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Silent Service Method

  • #6,681
  • Jan 13, 2010 8:13am Jan 13, 2010 8:13am
Quoting clockwork71
I am attaching a chart of three zones I see on this chart. I also see some areas in between, yes....but they are not worth entering at. They tend to serve as places to park stops behind.

Check it out - you see how "symmetrical" this "random" market is.
So identifying an area of congestion is not enough. Now I need that area to meet the definiton of "TRUE" supply and demand area.

mmmmmm, that is the difficult part I guess



Michael
The quality of your life is brought about by the quality of your thinking.
  • #6,682
  • Jan 13, 2010 9:22am Jan 13, 2010 9:22am
Quoting hornet
So identifying an area of congestion is not enough. Now I need that area to meet the definiton of "TRUE" supply and demand area.

mmmmmm, that is the difficult part I guess



Michael

If it helps - base them off of weekly charts only. Also, remember the market likes "00" and "50" numbers. The S/R lines should be read as "zones" and not lines also.

With enough time - these areas will jump out at you every time you look at a chart, I promise.
  • #6,683
  • Jan 13, 2010 12:09pm Jan 13, 2010 12:09pm
Quoting InfinitySL
I think what is confusing to me and other people who post on this thread is what exactly you mean by high risk....
OK, your first definition of high risk is similar to mine. At the moment 15% are for me high risk and this risk is calculated by adding all risks of all open trades. So one can have e.g ten 1.5% risk trades when he got good enough signals. High risk does not mean that you take every potential trade, it is here just the maximum potential loss of open positions.

The way you think of correlation is reasonable, I think that your opinion about correlation is very important in manual trading, since you cannot backtest for a very long period of time. But I keep my opinion when one uses EAs.

The same is the matter with the potential risk compared with return figures. I have systems which work with high probability and low return but high potential loss but these systems do not use the "Silent Service Method".
For the Silent Service Method and other manual trading strategies it seems to be good to have a high potential return with a low potential loss to be profitable.
  • #6,684
  • Jan 13, 2010 1:26pm Jan 13, 2010 1:26pm
Quoting Centaure
For the Silent Service Method and other manual trading strategies it seems to be good to have a high potential return with a low potential loss to be profitable.
Isn't this true with all systems? In the long run, it has to be this way because of the random bits of markets. Although it is a structure, and not random noise to me....the markets to hiccup and have surprises. Because of this, you need to aim for more than you risk. At this point, it comes down to math.
  • #6,685
  • Jan 13, 2010 2:21pm Jan 13, 2010 2:21pm
Quoting clockwork71
Isn't this true with all systems? In the long run, it has to be this way because of the random bits of markets. Although it is a structure, and not random noise to me....the markets to hiccup and have surprises. Because of this, you need to aim for more than you risk. At this point, it comes down to math.
Most scalping systems work with the method of risking more for small gain with a high probability.

At the beginning, when I was trading some years ago I heard everywhere that it is a good way to become profitable by aiming more pips than I risk.
I did not work so well for most of my strategies in the past, but I think there are strategies which can do that quite well.
But when you trade with low profit higher risk and high success rate one has to be very careful about drawdown, because to many losses in a row need a feeling when the strategies fails. Otherwise your account loses money fast.
I can justify this with expectancy value, too, and think that this is also a possible solution to make profit.
  • #6,686
  • Jan 13, 2010 5:58pm Jan 13, 2010 5:58pm
Quoting Centaure
Most scalping systems work with the method of risking more for small gain with a high probability.

At the beginning, when I was trading some years ago I heard everywhere that it is a good way to become profitable by aiming more pips than I risk.
I did not work so well for most of my strategies in the past, but I think there are strategies which can do that quite well.
But when you trade with low profit higher risk and high success rate one has to be very careful about drawdown, because to many losses in a row need a feeling when the strategies...
True, but back in the dark ages.....I was a scalper. Let me tell you how it worked out for me:

I would have a success rate of about 80%. That was great, except the day would typically work out like this....

I would have a couple of break even trades.
I would have 5 or 6 winning trades.
I would have one or two losers that would send me right back to break even.

While I believe is is possible to make money that way - it's hardly worth the time involved, let alone the stress. Think of it this way: I find that leverage is more than just margin. It's time. I used to spend 12 hours a day, making a little profit here and there. I was making about $4/hr. at point! It's a lot less stressful to just go work at McDonalds, for twice the money.

I like to leverage my time as well. I go out and play with the boys, and let the trade make me money. In the long run, that's what I wanted anyway. Not to sit at a computer and scalp for 12 hours a day. It sucked.

In the end, it's your (not you specifically, but people in general) decision as to how you want to spend your time/life. I went down that road, and found it extremely emotionally draining.

Chris
  • #6,687
  • Jan 13, 2010 6:13pm Jan 13, 2010 6:13pm
Great post Chris,

That brought it back for me, lots of hours, stress, most of the time little reward.

= unhappy household.

im much more relaxed and content now. trading dailies or weeklies.

I am truly glad i left those days behind, just what suits me though.

warren
I need to finish something i started
  • #6,688
  • Jan 13, 2010 10:21pm Jan 13, 2010 10:21pm
Quoting bigwal
Great post Chris,

That brought it back for me, lots of hours, stress, most of the time little reward.

= unhappy household.

im much more relaxed and content now. trading dailies or weeklies.

I am truly glad i left those days behind, just what suits me though.

warren
Right, of course....it comes down to the individual. But I feel safe in saying none of us envisioned trading to be sweating it out at the computer for 16 hours a day.

So the question then becomes - Why not have it the way you envisioned it?

Nice and low key - low stress.
  • #6,689
  • Jan 13, 2010 11:21pm Jan 13, 2010 11:21pm
hi everyone. I know a few of you got into some of these yen crosses. I was just wondering what you think of it now? im kinda unsure on how i managed this trade. i mean i sold where i thought strong supply was and let it go and got my stop to be entry price but seems to be retracing alot. i didnt take any partial profits or anything yet.

well i no worse case it will be a scratch trade but it might turn back down also. Kind of will be abit crappy if i walk away with nothing but i guess thats what you have to do if you want to get runners ?

trying my best to let things go and not interfere with trades
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  • #6,690
  • Jan 14, 2010 9:47am Jan 14, 2010 9:47am
One of the blogs I read alerted me to this update to the finviz website:

http://finviz.com/futures.ashx

Looks very promising for Futures traders...
  • #6,691
  • Jan 14, 2010 11:25am Jan 14, 2010 11:25am
Quoting InfinitySL
It popped... just in the wrong direction.




Sell moritmer Selllll!!
LoL ! Thats one the best movies ever. I still think about that every week before I trade.
May the fish in your stream of life always bite.
  • #6,692
  • Jan 14, 2010 4:47pm Jan 14, 2010 4:47pm
Quoting supermatt
hi everyone. I know a few of you got into some of these yen crosses. I was just wondering what you think of it now? im kinda unsure on how i managed this trade. i mean i sold where i thought strong supply was and let it go and got my stop to be entry price but seems to be retracing alot. i didnt take any partial profits or anything yet....
That is the breaks man.....I know it's a pain in that butt, but it really is how you get runners. It really comes down to your psychology. And that's the hard part.

Sorry my answer isn't cut and dry, but that really is the answer.
  • #6,693
  • Jan 14, 2010 4:55pm Jan 14, 2010 4:55pm
nah thats ok clock i agree its just what happens, i guess im actually trying to get stopped out just as a training excersise so i can accept holding on to a trade and not touching it.
just like a left e/a go but just got stopped out this morning, not to worry i am on the hunt for another long position there.
  • #6,694
  • Jan 14, 2010 7:12pm Jan 14, 2010 7:12pm
Quoting supermatt
nah thats ok clock i agree its just what happens, i guess im actually trying to get stopped out just as a training excersise so i can accept holding on to a trade and not touching it.
just like a left e/a go but just got stopped out this morning, not to worry i am on the hunt for another long position there.

Yes, I left my EUR/AUD long on it's own, and got stopped out as well. (For profit, but left a bit on the table as it were.) It's alright, you have to give it a chance, and I still believe in that trade. That's why I went long again, based upon monthly support, but a 1 hour bar.....if that makes sense.

My next post adds a little to the conversation about the AUD as well......
  • #6,695
  • Jan 14, 2010 7:19pm Jan 14, 2010 7:19pm
Not a trade signal, but maybe something worth keeping an eye on. I noticed this odd reaction to the Employment surprise in Australia.
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  • #6,696
  • Jan 14, 2010 8:29pm Jan 14, 2010 8:29pm
Quoting supermatt
hi everyone. I know a few of you got into some of these yen crosses. I was just wondering what you think of it now? im kinda unsure on how i managed this trade.
Takes time to get this right. Here's a yen cross that I got out of too soon. This is why I've started setting my trades at night so my hands are tied while I'm asleep! That way I have an 8hr head start on second guessing myself. The key (for me anyway) is to not stare at it all day. If you stare at it long enough and think about it hard enough, you can talk yourself out of any trade.

http://i437.photobucket.com/albums/q...-14_CHFJPY.png
  • #6,697
  • Jan 14, 2010 8:58pm Jan 14, 2010 8:58pm
Quoting supermatt
im kinda unsure on how i managed this trade. i mean i sold where i thought strong supply was and let it go and got my stop to be entry price but seems to be retracing alot.

well i no worse case it will be a scratch trade but it might turn back down also. Kind of will be abit crappy if i walk away with nothing but i guess thats what you have to do if you want to get runners ?

trying my best to let things go and not interfere with trades
Matt,

This post may not make anything any clearer for you, but the fact of the matter is, that if you're looking for "a runner", you may have to leave your stop in it's original position for a week or more. I notice that by the time we get an entry signal, it's at the same place price will come back to test in a couple of days, so if you've moved your stop to BE, odds are good you will get taken out of a good trade on a retrace.

This is something I'm learning from my stock paper-trades, which do not trade 24/6, and so give me more time to think about how I want to manage them, but the really big turning points do not turn on a dime. They turn, go for a bit and come right back you where you entered, just to shake out the weak hands, and prove support or resistance.

If you enter at a minor SR zone, moving to BE may be a good idea, but when you're looking at the top or bottom of a range, it might be better to let it breathe.

Here's a stock trade example. I took it short off a daily pinbar, that also gave me a weekly pinbar, but the next week was completely bullish, but I decided to wait it out......And now it's finally behaving.

Here's the daily and weekly:

http://i46.tinypic.com/28iolcn.png

http://i46.tinypic.com/2v3r5z9.png
  • #6,698
  • Jan 14, 2010 9:14pm Jan 14, 2010 9:14pm
yeah thanks guys i see what your saying, and totally agree that stops should be left at original position for a while before the real move happens
i have been witness to this happening over and over again.
  • #6,699
  • Jan 14, 2010 10:29pm Jan 14, 2010 10:29pm
I don't usually plug my pinbar thread, but you fellas may enjoy this single post:

http://www.forexfactory.com/showpost...8&postcount=60

I got a good chuckle out of it...
  • #6,700
  • Jan 14, 2010 10:49pm Jan 14, 2010 10:49pm
Quoting InfinitySL
I don't usually plug my pinbar thread, but you fellas may enjoy this single post:

http://www.forexfactory.com/showpost...8&postcount=60

I got a good chuckle out of it...

You are going to hell if you short fat people....LOL.
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