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Mathematical reasons why MOST DayTraders & scalpers fail?

  • #61
  • Dec 3, 2005 11:14pm Dec 3, 2005 11:14pm
Quoting xxDavidxSxx
Every trader is trading on what they "think" the market is gonna do. Based on a series of indacaters and educated guesses. Whats happening now might not be happening 5 min from now. We are all basically predicting the future. Weather its 5 min or 5 days its all in the future.
I can predict the market with absoultly no indacaters. Weather its 5 min or 4 hrs. Or any other chart. Price is king, and thats all you need to know.
The object is to make money any way you can. If you can scalp 50 trades a week for 100 pips or take 3 trades a week(like me) for 100 pips its all up to you.
But the "true" day traders don't scalp. They trade. And in the long term its the traders that will out last the scalpers.


There are no rich long term scalpers selling systems. There are no profetional scalpers selling systems. There are no signal providers for scalpers. WHY? In the long run, scalping will not out last a real trader. I make in 1 trade what a scalper might make in 20 trades.

Dave
LOL.... 99% of systems that are sold simply don't work. That's why the sellers are selling the systems. If the system worked so well, simply trade it and make money trading. A lot less headaches IMO. And as far as scalping systems, like I said in earlier posts, it's a developed skill not a mechanical system that can be purchased. A good scalper has no need to sell a system.

JohnFX
  • #62
  • Dec 3, 2005 11:27pm Dec 3, 2005 11:27pm
Quoting JohnFX
LOL.... 99% of systems that are sold simply don't work. That's why the sellers are selling the systems. If the system worked so well, simply trade it and make money trading. A lot less headaches IMO. And as far as scalping systems, like I said in earlier posts, it's a developed skill not a mechanical system that can be purchased. A good scalper has no need to sell a system.

JohnFX
John,

I have seen you in my thread. You know what I do. You know what I can do. But selling my system would be alot less headache that actually trading. Thats why people sell systems. Because there burned out on trading.
You know my success, but when the day comes I can stop trading and start teaching, selling systems, and providing signals, I will do it. There is more money to be made in the sales of a system then the actual use of a system. Only 5% become wealthy trading. And 4% of that 5 is brokers and banks. That leaves 1% for us. Do the math. The odds are better to win the lottery than to become rich trading.

Dave

edit: this is my last post here to avoid any further pissing.
Any doubt in me and my systems see "My Trades By Dave"

TYVM
  • #63
  • Dec 3, 2005 11:42pm Dec 3, 2005 11:42pm
Well while we're on the subject of "trading systems" I'm going to mention something which I previously wasn't going to in this thread. But here it goes. And this is no BS. I have discovered a phenomenon in the 1 minute EURUSD chart that occurs several times every single day. And I'll just call it a bar or candle formation, easy to spot, which from what I can see has about a 90-95% successsful re-occuring predictability. As far as the potential of it, I see at least 10 pips per trade. Now before I consider trading this occurance, I still have to examine more 1 miniute charts ( I have looked at about 3 months worth). But from what I can see it is very promissing. I still also have to come up with some paramaters in order to trade it. But, I don't see that as very difficult.

What I am getting at, is this. If this method that I have discovered pans out, I really have no intention of disclosing it to anyone or trying to sell it. That may sound a bit selfish on my part. But that's just the way it is. As I stated in an earlier post. If someone truely has a very good system, there really is no need to sell it. Plus there is always the possibility that a system or method would become less effective if lots of other traders started to use it.

JohnFX
  • #64
  • Dec 3, 2005 11:56pm Dec 3, 2005 11:56pm
Quoting JohnFX

What I am getting at, is this. If this method that I have discovered pans out, I really have no intention of disclosing it to anyone or trying to sell it. That may sound a bit selfish on my part. But that's just the way it is. As I use it.

JohnFX
Not disclosing it? Then why mention it? Sounds like BS to me.



Tell you what. I got a system thats 99.9% accurate but I'm not telling what it is.

You like apples? How bout those apples?

Claming to have a 95% accurate system that you'll not disclose or sell sounds like something trade vector would say. Remember him? Remember what happened to him? He's gone and used as a joke.
Don't go there!!!! We will all think your full of it.

Dave

Dave
  • #65
  • Dec 4, 2005 12:06am Dec 4, 2005 12:06am
Quoting xxDavidxSxx
Not disclosing it? Then why mention it? Sounds like BS to me.



Tell you what. I got a system thats 99.9% accurate but I'm not telling what it is.

You like apples? How bout those apples?

Claming to have a 95% accurate system that you'll not disclose or sell sounds like something trade vector would say. Remember him? Remember what happened to him? He's gone and used as a joke.
Don't go there!!!! We will all think your full of it.

Dave

Dave
Dave I am not bull-shitting. That's not my style. I mentioned my system to make a point. And maybe you should recall that I was probably the only person on this forum who saw that TradeVector was full of it right off the bat. You can verify that with james16 or Merlin. I think the tradevector posts are not longer available.

And I'll tell you what. If my system does indeed work and I start to trade it I would have no problem posting copies of my "real-money" statements. But I'm not here to try and impress anyone. Re-read my post carefully. If some of the words are to big, then grab a dictionary.

Ok guys and gals, time to hit the sack.

Later all;

JohnFX
  • #66
  • Dec 4, 2005 12:24am Dec 4, 2005 12:24am
Quoting JohnFX
Dave I am not bull-shitting. That's not my style. I mentioned my system to make a point. And maybe you should recall that I was probably the only person on this forum who saw that TradeVector was full of it right off the bat. You can verify that with james16 or Merlin. I think the tradevector posts are not longer available.

And I'll tell you what. If my system does indeed work and I start to trade it I would have no problem posting copies of my "real-money" statements. But I'm not here to try and impress anyone.

Ok time to hit the sack.

JohnFX
not here to impress? Then why claim to be developing a 90-95% accurate system that you wont disclose?

I was the first to call TV out on daily fx. So what?

My point is don't make claims you cann't back up. Real money statements mean nothing. A statement can be modified.
Try posting the actual trades as they happen. Thats the proof. We can see the time the trade was made and the time of the edits to the post. And then we can check the times against the charts movement times.
Showing 10 pips profit each day on a statement is basicaly meaningless with out the actual posted trade. And reasoning behind the trade.
My system is great, and its fully disclosed for all to see and use. No matter how accurate my system is I have no problem telling the world what it is. And I also help those to understand who don't. My thread is free training and offers a free system. Actually there are more than one working system posted in my thread. And I got more. And I am willing to post all of them given the time. Has nothing to do with greed. There are those here to help, and those here to learn.

Wich one are you? Because your latest postings are neither.

Dave
  • #67
  • Dec 4, 2005 12:29am Dec 4, 2005 12:29am
This thread should not be here. This thread is just inviting an argument.
I wish merlin would delete this whole thread. There is nothing to bennifit us here.

Dave
  • #68
  • Dec 4, 2005 2:37am Dec 4, 2005 2:37am
Ladies and Gentlemen, why not calm down and sit back to re-read every post in the thread once more?? I can see that the discussion is getting some heat over here

Everyone has the right to discuss his opinion but not force it over others. Remember Merlins' rule #1 for the Board: Debate with love...

I can see that the thread is defining why scalping is not the best method to consistently win the forex game, and neverthless, the discussion must be made with love and respect to everyones' opinion. Everyone has his own way of doing things and he has the right to do it the way he sees right.

Although I am against scalping and I agree with the thread starter that scalping is not the way, but I can't force that upon anyone, after all that's just my opinion, and in forex and the markets in general, no body is 100% right or 100% wrong, it's all relative.

JohnFX and xxDavid, you are both great traders whatever strategies you use and whatever arguments you have. I respect both of your opinions about the subject, but this doesn't mean I will follow any

Hope we all (including myself) get the message and keep it in our minds all the time, we are here on this Board to learn how to trade better, and debates helps this a LOT, so better focus on opinions and analyzing them rather than personalities..

Peace to everyone..


Thanks,

Nader
  • #69
  • Dec 4, 2005 9:42am Dec 4, 2005 9:42am
great reading your posts JOHNFX.

could i ask how long you been scalping?

i am currently building both a medium term trading system(for bread and butter) and an intraday scalping system (i really enjoy trading 2 to 5 times a day). so i read your posts with interest.

nice to your success ratio also.
another INTP
  • #70
  • Dec 4, 2005 11:19am Dec 4, 2005 11:19am
Quoting ElectricSavant
...last posts...
ElectricSavant, I read your last posts and I got the feeling that you needed an enemy to say all these...useful things. Why not just give advices without fight?

Actually I think I also belong to the scalpers with 20-40 trades an 30-60 pips weekly. I work constantly on my system (and John never said he doesn't!) to adapt myselft to the market (and maybe start to make more pips, which is not that critical!) and I also plan to increase income by involving more funds. Am I wrong? I don't think so. Let us say market checks it out
time is money! Z
  • #71
  • Dec 4, 2005 5:32pm Dec 4, 2005 5:32pm
Well guys I'm happy, my NY Giants beat the Dallas Cowboys to take over 1st place. But still 4 games to go so they haven't won it yet.

I'm going to start a new thread and call it "Forex Scalping & Very Short Term Trading. I probably should leave out the word "scalping", because some of these self-proclaimed trading know-it-alls, one in particular who seems to stick his nose in every thread, feel that scalping is a crime.

Well, hopefully the nay-sayers will only post if they have something positive or constructive to say about short term trading. All I know is I wil continue to trade this way as long as I am successful at it. But always trying to improve like any good trader. In the new thread I'll also keep advised on my development of the method I mentioned previously on the 1 min. chart.

Thanks,

JohnFX
  • #72
  • Dec 4, 2005 6:00pm Dec 4, 2005 6:00pm
Quoting JohnFX
Ho Lee, that's the style of a true scalper. And I would like to point out I'm not trading just 1 or 2 mini lots. Presently 20 mini lots ($20 per pip). Working my way up the eventually 50 mini lots per trade ($50 per pip). I "netted" 48 pips. Some of my 1, 2 or 3 pip gains could have easily turned to a losing trade had I not taken what you call a "crumb". So don't make ignorant statements if you're not standing here watching me trade live to see the circumstances.

JohnFX
I'm well aware of the scalper's style, that's why I'm questioning it. Especially when dealing with FX, you haven't explained why you intentionally go for small pips. As you said, some of your trades could easily have turned into loses, sounds like you walk a tight rope, you might yet fall off. So you bail and grab a little.

You are consequently only just ahead of the market, you could just as easily be behind it too.

So with the daily FX ranges generally being large and offering good moves both ways, why do you look for so little?

Scaling up the $ per click, to bring you into an acceptable level of income, isn't the answer.

The scalper's approach throughout the markets, is symptematic of poor market understanding, most beginners' first port of call is scalping. It requires little research and learning, involves little more than hitting and running, hoping that a bit of momentum will carry them through.

You might well make it work for your desired income, but the further you go up the income scale, the less you see of scalpers.
Life Is Not Like A Box Of Chocolates.
  • #73
  • Dec 5, 2005 6:23am Dec 5, 2005 6:23am
Quoting Ho Lee Foo
The scalper's approach throughout the markets, is symptematic of poor market understanding
While I agree that 50+ trades for 40-something pips net is definitely not the way to go, in this comment above quoted is where you lost me Ho Le Foo.

The market doesnt know about scalping. The market doesnt know about swing or possition trading. The market doesnt know of intraday trading. Furthermore, the market couldnt give two fcuks about any of them. The market only and exclusively knows about pips earnt or lost. There is no such a thing as poor market understanding as long as you make pips.

If a trader can sustain profits month after month, then he certainly knows what he's doing, regardless of whichever time frame he trades.
  • #74
  • Dec 5, 2005 6:39am Dec 5, 2005 6:39am
Quoting WTB
The market only and exclusively knows about pips earnt or lost. There is no such a thing as poor market understanding as long as you make pips.
Great comment - it made me feel better
time is money! Z
  • #75
  • Dec 5, 2005 6:40am Dec 5, 2005 6:40am
Ok John, I think perhaps people would be less judgemental if you could elaborate a little bit more on your trading system.

I would sure appreciate it myself.
  • #76
  • Dec 5, 2005 10:45am Dec 5, 2005 10:45am
Quoting WTB
While I agree that 50+ trades for 40-something pips net is definitely not the way to go, in this comment above quoted is where you lost me Ho Le Foo.

The market doesnt know about scalping. The market doesnt know about swing or possition trading. The market doesnt know of intraday trading. Furthermore, the market couldnt give two fcuks about any of them. The market only and exclusively knows about pips earnt or lost. There is no such a thing as poor market understanding as long as you make pips.

If a trader can sustain profits month after month, then he certainly knows what he's doing, regardless of whichever time frame he trades.
Ask yourself why it is that scalping is so attractive to beginners? All beginners lack understanding, with experience most move away to different trading styles, if they have any capital left.

If you are happy to let the market keep the baulk of the points then you've not understood what that market has to offer. If you're happy with inefficient systems, then fine, but there is no good reason to approach the FX markets with the intention of just scraping a little here and there.

Scalpers demonstrate their fear of the market, they want systems that have little or no drawdown(impossible), because psychologically they're green. That is the problem for all newcomers, to develope the mindset that allows a trader to sit through draw down and let the market do the work with the stronger moves.

I don't need a lesson on scalping, been there, down that, made some cash, then learnt years ago that I could do much better.
Life Is Not Like A Box Of Chocolates.
  • #77
  • Dec 5, 2005 10:53am Dec 5, 2005 10:53am
JohnFX,
I like your idea of a thread for short term trading. I hope it becomes a positive thing on this forum. I've been a Giants fan since Y.A. Title
JIM
  • #78
  • Dec 5, 2005 11:47am Dec 5, 2005 11:47am
Quoting Ho Lee Foo
Ask yourself why it is that scalping is so attractive to beginners? All beginners lack understanding, with experience most move away to different trading styles, if they have any capital left.
totally disagree - to live off scalping one needs to have a complete system. just like those playing long term.

what is more, I could say: all long term players are lazy since they don't want to make decisions too often

or maybe even I could say: all long term players lack talent because they didnt manage to create a good system which is not spread-insensitive enough. So they had to go long-term where spreads dont play any role.

I could: but I don't and actually I don't even think so.

I just wanted to show that attaking other's strategy just because it is other then yours is ridiculous!

And one more difference between long and short term playing, REALLY most important for me: I can automate scalping! Long term play needs some human driven decisions - short term doesn't!!!
time is money! Z
  • #79
  • Dec 5, 2005 11:51am Dec 5, 2005 11:51am
Qoute: I don't need a lesson on scalping, been there, down that, made some cash, then learnt years ago that I could do much better.


Hi Ho Lee Foo

You mean you earned something with scalping. At present you have a better system to earn even more.

JohnFx is man enough to prove himself. Any Boxer who dares to go up to the ring to box with Mike Tyson has courage. Winning or losing is unimportant. Courage to face humilation even in losing.
Would it not be nice that you too post a series of trades to support what you wrote. Let's say in a period of 1 month, you post your signals and John with his. We will see if your system scores more pips than his.
I am curious whether there is a system better than another or it depends actually on each individual trader.

Highway
  • #80
  • Dec 5, 2005 12:15pm Dec 5, 2005 12:15pm
Quoting Ho Lee Foo
there is no good reason to approach the FX markets with the intention of just scraping a little here and there.
There is no good reason to approach the FX markets other than, exclusively, to make money off them. Period. If a trader can sustain 50'ish pips a week, it doesnt matter whether he does it via one trade a week or 50 trades a week, because he will reach wealth either way in the long run.

You seem to believe that long term trading is "holier" than scalping. I say whichever shows a bigger bank account at the end of year is the "holier" becuase there is no other benchmark in Forex than raw, brute, straigh profits/losses.

Please dont missunderstand me Ho Lee Foo, I am not a scalper myself, but I see absolutely no wrong in it as long as pips flow in.
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