My way of seeing the market | Page 10 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Money management in trading - the stupid way and the right way 22 replies

Hard Way, Easy Way 115 replies

Is the martingale way the only way in Forex? 34 replies

Simple Way is the most advance way... 11 replies

2 Way VS 1 Way Analysis 9 replies

Attachments: My way of seeing the market
Exit Attachments

My way of seeing the market

  • #181
  • Jan 24, 2022 11:02am Jan 24, 2022 11:02am
Quoting Jaymantos
{quote} Those feelings have absolutely nothing to do with the trading environment, yet they more often than not dictate the next actions you will take. It is a probabilistic environment, and you have zero control over things that will happen there, unlike most other things in life. That’s why the learning-curve is more like an unlearning-curve, because you must reprogram your emotional algo to fit a totally new environment, and that is what really takes the 10 000 hours mark, and it can’t be done unless you… do it. That’s also the reason I said...
You say all this, but I notice you joined this place in 2016, and likely were actively trading or learning to trade way before then. So possibly around ten years trading experience behind you? How could you possibly judge how easy or obvious something is, that comes as 2nd nature to you......after ten years of doing it?

I am also reaching a point, where the game seems 'easy', at least from an analytical point of few although often not from an actual real trading point of view. But I have a good few thousand hours of screen time, encapsulating all the time spent chasing the same Red Herrings as every other retail trader gets sold until they finally develop their own thing that suits them (and works).

I could thoroughly explain my process within an hour, whilst giving several recent real world trading examples. Infact, I just done so to a total novice the other day. Can this novice then simply pick up what I explained to him and just start trading successfully? Highly unlikely, because to me, what seems easy and obvious (with my traders intuition built up over thousands of hours), to a novice is going to seem like a foreign language. Putting psychological factors to one side, that is what trading is like. Learning a language. Something that can only be achieved to a reasonable degree of fluency through countless hours of repetition until the totally arbitrary 'rules n customs' finally sink into the subconscious mind.......(with one difference between language and trading being that whilst the rule n customs change overtime for both, they change a hell of a lot faster in the markets than they do for the spoken/written word....what might have worked great for crude oil traders 10 years ago, might well today be just another Red Herring to sell to novices in $1500 trading courses)
  • #182
  • Jan 24, 2022 11:12am Jan 24, 2022 11:12am
Quoting MatDerKater
{quote} You say all this, but I notice you joined this place in 2016, and likely were actively trading or learning to trade way before then. So possibly around ten years trading experience behind you? How could you possibly judge how easy or obvious something is, that comes as 2nd nature to you......after ten years of doing it? I am also reaching a point, where the game seems 'easy', at least from an analytical point of few although often not from an actual real trading point of view. But I have a good few thousand hours of screen time, encapsulating...
I think screen time plays a huge factor in trading, that includes getting very comfortable and being able to use charts on any platform fluently, drawing lines, setting the chart up etc, and after of course momentum etc.
  • #183
  • Jan 24, 2022 12:29pm Jan 24, 2022 12:29pm
Quoting MatDerKater
{quote} You say all this, but I notice you joined this place in 2016, and likely were actively trading or learning to trade way before then. So possibly around ten years trading experience behind you? How could you possibly judge how easy or obvious something is, that comes as 2nd nature to you......after ten years of doing it? I am also reaching a point, where the game seems 'easy', at least from an analytical point of few although often not from an actual real trading point of view. But I have a good few thousand hours of screen time, encapsulating all the time spent chasing the same Red Herrings as every other retail trader gets sold until they finally develop their own thing that suits them (and works). I could thoroughly explain my process within an hour, whilst giving several recent real world trading examples. Infact, I just done so to a total novice the other day. Can this novice then simply pick up what I explained to him and just start trading successfully? Highly unlikely, because to me, what seems easy and obvious (with my traders intuition built up over thousands of hours), to a novice is going to seem like a foreign language. Putting psychological factors to one side, that is what trading is like. Learning a language. Something that can only be achieved to a reasonable degree of fluency through countless hours of repetition until the totally arbitrary 'rules n customs' finally sink into the subconscious mind.......(with one difference between language and trading being that whilst the rule n customs change overtime for both, they change a hell of a lot faster in the markets than they do for the spoken/written word....what might have worked great for crude oil traders 10 years ago, might well today be just another Red Herring to sell to novices in $1500 trading courses)
Well, we agree that learning to trade takes a lot of time, I'd say anywhere from 1 to 10 years depending on a lot of factors, baggage, commitment, other responsabilities, expectations, etc.

Your initial reply to my friday's post seemed to be in regards to the pertinence of hiring a trading coach or not but now you talk about "red herrings every other retail trader gets sold", implying that it's a scam, so I guess we both have a similar view on trading courses. I just thought you were defending them in your initial post, that's all.

I reiterated my belief that it's a bad idea in my last post, because learning how to trade properly, building the instinct you talked about; it takes a lot of time and dedication and can only be done by the trader himself.

I'm probably picking hairs, but to me the screen time is more like training your emotional algo which is what takes a lot of time and there's no shortcut to it. Whilst getting familiar with how a chart moves is shorter, in my opinion, but you can't really see the chart for what it is until you unlearn a lot of unecessary beliefs from past experiences, that may or may not stem from trading itself...

It'll be my sixth year in march...
No tree, it is said, can grow to heaven unless its roots reach down to hell
  • #184
  • Edited 3:41pm Jan 24, 2022 12:53pm | Edited 3:41pm
Quoting Jaymantos
A beginner will start trading without a clue of what he is doing, and that is often enough to generate an emotional load that will dictate how he will see the charts. It is likely that he’ll feel “inadequate” and that he is missing something, he will feel stupid and unknowing, in the dark; without realizing the endgame is just exactly the same. That’s when he’ll be ready to let go. He’ll stop craving chart righteousness and start loading, and unloading, without a care in the world. That’s when the instinct you talked about will be performing at...
Ultimately, there is a reason why funds hire psychologists to help traders perform better. I wouldn't go so far as saying courses are useless, but would rather say they're only good if they also target the psychological component of trading. I have for example always told people to hide the monetary column in the trading terminal and only look at pips. That's one small step everyone can do to lower (although not eradicate) the emotional load. What is also a common, I'm going to be brutally honest here, loser-trait is personifying the market. You see that countless times here in the forums and if you do that, it's practically over with your trading career unless you fix that problem. However, I wonder whether the root problem likely also has a technical reason: We're wired to believe we need to forecast the market. So yes, we need to unlearn that (psychological) instinct (and that also helps in other situations in life, dating for example has somewhat similar characteristics to trading - marriage is like removing the stop loss by the way, but I digress), but we still need to learn how to analyse odds and if you have learned this (technical skill), you're automatically one step closer to stop feeling betrayed, cheated by or whatnot by the market because these feelings suddenly become incompatible with your new gained view of the chart/market.
  • #185
  • Edited 1:39pm Jan 24, 2022 1:04pm | Edited 1:39pm
Quoting JensG
{quote} What is also a common, I'm going to be brutally honest here, loser-trait is personifying the market. You see that countless times here in the forums and if you do that, it's practically over with your trading career unless you fix that problem. However, I wonder whether the root problem likely also has a technical reason: We're wired to believe we need to forecast the market. So yes, we need to unlearn that (psychological) instinct (and that also helps in other situations in life, dating for example has somewhat similar characteristics to...
Whilst it doesn't pay the trader to get butt hurt from being turned over by the market (difficult not to be, especially from situations when his SL gets rinsed by a pin candle only for the market to then go whizzing off in his direction), knowing the markets are generally moved around in order to inflict max pain on other market participants, is simply acknowledging the reality of what makes markets move.....i.e. if a dealing desk at JP Morgan or HSBC gets wind of a big 'real money' sell order coming to the EURUSD, damn right they will push that market down as far as they can get it in advance of that order being executed, before quickly pushing it right back up, making it as difficult as possible for other participants to get in on the ride.

Beyond that, the institutions build up and unload their positions by setting up 'text book' market configurations in order to lure traders and their Stop Losses into the market as a matter of routine. No getting away from it, and no point in pretending it doesn't exist, or isn't the Modus Operandi of the financial markets.
  • #186
  • Jan 24, 2022 2:14pm Jan 24, 2022 2:14pm
All that talk about stop-hunting works out to be a supply and demand issue and there is no need to take it personally. The fault is the traders who tend to all want to get out at roughly the same price because it correlates with a previous turning point or because some silly indicator lines crossed. Placing a stop-loss is just another aspect of trading they need to learn.
  • #187
  • Jan 24, 2022 2:48pm Jan 24, 2022 2:48pm
Quoting JensG
All that talk about stop-hunting works out to be a supply and demand issue and there is no need to take it personally. The fault is the traders who tend to all want to get out at roughly the same price because it correlates with a previous turning point or because some silly indicator lines crossed. Placing a stop-loss is just another aspect of trading they need to learn.
Yes and No.

Many of these algo bots that the institutions put to work are coded to trade against well known cognitive biases a.k.a. they are coded to trade against 'shit that used to work'.....(until all the algos started trading against it)

...and that is basically the trading game.

If a small minority of participants are to make out like bandits, then the vast majority have to lose. The 'right' thing to do, is never what the majority are doing.
  • #188
  • Jan 24, 2022 4:05pm Jan 24, 2022 4:05pm
Quoting MatDerKater
{quote} Yes and No. Many of these algo bots that the institutions put to work are coded to trade against well known cognitive biases a.k.a. they are coded to trade against 'shit that used to work'.....(until all the algos started trading against it) ...and that is basically the trading game. If a small minority of participants are to make out like bandits, then the vast majority have to lose. The 'right' thing to do, is never what the majority are doing.
Markets are there to facilitate exchanges between its participants, wheter those exchanges are for "traditional" reasons or for speculative ones. Price will always trade to where there's volume willing to be traded at this price, until there isn't and it drifts off towards another attractive zone... It's not a scam per-se, it's not a conspiracy. You place a stop, thus add to the liquidity pool at the spot, and are willing to transact there, therefore effectively used the market for what it's best at: facilitating exchanges between willing participants...
No tree, it is said, can grow to heaven unless its roots reach down to hell
  • #189
  • Jan 24, 2022 5:34pm Jan 24, 2022 5:34pm
Talking about cognitive biases.

"They asked people to make specific choices between various alternatives. Kahneman and Tversky first had participants choose between one of the two gambles, or prospects:

Gamble A: A 100 percent chance of losing $3,000.
Gamble B: An 80 percent chance of losing $4,000, and a 20 percent chance of losing nothing.

Next, you must choose between:
Gamble C: A 100 percent chance of receiving $3,000.
Gamble D: An 80 percent chance of receiving $4,000, and a 20 percent chance of receiving nothing.

Kahneman and Tversky found that of the first grouping, 92 percent chose B. Of the second grouping, 20 percent of people chose D.
What the reflection effect proved was that people were risk-averse regarding choices involving prospects of gains and risk-seeking over prospects involving losses.

This means that virtually all human beings— including successful speculative traders—are wired the same way: We are all programmed to take small profits and large losses"
  • #190
  • Edited 6:10pm Jan 24, 2022 5:49pm | Edited 6:10pm
Quoting phoenix777
Talking about cognitive biases. "They asked people to make specific choices between various alternatives. Kahneman and Tversky first had participants choose between one of the two gambles, or prospects: Gamble A: A 100 percent chance of losing $3,000. Gamble B: An 80 percent chance of losing $4,000, and a 20 percent chance of losing nothing. Next, you must choose between: Gamble C: A 100 percent chance of receiving $3,000. Gamble D: An 80 percent chance of receiving $4,000, and a 20 percent chance of receiving nothing. Kahneman and Tversky found...
True...

...but greed based traders can run into just as much problems as fear based traders who snatch at profits too soon.

With that said, in a study conducted on which type of strategies were most profitable in the long run, firmly in first place was HUGE rr, but low hit rate strategies. Then in 2nd place, it was high hit rate, but low RR.

The two things, that almost no retail traders aim to do, although perhaps many fear based traders end up doing the latter, whilst limiting themselves to only taking trades with potential 2:1, 3:1 rr etc.
  • #191
  • Mar 14, 2022 5:42am Mar 14, 2022 5:42am
People always say consistency is key and it's true. I have one suggestion for anyone trying to learn how to trade:

Have a simple method / approach from which you make sense of charts. Don't add to it every now and then. Market is like a simple universe and we have to make sense of it through some kind of lenses in order to develop the mental structure to see the patterns. From that perspective, consistency is key.

Messing up with the approach everyday is like waking up everyday and see a different frequency spectrum. It is not helpful for the brain to pick up on the subtilities of the environment.
No tree, it is said, can grow to heaven unless its roots reach down to hell
  • #192
  • Mar 14, 2022 11:39am Mar 14, 2022 11:39am
Quoting venividivici
This is a great thread so far Don't forget bounces and support/resistance levels aren't perfect on the minute chart..I spent alot of time trying to trade perfect setups but those dont exist, they will be around those areas you expect but will form and bounce in a 'dirty way'. {quote} Small pullback trades several times a day is the key.. It doesn't matter if you lose a few..there's usually plenty of chances in the day.
I definitely agree with what you say about perfect setups don't exist, For example 3 bottoms don't always sit on a horizontal support line perfectly, one bottom might be 10 pips lower, the other might be 14 pips higher, so you draw the line so that it is somewhere in the middle, the best fit, about there-ish
  • #193
  • Mar 14, 2022 12:55pm Mar 14, 2022 12:55pm
Quoting Jaymantos
Price is attracted by liquidity; it might seem like it's moving heaven and earth to get it, but in fact it's just the way market works. A very common scenario is the infamous "stop hunt". Price returning is happening everywhere on the charts and I am starting to think to build my approach around it. I think that I get mesmerized too much with big moves on the chart and trying to catch them.
Hi there i am new to this forum but have been trading for about 10 years and have been through exactly what you described in your recent posts.
When the stop hunting is going on, I choose to sit on the fence for a while
For example...
Daily charts, price has gone past a support line, ie large trading institutions, banks buying from the buyers that are now selling to stop their losses and thus getting it at a discount
I drill down to 1hr chart and check once every hour to see if volatility has settled (stop hunt over).
When stop hunt is over it is usually followed be sideways consolidation move.
I draw a rectangular box around that consolidation, i check once an hour to look for entries to buy. I allow myself 3-5 loosing trades (depending on my mood) after 5 losses I walk away. And go back to checking the chart once a day. And my next trading opportunity (a different support or resistance line) might be 5, 10 or 15 days away. Thats my break from trading, checking just once per day.
When the next trading opportunity comes along I go back to checking once every hour, half sitting on the fence half not, and just try to think outside of the box about where I am going to put my entries and stop loss orders so that I don't end up being in the stop hunt (if there is another one)
And I don't think about lost opportunities, for example, 'if only my stop loss was 5 pips lower i could of gained 400pips!'
Because if I think like that, I will fall into that trap of messing around with my stop loss distances, over analysing and over tweaking looking for that perfect trading system that does not exist.
And if I do have my stop loss 5 pips lower, the same thing will happen in the future, price will over shoot it by 3 pips and then turn around and make a 1000 pip move.
Best to forget about the what ifs.

I usually use the average daily range indicator with a lookback period of 14 to get a rough idea about stop loss distance.

Hope all of that helped,
I've probably waffled on a bit.
Its my first post so I thought I would put the effort in
  • #194
  • Mar 17, 2022 4:05am Mar 17, 2022 4:05am
Quoting FruitFx
{quote} Hi there i am new to this forum but have been trading for about 10 years and have been through exactly what you described in your recent posts. When the stop hunting is going on, I choose to sit on the fence for a while For example... Daily charts, price has gone past a support line, ie large trading institutions, banks buying from the buyers that are now selling to stop their losses and thus getting it at a discount I drill down to 1hr chart and check once every hour to see if volatility has settled (stop hunt over). When stop hunt is over...
Hi FruitFx, I get that you are more long term trader? I am scalping and taking about 5 trades everyday, in average. Did you start longer term after experiencing some of the problems I mention in this thread? Damn, you go 5-15 days without a single trades sometimes? That’s insane discipline.

I understand what you say with not caring about lost opportunities. It's crucial to just focus on our methodology and forget all the rest. It's us who create the "edge" (our brain and ability to "see" probabilities through consistency in the method), not tweaking a system or indicator.

Thank you for the reply, as you can see I'm usually mostly talking to myself in this thread .
No tree, it is said, can grow to heaven unless its roots reach down to hell
  • #195
  • Mar 18, 2022 4:41am Mar 18, 2022 4:41am
Those who can persevere in the market are great
  • #196
  • Mar 25, 2022 7:53pm Mar 25, 2022 7:53pm
Inserted Video
No tree, it is said, can grow to heaven unless its roots reach down to hell
  • #197
  • Apr 5, 2022 8:26am Apr 5, 2022 8:26am
Attached Image (click to enlarge)
Click to Enlarge Name: screenshot.png Size: 26 KB


It is worth waiting.
No tree, it is said, can grow to heaven unless its roots reach down to hell
  • #198
  • Aug 26, 2022 5:15am Aug 26, 2022 5:15am
The difficult thing

In trading, the difficult thing is often the right thing to do. The difficult thing comes in many shapes and forms.

- Holding a trade during a nasty retrace and accepting the pain of uncertainty about what’s going to happen next.
- Accepting a small loss and not making it worse.
- Stopping ourselves from reloading immediately after a loss out of anger and/or boredom, in disregard to our plan.
- Accepting the day as it was and move on to other things.
- Having balance in our lives.
- Trusting that tomorrow will bring a whole new world of possibilities. Letting go.
- Letting the market take us out at our stop loss and not entertaining any anger or frustration about it.
- Not entertaining anger and frustration.
- Realizing it’s all about the long game and accepting the outcome of a single bad day.
- Catching ourselves during tilt, getting up and closing everything down, then doing something else and enjoying it. Then coming back the next day with a fresh mind.
- Seeing price miss our target by a small amount of pips at +5-10R then slowly creep its way back to our stop at 1-2R or B/E and be totally fine with it.
- Accepting the bad days and even laughing about them.
- Recognizing the day is over and moving on.
- Going outside, taking a walk or joggging after something went wrong.
- Being able to let things be and go do something else while waiting.
- Being ok with either a win or a loss.
- Seeing price move 100 pips without us because the trade wasn't right for us, and not start questionning the plan.
- Forgiving ourselves for our mistakes.
- Having a plan and following it.
- Pulling the trigger when our plan comes together despite the fear of being wrong.
- Staying calm and following the plan despite a few losses in a row.
- Refraining from watching price action on a bar by bar basis which causes to feel the pain and elation of every tick.
- Being able to wait, and disregard the feeling of urgency to take an action.
- Coming back mentally from anger.
- Meditating.
- Eating well.
- Doing exercises.
- Sleeping well.
- Enjoying the breaks away from markets.
- Constantly reviewing our mistakes.
- Etc.

While doing the difficult things is not a one-way ticket to success, it puts us in a position to experience the markets from a completely different point of view than how the vast majority of participants experience them.
No tree, it is said, can grow to heaven unless its roots reach down to hell
  • #199
  • Aug 26, 2022 6:21am Aug 26, 2022 6:21am
Quoting Jaymantos
The difficult thing In trading, the difficult thing is often the right thing to do.
"It is easy to hate and it is difficult to love. This is how the whole scheme of things works. All good things are difficult to achieve; and bad things are very easy to get."
- Confucius
  • #200
  • Aug 26, 2022 7:15am Aug 26, 2022 7:15am
Quoting phoenix777
{quote} "It is easy to hate and it is difficult to love. This is how the whole scheme of things works. All good things are difficult to achieve; and bad things are very easy to get." - Confucius
Epic quote!
No tree, it is said, can grow to heaven unless its roots reach down to hell
1 trader viewing now