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Where is the EDGE in trading? The most important thing in trading!

  • #221
  • Aug 7, 2011 11:50pm Aug 7, 2011 11:50pm
Quoting CrucialPoint
See, I told you didn't have to smoke weed while talking to Hawking to get it... But why would anyone take you seriously, you're just another nutcase!!!
well, i'm not entirely convinced so i've decided to test the waters with a combination of glue and metho fumes. i might even lick a toad once in a awhile and see how that goes.

as for the convergence / divergence... getting around that, or better yet, finding methods that eliminate the convergent part is tricky (and frustrating).
Congratulations ScalaFX for coming out of the closet!
  • #222
  • Aug 8, 2011 12:02am Aug 8, 2011 12:02am
Quoting Mr Breakout
No they don't Allan, they just appear to be trending for a short period of time.
If you flip a coin and Head comes up, the probability of obtaining another Head is always 50%, where is the trend here?
Put a grid, any grid, on a chart. Will the price go up or down? Run a test over as many candles as you can get. You will find the chance the price goes up one grid line from any arbitrary starting point is 50%, or as close as no matter. The chance it goes up two lines is 25%, and so on. (This is why martingale systems always fail.)

Quote
On the other hand, if a currency pair moves 100 pip higher, its probability of moving another 100 pips in the same direction is not 50% anymore, but more than 50% (precisely because markets trend), a simple statistical study will reveal that.

It depends on which chart you choose to study.

Run a 100 pip breakout entry over a year-long consolidation and see how much you make.

Quote
There is no house to beat, in trading you are simply profiting from the mistakes and emotions of other less disciplined, less knowledgeable traders.

You're trading against a market maker who has no intention of giving you his money. Or more precisely, he will give you enough to win your confidence, then take it all back, along with your shirt.

Give 1000 traders $1000 each. Twelve months later, 900 have lost the lot, 100 have $5000 each and the broker has $500000. The 100 winners feel they are very clever, having made 500%. They tout their success on forex forums and get lots of vouchers. Another 12 months, 10 super-traders are left. (The others have gone strangely quiet.) The 10 now have $25000 each and feel like George Soros himself. Even a baby can do this, they say. Meanwhile, the bucket shop has accumulated $750000. And so it goes.
  • #223
  • Aug 8, 2011 12:07am Aug 8, 2011 12:07am
Quoting nubcake
well, i'm not entirely convinced so i've decided to test the waters with a combination of glue and metho fumes.
Ahhhh.... now I'm beginning to understand the mentality here. Some of my younger relatives went to prison for METH.

Scavengers. Low-Lives. Maybe someday I will overcome. But meanwhile.........
  • #224
  • Aug 8, 2011 12:11am Aug 8, 2011 12:11am
Quoting Mr Breakout
No you are right, trading Forex does not require a college degree, it only requires a lifetime of studying.

A true trader is always looking for the ultimate trading system that will give him the ultimate edge. This is why he needs to read every single book on that subject.

At least this is what I am doing, and I will keep searching for a better system until I die, this is what real trading is all about.
There must be some point where you stop looking and 'GET ON WITH IT'

I mean really, there's no such thing as a better system, just a better YOU

Not ripping into you breakout .... just adding something that can help others
  • #225
  • Aug 8, 2011 12:14am Aug 8, 2011 12:14am
Quoting AllanS
Put a grid, any grid, on a chart. Will the price go up or down? Run a test over as many candles as you can get. You will find the chance the price goes up one grid line from any arbitrary starting point is 50%, or as close as no matter. The chance it goes up two lines is 25%, and so on. (This is why martingale systems always fail.)



It depends on which chart you choose to study.

Run a 100 pip breakout entry over a year-long consolidation and see how much you make.



You're trading against a market maker who has no intention of giving...
WHAT DOES ANY OF THIS CRAP HAVE TO DO WITH THE TITLE OF THIS THREAD????
I don't know either. That's why US credit was downgraded, because EVERYONE HAS TO PROMOTE THEIR OWN AGENDA rather than talk sense.

You know it's true. We ruin our own country.
  • #226
  • Aug 8, 2011 12:14am Aug 8, 2011 12:14am
Quoting AllanS
Put a grid, any grid, on a chart. Will the price go up or down? Run a test over as many candles as you can get. You will find the chance the price goes up one grid line from any arbitrary starting point is 50%, or as close as no matter. The chance it goes up two lines is 25%, and so on. (This is why martingale systems always fail.)
something about this doesn't sit right with me and i can't quite put my finger on it, but here goes anyway...

it might be true that over a long enough period price goes nowhere and all in all it will go up or down equally, but there are also the small times when price takes off and makes a dedicated movement in one direction over n units. so you either play the fade game or the trend game, or you find a way to play it both ways simultaneously and get all the cars, riches, and bitches.

price can't stay contained forever else it's not a market and becomes predictable.

and this is why the hunt for edges begins. tipping the odds in your favor of approaching a trade within the right context can only be helpful.
Congratulations ScalaFX for coming out of the closet!
  • #227
  • Aug 8, 2011 12:16am Aug 8, 2011 12:16am
Quoting egadsforex
Ahhhh.... now I'm beginning to understand the mentality here. Some of my younger relatives went to prison for METH.

Scavengers. Low-Lives. Maybe someday I will overcome. But meanwhile.........
meth? surely you jest. i said metho....lated... spirits. before looking at charts from now on i think i might have to go lick the petrol cap on the bike and maybe put a felt tip pen in one nostril.
Congratulations ScalaFX for coming out of the closet!
  • #228
  • Aug 8, 2011 12:28am Aug 8, 2011 12:28am
Quoting nubcake
meth? surely you jest. i said metho....lated... spirits. before looking at charts from now on i think i might have to go lick the petrol cap on the bike and maybe put a felt tip pen in one nostril.
No jesting here but great reply. Yup, I love that petrol cap on the bike but now that I'm making the bucks I'm thinking I may have to get a haircut in the next year or so.

Anyway, peace to you my brother !
  • #229
  • Aug 8, 2011 12:41am Aug 8, 2011 12:41am
Quoting egadsforex
No jesting here but great reply. Yup, I love that petrol cap on the bike but now that I'm making the bucks I'm thinking I may have to get a haircut in the next year or so.

Anyway, peace to you my brother !
going corporate then. (sellout) lol.
Congratulations ScalaFX for coming out of the closet!
  • #230
  • Aug 8, 2011 12:48am Aug 8, 2011 12:48am
Quoting nubcake
going corporate then. (sellout) lol.
Sorry... gotta do wut u gotta do. But I'm hanging in there for everyone (no politician here).

I wish myself good luck !!
  • #231
  • Aug 8, 2011 12:48am Aug 8, 2011 12:48am
Quoting egadsforex
WHAT DOES ANY OF THIS CRAP HAVE TO DO WITH THE TITLE OF THIS THREAD????
Where's the edge in trading? Become the broker.

Be realistic. Suppose a poster in another thread tells me his broker owes him $10 million in unrealised profits. I conclude his system must work well.

Now suppose one person in 100 who reads this thread succeeds in imitating his system, and 10000 people read it. That means in a year or two, his broker will owe a billion dollars to his punters. Dream on! The broker will change his rules long before that happens. He must torpedo any successful system, or else go broke.

Now said poster, being a clever chap, would understand this as well as I do. So why would he risk killing the goose that lays such golden eggs? Perhaps he's exceedingly generous. Perhaps he's a ghost writer whipping up some business. Perhaps he's just having a good laugh. I'm tempted to have a go at it myself, just to see how far I can lead the gullible. Maybe make a bet with a mate over who can get the most vouchers in the shortest time.
  • #232
  • Aug 8, 2011 1:02am Aug 8, 2011 1:02am
Quoting AllanS
Where's the edge in trading? Become the broker.

Be realistic. Suppose a poster in another thread tells me his broker owes him $10 million in unrealised profits. I conclude his system must work well.

Now suppose one person in 100 who reads this thread succeeds in imitating his system, and 10000 people read it. That means in a year or two, his broker will owe a billion dollars to his punters. Dream on! The broker will change his rules long before that happens. He must torpedo any successful system, or else go broke.

Now said poster,...
the way you talk is as though it's everyone versus brokers, when in reality it's some people versus brokers (bucket shops), and others who are simply versus others. you are heading in the direction that concludes with "you can't make money trading unless you are the broker", where clearly this is not the case. especially since brokers are not the market.
Congratulations ScalaFX for coming out of the closet!
  • #233
  • Aug 8, 2011 1:23am Aug 8, 2011 1:23am
Quoting AllanS
Put a grid, any grid, on a chart. Will the price go up or down?
The expression "go up or down" is vague and has absolutely no mathematical or statistical meaning, Allan.

Again, go back to the year 2000 (nothing to do with that crazy Conan O'Brian Show ) and each time the Euro/USD or any other currency pair makes a 50 or 100 pip move higher/lower, count how many times it makes ANOTHER 50 or 100 pip move in the same direction. Repeat that until you reach July 2011.

You will find that this probability/number exceeds 50%. This fact alone gives us an edge.
I cannot say more this is already kindergarten stuff, no offense Allan.
  • #234
  • Aug 8, 2011 1:46am Aug 8, 2011 1:46am
Quoting AllanS
Become the broker. .
Well, you can still buy FXCM shares if you like, the biggest retail Forex broker in the world I believe.

The stock is down almost 40% since January but hey, you might get lucky:
http://ycharts.com/companies/FXCM
  • #235
  • Aug 8, 2011 2:04am Aug 8, 2011 2:04am
Quoting nubcake
the way you talk is as though it's everyone versus brokers, when in reality it's some people versus brokers (bucket shops), and others who are simply versus others. you are heading in the direction that concludes with "you can't make money trading unless you are the broker", where clearly this is not the case. especially since brokers are not the market.
I was on my way to somewhere else until I read this post. I could not agree more. It has become the norm for Americans to always blame someone else for the problems that we instill on ourselves. That is why S&P downgraded American debt. There is no compromise, only finger-pointing.

If you can't trade, you blame the broker and tell the "GUV" to help you.
If you can't run a business (whatever it involves) it's the "GUV'S" fault and you must be bailed.
If you're a farmer and the market is overcrowded you must have subsidies or hell is to pay.

Do you see what is happening? There is no personal responsibility anymore. It is ALWAYS the fault of someone else. Politicians, traders, society cannot survive in that atmosphere. It's not a joke. Those of you who know history (YOUR EDGE) already know. SOMETHING must change.
  • #236
  • Aug 8, 2011 2:16am Aug 8, 2011 2:16am
Quoting egadsforex
Perhaps I did misunderstand. However, if I have a method that is earning me 20% per month, why should I (or you) not be happy? Isn't it greed that suffocates the trader/investor?

How have you overcome this factor in your trading glory?

I will just say "HUH?" because I'm really not that fluent in foreign languages.
Why should you not search for better methods? What is the problem with that?
Everywhere people are trying to achieve excellence and perfection (be it sports, production, services,...), why shouldn't we have the same standards in trading?
  • #237
  • Aug 8, 2011 2:18am Aug 8, 2011 2:18am
Quoting egadsforex
If you would take the time to actually study then you would know that FX is not a zero sum game.
interesting, why you think fx is not a zero sum game? Somebody has to lose so that somebody else can win. Actually it is even a negative sum game, cause brokers also take out their share of every transaction.
  • #238
  • Aug 8, 2011 2:26am Aug 8, 2011 2:26am
Quoting egadsforex
I was on my way to somewhere else until I read this post. I could not agree more. It has become the norm for Americans to always blame someone else for the problems that we instill on ourselves. That is why S&P downgraded American debt. There is no compromise, only finger-pointing.

If you can't trade, you blame the broker and tell the "GUV" to help you.
If you can't run a business (whatever it involves) it's the "GUV'S" fault and you must be bailed.
If you're a farmer and the market is overcrowded you must have subsidies or hell is to pay.

Do...
and then when the guv sees all of these poor helpless chaps they have excuses for more regulations, and with regulations comes fines and taxes. inflation?
Congratulations ScalaFX for coming out of the closet!
  • #239
  • Aug 8, 2011 2:26am Aug 8, 2011 2:26am
Quoting Mr Breakout
The expression "go up or down" is vague and has absolutely no mathematical or statistical meaning, Allan.
Suppose some pair is $20. Choose a grid size, say $1. Given a large sample, the probability the price will reach $21 before it reaches $19 is 50%. The chance it will reach $22 before $19 is 25%.

Quote
Again, go back to the year 2000 and each time the Euro/USD or any other currency pair makes a 50 or 100 pip move higher/lower, count how many times it makes ANOTHER 50 or 100 pip move in the same direction. Repeat that until you reach July 2011.

You will find that this probability/number exceeds 50%. This fact alone gives us an edge.

That's curve fitting.

Quote
I cannot say more this is already kindergarten stuff, no offense Allan.

No offense taken. It's your money.

Hey. Just made another $1000 demo. Up 35% this month, scalping 1M. Average time/trade maybe 20 seconds. Works a treat. Would I consider risking real money? You gotta be joking.
  • #240
  • Aug 8, 2011 2:28am Aug 8, 2011 2:28am
Quoting reres
No it hasnt. Over 150 posts here and not a single one of those angry TA traders said anything sensisble. All they said was "oh well good TA traders are hiding" or sth like "cut your losses and run your profits" ...that doesnt explain why it would work. Lagging data cannot on multiple timeframes in interrelated market cannot make any predictions. I can see why they are angry, its becouse they cannot answer the simple question. Why?
you often mention statistics. And that is also what I do day in day out, finding statistically significant patterns in the price date (which also make sense).
If I find out that after a 50 pip move, price tends to move another 30 pips 50% of the time, while not hitting my stop that is 10 pips away - isn't that also a simple form of TA combined with stats?
Each pattern you hear about actually has its stats. You just need to get the stats for yourself and then decide whether the results are good enough and consistent enough to become an edge you wanna exploit.

Well, and there is a definitely proven profitable TA trader: Marty Schwartz in market wizards.

And why does TA make sense? Sometimes it exploits a mass behavioral pattern.
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