: The reason I am pointing out what the greats do, is because people are literally in competitions with "World-Class" traders over MONEY. So you really need to get your major league mindset on, if you want to succeed consistently and over the long term. It is not intended as an ad verecundiam (appeal to authority) argument, but rather a data point of what world class people do.
More...


Thanks for your comment. I agree with you for the main basis. Especially: the devil is in the details. But if you don't mind what kind of idea you trade? I tested so many ideas and found a few which I trade now. But now I have lack of ideas which I can test. I tried to check how the other people (funds) trade. Some of them don't hide ideas (due the details). Having experience I decline most of them without testing due they are not fit my style and my capacity.

But I can share it with you, perhaps you found it will suitable for you. Ifound it in open sources.
1. One fund trade arbitrage (divergence and convergence) between futures on Global indices, intraday (Systematic Alpha Management)
2. Perry Kaufman trades simple logic patterns (like 3 days in the row in one direction and next rebounds whithing 2 days).
3. Larry Williams uses seasonic influences in combination with bars analysis.
4. Tom Sosnov sell strangles and manage of positions and so on.

You are right with opinion that it might work but not for me. Perhaps you have Ideas which are not for you but you can share with them there.
 
deaddog said:
You are looking for something that works. Probably not going to find that. Look for something that works half the time that makes you more money than when it doesn't work.

Develop a strategy that keeps losses small and gains big. Work on reducing the size of your losses and increasing the size of your gains.
More...

This is very old rule doesn't work correctly nowadays. Markets become more and more open so it tends to be more and more efficients. Small stop losses give much worse results in back testing intraday and swing movements in comparison sith big. I mean big and small in comparison with average ATR.
 
Perhaps you are right. My experience and approaches makes me blind sometimes on some obvious stuff. But on your opinion what is work statistically?
 
All strategies I have tried and still use for trading indices and forex have depended purely on TA, none have been based on any FA or news during the development / planning stage.

When you boil it down, if your profit depends on price rising, then you need to be in an uptrend. There are two ways to get into an uptrend - either join an established uptrend or join a just starting uptrend.

After that, how important is the detail really?
 
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