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At the end it all comes down to the same thing 43 replies

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  • #41
  • Oct 14, 2008 1:16am Oct 14, 2008 1:16am
i said good-bye to FF some days ago...

but i guess i can step in here and throw my 2 cents this time -i think is a valuable question-:

Is there a real "edge" out there u ask?

the answer is yes...

but all the threads u mention are not about THE edge... this are strategies... approaches... etc.

imho, since there will be always buyers and sellers... supports and resistances... u will always find buying and selling levels... for any trend or rangebound market...

and "edge" -at least for me- is that tiny LITTLE thiny that makes u identify the TINY probability price goes one way or the other...

in other words... the edge is that "tool" that makes u decided whether to buy or sell... that TINLY LITTLE THING that differenciates the winners and losers.

and no... i dont think somebody is naive enough to share his/her edge in a forum.. because that takes a lot of work and time... is intellectual property since it is one's creation...

and i can bet u wont find an "edge" for sale not even for a million dollars...

the only thing that remains is to keep up with good threads and approaches... and with a bit of luck... one could find one's very personal and private edge...

few words:

"the edge" is something that cannot be tought but only learnt

Quoting tdion
We're all posting the same ideas over and over every few months

 

  1. PermanentJuan: "Don't trade the cross wait for confirmation" -> my own "MA w/ Jacko AH" thread
  2. How many moving average systems do we find? Lever's "Cornflower?" "Key to the mint?" "Vegas Tunnel" "Bunnygirl cross" etc....
  3. My "Martingale EA Almost can't lose" posts -> FXTradePro's "SemiMartinglae strategy"
  4. Should I even start talking about Finonacci? "BAT by Team Aphid"
  5. Countless hedging systems that explode. Where does it end????


It's the same wheel reinvented OVER AND OVER. In other words, we are all so desperate for a REAL advantage, that we wander the same circles.

My question is, IS THERE ACTUALLY AN EDGE OUT THERE? These systems posted above are a waste of time. They are gambling. There is no evidence that they will continue working.

  • #42
  • Edited 4:26am Oct 14, 2008 3:24am | Edited 4:26am
As they say, whoever they may be, "One man's meat is another man's poison".

I suppose it is for us all to ultimately discover what kind of trading suits us and that we can use it.

Strange, how such an economic orientated subject lends itself to a philosophical viewpoint in which ultimately we have to discover for ourselves, our self.

Incidentally, I am at this very moment being shown my true self through a $700 loss.

Good for the soul I suppose. Ha
Starting to see instead of just looking.
  • #43
  • Oct 14, 2008 6:01am Oct 14, 2008 6:01am
Creative usage of leverage is the only edge.
I'm not a Turk, nor am I angry.
  • #44
  • Oct 15, 2008 7:35am Oct 15, 2008 7:35am
Quoting angry_turk
Creative usage of leverage is the only edge.
Your first post. And probably the best post in this thread
  • #45
  • Oct 29, 2008 5:16pm Oct 29, 2008 5:16pm
I suppose I feel honored to be on that list, especially since my thread was a derivative of Tdion's thread. Cheers to me.

Quoting tdion
We're all posting the same ideas over and over every few months

  1. PermanentJuan: \"Don't trade the cross wait for confirmation\" -> my own \"MA w/ Jacko AH\" thread
  2. How many moving average systems do we find? Lever's \"Cornflower?\" \"Key to the mint?\" \"Vegas Tunnel\" \"Bunnygirl cross\" etc....
  3. My \"Martingale EA Almost can't lose\" posts -> FXTradePro's \"SemiMartinglae strategy\"
  4. Should I even start talking about Finonacci? \"BAT by Team Aphid\"
  5. Countless hedging systems that explode. Where does it end????


It's the same wheel reinvented OVER AND OVER. In other words, we are all so desperate for a REAL advantage, that we wander the same circles.

My question is, IS THERE ACTUALLY AN EDGE OUT THERE? These systems posted above are a waste of time. They are gambling. There is no evidence that they will continue working.

  • #46
  • Oct 29, 2008 5:43pm Oct 29, 2008 5:43pm
Interesting post. I have a system and stick to my rules. I know when I do this, I will get positive pips (+30-50, sometimes more) on over 85% of my trades, and I will fail (-35-40 pips) on the other 15%. I learned long ago that I must stick to my rules. Period. I review my rules every week to make sure they are still good (like to prove to myself that everything is ok). I use TA tools every day (fibs, trend lines, MAs, bolinger bands, MACD, S/R) and never rely too much on any one, because they just help me put things into perspective. When my rules are met, I enter a trade. I never rely on hope. Ever. And every day I trade, I know success comes down to one thing -- me. If you are having trouble with your trading, look deep into your self to determine what you are doing right and wrong. No system will make you a good trader, and a good trader is nothing without a good system. I have traded for over four years to get to this level. If you have not put in the time, stop complaining and get to work.
  • #47
  • Edited 6:52pm Oct 29, 2008 5:56pm | Edited 6:52pm
Quoting rapaduski1
Interesting post. I have a system and stick to my rules. I know when I do this, I will get positive pips (+30-50, sometimes more) on over 85% of my trades, and I will fail (-35-40 pips) on the other 15%. I learned long ago that I must stick to my rules. Period. I review my rules every week to make sure they are still good (like to prove to myself that everything is ok). I use TA tools every day (fibs, trend lines, MAs, bolinger bands, MACD, S/R) and never rely too much on any one, because they just help me put things into perspective. When my rules are met, I enter a trade. I never rely on hope. Ever. And every day I trade, I know success comes down to one thing -- me. If you are having trouble with your trading, look deep into your self to determine what you are doing right and wrong. No system will make you a good trader, and a good trader is nothing without a good system. I have traded for over four years to get to this level. If you have not put in the time, stop complaining and get to work.
Hi rapaduski1,

So you have rules and stick to them. But... there is room for ... intuition? ... maybe experience with your system? .. In short, it is not 100% mechanical. Right? Maybe not everyone could make money out of your system. Is suits you. You made it. Am I right?

Edit: Ops! Sorry. Jumped in asking questions before reading the whole thread... .
  • #48
  • Oct 29, 2008 6:18pm Oct 29, 2008 6:18pm
Quoting tdion
Hey John, wouldn't you agree that trends can reverse without warning?

If so, you are never more certain than your last tic....
That is why I don't give too much credit to trend trading. To trend a few pips the market moves hundreds, maybe thousands of pips up and down. Why go after those few pips? Volatility handling systems have much more chances of being profitable, in my opinion. Trend following systems get killed by volatility and by sudden market reversals. Volatility trading may get hurt by emerging trends, but so much as you can't get 100% of a trend you can't get 100% from volatility. But why try to get a fraction of what is "small" (when compared to what is HUGE - market "noise", that nearly supresses the signals, if any at all?).

Still reading this interesting discussion. Itchy fingers though. Sorry.
  • #49
  • Oct 29, 2008 9:32pm Oct 29, 2008 9:32pm
Your edge can be anything, tweezers, pins, fibs, 123’s …..setups as many as the day is long, what matters is that it gives you the cahones to enter the market.

From that point on the edge is worthless, it’s how you manage the trade. No matter what edge you place your trust, sooner or later you’ll find yourself on the wrong side of the action. It’s this time that separates the boys from their toys.

Fwiw,
  • #50
  • Oct 29, 2008 10:16pm Oct 29, 2008 10:16pm
Quoting tdion
We're all posting the same ideas over and over every few months

 

  1. PermanentJuan: \"Don't trade the cross wait for confirmation\" -> my own \"MA w/ Jacko AH\" thread
  2. How many moving average systems do we find? Lever's \"Cornflower?\" \"Key to the mint?\" \"Vegas Tunnel\" \"Bunnygirl cross\" etc....
  3. My \"Martingale EA Almost can't lose\" posts -> FXTradePro's \"SemiMartinglae strategy\"
  4. Should I even start talking about Finonacci? \"BAT by Team Aphid\"
  5. Countless hedging systems that explode. Where does it end????


It's the same wheel reinvented OVER AND OVER. In other words, we are all so desperate for a REAL advantage, that we wander the same circles.

My question is, IS THERE ACTUALLY AN EDGE OUT THERE? These systems posted above are a waste of time. They are gambling. There is no evidence that they will continue working.


nothing has done better for me than MTF Stochastic (whatever flavor). Try it you'll like it.
  • #51
  • Nov 2, 2008 1:01am Nov 2, 2008 1:01am
Quoting tdion
We're all posting the same ideas over and over every few months


It's the same wheel reinvented OVER AND OVER. In other words, we are all so desperate for a REAL advantage, that we wander the same circles.

My question is, IS THERE ACTUALLY AN EDGE OUT THERE? These systems posted above are a waste of time. They are gambling. There is no evidence that they will continue working.
I think that trading Forex (even stock/index options for the most part) is a lot like fishing a B.A.S.S tournament: You may have a tackle box full of lures, but they are really only variations of just a few basic types. You chose the right one based on the conditions at that time. The same goes with trading. The edge is that you find something that works majority of the time that fits your trading style, and then you modify it as needed based on the current situation.

I typically only trade the GBP/JPY because it has a fairly large daily range. I think that it helps to focus on only a few currencies, because you get to know the pair and how it reacts in certain conditions. I also like the shorter-term charts (15m, 4m, 2m with 30m/1hr confirmations).

I have found a fairly easy "edge" that comes around pretty often in the different time frames if you are lucky enough to be at your computer at the time (I don't trade EAs): When the entire body of a candle falls outside of the bottom Bollinger Band (default), I buy at the end of that candle, if possible, or the very beginning of the next candle. I find that it will usually move up to the mid-Bollinger Band (roughly the 21-period MA), and I set my sell limit to just below that and adjust as needed should it move towards the upper band. I may modify this such that the entire body does not need to be outside the band if Slow Stochastics (5,3,3) are very low. Again, you get to know how a pair reacts in certain conditions, so you can adjust your methods accordingly.

Will this continue to work? There is no reason why it shouldn't. Will it work every time? Well, I think you would be hard pressed to find a 100% every-time, all-the-time system, but this is close enough for me.

This is just one of the "lures" I use. Having confidence in everything else that I have in my tackle box, regardless of what others think about them, well,.....I think that's what really gives me an edge.

My opinion, for what it is worth.

Good trading!
  • #52
  • Nov 7, 2008 5:07am Nov 7, 2008 5:07am
Here's a question:
If i gave you a system/strategy that made 100% ROI every year,could you make the same returns using this very same system/strategy?

Answer:
Yes.....if you BELIEVE in the system/strategy and the rules that founded it.
However,if this system/strategy clashed with your beliefs about the market and the way YOU should trade the market,then you would likely lose money.

Example:
Say Joe Blow is trading a mechanical system which gives signals based of lagging indicators on the 15min time frame.
He shows me his fx statement and says:"Steve,i have been using this system for over 3 years now and have made well over 100% every year with minimal drawdowns.Take it and use it,you won't be disappointed."

So,knowing no better(because i am new to the game)i take the system and i lose all of my investment.

Here is why i lost all of my investment in this example.It has everything to do with my beliefs,which in turn will affect how i trade the system/strategy and the following of rules:
1.I DON'T BELIEVE in smaller time frames.Why?Because i have stared at enough 15min charts to know that price movements are purely random.I DO BELIEVE in trading higher time frames,daily,weekly etc.Higher time frames also fit in with my life and they also align with the belief that i could trade fx and have more spare time to enjoy life.
2.I DON'T BELIEVE in mechanical systems.Don't get me wrong,i have rules which i follow,but i make the decisions not the computer/code.
3.I DON'T BELIEVE in lagging indicators or any other indicators for that matter.I DO BELIEVE in following price.

If you trade a system/strategy you DON'T BELIEVE in you will break the rules of that strategy and will turn a winning system/strategy into a loser.It matters none how good that system/strategy is.

You edge is knowing that you need to believe strongly in whatever system/strategy you bring to the table and the rules that your system/strategy are founded on.

I have been trading for well over 5 years now and have tried many systems/strategies and time frames.Trying,testing,toying,experimenting getting in touch with my feelings my beliefs.This is what the trading journey is all about.

Personally,i began to taste success when i looked deeply into my beliefs about the market and the way i should trade it.
I suggest to all those struggling,write down your beliefs on a piece of paper and then design your system/strategy around your beliefs.
Design your system/strategy around your beliefs,don't try and change your beliefs to fit the system/strategy.

Below is a list of some of the beliefs that i have.I have designed my system to fit my beliefs.

-I believe in trading trends and its the ONLY way to make money.....ACCORDING TO MY BELIEFS.
-Higher time frames offer greater probabilities for success.....ACCORDING TO MY BELIEFS.
-I believe anyone can trade successfully provided they build a system/strategy around THEIR BELIEFS.


I think i have crapped on enough but i think you guys get the point.
Cheers
SK
  • #53
  • Nov 7, 2008 5:34am Nov 7, 2008 5:34am
Hi,

...it only works if your beliefs are in accordance with the laws of the market.

If your belief is contrary to those, it might work on occasions, but in the long run faliure will be the consequence.

Knowledge supersedes Faith.

regards,
daytrading
Enter Signature
  • #54
  • Nov 7, 2008 1:47pm Nov 7, 2008 1:47pm
Quote
...it only works if your beliefs are in accordance with the laws of the market.

Are these laws you talk about laws we make about the market or are these laws 'market laws'.Laws everyone knows.Laws displayed in all their glory out in plain sight.
For example:thou shalt not murder.There's a law.A law from God and man.

If you have time dt could you be kind enough to give me a few examples.Maybe even direct me to the list of the laws of the market.I was not aware there were any.I did try and google it but still no luck.


In all honesty,i don't think one can place the word law and market in the one sentence.I think we need to replace law with another word,its misleading.
All in the name of progress.
Thanks in advance.

Cheers
sk
  • #55
  • Nov 7, 2008 2:17pm Nov 7, 2008 2:17pm
You cannot "google" a list of laws of the market. Laws in this context are simply unquestionable truths about the characteristics of the market. This could be anything from broker boundaries to price discovery. Discovering these "laws" means learning the market. A good place to start would be learning how and why price moves. A system built off of this information is a system that is in direct sync with market characteristics, and therefore has a higher probability to succeed.

If you make beliefs about the market that are contrary to its laws, then you are limiting yourself. If you believe that
Quote
trading trends and its the ONLY way to make money...
then you are limiting yourself to countless other ways to succeed. I think it would benefit you to replace "beliefs" with "comfort" in your above posts. If trend trading is most comfortable to you, trade it. But you need to believe that others (non-trend traders) can very effectively profit from you, and you need to understsand why.

You don't like the word law? OK. Ask yourself this: What do you absolutely KNOW about the market? In this question lies your edge. It sounds like your a trend trader. Most trend traders answer this question saying, "I know that trends exist." They build a system based on trying to catch and ride the edge (trend) they have identified.

There are tons of other edges out there, many much more efficient than "trends exist". That is just something for you to think about.

Good luck.
Headline: USD drops due to news of USD dropping!
  • #56
  • Nov 7, 2008 2:20pm Nov 7, 2008 2:20pm
Quoting skfx
Are these laws you talk about laws we make about the market or are these laws 'market laws'.Laws everyone knows.Laws displayed in all their glory out in plain sight.
For example:thou shalt not murder.There's a law.A law from God and man.

If you have time dt could you be kind enough to give me a few examples.Maybe even direct me to the list of the laws of the market.I was not aware there were any.I did try and google it but still no luck.


In all honesty,i don't think one can place the word law and market in the one sentence.I think we need to replace law with another word,its misleading.
All in the name of progress.
Thanks in advance.

Cheers
sk
Hi,

...there is no need for us "to make" the laws. They are existing in the same way that gravity exists. We [humans] did not make or invent the law of gravity, yet at some point [during an early physics lesson just after leaving the caves] we discovered or defined it. My Lord, how did that happen? Suppose the scientists were throwing a bunch of things in the air and - low and behold - they came always back to earth....there it was: the law of gravity.

Now, a bunch of traders kept observing the prices in forex and guess what: they found some occurrences that kept happening over and over again - irrespective of time. [which btw, makes it so important that it can be classified as a law] Why? Because ask youself this: can you 100% guarantee that the sun will come up tomorrow? No, you can't - because we might get a supanova and its all gone....BUT the probability that the sun will still be there is so close to 100% that the actual chance of a supanova can be dismissed - hence a law can be assumed on the amount of times the sun has come up in the past without faliure.

By the same token, you can find occurrences in the market that happen without faliure and with almost 100% certainty - and believe me, traders are happy with a lot less than "almost 100% certainty"....

Anyway, these occurrences exist in every market since markets began, and they will be there as long as [free] markets exist.

Now go and find them.

If you haven't by next week, I will return.

regards
daytrading
Enter Signature
  • #57
  • Nov 7, 2008 4:54pm Nov 7, 2008 4:54pm
There are mathematical tests for time series to determine the amount of deviation from random walk, a time series can deviate towards trending or mean reversion. I ran these tests across the major currency pairs and they are all pretty much show no deviation from a random walk, there were some exceptions, but nothing substantial. I will leave others to think though the ramifications of indicators and discipline in light of this information, cause you're all gonna jump down my throat if I say it.
The breaking of a wave cannot explain the whole sea.
  • #58
  • Nov 7, 2008 7:03pm Nov 7, 2008 7:03pm
Quoting angry_turk
Creative usage of leverage is the only edge.

No its not.
  • #59
  • Nov 7, 2008 7:17pm Nov 7, 2008 7:17pm
Hi, 1st, if you don't know if you have an edge, then you don't have it. IF these systems posted seem to keep falling into the same loop of success for a little while backtesting, then maybe some success with real time trading then ultimately failing spectacularly then you understand that they will never work because the market behavior changes constantly! There are trending systems that fail in countertrend markets and vice versa. Their trading lives are short lived, to say the least.

The most important thing to learn is that, even if you are the most disciplined trader, trading a system that will ultimately fail is not your fault but the flaw in the trading system itself. The hardest thing to do in trading is finding the correct information and analysis to base your trading system upon. Understanding and applying it in real time is a whole other quandary itself.

Also, money management THEN trade management is the most important of any system and I promise there are no professional 'scalpers' trading for banks or hedge funds.

The problem is they are not willing, or legally allowed to share their trading methods. This website is full of traders, experienced or not, that all fall into the same pitfall of traders that doom their attempts to make money. So it may seem as though noone makes money in this business. Understand also that chart readers and analysts are NOT traders.

Anyways, I hope I didn't ruffle anyones feathers but this is a start for you guys.
  • #60
  • Nov 7, 2008 7:57pm Nov 7, 2008 7:57pm
Quoting tdion
Longer timeframes are impossible to predict because future news events are uncertain.... therefore long term trends are luck.

Short term trades are irratic at the sub-cent level and only the central bankers push the rate back and forth.... it is impossible to predict the currency pair's path because there are several forces acting on the instruments, each with different impact.... and not predictable who will do what when.

-TD
You don't have to predict the trend. That's the entire point. Trading with the trend simply makes the shorter term movements more predictable since that is were the momentum is going.

Most don't realize how much their chances are increased (even scalpers) if they simply trade in the direction of the trend. This is were the bias and momentum go. If a descending triangle is forming in the short EUR/USD direction, the chances that it will break to the down-side. An ascending triangle under the same conditions will more likely turn into an ascending wedge and break to the down side (i.e. give a false signal).

Fighting the trend (incl. catching falling knives) in this business will definately lead to failure in the long term... still don't get why people do it.
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