Call me Vidvad - I day trade futures

In 2007 I traded an fx options strategy that hasn't worked since. In 2008-9 I traded a spot fx strategy that no longer works, and from late 2009 until early 2011 I traded a EURUSD strategy that hasn't worked since. All of this because the markets in question have changed. I could go on, and these changes are well-known to many people who were around then.

And as you know, NQ behaves very differently now compared to Nov-Dec last year. And so on, and so forth. And depending on how you trade, you may need to stay on top of such changes.

But now I'm curious. What's a price action strategy that has endured for generations?

There are a lot of good points here. I used make my living in the Market. Have had series 7 and bunch of other numbers they made me get. I started learning the market back in high school. My boss at the time was blind and would read him all kinds of research from his broker back then. This is like 1977. Then I ended up getting a degree in Economics and working in the industry.

The markets have changed a lot. Today so many more people have easier than ever access to the markets. They are much choppier than before. Also from year to year and month to month the volatility changes. So my basic strategy has not changed much But how I trade them has. I have slowed my charts down. I know a guy that he just loves to trade currency pairs and he use a 1hr and 15min charts. No indicators at all. He does really well. I have seen another guy trades and just uses a 5min chart with a 21Ema and trades as prices cross back and forth. He does really well.

As the volatility increases and decreases that is where most people do not adapt to the changes. So they end up trading noise. I see a lot of people that used trade the ES now trading the NQ simply because the ES has slowed down.

Every firm out there that manages any large amount of money has a black box with a Algo running. But they watch it closely and every 3-4 weeks make minor adjustments to the Algo to adapt to the market. We can do the same. Same basic trades just adjusting to the range and volatility of the market.

But when you can trust your method then as Vid has been saying you really need to follow the rules and trade them without your fear or greed getting in the way. Most traders after blowing up an account are usually late because the waited to long wanting to be sure before they enter because the have lost before.

When I start losing it because I either just missed the opportunity all together or I waited to long and then by the time I entered I missed it. The next thing most traders are trying to make to much on every trade. They let the small winners turn into bigger losers. Then once it is a loser they hold it even longer hoping it will come back to them.

The danger with indicators is that people trade them blind. Meaning when the market is really strong and trending they are following all the signals, but when the market changes or goes into consolidation for a while, which happens several times a day when inter-day trading they are still taking the same signals when they should not be. And example that is simple is like with the Macd and you just trade every cross going long or short and wonder why I am losing on so many trades. That is where some one needs market structure skills over above just trading indicators.

I have found the system or method is not as important as just good market structure skills, Where support and resistance area's are. trade management skills. Things like that. Really a trader should be able to make money going long and short. And trading a naked chart is not that hard if you just study them for a while. You do get into a the rhythm of market after while. I like to study other peoples methods. It kind of amazing to see how creative we can be.

Good posts everyone. There a lot of good traders here. All the best to everyone!!

But you've not demonstrated that these were specifically price action strategies that no longer work. 2008 was the retail forex hay day when many pairs moved hundreds of pips each day and there was far more retail participation because US traders were still juiced on 200:1 leverage. Retail forex has been a slog since the Sarbanes-Oxley Act took FX away from US traders for the most part.

What specifically about these edges was based on price action alone?

Look, I have no accountability towards you. If you don't believe me, don't. And best of luck on your journey

I wasn't looking for accountability from you or anyone. We are, or at least were, having a discussion about a topic you yourself brought up. I was asking reasonable questions as part of normal human discourse about a claim you yourself made.

In any case, I'm opting out of this discourse. Apologies for wasted time, and best of luck to you.

There seems to be a misunderstanding by some as to what exactly is the insight I gained through the roulette epiphany. I am here attempting to recenter the focus. First, a few points made by the late Mark Douglas, author of The Disciplined Trader and Trading in the Zone:

"Putting on a winning trade or even a series of winning trades requires absolutely no skill. On the other hand, creating consistent results and being able to keep what we’ve created does require skill. Making money consistently is a by-product of acquiring and mastering mental skills." -Mark Douglas

"When you genuinely accept the risks, only then will you be at peace with any outcome." - Mark Douglas

"When you achieve complete acceptance of the uncertainty of each edge and the uniqueness of each moment, your frustration with trading will end." -Mark Douglas

"The degree to which you think you know, assume you know, or in any way need to know what is going to happen next is equal to the degree to which you will fail as a trader." -Mark Douglas

The epiphany came when I heard this part of the documentary video about Gonzalo Garcia-Pelayo:

"Finally, after a lot of hard work armed with their fine-tuned data and a year after Gonzalo's initial experience, they're in a position to play ball and win. They enter Madrid's Premier Casino individually. Gonzalo and his family believe they have a 6% advantage, more than double the house edge. In theory they should be able to win money from the casino at twice the speed it's usually lost. European Roulette gives the house a 2.7% edge over the player because there's only one green number on the wheel, the number zero. Betting rules are simple: players can bet on an exact number where the payout is 35 to1, or they can bet a red or black number will come up at even odds. The Pelayos aren't interested in betting red or black. They're here for the bias alone. It means that most of the time they bet they'll lose. However, because of the bias, the 35 to1 wins they hit will drastically outweigh the losses. Except things haven't started well. For the first two hours the numbers they've been betting on don't connect. Spin after spin, loss after loss, their already small bank roll is disappearing fast. A stressed-out Gonzalo knows he needs to be patient. Then probability bites back! Dealing the team several high stakes wins in a row! Despite the early losses, their first serious night of roulette is a profitable one. But Gonzalo has no intention of leaving it there."

"Except things haven't started well ... loss after loss, their already small bankroll is disappearing fast ... [but] a stressed out Gonzalo knows he needs to be patient. Then probability bites back!"

That right there is the roulette epiphany being demonstrated as clearly as it can demonstrated. It is itself not esoteric or mathematical. It is simply the acceptance that when one is playing a probabilities-based game, i.e. a game of chance where each outcome is uncertain and independent from each preceding and subsequent outcome, and one has a known edge in one's favor, one must not deviate from that edge, even when doing so would be the easiest and quickest way to stop the pain. The pain is an illusion, as it is a reaction to a temporary run of losses, which is normal for any positive expectancy edge.

I am logging out of FF until the end of the month. I have constructed a trading plan that will allow me to follow Mark Douglas's exercise correctly for the first time since I've begun this journey.

This is make or break for me.

If I can't follow this plan for the next 8 trading days, then I really feel that I will have to conclude that I am not built for this trading game and it will be time to stop wasting my time thinking that I am. On the other hand, if I can nail this plan flawlessly for the next 8 trading days, then the roulette epiphany will have saved my trading career and made my future success possible.

The Exercise:



The Goal:

Hi Vidvad,
I am writing this message to you because I have followed you post for some time now. I can see from your posts that you are dedicated to trading and you believe that you have a chance that you can make it. I have noticed that you have many great ideas yet I believe you always feel that you are missing something, that 1% that will make you successful. I have been there many times and trust me when I say I feel your frustration. I evolved from the mainstream trader and it was from letting go of old worn out beliefs and creating new beliefs that broke the rules. People told me I could not make 7.5R on my trades and so I set out to do that and found it easy. You may think that if you lock yourself away for eight days you will rise from the ashes a trading phoenix. I guarantee you will start creeping onto the forum and start absorbing others views. You will be better off looking at posts but not posting anything yourself. This will also be good for your disciple. I have looked at your charts and I can see where you are coming unstuck but it is not my place to intervene. If you do want any help / suggetions you can message me and I will do what I can to help you.
Anyway my friend good luck with the endeavor.
Regards
Rob

I've taken steps to keep this from happening. I have Blocksite, and I'll be adding FF to it tomorrow morning at 8AM. I also informed my friends with whom I share a small discord that I'll be blocking discord as well.

I plan on logging out of all social media and blocking frequently visited websites by that time. I will limit my computer use to Ninjatrader and TopstepX during my trading window only, strictly enforced. I will return to FF about noon on Friday February, 28. In the meantime, I will be using the time I typically spend on the computer to focus on reading books, walking, and eating healthy. All of which I hope will support me in trading well for the next 10 days.

The first book on my list is Dostoevsky's The Gambler.

I have created a 100% mechanical, 0% discretionary trading plan. It is a true, 2:1 "set it and forget it" trading plan. Each session, there will be either one trade or zero trades. If there is a trade, it will either result in a -1R or a +2R.

I'm not sure which charts of mine you are referring to but the charts I am using today are so very different from the charts I was using when I started this journal, and even different from the charts I was using a few months ago.

No indicators whatsoever, and I am using 60 minute bars only.

The end P/L does not matter to me at all. In fact, I told my discord friends that I will using a topstep combine for the 8 day exercise, and if I blow the account because of a bad run of losses, no problem, I'll just pay the $49 and reset the account and keep trading the trading plan. The only criterion by which I will judge my performance is to what extent did I execute my trading plan flawlessly, without hesitation or fear.

I'll be back to FF and this journal on Friday 2/28/2025. I feel I must do it this way to eliminate the distractions that are part of public discourse.

I appreciate you following my journey and taking the time to speak with me here, Rob, and I am a reader and admirer of your contributions to FF.

Thank you for your kind thoughts.

Sincerely,

vidvad

hey vidvad,

Any chance you'd open an account with Darwinex Zero?
I like to see how your risk adjusted trading is.

I just checked and it is a monthly subscription SIM account? No funding? I doubt I'd ever spend time or money on such a product.

I adjust risk based on the size of the required stop on each particular set up.

I'm logging out of FF now.

I'll see you guys on February 28!

Yes it does take a change of mindset to trade Darwinex.

Hi VidVad,
Firstly, best of luck on your trading journey over the next 10 days. You may not see this message until then and maybe that's a good thing as I certainly don't want to distract you on your mission..but it's maybe something to consider afterwards.

The Roulette Epiphany
-------------------------

I may be wrong but what I understand about what you like about that story is the fact we can do a lot of preparation before we sit down to bet. We have our stats worked out and a slight edge on the frequency of particular ball numbers from that biased wheel. That's fine, we know which table this wheel is at and we know the wheel's discreet markings in case it moves to another table. Therefore we can bet WITH CONFIDENCE that over a very large number of bets our edge should prevail..even with a disastrous losing streak in the beginning (as long as we play our wheel).

In trading, I think it's slightly different. Yes, we can still work out stats beforehand for our chosen instrument and then trade strictly to a plan. BUT..the big difference I see is that when the casino changes our biased wheel we SEE that straight away. We can stop betting on the new wheel immediately (as we need to work out new stats for it's bias). In trading we can't SEE them changing the wheel..at least not immediately like in the casino. When you hit 10 losses in a row then the psychology comes into play..."are my stats still valid for this?", "did they change wheel without me noticing?", "do I persevere with this plan or back to drawing board?"

Anyway, just my thought. Again, best of luck

Regards
DM

Sad to see that Vidvad. But hey sometimes we just need a break. One of the reasons I do not really create content on my Forum. I post once in a while. Just keep doing what you are doing. I think one of the best qualities of your Method is you are not over trading. I see your one chart was 15 seconds long (if I saw that right). I thought cool. Most people over trade. I do that some times. Okay more than sometimes. Have great day and do not let the doubters get to you. I think it is great that you got the place where you realized you just needed to trust your method. Play the odds and be consistent. It really is that simple. The simpler the Method the better is what I have found over the years. All the Best!!!

What a refreshing break from social media that was!

And productive too!

5 trades deep into a 10 trade exercise on NQ using my preferred methodology, which I will henceforth simply call the "Gonzalo" method, in honor of Gonzalo Garci-Pelayo


MAE = max adverse excursion (the most the trade went against the position)
MFE = max favorable excursion (the most the trade went in favor of the position before hitting a trailing stop)

I've also done some testing/sim trading using a hybrid of LauraT's roadmap and IslandFx's "Detrended Oscillator"

I wasn't able to find an oscillator for Ninjatrader, that reproduces IslandFx's, but I did find a "detrended oscillator" for Ninjatrader that is of interest to me.

Other Ninjatrader users can download it for free at the ninjatrader ecosystem website:

Detrend Oscillator NT8 - NinjaTrader Ecosystem

Yesterday's NQ trades on the "detrended roadmap"


Today I traded my Gonzalo method this morning and then I had meetings for work, so I was only able to grab this one long late in the day on the detrended roadmap

The biggest improvement I've experienced this week is patience!

Without the distraction of CNBC and FF and Twitter I really felt a different level of focus, like a whole level beyond any I've been able to muster in the past. And that extreme focus yielded a surprising level pf calm patience. I can say that from the Monday open through the Friday close, I not once felt even the smallest tug of FOMO.

I'll (probably) have more to say over the weekend, but I wanted to make this entry.

I may limit my journal posts to once per week here at FF. I don't know that I'll log out and stay away for the whole week, but I think it might be valuable to continue to stay away from flogging myself in public during the trading week and instead limit myself to a weekly summary of where I'm at that week.

I'm embarrassed by President Trump's position and behavior.

That's the official Nazi salute of Bandera's murderers. During and after World War II.