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Fail Better

  • #81
  • Edited 10:50am Apr 19, 2011 8:13am | Edited 10:50am
Quoting the_wizard
Yes, I don't trade alot of the crosses/minors because of the spreads but also because there are plenty of opportunities out there and I find that I work best by knowing a few markets and their nuances, well.

I do think it helps Currency traders to keep an eye on the commodity space and the equity indices and even some of the fixed income.

It's an increasingly inter-related market these days.

Moves in equities, fixed income and commodities have a knock on effect on the dollar and vice versa.

I set my screens up in a specific way so that...
I first heard about correlations from Raczekfx,then Lovejoy80 and became interested,usually I look at Djones and if its rising I look to buy jpy and usd crosses and vice-versa,but don't really understand why is that happening.I have some affirmations written on my DJ and Oil charts...are they true or should I change something?
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  • #82
  • Apr 19, 2011 8:23am Apr 19, 2011 8:23am
Quoting vasmiza
Any thoughts on this one? I'm not quite sure about the SL "stop loss". Did the reaction already occur by the quick move up on the previous bar? Or is this a matter of not buying a PPZ "price pivot zone" to which price has constantly returned? lol
Hi Vasmiza,

IMHO, we should take trades on the first touch, on the first touch we have a high probabilities in might bounce on the second those probabilties decrease, see on the example on the chart you attached.

First touch bounce, second touch close below ppz.

With the first touch we have a high probability in might bounce on the second... our probalities decrease to a 50% when it becomes gambling instead of trading.

Hope it helps.
Os.
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Trade Smart
  • #83
  • Edited 9:10am Apr 19, 2011 8:29am | Edited 9:10am
Quoting Osman
Hi Vasmiza,

IMHO, we should take trades on the first touch, on the first touch we have a high probabilities in might bounce on the second those probabilties decrease, see on the example on the chart you attached.

First touch bounce, second touch close below ppz.

With the first touch we have a high probability in might bounce on the second... our probalities decrease to a 50% when it becomes gambling instead of trading.

Hope it helps.
Os.
Thanks Osman,

Yes makes a lot of sense. We want first touch bounces. At this point we could even start looking for shorts. Hence, Wiz's statement:

Quoting the_wizard
Never buy a support level (or sell a resistance for that matter) when price constantly returns to it. What's this, the 5th time back?

I'm looking for shorts by this point. Even before its broken out.
  • #84
  • Apr 19, 2011 9:45am Apr 19, 2011 9:45am
Quoting vasmiza
Any thoughts on this one? I'm not quite sure about the SL "stop loss". Did the reaction already occur by the quick move up on the previous bar? Or is this a matter of not buying a PPZ "price pivot zone" to which price has constantly returned? lol
Price has visited that price too many times recently for me.
  • #85
  • Apr 19, 2011 9:51am Apr 19, 2011 9:51am
Quoting vasmiza
Thanks Osman,

Yes makes a lot of sense. We want first touch bounces. At this point we could even start looking for shorts. Hence, Wiz's statement:
First touch is usually the best.

Ideally you want some space between the original breakout point and the point at which price comes back to the level.

Space away from potential problem areas.
  • #86
  • Apr 19, 2011 9:53am Apr 19, 2011 9:53am
Quoting vasmiza
Thanks Osman,

Yes makes a lot of sense. We want first touch bounces. At this point we could even start looking for shorts. Hence, Wiz's statement:
You´re welcome vasmiza...


Here is a trade I saw yesterday but didn't took it today

TT at 0.87920
4hr EG .. hit 1st FTA

Comments are appreciated.

Os.
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Trade Smart
  • #87
  • Apr 19, 2011 10:56am Apr 19, 2011 10:56am
Quoting the_wizard
First touch is usually the best.

Ideally you want some space between the original breakout point and the point at which price comes back to the level.

Space away from potential problem areas.
Hey Wiz,

This question has been bugging me for some time now. You might be the right person to shoot this at.

I understand the logic behind multiple touches of a PPZ indicating its weakness but then there are traders out there that trade exclusively only patterns like double tops, and those that do trade such patterns find the triple top to be even better than the double top.

I am not one of those but then the single top should be "more famous" (so to say) than the double and the triple tops, no?

g.
I believe . . .
  • #88
  • Apr 19, 2011 2:58pm Apr 19, 2011 2:58pm
Ok...another demo trade....EURUSD yesterday closed below 1,43500 PPZ...and some minutes ago it retraced just there... +17 pips right now..let's see how it plays out..
My plan is to ride the entire position until the target is reached...
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Market is like a puzzle, YOU have to fit the pieces!!
  • #89
  • Apr 19, 2011 8:52pm Apr 19, 2011 8:52pm
Quoting the_wizard
A friend of mine just said to me: "Who on earth is going to read a journal called "fail better"? lol
Those of us who have been around a while and know how easy it is to lose capital .

Wiz, thank you soooo much for your seminars and postings!!!!
(Sheldon)
  • #90
  • Apr 20, 2011 1:55am Apr 20, 2011 1:55am
Quoting Chris_B
Ok...another demo trade....EURUSD yesterday closed below 1,43500 PPZ...and some minutes ago it retraced just there... +17 pips right now..let's see how it plays out..
My plan is to ride the entire position until the target is reached...
Ok...losing trade... :-) It was not the best level to enter...
Market is like a puzzle, YOU have to fit the pieces!!
  • #91
  • Apr 20, 2011 7:48am Apr 20, 2011 7:48am
Enjoying the read and the different angles

Would be keen to join a webinar if space

[email protected]

Many Thanks
  • #92
  • Apr 20, 2011 8:48am Apr 20, 2011 8:48am
Had my order at 1.45500 came up till 1.4547 and down...TP at 1.45
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Trade Smart
  • #93
  • Apr 20, 2011 8:53am Apr 20, 2011 8:53am
Quoting Osman
Had my order at 1.45500 came up till 1.4547 and down...TP at 1.45

LOL, go Osman! Faking the breakouts like a pro ;-)
  • #94
  • Apr 20, 2011 8:58am Apr 20, 2011 8:58am
Quoting Rich_Hemp
I've been enjoying your thread and webinars Wiz and I'm also a keen follower of the J16 chart thread. I've found there seems to be a clear divide between your money management and that of J16.

Whilst you seem confident that breakeven will do damage over time, J16 has encouraged a breakeven move around the FTA to protect against a loss countless times, and BE trades should be treated as winners.

I understand there will be differences between two trader's strategies when it comes to management, but are you advising against what J16 teaches? If...
Rich,

All I can say in this regard is: Take a daily pin bar and move to breakeven at the first FTA.

Report back with the results over time.

Tom
  • #95
  • Edited 1:16pm Apr 20, 2011 9:35am | Edited 1:16pm
Rich_Hemp,

I would urge you to go and read this thread: http://www.trade2win.com/boards/fore...g-me-alot.html

It's only 7 pages long. Read it very carefully.

It may just be the answer.
  • #96
  • Apr 20, 2011 9:40am Apr 20, 2011 9:40am
Quoting the_wizard
All I can say in this regard is: Take a daily pin bar and move to breakeven at the first FTA.

Report back with the results over time.
Quoting the_wizard
I would urge you to go and read this thread: http://www.trade2win.com/boards/fore...g-me-alot.html
I will do, thanks for your replies.
  • #97
  • Apr 20, 2011 9:52am Apr 20, 2011 9:52am
Lol !! Yeah you're rite.. just today, i took BUOB on E/CHF entry at 1.2923, FTA was at 1.2960 final profit 1.2995, price went to 1st FTA, closed half.. other half to BE, price went down and hit BE.

On the EU TT, it didnt hit the 1.45500 where my sell order was... missed that trade by 3 pips

Tom, sent you an pm/email yesterday, did you received it ?

Os.
Trade Smart
  • #98
  • Apr 20, 2011 10:02am Apr 20, 2011 10:02am
Sold @ 6423 as a market order, order froze, called alpari and the customer service said I should have gotten a requote, but didn't get it
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  • #99
  • Apr 20, 2011 10:03am Apr 20, 2011 10:03am
Quoting the_wizard
Rich,

All I can say in this regard is: Take a daily pin bar and move to breakeven at the first FTA.

Report back with the results over time.

Tom

Hi Tom,

Here I can report my results (starting 1 January this year)
I do exactly that: Take a daily pin bar and move to breakeven at the first FTA.

But, wait a minute I thought the problem was with my ability to be picky. I have never really questioned the Breakeven concept (as it feels good really).... will now go register at that other forum to read the link you provided, thanks.

May I ask you please. What is you view on Risk/Reward, as you know with J16 Risk Reward for any particular trade is not a significant factor, i.e. meaningless.

P.S. Thanks for the email, looking forward for your webinar!
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  • #100
  • Apr 20, 2011 10:05am Apr 20, 2011 10:05am
I don't want to go up against James' teachings. He's pretty much single handedly response for why I am, where I am. However, we all have to take someones strategy and make it our own through our own experiences.

The response below is lifted (near verbatim) from posts in the link above. But please read that link. There are some good examples.

The break even move

I've got a good deal of experience with the "breakeven move" having seen it severely hinder performance in both my own account and others.

Infact one of the biggest and most successful professional traders I have ever worked with, who used to get sick of me ranting about "how I would still be in if I hadn't moved my stop to lock in profit" told me in plain English that I was a c*** for moving the stop to breakeven. (I'm not sure if he was that polite).

This is because almost every single time it makes absolutely no sense in the context of where the market is trading. If, for example, you take a trade at the top of a pin, you are entering in the middle of no-mans land after the market has moved away from support. The market knows about previous highs. It knows about previous lows. It knows about support. It knows about resistance. It knows about patterns. It does not know about where Johnny Green Fingers entered and has a risk free trade.

I give numerous examples in that thread of being well over 50 ticks up and then seeing the market come back to break even before making a huge move. Infact it is something that happens so often, James has actually covered it in a webinar and Seeking light actually coined a term to explain it!!!

The sad fact about the breakeven stop is that it means nothing when the market comes back and takes you out aside from the fact that you just got shaken out of what could (and usually is) a great trade because you were afraid to take a loser.

I think my biggest problem with break even is that it is common knowledge that one should trade the markets and not their P&L.

Using a break even stop in this strategy is trading your P&L in 99% of cases.

If you think it's going to turn and you are trading into a FTA get out!! But moving to break even smacks to me of relying on HOPE.

E.g. I HOPE it will go further but I don't want to take a loss if it doesn't.

And once again, hope is a killer in trading.

Anyway, I've said enough on the subject. Sorry if it's been a bit of a rant but honestly, this break even thing is the one issue that just keeps coming back in most of the people I speak with. People can see it destroys their performance but they just can't deal with not using it because it's comfortable and makes them feel safe.

Ultimately though, the proof is in the testing.

If you don't believe me on any of this, try it yourself.
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