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Attachments: There are no secret patterns and there will never be one
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There are no secret patterns and there will never be one

  • #81
  • Edited 4:00am Sep 28, 2010 3:37am | Edited 4:00am
Quoting esuffw
Hi Kyla

I am just trying to help. Regarding the email, you can just PM me, or even share it here on the thread. I am no master of trade, but since I am within a professional trading environment nowadays, I would like to give some info back to the place which got me started.

Regarding trading, most people ignore the most important part. "Self analysis". Take a loosing trader who blows accounts after accounts. BY ANALYZING HIS OWN TRADING STATEMENTS, he would have found great ways to become profitable. It is the "I" factor as you said, not...
When i did that a few years ago, thats when i turned the corner.

(Manual backtesting)
  • #82
  • Sep 28, 2010 4:13am Sep 28, 2010 4:13am
Quoting Venice
I only agree with this statement because of the chaos theory.

AND, if a pattern/indicator is used by enough people with big$$$, it becomes a self full filling prophecy.

For instance in Forex, 200 MA is huge to the big boys.
i'm calling you out on this!

1. if a pattern / indicator is used by enough people with big $$$ then yes it could become a self-fulfilling prophecy... so why isn't it? which leads to...

2. who says the 200 MA is huge to the 'big boys'?

3. the fact you use the term 'big boys' suggests this is regurgitated. please advise.
Congratulations ScalaFX for coming out of the closet!
  • #83
  • Sep 28, 2010 4:19am Sep 28, 2010 4:19am
Quoting Fxtrader
When i did that a few years ago, thats when i turned the corner.

(Manual backtesting)
Hi Fxtrader

Hard work pays. The problem is, most want easy way out (COMPUTER BACKTESTING). Glad to hear about your turn.
Life is a school for the soul
  • #84
  • Sep 28, 2010 5:12am Sep 28, 2010 5:12am
Quoting nubcake
i'm calling you out on this!

1. if a pattern / indicator is used by enough people with big $$$ then yes it could become a self-fulfilling prophecy... so why isn't it? which leads to...

2. who says the 200 MA is huge to the 'big boys'?

3. the fact you use the term 'big boys' suggests this is regurgitated. please advise.
Hi nubcake

Thx for bringing this up. (OH BOY, THIS POST IS GOING TO BE LONG)

It is true there is an effect of self-fulfilling prophecy. Not only in Technical analysis, but also in ALL TYPES OF ANALYSIS. Think about Fundemental Analysis. When everyone thinks A stock is overvalued, AT THE SAME TIME, WITH THE SAME PRECIEVED VALUE, the price will fall right to their FAIR VALUE. But what was there to judge if A was overvalued? Its just a belief system.

This self-fulfilling effect is less shown by fundementals or quan analysis due to its wide differences between indivdual's prespectives. Now, moving to technical analysis. In technical analysis,

1. We were taught to use similar tools.
2. Settings of the tools can be well defined (such as 200, 12, 50 etc...).
3. Certain settings (200 SMA in this case) have been advertised strongly.
4. Some settings are Default settings of your charting system.

So the chances of traders using a "WELL KNOWN" ma is not rare. But, very importantly, there are some misconception regarding the market will move because a lot of attention is paid to a certain point (200SMA).

1st - Understand the MARKET IS LIQUIDITY HUNGRY. It seeks liquid. Liquid is food of the market makers. (If you dont understand this point, ask till you do, this post is going to be too long)

2nd - When MASS ATTENTION is paid to a certain point, the market makers WILL KNOW THERE IS FLOW. (MARKET MAKERS DONT TRADE ON SIGNALS, THEY TRADE ON FLOW)

3rd - A KNOWN FLOW AREA can become their hunting ground. How do they do this? Slap on the 200SMA. There are times when it supports, times when it doesnt. Same as any other "well known" support and resistances.

You have to ask, WHO IS BENIFITING FROM THE FAILURE OF SUCH INTREST POINTS?

What do failure of intrest points gives to the market? STOP LOSSES!
What do stop losses gives to the market? LIQUITITY AT A DISADVANTAGED PRICE!
What does a disadvantaged price gives to the other party holding the other side of the trade? PROFIT!
Where do all those profit go to? MICHELIN STAR RESTAURANTS!
Where do all the food go to? MARKET MAKER'S TRADER'S STOMACH!

THIS IS THE REASON WHY YOU GET FAILURE IN VASE-INTREST POINTS COMBINED WITH SUCESSES. THIS IS THE MIS-CONCEPTION OF "BIG GUYS" SELF FULLFILLING THEORY.

WHEN A POINT OF INTREST BECOMES WELL KNOWN, ITS ACCURACY WILL MOST LIKELY BECOME MORE RANDOM THEN BEFORE. THIS IS DUE TO THE LIQUID/PROFIT HUNGRY MAMMOTHS ARE IN CONTROL ALL FOR THE SAKE OF LIQUIDITY.

Need a rest soon...
Life is a school for the soul
  • #85
  • Sep 28, 2010 7:50am Sep 28, 2010 7:50am
not a problem.

nice post. personally i was hoping it would be longer. your posts so far emit an air of proper understanding and sincerity, and not just blind-faith in hocus pocus and fluked past results. very nice.
Congratulations ScalaFX for coming out of the closet!
  • #86
  • Sep 28, 2010 8:09am Sep 28, 2010 8:09am
subscribing. Finding it difficult to understand this riddle. Will try.
Thanks anyway.

chonghm
  • #87
  • Sep 28, 2010 9:17am Sep 28, 2010 9:17am
Quoting nubcake
not a problem.

nice post. personally i was hoping it would be longer. your posts so far emit an air of proper understanding and sincerity, and not just blind-faith in hocus pocus and fluked past results. very nice.
Hi nub. Looks like esuff summed up (and in a much better way)

I would like to reflect upon the idea that Market makers seek liquidity. Why is this? Think about it. A general underlying fundamental point of liquidity is that volume is present. Security/Currency can be sold/bought without having to wait for the matching buyer/seller. Guess who makes money on the spreads? Market makers. They seek out these levels because it will make them the most money. More people buying and selling means more profits from spreads. They even figure they can be nice by tightening the spread, which, in turn can get more people to enter the equity/currency.

It's all about the money, for market makers, for the big banks, for everyone. It all must be accounted for. Follow the money...
  • #88
  • Sep 28, 2010 9:48am Sep 28, 2010 9:48am
Quote
Hi nubcake

Thx for bringing this up. (OH BOY, THIS POST IS GOING TO BE LONG)

It is true there is an effect of self-fulfilling prophecy. Not only in Technical analysis, but also in ALL TYPES OF ANALYSIS. Think about Fundemental Analysis. When everyone thinks A stock is overvalued, AT THE SAME TIME, WITH THE SAME PRECIEVED VALUE, the price will fall right to their FAIR VALUE. But what was there to judge if A was overvalued? Its just a belief system.

This self-fulfilling effect is less shown by fundementals or quan analysis due to its wide...

Wow...superb post. Please accept my salute esuffw. Your thoughts clearly point out that you are one of the professional traders.

The brain is most powerful PC in an entire universe. All it wants intense hard work to understand the markets and get a feel of it.





How
  • #89
  • Sep 28, 2010 11:03am Sep 28, 2010 11:03am
Quoting nubcake
not a problem.

nice post. personally i was hoping it would be longer. your posts so far emit an air of proper understanding and sincerity, and not just blind-faith in hocus pocus and fluked past results. very nice.
Thank you nubcake

Its comforting to hear such words. Nevertheless, I still have a LONG way to become a better trader.

I hope while I grow, I could continue to share with FF what I have learned. Collective knowledge is a very powerful force.

*I got tired. Been trading since morning market open so could not carry on. I will try add in tomorrow.
Life is a school for the soul
  • #90
  • Sep 28, 2010 11:05am Sep 28, 2010 11:05am
Quoting chonghm
subscribing. Finding it difficult to understand this riddle. Will try.
Thanks anyway.

chonghm
Hi chonghm

Feel free to ask anything. If it is a question which I couldn't answer, even more welcome!
Life is a school for the soul
  • #91
  • Sep 28, 2010 11:18am Sep 28, 2010 11:18am
Quoting Venice
Hi nub. Looks like esuff summed up (and in a much better way)

I would like to reflect upon the idea that Market makers seek liquidity. Why is this? Think about it. A general underlying fundamental point of liquidity is that volume is present. Security/Currency can be sold/bought without having to wait for the matching buyer/seller. Guess who makes money on the spreads? Market makers. They seek out these levels because it will make them the most money. More people buying and selling means more profits from spreads. They even figure they can be...
Thx Venice

Yes, follow the money. Use the basic knowledge of this market, you can also understand WHICH MONEY are you following.
Life is a school for the soul
  • #92
  • Edited 11:42am Sep 28, 2010 11:22am | Edited 11:42am
Quoting kingfisher
Wow...superb post. Please accept my salute esuffw. Your thoughts clearly point out that you are one of the professional traders.

The brain is most powerful PC in an entire universe. All it wants intense hard work to understand the markets and get a feel of it.





How
Thx kingfisher

I am not that professional yet. Still a newbie in here (both in FF and at my job). Just trying to share what I learned so far and hope that a few traders could avoid the painful roads I have traveled which was not necessary.

It is also good exercise to note down and be able to discuss with open minded people like you, it reinforces my learning.

Good trading to you
Life is a school for the soul
  • #93
  • Sep 28, 2010 11:42am Sep 28, 2010 11:42am
Esuffw -

So, out of curiosity, could you give us an example of how you trade on a day to day basis? What's your "routine"? What are the list of questions you ask yourself and checkpoints you consider? I can tell that money management and entry and exit strategies are core, but what else do you bring into consideration each time you place a trade? Particularly with fundamentals?

K.
  • #94
  • Sep 28, 2010 12:09pm Sep 28, 2010 12:09pm
Quoting kcardinalis
Esuffw -

So, out of curiosity, could you give us an example of how you trade on a day to day basis? What's your "routine"? What are the list of questions you ask yourself and checkpoints you consider? I can tell that money management and entry and exit strategies are core, but what else do you bring into consideration each time you place a trade? Particularly with fundamentals?

K.
Oh dear, a glance of the thread and I see a reply just before I go to bed. COFFEE! lol

Hey k

What I do, I will post out here in simple steps. The details regarding why I do such things might have to be explain much much later. (SUPER TIRED, I AM IN HONG KONG TIME ZONE).

1. Aware of fore coming news (Understand what type of news would make different entities move their assets, which news is likely to cause elephants to come out in crowds)
2. Pick a reference point (That is much harder then said. I will need to go into detail in that later, REMIND ME!!)
3. Wait for foreign capitol or get out at a very small loss. (Some will go further to scale into a loosing position, but for that you need to start out even lighter in proportion.)
4. When foreign capitol is available, there is an excel sheet right next to me that works out the best position size to add in relation to a predefined stop (not a stop loss, because it is most likely a small profit or breakeven)
5. Scale out profits which leaves enough on the table (again, all worked out on excel, simple VBA stuff) to add in later levels
6. Continue or end.
7. Reference point
8. Repeat


If there is no news, try to follow the dealers. (NO NEWS CAN BE GOOD NEWS!!)

When big news hits and indeed a change of elephant portfolio, get ready for some serious pyramids (do it like they do in Egypt).

Sometimes, portfolio change happens unexpectedly. Pay attention always.

CROSS MARKETS: GOLD, OIL, INDEXES, BONDS, FX PAIRS. This is too much to be explained in one post, and you really should do your own homework for this!

I might add in tomorrow, coffee is not doing any good

Hope it helps

Good night all
Life is a school for the soul
  • #95
  • Sep 28, 2010 12:27pm Sep 28, 2010 12:27pm
Quoting indy360
Very interesting thread, subscribing.
it's not that interesting.
  • #96
  • Sep 28, 2010 12:31pm Sep 28, 2010 12:31pm
Quoting witsnpips
it's not that interesting.
Maybe not to you, you must be in the 5% of successful traders then.

  • #97
  • Sep 28, 2010 12:32pm Sep 28, 2010 12:32pm
Before you ask, im in the other 95%!

Just good to read a different take on things rather than the usual - watch this cross that, and enter!
  • #98
  • Sep 28, 2010 12:36pm Sep 28, 2010 12:36pm
no, i'm not in the 5%, i was just sincerely making a point that this thread isn't that interesting.
  • #99
  • Sep 28, 2010 1:33pm Sep 28, 2010 1:33pm
Quoting witsnpips
no, i'm not in the 5%, i was just sincerely making a point that this thread isn't that interesting.
Perhaps you could share information, ideas, or thoughts that would be of interest to you? This thread has started out with a view of the market that isn't of the norm and the more input we get, the better!
  • #100
  • Edited 4:51pm Sep 28, 2010 4:42pm | Edited 4:51pm
Quoting witsnpips
it's not that interesting.
yes it is.

400 odd posts, no charts, barely more than an average of more than 10 words per post.

what you have to say appears to me to have no value at all, why do you bother posting here?
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