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Trend Trading All Pairs

  • #9,861
  • Jan 1, 2011 7:27pm Jan 1, 2011 7:27pm
Quoting shiko
Most of strategies posted have no sense at all. Even I can say it without backtesting. I also always have arguments when i meet strategy that uses no stops. I know some guys who are very successful trading with no stops from Oanda forum, but I believe sooner or later they will get caught big time.
when trading with stop and proper MM I see not much risk as long as I do not over trade.

No stop trading....ha! i know some people from 2009 like that...they were long EUR/USD at around 1.5000 without stops......

Fools.

They kicked me out of their forums.
  • #9,862
  • Jan 1, 2011 7:31pm Jan 1, 2011 7:31pm
Quoting dddd
No stop trading....ha! i know some people from 2009 like that...they were long EUR/USD at around 1.5000 without stops......

Fools.

They kicked me out of their forums.

You know, some use really smart things by trading without stops but somehow controlling risk. i have had a talk to Grim who is a very intelligent guy he somehow controls his risk without stops, although I have no idea how. Anyway, I believe things might happen that can caught with everyone who trades with no stops even the smartest one. Black Monday 1987 comes to mind and things like this happen from time to time.
  • #9,863
  • Jan 1, 2011 7:34pm Jan 1, 2011 7:34pm
Reading Caleb's book was an eye opener for me regarding using hard stops.
No one knows when black swan event might happen and times are very uncertain.

Ah, well, I do not have to go too far back. May 6, 2010. Quite a few guys who were long without stops got burnt.
  • #9,864
  • Jan 2, 2011 2:39am Jan 2, 2011 2:39am
Quoting dddd
i have the opposite view: i think low win-rate with high R:R is tougher. Here is my reasoning why: we are human. When we conduct these backtest cases, there is an underlying assumption that every trade will be taken. That is not the case in reality, unless you are using a trading robot.(and trading robots are no, no.)

Personally, my daily existence of life/work interferes with trading a lot, as such, i prefer high win rate with lower r/r....
Also an interesting point. Due to the methods I am using I know that I won't miss any trades. As shiko suggested, they are happening on the daily.
So, I completely agree with you. If I can't take every trade in reality, then it's better to stick to a high win-loss and low R:R strategy.
  • #9,865
  • Jan 2, 2011 2:51am Jan 2, 2011 2:51am
Quoting dddd
I remember my earlier days of trading, i got soo fed up that i decided to trade with a stop of 50 to 100 stops and price target of 10pips.
I rigorously avoided all news, etc, choose what i considered solid S/R levels with a sweet round number, etc.. What happened?

I had a very, very high win rate, with max leverage of 1:400; i was doubling my account every a week...yeah, you are reading that correctly: i was doubling it every week. My reaction to this sudden fortune? First i was scared because i know i was playing russian roulette with my account,...
Cool story actually! hehe, I did the typical newbie mistake in the beginning: trading without a stoploss. First account went down the toilet. haha

Everything comes down to expectancy. if you have a such a high negative R:R you gotta have a 80 to 90% win-rate to compensate for that negative R:R. There might be a point where your strat would even have worked long-term by slightly increasing the R:R, so that you don't need such a high win-rate. But that's just an assumption here.

I also agree with you point about patterns and strategies. The probabilities are depending a lot on time-frame AND they also depend a lot on the pair you trade. On some pairs triangles won't work at all, while on others they give such an incredibly high win-rate, that it seems like pure magic.
  • #9,866
  • Jan 2, 2011 2:53am Jan 2, 2011 2:53am
Quoting shiko
You know, some use really smart things by trading without stops but somehow controlling risk. i have had a talk to Grim who is a very intelligent guy he somehow controls his risk without stops, although I have no idea how. Anyway, I believe things might happen that can caught with everyone who trades with no stops even the smartest one. Black Monday 1987 comes to mind and things like this happen from time to time.
They probably scale in and out instead of using stops. That's also a way to trade, but I wouldn't trade that way.
  • #9,867
  • Jan 2, 2011 3:00am Jan 2, 2011 3:00am
Quoting shiko
Reading Caleb's book was an eye opener for me regarding using hard stops.
No one knows when black swan event might happen and times are very uncertain.

Ah, well, I do not have to go too far back. May 6, 2010. Quite a few guys who were long without stops got burnt.
Yes, cause you never know the intensity of the black swan event. All the effort you did when the "white swans" occured can be easily whiped out by a black swan event.
Thus, stops are so damn important.
Or we can also try reversing this dynamic and get small losses in a white swan event and wait for the black swan to make us rich. Well, that is the essence of high R:R and low win-rate trading strategies.
  • #9,868
  • Jan 2, 2011 8:33am Jan 2, 2011 8:33am
Quoting dddd
I remember my earlier days of trading, i got soo fed up that i decided to trade with a stop of 50 to 100 stops and price target of 10pips.
I rigorously avoided all news, etc, choose what i considered solid S/R levels with a sweet round number, etc.. What happened?

I had a very, very high win rate, with max leverage of 1:400; i was doubling my account every a week...yeah, you are reading that correctly: i was doubling it every week. My reaction to this sudden fortune? First i was scared because i know i was playing russian roulette with my account,...
would be interesting to know how often you were able to double your account.
  • #9,869
  • Jan 2, 2011 11:33am Jan 2, 2011 11:33am
Quoting Custos
Yes, cause you never know the intensity of the black swan event. All the effort you did when the "white swans" occured can be easily whiped out by a black swan event.
Thus, stops are so damn important.
Or we can also try reversing this dynamic and get small losses in a white swan event and wait for the black swan to make us rich. Well, that is the essence of high R:R and low win-rate trading strategies.
I believe that will require an adept use of OPTIONS.

Oanda have the box trade. that allows you to bracket a region on a chart. If a big event propels or not propel price action out of that box, you make money. (depending on how you bet).

These requires enhanced understanding of fundamentals.

Quoting Custos
would be interesting to know how often you were able to double your account.
Every week. I was using 1:400 leverage. My most reliable pair was NZD/USD. The pair that killed me was USD/CAD. The trade(usd/cad) that killed my account happened during london trading session. It was a short trade.
  • #9,870
  • Jan 2, 2011 11:35am Jan 2, 2011 11:35am
Quoting shiko
Reading Caleb's book was an eye opener for me regarding using hard stops.
No one knows when black swan event might happen and times are very uncertain.

Ah, well, I do not have to go too far back. May 6, 2010. Quite a few guys who were long without stops got burnt.
I like caleb book. I find it humbling and sobering
  • #9,871
  • Jan 2, 2011 1:38pm Jan 2, 2011 1:38pm
Quoting dddd
I believe that will require an adept use of OPTIONS.

Oanda have the box trade. that allows you to bracket a region on a chart. If a big event propels or not propel price action out of that box, you make money. (depending on how you bet).

These requires enhanced understanding of fundamentals.



Every week. I was using 1:400 leverage. My most reliable pair was NZD/USD. The pair that killed me was USD/CAD. The trade(usd/cad) that killed my account happened during london trading session. It was a short trade.
well, I might try options one day, but right now I am satisfied with simple forex trading.
hm, I was just wondering about how many times you doubled it up. Cause after 7 times you would make a even make small 1,000$ into a 100,000$. So was just wondering how high it went.
  • #9,872
  • Jan 2, 2011 3:02pm Jan 2, 2011 3:02pm
Quoting Custos
well, I might try options one day, but right now I am satisfied with simple forex trading.
hm, I was just wondering about how many times you doubled it up. Cause after 7 times you would make a even make small 1,000$ into a 100,000$. So was just wondering how high it went.
oh, i see.

I only went 3 weeks. I started with $2000. I was already at $19,000 and some change(which means i was already past the expected target of $16,000 for the 3rd week) when it happened. When i took the failed USD/CAD trade, it drained the account down to $400 or so dollars. I woke up the next morning to open my account, and noticed that it has been wiped clean. I got a call from my broker, talking to me about leverage and risk/reward, etc.

Man, ...that was an interesting day for me.

I thought i have all the bases covered as per usual: no news, not even yellow ones, solid S/R levels with all the confluence in the world(rn, fib, etc), etc. I mean, my reasoning was very simple: When you have a solid level of S/R with all the confluence in the world, at the very least, there should be a bounce of +10 pips from that level, come heaven or hell. So, let me leverage this stuff up, set a high SL point of 100 pips, 500 pips, or sometimes 50 pips and gather the pips. Well, it worked....for awhile.... while it worked, i was busy counting the $$$$$...projecting how easily i would be a multi-billionaire(not multimillionaire, mind you. I aimed higher.) Fantasizing about all the stuff i am going to be doing with my money. Hahahahaha. Hehehehehe. Hohohohoho.

I am curious, CUSTOS, why are you so interested? I can discuss the strategy with you in detail, who knows, given what i know now, heck, one can even modify/enhance it further. As far as i am concern, the fact that i even got to $19,000 was pure fluke/accident. Because there are soo many possibilities:What if my first trade was the USD/CAD that wiped me out? I would have been crushed on the first day. What if i decided not to take the usd/cad trade because i was busy or away? I probably would have gone a couple more days or weeks before the day of reckoning. What if my very first trade was thatt USD/CAD? I would have been wiped out at the onset. So, in the end, it doesnt matter. If you play russian roulette too many times you will eventually lose. And since you cant see the future, you never, never, never know when that day of reckoning will happen.

There were a few modifications i thought about then after my usd/cad failure:

(1)When price move in your direction by +5pips, BE the trade; rather than wait from price to move +10pips full. If you see an opportunity to trail price and make more than +10 pips, do so.
(2)Only trade NZD/USD(why? nzd/usd worked well for me that time, i dont know why. most of my gains where made with that pair); or Only trade superbly, smoothly trending market. Check the weekly, monthly for this.
(3)Do a bimonthly withdrawal. After you've compounded your gains for two weeks, withdrawal all money down to $2,000, because, after two weeks of wining streaks, you will start to get rusty. Besides, it is borderline impossible to go for more than two weeks with trade after trade after trade and not make any mistake. or encounter a fluke accident. That means for a best case scenario: a net gain of $6,000 per two weeks = $12,000 per month.
(4)If you have a good year, then increase the starting capital to $5,000 the following year; if you have a good 6 months during that following year; then increase starting capital to $10,000-- that should give a net $60,000 per month. We will see what happens after that.
(4)Do not trade on sunday and fridays. If you have a winning, net positive 4 months, take two weeks off after every 4 months.

I must have made other rules and what not....i dont remember them anymore; but anyways, in the end, i see it as a total loss. In the end, you are playing russian roulette. YOU ARE BOUND TO LOSE.
  • #9,873
  • Jan 2, 2011 3:30pm Jan 2, 2011 3:30pm
Quoting dddd
oh, i see.

I only went 3 weeks. I started with $2000. I was already at $19,000 and some change(which means i was already past the expected target of $16,000 for the 3rd week) when it happened....
oh, I am just curious, cause I am interested in your stats. But from what you told me, the stats are unfavorable.

As you said, it is just impossible to be 100% right. And apparently with your strat, if you make one mistake you are back at 0.
hm, and even a 90%+ winrate is very hard to achieve. I am not sure if S/R level trading, no matter how many tools you add will ever achieve such a high winrate.
One might have to tighten up the stop loss to see if we can get a positive expectancy.
But I agree, trends definitely help.
  • #9,874
  • Jan 2, 2011 3:46pm Jan 2, 2011 3:46pm
Quoting Custos
oh, I am just curious, cause I am interested in your stats. But from what you told me, the stats are unfavorable.

As you said, it is just impossible to be 100% right. And apparently with your strat, if you make one mistake you are back at 0.
hm, and even a 90%+ winrate is very hard to achieve. I am not sure if S/R level trading, no matter how many tools you add will ever achieve such a high winrate.
One might have to tighten up the stop loss to see if we can get a positive expectancy.
But I agree, trends definitely help.

I am familiar with this situation although I have never leveraged my trades so high. I was with Oanda. Doubled 2 demos each within 1 month then started trading Live Oanda, almost doubled account within 3 months and then 1 day lost 70% on 1 trade. same pattern, picked few pips and had huge stops plus big leverage. That was the fall of 2008. BW, market was very different then with huge spikes. i remember how Eur/Jpy spiked 200 pips up and down within few seconds at aftermarket hours. Whatever returns are any strategy or MM style that makes does not matter how many % but with risk of blow up, will blow account up eventually. it ios a matter of when, not if.
  • #9,875
  • Jan 2, 2011 3:46pm Jan 2, 2011 3:46pm
yes, forgot to mention, I added to trades that went against me as well... even pyramided.
  • #9,876
  • Jan 2, 2011 3:51pm Jan 2, 2011 3:51pm
Quoting shiko
I am familiar with this situation although I have never leveraged my trades so high. I was with Oanda. Doubled 2 demos each within 1 month then started trading Live Oanda, almost doubled account within 3 months and then 1 day lost 70% on 1 trade. same pattern, picked few pips and had huge stops plus big leverage. That was the fall of 2008. BW, market was very different then with huge spikes. i remember how Eur/Jpy spiked 200 pips up and down within few seconds at aftermarket hours. Whatever returns are any strategy or MM style that makes does not...

I remember fall of 2008. that was when i got into pyramiding. also when i found hector on youtube.
  • #9,877
  • Jan 2, 2011 3:55pm Jan 2, 2011 3:55pm
Quoting shiko
I am familiar with this situation although I have never leveraged my trades so high. I was with Oanda. Doubled 2 demos each within 1 month then started trading Live Oanda, almost doubled account within 3 months and then 1 day lost 70% on 1 trade. same pattern, picked few pips and had huge stops plus big leverage. That was the fall of 2008. BW, market was very different then with huge spikes. i remember how Eur/Jpy spiked 200 pips up and down within few seconds at aftermarket hours. Whatever returns are any strategy or MM style that makes does not...
haha, nice. yeah, I think we all have to go down that root once. But those experiences make us already better traders by itself, cause we know which strats to avoid and what to look for.
  • #9,878
  • Jan 2, 2011 3:57pm Jan 2, 2011 3:57pm
Quoting dddd
I remember fall of 2008. that was when i got into pyramiding. also when i found hector on youtube.
I don't find pyramiding necessarily bad. But it is just less useful when one tries to compound returns.
  • #9,879
  • Jan 2, 2011 4:01pm Jan 2, 2011 4:01pm
Quoting dddd
I remember fall of 2008. that was when i got into pyramiding. also when i found hector on youtube.
sometime in winter 2009 I found No Brainer trades.
Still, I am having progress but have a lot of things to do. But frankly I already feel I am close.
  • #9,880
  • Jan 2, 2011 4:04pm Jan 2, 2011 4:04pm
Quoting Custos
haha, nice. yeah, I think we all have to go down that root once. But those experiences make us already better traders by itself, cause we know which strats to avoid and what to look for.
Custos, you know what's funny? I did not read about pyramiding anywhere... I got into it myself. it says how similar most of humans think and how proper trading habits go against human nature.
by piramiding I mean additing to losing position increasing each additional position while price moves against you. i had the whole system of doing so
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