Why Is The Obvious Not So Obvious?

[Pelt]

SC

You have questions Sir - ask


RN

About what I posted a while back about not knowing what will happen...

I think after enough time one can understand this concept easily enough.

My question is, do you have some way of placing a bet such that you believe one thing happening is more likely than something else?

That's not to say that you KNOW what will happen, but that you would think one thing is more likely to happen than another?

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

DDR

You didn't ask - but for me 100% Yes Sir

I only had to get out of my own stupid fucking way first - in order to find it


Yes I had to learn skills..., a language..., and how to be a good loser - but the ultimate answer to consistency - was (in) me

RN

Just as an aside, I've more or less given up on trying to structure trades by 'reading' a chart. More like just observations... I.e. if I think price is moving up, what are the odds that this EXACT spot I enter will be a top or a bottom? And then structure trades looking for a pullback with the idea that price should continue in it's original direction(there's more to it, but that's just a general idea). As price is rarely making an actual top or bottom, but moving in a direction to create a top or bottom.

This is something I still am working on, but it seems most times I am correct. Although today, I somehow managed to call every intermediate top and bottom today (which means I'm losing money).

I'm not sure if anyone else thinks that's different, but it seems so to me.

 

[SkyChef]

SC

You have questions Sir - ask

Getting this crap is like trying to drink from a super high pressure fire hose


You're dead on - one step at a time


RN

Thank you Sir for the offer.
When I know what I'm looking for, I'm going to ask.

 

[fortydraws]

Well, after reading the whole thread I still have no clue what's the obvious is and I don't really care about it a bit as it is right now. It's just nonsense trying to find something that you have no clue of what it is. When one is not prepared to see it, one just can't see it. Period.

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.

 

[J_Smith]

SC, the truth is that we all make mistakes, but the main difference between those who can make money, and those who can't, is knowing that the mistakes are an integral part of trading, no matter how much we learn about trading, from whoever.

Hindsight on a chart is easy, and the more times you actually pull the trigger when that line is broken to the upside or downside, the more you will see that you are far better off to wait for confirmation, which will more than likely result in less gain initially, but will also result in you being on the right side of the market when the moves worth talking about materialize.

One of my biggest problems years ago was having too tight a stop loss, and only after trading a bit with one who actually knew what he was doing, did I start to see the reality of using tight stops, which is much more losers than winners. This person, who knows more about trading than anyone I have ever met, uses a 10 point stop when trading the ES. At first I thought this was crazy, but soon saw the reason behind it when I started to do some trades with him, as when combined with proper timing, the chances of your stop being hit are far less, and the chances of you catching the larger moves increase, which is what you want. The ES is one of the hardest markets to trade, as it is the home ground of the real pros, and if you try to trade against those people with tight stops, well, you will be in for one rude awakening.

I have no problem trading any stock with stop loss equal to a % of the average moves, but I will never ever trade the ES during regular hours with anything less than a 10 point stop, and if I am not in full control, as in having a few screens to trade with, I will only trade it using Options, and the very odd time with a tighter stop outside regular hours when the pros are gone, as it is not as volatile then, but this is still very risky, and fine once one knows this and does not expect too much profit from a trade.

You must respect your opponents, and instead of trying to beat them, join them, not on the same scale obviously, but in the same approach, as profits will always be relative to account size!

J_S

 

[J_Smith]

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.

The only thing I know, is that I really know nothing

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?

J_S

 

[SkyChef]

SC, the truth is that we all make mistakes, but the main difference between those who can make money, and those who can't, is knowing that the mistakes are an integral part of trading, no matter how much we learn about trading, from whoever.

Hindsight on a chart is easy, and the more times you actually pull the trigger when that line is broken to the upside or downside, the more you will see that you are far better off to wait for confirmation, which will more than likely result in less gain initially, but will also result in you being on the right side of the market when the moves worth talking about materialize.

One of my biggest problems years ago was having too tight a stop loss, and only after trading a bit with one who actually knew what he was doing, did I start to see the reality of using tight stops, which is much more losers than winners. This person, who knows more about trading than anyone I have ever met, uses a 10 point stop when trading the ES. At first I thought this was crazy, but soon saw the reason behind it when I started to do some trades with him, as when combined with proper timing, the chances of your stop being hit are far less, and the chances of you catching the larger moves increase, which is what you want. The ES is one of the hardest markets to trade, as it is the home ground of the real pros, and if you try to trade against those people with tight stops, well, you will be in for one rude awakening.

I have no problem trading any stock with stop loss equal to a % of the average moves, but I will never ever trade the ES during regular hours with anything less than a 10 point stop, and if I am not in full control, as in having a few screens to trade with, I will only trade it using Options, and the very odd time with a tighter stop outside regular hours when the pros are gone, as it is not as volatile then, but this is still very risky, and fine once one knows this and does not expect too much profit from a trade.

You must respect your opponents, and instead of trying to beat them, join them, not on the same scale obviously, but in the same approach, as profits will always be relative to account size!

J_S

JS,

Of course. Once I've realized my shortcoming, ES is off my book. I just trade the regular US stocks & piggy back ES through SPY option.

 

[J_Smith]

JS,

Of course. Once I've realized my shortcoming, ES is off my book. I just trade the regular US stocks & piggy back ES through SPY option.

That is good SC, as the ES is not a market to mess around with, as one can lose a lot of money very quickly if not in full control, and have some idea of how the big players operate.

Options, they are not easy to trade, but I think are invaluable for the likes of ES and CL, which make up 90%of my current trading. What I am finding, is that strike selection is crucial, in that, if you pick strikes with too low a delta, you are wasting your time, too high, and you risk too much per trade, so like all trading, experience brings familiarity, and since I started to concentrate on ES and CL, as opposed to SPY, my results are much better.

What I do not like about SPY, and stock options, is the market hours, in that you have to wait for the regular trading hours to trade, whereas with the futures options, the options are the same time as the futures, and this can be a major benefit at times. Of course the spreads will be wider outa hours, but when you compare that to the inability to trade during highly volatile times, the wide spreads are not really an issue in the overall context.

I do not use normal option analysis, as in volatility analysis, and so far I have not had any major issues with same, so, as the saying goes, if it is working OK then you keep doing it, if not, then you must change what you are doing, which is a very obvious to me anyway!

J_S

 

[Redneck]

My question is, do you have some way of placing a bet such that you believe one thing happening is more likely than something else?

That's not to say that you KNOW what will happen, but that you would think one thing is more likely to happen than another?

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:

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

 

[Redneck]

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

Good Stuff Sir

RN

 

[J_Smith]

A flow chart yes ok got it

Amazing the difference a few years make!

https://www.draw.io/#LA to B

J_S