LeonLorenzo Makes the rules. (Live)

This thread will be a Continuation of the previous Journal thread...

The main difference being that I will be trading Live with a couple hundred pounds, Ive still got to decide on the exact number. I will be going live with Oanda as I already have an account with them from the last time I blew it which was a year or so ago.

I will be using the Tdion phillosophy when it comes to trading my account, trade sizes will be arranged so that there is no money sitting there without a purpose, and obviously it is 100% Risk capital.

At the end of my previous thread when I had not posted for a while Craig asked what had happened. I responded with the following...

I had a long hard think about what my reasons could be for opening a Journal when I went live. And the answer is that I enjoy to chat every now and then(mostly its drivel though... I fear). And that If I do well, which I am reasonably confident about, this may actually open some doors for me.

My main method of trading will be roughly thesame as In the previous thread.

Method wise- Im still not totally happy though, I would like to be able to base my trades on a cause and effect, an edge that I could write down in a sentence.

EDIT(25/04/09): I now know what m edge Is.

Leon

Hey Leon

Just dropping in at half time (you must be watching the footie?!) to say best of luck with the new journal & hope you find it as useful as I have mine.

BTW, didn't realise you were living in the UK lol

Kind Regards
Steve

To be honest Im not really a sports fan. My dads a Man-U fan, It didnt really rub off on me though.
0-0 boring!
Cheers for dropping in.

________________________________________________

Just for a little reminder of how different market conditions will effect my trading once I start....

Trending markets and ranging markets are not a problem. I will experience losses when a strong trend without pull-backs starts against me and blows through STRONG support or ressistance without a second thought, the trend would have to be about 200pips long(in current market conditions). This will happen, but I cant see this happening enough to make my trading unprofitable. I have experienced such losses in the demo journal, so you can see what kind of losses I am talking about there. I have pre-determined Stop prices from the very start of my trades.

Hey Leon,
I would save my money till had a really good idea of what your edge is, otherwise the market is just going to slowly beat you to death.
I know it's frustrating not being able to get the show on the road (it took me 3 years of false starts to get my ATS running, endless frustration), but you will be much better off if you know what you are gunning for and how to measure it.

that's a pretentious title, leon

who cares - you are young

DO not gamble with more money than you can afford to be 100% parted with - and, on that note, KNOCK EM DEAD (with the market's help, of course)


craig, sometimes getting burned is a good part of the learning process.

Thanks for the posts Guys.

I wouldnt say I dont have an edge, But I cant prove that I do have one, thats my issue. Maby when Im well in to the Computer science course at college Ill be better equiped to prove or dissprove some beleifs I have.

My demo trading went well, But my concentration was lacking and I found myself rather bored without getting much in return. Im hoping that this live account will allow me to be move involved, take more notice and hopefully I will have some new Ideas while doing it. God forbid, I may actually make some cash. From looking around the forum there seems to be many claiming consistent success working on much more shakey methods/principles than I am.

that's a pretentious title, leon
Lol, The most I can do Is make my own trading rules.
who cares - you are young

DO not gamble with more money than you can afford to be 100% parted with - and, on that note, KNOCK EM DEAD (with the market's help, of course)

craig, sometimes getting burned is a good part of the learning process.
Dont say that. Its happened before and I seriously wouldnt be going live unless I thought I had a decent shot. But yes, the money is secondary at this point. Putting the money on the line is a form of forced learning.

Thanks for the posts guys.

Note: Fuck the British school system. I went for my college interview today and was told that the Entry requirements have been put up, so they wont let me do the A-levels. They offered me an Access course, but this wont even give me 'access' to the A-levels, totaly retarded, maby a crappy Uni will take me on though, good times hey?

EDIT: Im not going to be beaten. Ill take what I can get, maby I can prove myself and switch over. The big problem being that the Degree isnt the important thing, its where you get it from that counts. Without the A-levels my options will be very limited. Ive said this before, but the Public school system didnt help me out, At 16 I didnt know what I wanted from life and didnt care about exams in the slightest, thats way too young to have to make a rational decision about the rest of your life.

I have been reading through Trading and Exchanges again, It might take me afew reads to absorb everything. I have an idea for another trading method though(not saying Ive ditched the other, but at this point I need to be banging out all the ideas I can)

I need to find some kind of entry signal before a larger Entry signal. The Initial entry signal would be the footprint of the Better informed traders, I would then trade after them but before the main signal, (eg, previous Session low Breakout), at this point I would be expecting more Uninformed traders to join the party. Sounds easy writen out like that, lol.

EDIT: It actually sounds stupid looking at this above on second thoughts. Isnt this what every single person on the forum is trying to do? Lol. The difference is that most here have no reason to expect others to push prices further after them, no logical one anyway.

The only way to be further up the chain is to be a Value/fundamental trader. I dont fancy my chances at this point though.

Everything above, once again, depends on If the Forex market is indeed speculative in majority.

EDIT: Question for Tdion and/or Craig(or VV)- Are your trade ideas backed up by moves that can be explained, Or has your number crunching shown that there is a possitive expectancy although the reason for it cant be explained? Im basically asking the chicken or the Egg question. What came 1st, an idea of what could be happening in the markets at certain times or ....(for eg) after EU moves 100pips its more likely to move another 50 in the same direction than reverse 50(simple example that came to mind).

I hope I made that understandable.

education is most important! people will argue that it doesn't matter, and millionares are uneducated people.

but answer this - without a high paying JOB, where does the startup capital come from? and what bank would loan to an 18 year old with no experience in any field, and terrible grades?

trading should be your HOBBY and you should put your focus on a REAL life.

that's what i did.

i have a bachelors and masters in computer science. i make very good money, and have enough time to pursue trading on the side.



as for your question: i have preached on this subject OVER and OVER.... if you can't identify why the price is moving up and down, you don't have a real edge. plain and simple. and the second best thing is a statistical reason to enter / exit, which can change over time.

all i have are statistical models (thus, my trading is gambling) because i don't have insider informaiton.

Well, just to update:

I will be funding my old Oanda account with £300 some time In the next week. I wont be documenting trades but I will post the account balance on a Daily basis(on the days I trade).

I will allow for 4 consecutive full size losses untill the account is brought to margin call, this is much more agressive than I was trading In my demo journal where I would have been able to sustain about 8 consecutive full size losses.

The odds are against me making anything of this account.... I understand that perfectly, I have come to the conclusion that It is near impossible for me to automate the method so Its impossible for me to backtest and verify(or dissprove) its long term profitability.

You can be sure of one thing, and that is the fact that you will see me eventually bring this account as close to Zero as it can get, or see me withdraw 1/4 of its value each time It is doubled after £1000. (You will actually see the outcome, I will not stop posting one day never to be seen again. You will see me lose it all OR make afew bob)

Account hits £2000 withdraw £500
Account hits £4000 withdraw £1000
ect.

If nothing else, this will be a learning experience where I will have a reason to be watching the markets and hopefully have some new idea's.

Im also working on other methods but am collecting data currently, once I have a large enough sample size to make some rules and forward test I will hopefully have a much stronger and proveable cause/effect to trade by.

Leon

EDIT: If the market decideds that my play-around-money-account should grow in to a nice amount I may cut back on the risk I am taking.

Ok, seems like I am changing my mind every hour.

Im calling off the Live trading for a while. Instead I am going to invest In a trading simulator and Trade a couple of years of data, depending on my results I may or may not go live.

Regardless I will keep the journal Updated.

Well, I went to the interview for the Access course and was told that I should be able to start at Level 3 which means it will take only a year to complete.
Once ive completed this I will be able to attend Uni and study for a degree. Problem being that Im not sure what I want to do yet, If I would have done A-levels I would have had a chance to descover what I prefered, Economics or Computer Science.
I am determined and sure that whatever I choose I will put in 100% effort. I can just see Econ being a subject that I will learn alot from but will have very little practical use other than 'Look at me with the Econ degree'.
Where-as Computer science I can see as being much more usefull In terms of learning skills for work or personal projects.
Looks like Ill have do a little reading on that matter.
Regarding my trading, Im still testing and In the process of making everything more mechanical.
Leon