Mi Mark!
Thanx for your very valuable reminder.
Sometimes things start to go the wrong way ...
All the best,
Niels
Thanx for your very valuable reminder.
Sometimes things start to go the wrong way ...
All the best,
Niels
Technical Analysis Fallacy
I know I said I wouldn't post anymore but I'd like to make one comment on the posts by FX Plankton and some of the others from relative newcomers to the thread in the last couple of weeks...
Firstly, FX Plankton, I am sure from looking at your blotter from Friday that if you made over 22% in one day then the positions that you took were far too large relative to the size of your account. The risk of ruin would be too great if you traded like that with real money. Just by looking at this one aspect of your example, I am 100% sure you are not following...
- #24,147
- Edited 4:17am Apr 4, 2011 3:49am | Edited 4:17am
- | Joined Aug 2007 | Status: Trader | 295 Posts
Looks like I missed a good point to enter a rescue trade. Mused over that point for too long so now I'm in a hope state which is not good... trying to get back into analysis and objectivity mode.
P.S. When it comes to MM and MO, fti showed the geometric progression of how much one needs to make to get to breakeven, which is plain and clear to see. The implications of that however, to me are not. The way I understand, the importance of this is that losses are REALLY bad? So I suppose that's what fti kept talking about quite a lot in the earlier threads when he said things along the lines of... small gains are better than small losses? So basically, no matter what... we must do everything in our power to never come out with loss?
So when he said:
"Snowballing in a loss situation is very tricky,
The trick is to stay on the front line, and not allowing the market to run too far away from you for effective salvaging the bad . Therefore averaging of cost is the main component in this MO. Later in Art of War you will learn that to save 1 bad postion , you will need a squad. Therefore the timing is critical and the terrain whereby this is allowed to occcur must be manageable. This MO must be given sufficient thought , well parametered and executed swiftly on running battle sequences. If any possibilities of failure were to present itself , the whole exercise have to be abandon. So use it wisely. Under the strength of unlimited capital, this activity will dig you out of the holes , a trader might find themselves in. But traders do not have unlimited resource as with banks, if this protocol is adopted then much preparation is necessary, in terms of the limits of the parameters is concerned."
He basically meant that... in order to execute a successful rescue, you must get back to analysis mode... look at the longer term areas of importance and make sure that you enter at point where prices are unlikely to go against the rescue trades i.e. you must essentially continue trading but with such tools as fib progressions etc at your disposal which are essentially designed to indicate to you how big of a rescue (how many troops to initiate) in order to get your account back to or as close as possibly to where you started from?
So in other words, understanding the various progressions etc is merely understanding basic maths and being able to make basic calculations in order to figure out how big of a trade to put on to get yourself out of the mess u got urself into (in laymans terms)???
P.S. out at a loss
decided not to rescue after all.
P.P.S. looks like indianguinnie is a better dancer than me lol
P.S. When it comes to MM and MO, fti showed the geometric progression of how much one needs to make to get to breakeven, which is plain and clear to see. The implications of that however, to me are not. The way I understand, the importance of this is that losses are REALLY bad? So I suppose that's what fti kept talking about quite a lot in the earlier threads when he said things along the lines of... small gains are better than small losses? So basically, no matter what... we must do everything in our power to never come out with loss?
So when he said:
"Snowballing in a loss situation is very tricky,
The trick is to stay on the front line, and not allowing the market to run too far away from you for effective salvaging the bad . Therefore averaging of cost is the main component in this MO. Later in Art of War you will learn that to save 1 bad postion , you will need a squad. Therefore the timing is critical and the terrain whereby this is allowed to occcur must be manageable. This MO must be given sufficient thought , well parametered and executed swiftly on running battle sequences. If any possibilities of failure were to present itself , the whole exercise have to be abandon. So use it wisely. Under the strength of unlimited capital, this activity will dig you out of the holes , a trader might find themselves in. But traders do not have unlimited resource as with banks, if this protocol is adopted then much preparation is necessary, in terms of the limits of the parameters is concerned."
He basically meant that... in order to execute a successful rescue, you must get back to analysis mode... look at the longer term areas of importance and make sure that you enter at point where prices are unlikely to go against the rescue trades i.e. you must essentially continue trading but with such tools as fib progressions etc at your disposal which are essentially designed to indicate to you how big of a rescue (how many troops to initiate) in order to get your account back to or as close as possibly to where you started from?
So in other words, understanding the various progressions etc is merely understanding basic maths and being able to make basic calculations in order to figure out how big of a trade to put on to get yourself out of the mess u got urself into (in laymans terms)???
P.S. out at a loss
decided not to rescue after all.P.P.S. looks like indianguinnie is a better dancer than me lol
where you see Ego I see just an honest attempt from someone who just wants to learn.You should see my EGO LOL
You see everything is matter of perspective and how you relate to others opinion.
you can't know 100% sure of what are his intentions, just give a man time and it will show you who he is.
There is nothing like losing all you have in the world for teaching you what not to do. And when you know what not to do in order not to lose money, you begin to learn what to do in order to win.You begin to learn! This are the best lessons that anyone...
Making mistakes is the beginning of the learning journey as the old saying ...If one never make mistakes means one does nothing at all(learn nothing)
- #24,155
- Apr 4, 2011 6:49am Apr 4, 2011 6:49am
- Joined Oct 2007 | Status: Trader | 4,269 Posts
Totally agree on this one.. you will never learn how to ride a bike till you fall from it "multiple times" I am sure the seniors here is with good intention.. trying to guide the newbies not to make the mistakes..
Making mistakes is the beginning of the learning journey as the old saying ...If one never make mistakes means one does nothing at all(learn nothing)
Hi Dan,
I share your experience about making your own experiences and also mistakes. Yeah - that kind of lessons are the most valuable, when you are willing to learn from it.
But what I want to do is, to show you the failures and problems in your trading and mindset, that you might not be aware of ....
But you are right - offering some help and the way to give hand needs to be adjusted to every persons personality and way of learning ..
CU,
Niels.