Why Is The Obvious Not So Obvious?

[fortydraws]

You are on the right track FD, and I am wondering how far you have actually got in relation to improving on what you do, as a result of this way of thinking?

I said to someone recently that I consider myself to be a work in progress, and I am making progress. I have achieved my initial goals. Having done that, I have set new ones. These goals are essentially the same as those @i am nobody has shared here at ET. I've been working at those since last July. I am not perfect yet - doubt I'll ever be perfect. The upshot is that I do not need to be to make a lot of money.

 

[J_Smith]

I said to someone recently that I consider myself to be a work in progress, and I am making progress. I have achieved my initial goals. Having done that, I have set new ones. These goals are essentially the same as those @i am nobody has shared here at ET. I've been working at those since last July. I am not perfect yet - doubt I'll ever be perfect.

Many might not agree with this, but here it goes anyway!

Years ago I spent many many hours doing up flowcharts, pdf's and excel files, all in relation to "what I must do in order to become successful".

Result, a total waste of time and effort, doing nothing but stopping me from trading, which is what I needed to do in order to gain the required experiences.

Today, I do not write down anything, or do up anything, or read anything, or research anything, for, all I am interested in now is trading, for, I know that if I do not trade I will make nothing!

I post on ET to keep me off the drink

You need to get to the stage where you know what works best for you, and what does not work well for you, and obviously concentrate on what you can actually do - no good looking at daytrading the open if you can not be there at 09:30 to do it!

That said, I still have all of my excel work, which is used for daytrading, and it automatically gives me the average values for recent moves, a stop loss level, and a profit target level - so in that respect this work was not a waste of time, as when I have the time to daytrade, I need only sit down half hour before the market opens, and have all my setups ready for the stocks that I follow, which is Dow30, plus major ETF's.

My current trading with options on ES and CL is fine, but I really believe that much larger gains can be achieved daytrading stocks, for much less risk, but that is my personal opinion, based on the way I trade stocks, using my own setups and screening process. My way might not suit anyone else.

For now, it is primarily options on ES and CL.

J_S

 

[DDR]

Getting back to your request J_S I offer my trading plan instead of the flow chart method. It will give some clarity on how I view the markets and how I think before, during and after a trade entry.
I welcome all thoughts and criticism on this plan

Trading plan below relates to daily and 4 hr TF

Mindset before taking trade: Be sure to check the boxes on your CTC checklist first, close enough is not a trade. A textbook setup is whats works !
Risk Management: Dollar amount on swings no more than 2000.00 Account size 100K The stop is placed above all noise and in a place where it is where I would definitely be wrong
Entry Signal: There must be a retest failure at or near an R level. RSI divergence present and MACD to be in extremes. Trendline must break, look for low risk areas to enter (See chart for generic view)
Mind set during the trade: Set and forget take no prisoners either this will be a win or a loss don't meddle with position after placing it
Exit or poss exit: Partial exit after first pullback equal to measured move target Full exit when indicators move into opp extremes and show basing pattern
Post trade: Analyse what you did right and if a loss know what not to do next time the same setup presents
(RED LINES ON CHART ARE MONTHLY S N R LEVELS)

 

[SkyChef]

I think you're right. At the same time if it is true that the obvious is not so obvious, then the answer would seem to be that what is in fact obvious is only made obvious as a matter of a particular perspective. So the real issue is not why is the obvious not so obvious. the real issue is how does one gain that perspective on the markets by which the obvious becomes apparent?

In my opinion, that perspective comes from first completely humbling oneself by acknowledging that one does not know anything about how the markets work. Then, the process of studied observation with the intent of discovering how the market works can begin. But so long as you carry even one preconceived opinion about the market that was not derived from your empirical observations of price action, but instead is something you "picked up along the way," then your chances of attaining the required perspective are likely nil.

FD,

Thanks for the clue on #1.

On paragraph 2, a question naturally comes up. Do A, B & C ,assumed w/ a common denominator of "acceptance of zero knowledge about how market works", arrive with the same conclusion of the possible market action based on their empirical observations of price action?

SC

 

[J_Smith]

Getting back to your request J_S I offer my trading plan instead of the flow chart method. It will give some clarity on how I view the markets and how I think before, during and after a trade entry.
I welcome all thoughts and criticism on this plan

Trading plan below relates to daily and 4 hr TF

Mindset before taking trade: Be sure to check the boxes on your CTC checklist first, close enough is not a trade. A textbook setup is whats works !
Risk Management: Dollar amount on swings no more than 2000.00 Account size 100K The stop is placed above all noise and in a place where it is where I would definitely be wrong
Entry Signal: There must be a retest failure at or near an R level. RSI divergence present and MACD to be in extremes. look for low risk areas to enter (See chart for generic view)
Mind set during the trade: Set and forget take no prisoners either this will be a win or a loss don't meddle with position after placing it
Exit or poss exit: Partial exit after first pullback equal to measured move target Full exit when indicators move into opp extremes and show basing pattern
Post trade: Analyse what you did right and if a loss know what not to do next time the same setup presents
(RED LINES ON CHART ARE MONTHLY S N R LEVELS)
View attachment 161617

I will have to think about this one DR, as you are trading FX, and even though a chart is a chart, trading FX is not the same as trading stocks or futures, so no good pretending it is.

I know where you are coming from with the text book stuff, as in S&R lines, wedges, triangles, macd, rsi, and all that stuff, but I do not use any of that stuff apart from S&R lines - I did when I started out initially, but got rid of it all from my screen after a short time, as it was only costing me money.

Measured moves, now that is a big debate. I was big into measured moves up to my last exit from trading, due to silly personal circumstances which are now being fully resolved, but recently, with a full clear head, due to not killing my brain cells with alcohol, I am starting to think that measured moves are not what they appear to be, in that, what you are seeing in a measured move, is not a repeat of the range, but it is something else that gives the impression it is range repetition, and I will leave you think a bit about that one

Major S&R levels, yes, these are a must, as every trader out there is looking at them when price approaches these levels, so they can not be ignored.

You have failed to mention auto traders, which today make up a very high percentage of trading in all markets, so, to ignore them is to ignore what moves price, which you must understand as much about as possible if you are trading against these auto traders.

Before I look at the FX chart to give you my opinion, which really means nothing as I rarely trade FX, you failed to show the symbol and timeframe, which you must do when posting a chart, or let it be known what the instrument and time frame is.

Your risk of 2% per trade is a bit high for me, but that is your choice. I would not agree entirely with putting a stop loss "out of the way", unless there is a valid reason such as a tighter stop loss just does not work with this market, which will only be known from experience. I think it is far better to get your timing perfected, so that you can reduce your stop loss, as better timing means the trade will go your way soon after trade entry, thus allowing you keep a tighter stop loss - again, the text book stuff is not the best way to do things, unless you have proved it to yourself that it really is!

J_S

 

[DDR]

Please allow me to be perfectly clear - I never know - never

I cannot foretell..., forecast..., predict..., or even guess - impending order flow

==============

I read price..., as easy as..., and just like - you're reading these very words Sir


====================


Also, could you explain a bit more what you mean when you say:
View attachment 161616


Not to put you off Pelt - but..., my first 1K or so..., maybe even as much as my first 2K posts..., dealt pretty much exclusively with / on the (my) psychological aspect of trading

Discussing it is pretty much out of my system at this point - now I focus more on the actual trading aspect


That said - as FD said

Clear your mind of all preconceptions.., of all biases..., everything - then learn to read price

Once that skill is second nature - learn to be a good loser..., a good follower

Learn and accept that..., your hopes.., desires.., ego..., opinion..., emotions..., anything of a personal nature - has no place in trading

Learn - every conceivable thing the normal world teaches to achieve success..., or measures - as success..., or deems - successful - is completely counter to successful trading

Every damn bit of it

Learn to be completely comfortable..., and thrive in uncertainty

Learn that following a process and routine - is exponentially more important - than an outcome..., And..., it the only way to be consistent..., and successful - over a sustained career

Learn - losing doesn't make you a loser..., nor does winning make you a winner

Learn detachment..., objectivity..., focus..., opinion-less..., emotion-less

Does not mean I am somehow less human - just means i can set these aside and focus on what needs to be done..., and do it exactly - when it needs to be done

Do I have an ego - absolutely
Do I get mad.., happy.., frustrated - absolutely
Do I have wants and desires - absolutely
Do I fuck up - absolutely

Do I allow these to interfere with trading - not one bit


==============

These are off the top of my head Sir - sure there many things I'm forgetting - but hell.., I'm only human

Like I said - many of my initial posts detailed out my journey (makes for damn boring reading - living it - now that is another story )


RN

The text in blue is very profound and sincere, obviously RN is wanting the best for everyone by sharing what he needed to do in order to break through to the next level. Alot of ppl wanting to be traders do look for short cuts that bit is the human side but when you realize the huge task ahead it's best to roll up the sleeves and tear back the layers to get to the core or where your head needs to be. You have to admire traders that need nothing but a naked chart and are profitable ! like I said I've been there I've made money but over trading has caused me to give it back. 2016 is about trading less and letting the market come to me and my trading parameters.

 

[schizo]

Learn and accept that..., your hopes.., desires.., ego..., opinion..., emotions..., anything of a personal nature - has no place in trading

Learn detachment..., objectivity..., focus..., opinion-less..., emotion-less

Man, when I wrote in another thread that one should throw out all emotions and trade like an automaton, you raised a big stink. Anyway, no big deal.

I read price..., as easy as..., and just like - you're reading these very words Sir

Psychological baggage aside, trading is ALL ABOUT PRICE.

It's how you come to see price..., at what angle.

Some see the price from above, some from below..., one sees it from the vantage point of risk management while the other sees as profit target.

Price Action = Price Flow + Price Pattern.

It wasn't meant to be "obvious".


Schizo

 

[DDR]

I will have to think about this one DR, as you are trading FX, and even though a chart is a chart, trading FX is not the same as trading stocks or futures, so no good pretending it is.

I know where you are coming from with the text book stuff, as in S&R lines, wedges, triangles, macd, rsi, and all that stuff, but I do not use any of that stuff apart from S&R lines - I did when I started out initially, but got rid of it all from my screen after a short time, as it was only costing me money.

Measured moves, now that is a big debate. I was big into measured moves up to my last exit from trading, due to silly personal circumstances which are now being fully resolved, but recently, with a full clear head, due to not killing my brain cells with alcohol, I am starting to think that measured moves are not what they appear to be, in that, what you are seeing in a measured move, is not a repeat of the range, but it is something else that gives the impression it is range repetition, and I will leave you think a bit about that one

Major S&R levels, yes, these are a must, as every trader out there is looking at them when price approaches these levels, so they can not be ignored.

You have failed to mention auto traders, which today make up a very high percentage of trading in all markets, so, to ignore them is to ignore what moves price, which you must understand as much about as possible if you are trading against these auto traders.

Before I look at the FX chart to give you my opinion, which really means nothing as I rarely trade FX, you failed to show the symbol and timeframe, which you must do when posting a chart, or let it be known what the instrument and time frame is.

Your risk of 2% per trade is a bit high for me, but that is your choice. I would not agree entirely with putting a stop loss "out of the way", unless there is a valid reason such as a tighter stop loss just does not work with this market, which will only be known from experience. I think it is far better to get your timing perfected, so that you can reduce your stop loss, as better timing means the trade will go your way soon after trade entry, thus allowing you keep a tighter stop loss - again, the text book stuff is not the best way to do things, unless you have proved it to yourself that it really is!

J_S

Hi the chart is of the DJIA, confusion over not posting the whole picture my bad.
I've never given auto traders a thought, I think a signal is a signal and as long as your stop is out of the noise you should be alright. but also I am unaware of how they interfere in the markets.
Another chart with my trading signal triggered
Unfortunately I did not take the signal as someone told me it would move higher first while this formation was forming. That's another thing I will not ever do ask someones opinion !

 

[J_Smith]

Man, when I wrote in another thread that one should throw out all emotions and trade like an automaton, you raised a big stink. Anyway, no big deal.


Psychological baggage aside, trading is ALL ABOUT PRICE.

It's how you come to see price..., at what angle.

Some see the price from above, some from below..., one sees it from the vantage point of risk management while the other sees as profit target.

Price Action = Price Flow + Price Pattern.

It wasn't meant to be "obvious".


Schizo

You always start a post here with a reference to another post by you somewhere else, bad habit!

You make money by doing, not by looking, but as you must look before you do, then it is obvious the way you look will determine what you think, and thus result in how you act.

Do not make things sound complicated, as price can only do 3 things, and they are...

1. Go Sideways
2. Move Up
3. Move Down

But, as price does its 3 things, you can try to determine what price will more than likely do next, as price moves due to actions taken by people, a lot of which has been fully automated.

EQ
OB
UB
HWB
BOB

I know that HWB is known by some, but I am not so sure about the other 4!

J_S

 

[Redneck]

Well..., least you're not calling me an unproven guru

I call that progress!!!!!!!!

Man, when I wrote in another thread that one should throw out all emotions and trade like an automaton, you raised a big stink. Anyway, no big deal.

It one thing tying to suppress emotions

It quite another being totally at peace

Psychological baggage aside, trading is ALL ABOUT PRICE.

It's how you come to see price..., at what angle.

Some see the price from above, some from below..., one sees it from the vantage point of risk management while the other sees as profit target.

Price Action = Price Flow + Price Pattern.

It wasn't meant to be "obvious".

There is another way of seeing price action..., and it worlds apart from the above my friend

Exactly how it is..., how it unfolds..., the intent..., the orchestration (which include the traps.., the forced liquidation..., the confusion).., and the behavior

Sure sounds guru-ish I admit - but it fact

RN