Id rather have a shot gun than a sniper rifle | Forex Factory

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Id rather have a shot gun than a sniper rifle

  • #1
  • First Post: Feb 18, 2010 8:04pm Feb 18, 2010 8:04pm
Well what do you do on your first post? start a thread. I have been lurking here since 04-05 and have seen this site go from some really great "wanna be traders" actually be traders, to an unemployed lottery.

I wanted to start this thread and see where it goes because too many here are gambiling and think that they have to overleverage and hit the market with pin pnt precision. This is the absolute best way to make sure you never make it.

let me ask some questions?

1. how much attention are you paying to your phsycological state when entering and exiting trades?
2. If you loose do you increase your next trade or decrease?
3. what is your "expectancy" are you preprogramed to loose? or do you expect to win and supprised when you loose?
4. what is the most powerful mathmatical law?
  • #2
  • Feb 18, 2010 8:35pm Feb 18, 2010 8:35pm
Quoting mr-T

1. how much attention are you paying to your phsycological state when entering and exiting trades?
2. If you loose do you increase your next trade or decrease?
3. what is your "expectancy" are you preprogramed to loose? or do you expect to win and supprised when you loose?
4. what is the most powerful mathmatical law?
1. I don't think, I trade. Your psychology only comes into play when you risk too much. My rules for entering and exiting a trade are very clearly defined and I follow those rules to the letter. To do anything else is suicidal.
2. Lose not loose. Neither. Risk stays the same for every trade. 0.25%.
3. Again, Lose not Loose. Again neither. I take what the market gives me. Win, lose or draw makes no difference to me. I am surprised by nothing in Forex. Todays interest rate change in the U.S. is a great example. Those who risk too much were surprised and frightened.
4. Einstein once said that the greatest invention ever created was compound interest.
  • #3
  • Feb 18, 2010 9:23pm Feb 18, 2010 9:23pm
yeah,where is spell check on this thing......

Im sure for you all this is true, but how did you get to that pnt? I may be mistaken but you are one of the few successful scalpers.

I am trying to take new traders on a journey that might ither become there longterm approach or let them survive to the hightest you might be used to.

when i read your post it screams "system and rules" no see play no play game. I think alot of newer traders are stuck in the grail search...

I have a pnt to all this and its simple, not the grail, but conquers alot of the common problems that many of us face or atleast fight to keep from coming up from time to time.
  • #4
  • Feb 18, 2010 10:22pm Feb 18, 2010 10:22pm
trade the dailies and scalp when I get bored. Most of the time now I just come in around midnight GMT and move stops and place buy and sell stop orders. My initial success was with scalping. I like the speed just don't like the long hours in front of the computer.

the grail search is just a part of the progression of a trader. It's easy to get stuck in that search and not move on to accepting losses as just a part of the fun.

I got to where I am trading wise by a continuous and relentless drive to improve. I was bound and determined in the beginning to not become one of the many who have wiped out an account. I could not accept that as a part of learning how to trade. Fortunately I have been able to keep that promise to myself and not blow an account.

with some brokers offering sub micro lots there is no reason someone needs to risk a big chunk of their account on each trade.

Keep going with the thread, I like your direction. Hopefully more will join in.
  • #5
  • Feb 18, 2010 11:20pm Feb 18, 2010 11:20pm
I see you have some attributes that these traders need to emulate,

1 understand there is a process and I underscore IS, you cannot get around it. One thing i wish more new traders would value is the psychological damage of a blown account, It should not be a cost of learning. There are too many luxuries of technology to lay the "tool" of your success on the chopping block. (ie) Back testing and demo. My kids are fun to watch especially in context of trading. I tell them to do this or that or not to do this or that. I have one child that will listen and do as instructed, just for some reason rides the line. I have another child that seems to love discipline, very hard headed. I also have another child that seems to want to do what is right, but falls off the wagon so to speak and when corrected is more vigorous than if she had never been disciplined.

My focus for this thread is not for the 1st child, you don't need me because if you follow instruction it can be found and you will listen (especially from the "greats" of this forum) look up the FF all stars.

My focus is definitely not for the heard headed, as you will never learn always believing that you will figure it out on your own... to you i wish you luck you will need it

I want to focus on the "teachable"


I don't want to set this thread up to lead people to believe that "I" have some great revelation that if you will just hold on you will solve all your problems. What I have to share is a way of approach and has served me well through the yrs. I have seen my father ride market after market and be one coool dude... I was the teachable one in the family. I definitely fell off the wagon, as the greed crept in.. By the way allot of people say that there is 2 emotions to control "Fear & Greed".... Oh no there is only one GREED.


I also want to set up to the new traders that while the "news and fundies" are important later down the road they should not even concern you now.. I am sad to tell you that by the time you even here the news or read the article the informed traders are already in position, sorry, just fact.
Please do not waste your time rather spend it on yourself in mind games. Ill explain more later.
  • #6
  • Feb 20, 2010 3:28am Feb 20, 2010 3:28am
Quoting mr-T
One thing i wish more new traders would value is the psychological damage of a blown account, It should not be a cost of learning.
pain is a great teacher. the pain of loss becomes less with iteration and as the losses become controlled.

i am at a next step and the hurdle is boredom. consistent, disciplined trading is boring. take something that is racy and dangerous, like highwire walking without a net, and through repetition and discipline it becomes as mundane as sweeping the floor.

hey but you can still kill yourself sweeping the floor. it's rare, but it happens.

possible remedies for the boredom of trading:

- stop trading
- take breaks from trading
- cash in your accounts and spend or give away all the money
- have a regular job or hobby or craft or art that doesn't bore you and let the proceeds from trading fund that activity, if necessary
- trade different instruments
"If The Fool persists in his Folly he will become wise." - William Blake
  • #7
  • Feb 20, 2010 4:10am Feb 20, 2010 4:10am
I dont tend to lose too many trades as I am able to see pending orders at IB level.

Scoobs.
  • #8
  • Feb 22, 2010 11:08am Feb 22, 2010 11:08am
Quoting mr-T
let me ask some questions?

1. how much attention are you paying to your phsycological state when entering and exiting trades?
2. If you loose do you increase your next trade or decrease?
3. what is your "expectancy" are you preprogramed to loose? or do you expect to win and supprised when you loose?
4. what is the most powerful mathmatical law?

let me answer some questions....

1. my phsycological state is not a factor due to trades being placed by expert advisors....

2. the ea's might increase or decrease the next lot size, so it might appear to be attempting to recover prior loss or reducing the next trades exposure.... but that is appearence only... prior trades are not a factor in future trades....

3. the ea's do have an expected win/loss ratio.... but possibly equally important is the averge gain/average loss ratio..... losses are expected and accepted.....


4. what is the most powerful mathmatical law......

ok , i give up........

what is the most powerful mathmatical law......h
to trade and code, keep both simple... no call to impress....h
  • #9
  • Feb 22, 2010 11:28am Feb 22, 2010 11:28am
Quoting scooby-doo
I dont tend to lose too many trades as I am able to see pending orders at IB level.

Scoobs.
lol I want that platform .
  • #10
  • Mar 1, 2010 10:55pm Mar 1, 2010 10:55pm
I tried to set this thread up with some thought provoking. I know that this wont help every one, but ill make this short and sweet, and if there is more discussion then so be it.

the most powerful financial mathematical law is compounding, as magnum said earlier.

Let me first say this: IF YOU DO THIS YOU WILL BE SUCCESSFUL PERIOD.

scale into your position with the current daily trend divide your risk up in to 1/4. use your 4th position not as an entry but as a stop loss. wait until you hit the trend line range on the daily charts and make sure your stop is 1/2 the average daily range above the last swing high or low (which ever applies).


This is what all this accomplishes:
1. you actually will hope your first positions are negative a very unusual concept for newbies (fixes allot of emotional scared money problems)
2. you will then become a strong holder ,oblivious to spikes and news events. (ie.) not easily shaken out.
3. It satisfies the need to be in the market as many newcomers fall prey to. (ie) not up one minute and give it all back and then some the next.
4. When you realize that compounding is the most powerful tool you have, then the slow but positive growth will fuel your success.


I have allot of "real" trader friends and some of them are what you might call top guns, but they all ooze with calm confident approaches. (and they would say the same of me) This I tell you and believe it or not you will not make it to those levels unless you learn what this approach teaches you I promise.

As i said i just gave the very basic concept. so much more to discuss if you wish.

good day
  • #11
  • Mar 2, 2010 12:05am Mar 2, 2010 12:05am
I have been studying various candle formations that occur at strategic pnts as well as tested breakouts and scaling into them, However if i was to divide my entry into 4ths and i was correct within my first entry I would starve. I divide my entry into thirds and close all positions when price hits my last third.
  • #12
  • Mar 2, 2010 12:18am Mar 2, 2010 12:18am
Quoting t2l&l2t
I have been studying various candle formations that occur at strategic pnts as well as tested breakouts and scaling into them, However if i was to divide my entry into 4ths and i was correct within my first entry I would starve. I divide my entry into thirds and close all positions when price hits my last third.

So hows that been going for you? Be careful on candle formations, make sure you take the ones pro trend, there are some seemingly good counter trend trades, but why take them when you can just wait or find a trending market or a clear range.
  • #13
  • Mar 2, 2010 12:24am Mar 2, 2010 12:24am
sorry I just reread my post and it was not well written I will respond in more detail later. T2l, I noticed that you are from nc. pm me, I think you are just around the corner
  • #14
  • Mar 2, 2010 12:42am Mar 2, 2010 12:42am
Quoting mr-T
So hows that been going for you? Be careful on candle formations, make sure you take the ones pro trend, there are some seemingly good counter trend trades, but why take them when you can just wait or find a trending market or a clear range.

It has been going ok. I still get frustrated when I wait for a entry and finally get to enter,and bam goes my way just as i wanted and had so patiently waited for, but i am in my first scale in and feels like i should have been in more. so there is still emotions that you have to fight.
  • #15
  • Mar 2, 2010 2:32pm Mar 2, 2010 2:32pm
Quote
It has been going ok. I still get frustrated when I wait for a entry and finally get to enter,and bam goes my way just as i wanted and had so patiently waited for, but i am in my first scale in and feels like i should have been in more. so there is still emotions that you have to fight.

Do you trade full time?

I also look for candlestick formations around pivot levels on 15 min chart.

I can figure out some good day trades with this method but i can not work full time in a job as i will be watching 15 min candle for 10 hours a day atleast.
  • #16
  • Mar 3, 2010 5:54pm Mar 3, 2010 5:54pm
Quoting kingfisher
Do you trade full time?

I also look for candlestick formations around pivot levels on 15 min chart.

I can figure out some good day trades with this method but i can not work full time in a job as i will be watching 15 min candle for 10 hours a day atleast.

I am still on the fence with the whole idea.. I obviously would if i knew for sure that it would supply my families needs; however the thought of the level of maturity as a trader i would have to maintain keeps me from even going there. I do know that before i scaled in to positions my emotions would run control me, cutting to early and staying to long.

It is almost impossible to back test this approach to the letter and have #'s I feel are accurate. some times I scale in and when the last position is even with the previous position i take profit telling my self that i am reducing exposure, only to have them take off and be what would have been great trades, or not taking profit and loosing the trade.

That is why when i read the title of this thread it caught my attention, because that is how i feel, I am taking the shotgun approach. Mabey because no one really knows the next move of the market as they can know the general direction.

Are you full time?
  • #17
  • Mar 3, 2010 7:47pm Mar 3, 2010 7:47pm
Quoting mr-T
Well what do you do on your first post? start a thread. I have been lurking here since 04-05 and have seen this site go from some really great "wanna be traders" actually be traders, to an unemployed lottery.

I wanted to start this thread and see where it goes because too many here are gambiling and think that they have to overleverage and hit the market with pin pnt precision. This is the absolute best way to make sure you never make it.

let me ask some questions?

1. how much attention are you paying to your phsycological state when entering...
Interesting thread - I agree with the overall sentiment though I make a living (as a full time trader) through operating with a sniper rifle rather than a shot gun (maybe it's just a terminology understanding?). I sit with my sniper rifle and wait... and wait... and wait until the right set-up emerges. I then enter a high probability trade, spend time with my family, eat dinner, go to bed, sleep well, wake up in the morning and close the trade out (if total equity target not reach overnight).. that's my "sniper rifle" method, to use your terms - sometimes as little as 5 trades per month.. from a full time trader. OK - now for your specific questions:

1) Pyschology state is not relevant to my trading success - I have a plan and I stick to it. Yes, I mean that. The plan may evolve over time based on additional learning (that should never end) but my job is to stick to the plan.

2) My 'money management' (don't like that term actually) for a specific trade is just basic risk management. Known risk for each trade determines contract sizing and is a small % of capital available at the time fo the trade...simple

3) I know what the capability of my method is, and therefore I know what the probability of winning vs loosing trades should be. I will only be surprised if my method fails to deliver expected rate of monthly return for 2 months, and if so, I would want to find out why.. and quickly.. but thankfully that's not been an issue for a couple of years now.

4) The most powerful 'mathematical law' is that my trading outcomes (ie $$$$) reflect the robustness of my method - note absence of term "system" here. A simple equation, really. It's either crap in - crap out; or proper method in - good returns out. An obvious equation but not many people behave like they understand this when it comes to trading.
  • #18
  • Mar 3, 2010 10:31pm Mar 3, 2010 10:31pm
Hi hedge, I do not want to come off arrogant, I am a very passive person and as you can tell have a very hard time with communication. (probably the reason i have to trade cant really fit inside the "real world")


The pnt you make with your waiting and finding the right moment to pull the trigger on your sniper rifle is nothing more than having your emotions in check.

I am glad that there are some seemingly seasoned traders commenting, but I want to pull back the curtain for a moment.

How long have all you short term traders been profitable? 5 yrs.? 10 yrs? 20 yrs?

again I am not trying to be an arse, but rather want to relay the facts. If you are a successful short term trader (ie. entry with high lots and pin pnt accuracy) then you are the bill gates and warren buffets of trading. (1 in a million)

I know of some friends that use such an approach using arbitrage and market inefficiencies. These approaches are very lucrative some long lasting and some have faded away as the market learns of them. I actually have a very great system that exploits a certain situation when it occurs (which is not often). The problem is that this requires to maintain a certain level of heightened awareness that is very difficult to manage. You say "what a fool,are you saying you don't use it"? That is exactly what i am saying!!

It really breaks my heart to see all these people breaking their necks, stumbling over each other to find the grail, and even if they found it couldn't maintain it. Kinda like the rock star with a fat pay check, but has to keep preforming to pay for that Lamborghini and 10mil house. do some make it? obviously, yes, but how many or in what % do not.

I started this thread to break down barriers and expectations of new traders. I spend about 2-4 hrs a day trading (inclusive of reading and networking). I will be successful for the next 25-30 yrs. Why? because I don't complicate it or try to live above my means , (yes, my emotional means).

The title of the thread is implying a shotgun vs a sniper rifle. Ill address this to new traders. Please do not fool yourself into believing that you can win with a sniper rifle. If you want to, or feel you have to, then start with your shotgun in order to live to be trained with the sniper rifle. It Maybe that you find that lying on the cold ground and freezing your but off isn't as glamorous as it looks on TV.

If you learn this approach, (if there is any interest) that i will explain in the next months ahead, and learn the power of the compounding. you will go out and try to do odd jobs and deliver pizzas or whatever to get your hands on more money because small returns consistent over periods of time is so amazing period. one of the reasons most new traders don't make it is obvious, but doesn't seem to change their behavior is trying to make 20% a day, a week, a month. Can it be done? oh yes, for long periods of time ?if so you'll be hearing from Mr. Rothschild.
  • #19
  • Mar 3, 2010 11:11pm Mar 3, 2010 11:11pm
All right I am ears. so far it seems that you are just saying whatever the "system" (i hate that word as well) scale into it. I m not trying to disrespect you, but that is no revelation. Is there something I am missing that prevents you from proceeding? I tried to pm you, but you need to enable that feature, thanks. Yes, Winston-salem is about 15-20min away.
  • #20
  • Edited 11:52pm Mar 3, 2010 11:12pm | Edited 11:52pm
Quoting mr-T
Hi hedge, I do not want to come off arrogant, I am a very passive person and as you can tell have a very hard time with communication. (probably the reason i have to trade cant really fit inside the "real world")


The pnt you make with your waiting and finding the right moment to pull the trigger on your sniper rifle is nothing more than having your emotions in check.
Hi Mr-T - I think I know what you are trying to say, and I commend you with your approach of sustainable trading (the 20+ year plan), as we are on the same wavelength there! I think your analogy of the sniper vs shotgun might raise questions in terms of one approach being better than the other... For example, my "sniper" method of trading is more than having emotions in check, as emotions (be they in check or not) have no relevance within a sound method - (see below thread link to see what I am talking about - though most of thsi stuff would be familiar to an experienced and sound trader such as yourself) and an analogy of "shotgun" could be construed to be something like a "spray and pray" method of trading vs ths specific, targeted and patient method which is of course the sniper! - even though I know this is not what you mean. Nevertheless we have similar views on many things, it would seem. Sorry - I don't want to interrupt the flow of your good thread here and I hope you will be able to help some of the new traders see some of the realities about trading, as indeed you are indicating very well in some of your posts. Good to see some common sense going on in these forums for a change! "Common sense is not that common..."

All the best.

http://www.forexfactory.com/showthread.php?t=222471
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