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  • #461
  • Dec 20, 2011 8:52pm Dec 20, 2011 8:52pm
Quoting Chicky
Trade# 57 Entered. Long for 100 pips
Entered Trade #58 few hours ago. Long for 100 pips.

Trade#57 and #58 running.
Attached Image (click to enlarge)
Click to Enlarge Name: 57.jpg Size: 138 KB
The Thief of Wall Street
  • #462
  • Dec 21, 2011 11:36pm Dec 21, 2011 11:36pm
Quoting Chicky
Entered Trade #58 few hours ago. Long for 100 pips.

Trade#57 and #58 running.
Trade# 57. Running
Trade# 58 concluded. 1%
Trade# 59 entered. Long for 160 pips

Trade#59 is last of the 2 trade set-ups. No matter what is the outcome of these two trades, will switch back to "One trade at a time" policy.
Attached Image (click to enlarge)
Click to Enlarge Name: 58.jpg Size: 119 KB
The Thief of Wall Street
  • #463
  • Dec 22, 2011 8:23pm Dec 22, 2011 8:23pm
Quoting Chicky
Trade# 57. Running
Trade# 58 concluded. 1%
Trade# 59 entered. Long for 160 pips

Trade#59 is last of the 2 trade set-ups. No matter what is the outcome of these two trades, will switch back to "One trade at a time" policy.
Trade# 57. Hit SL. Loss 1%
Trade# 59. Running
Attached Image (click to enlarge)
Click to Enlarge Name: 59.jpg Size: 133 KB
The Thief of Wall Street
  • #464
  • Dec 22, 2011 9:22pm Dec 22, 2011 9:22pm
Quoting Chicky
Post 1 of 4: The first and foremost lesson learned is to Have an Edge.

The edge means a “Method” or a “Result of Analysis” that puts traders in advantageous position in such a way that odds are in their favor if their analysis is right or their method is sound.

[color=black]An edge can be a conclusion regarding market’s future direction after analyzing fundamentals or it can be a technical method that is likely to yield profit over a certain number of trades. The profit is net result...
100% right, have an edge.

An Edge does not in anyway mean an exclusive abstruse methodology or esoteric privileged information for an elite class of Speculators that once discovered will open the paths to the mythical riches of the Foreign Exchange Market.
In my Research I have found that we constitute 10% approximately of total market share and the 95% of failure rate is actually not entirely truth.
Retail Forex is found to be dominated by Uninformed Market participants, and Over leveraged practices that lead to the demise of 52% of Oanda 2011 retail accounts.
other Brokers report <5,000 account profit rate to be averaged of 20% and >10,000 reported profitable retail account to be averaged of 47%.

The edge simply comes from, what works in the Market, and your EDGE MUST INCLUDE Money Management.

I personally derive my Edge from Analysis of the Security in question taking into account, correlated markets, macro economics, and chart reading skills. Research on structure, brokers, mathematical theories that take into account similar market conditions i.e stochastic process, time series analysis, statistics, random sampling distribution, market micro and macro structure theories....among other factors (not hidden knowledge just too lazy to site here like knowledge of traditional T.A etc)

having said all that, Chicky where I find it particularly challenging is not the analysis part of the Market, is the Risk Management Part.
how much % risk to expected % gain.

and i believe you where alluding to that in some of the points you make.
there is a finite number of tries before one puts ones self in disadvantage if a stop is hit at 15pips, 20 pips, and now you are re attempting re entry you need to overcome -35pips to make this trade profitable.

fti advocates a no stop, average down theory, however take your loss if you are against trend. Which leads to an increased commitment to a bad position, snowball of loss, and the dilemma that figuring out you are against trend is harder when badly committed.

others like nanningbob use the counter trend, small leverage, range trade, which then has a hidden opportunity cost and profit cap.

however if you let that breathe by entering with a wide stop let say away from ATR, then you risk a > loss potential.

then also new traders including myself at the beginning have the dilemma of position sizing. Including the wrongful use of leverage.

so then the money management techniques should be given equal study as the analysis techniques which i do not see this being done too often in FF. Everyone is interested in FIGURING out the market that they FAIL TO REALIZE that MONEY MANAGEMENT IS PART OF THE EDGE.
AVT INVENIAM VIAM AVT FACIAM
  • #465
  • Dec 22, 2011 9:44pm Dec 22, 2011 9:44pm
I was reading further on your theories, and i agree with you on all counts.

the chart is nothing but recorded transactions
fundamentals is nothing but present environment.

if you find a way to understand the present environment, and are able to consequently run an assessment on the current transaction record => profit potential.

however with the premise that the chart is nothing but a transaction record, then it will record new transaction as they come along, with information that you might not know about.

hence the logic behind Risk management and position sizing that you put forth is very solid.

in effect your lessons learned are lessons that all of us painfully learn, and everything we hear becomes clear. It is a business, and needs to be treated with professionalism, not with wild expectations of profit, there is many ways to make business, but many business fail.

to add to the already enlightening post i can tell you that the Market more often than not acts according to the laws of motion

lex I
Corpus omne perseverare in statu suo quiescendi vel movendi uniformiter in directum, nisi quatenus a viribus impressis cogitur statum illum mutare.

Lex II
Mutationem motus proportionalem esse vi motrici impressae, et fieri secundum lineam rectam qua vis illa imprimitur.

Lex III
Actioni contrariam semper et ćqualem esse reactionem: sive corporum duorum actiones in se mutuo semper esse ćquales et in partes contrarias dirigi.

which I used to fail to see, attempting to pick tops and bottoms, predicting where the market will be. etc. and failing to see the Forces that are clearly imprinted in the Chart.

you do not have to buy low and sell high
you can also buy high and sell higher
AVT INVENIAM VIAM AVT FACIAM
  • #466
  • Dec 22, 2011 11:06pm Dec 22, 2011 11:06pm
Quoting the redlion
100% right, have an edge.

An Edge does not in anyway mean an exclusive abstruse methodology or esoteric privileged information for an elite class of Speculators that once discovered will open the paths to the mythical riches of the Foreign Exchange Market.
In my Research I have found that we constitute 10% approximately of total market share and the 95% of failure rate is actually not entirely truth.
Retail Forex is found to be dominated by Uninformed Market participants, and Over leveraged practices that lead to the demise of 52% of Oanda 2011...
Thanks for your contribution Red.

You discussed several interesting points, all of them very valid and pertinent. I would just like to add that:

1. Many do not relate thier risk per trade with their method's win/loss ratio of trades, a basic Money Management mistake. With 60:40 win ratio of my system, I take not more than 1% risk per trade knowing that there can be 40 consecutive losses. Like you mentioned there is a limit to how much one can afford to lose (Finite Number of Tries). That puts my trades within the definition of calculated risk.

2. I am very happy you mentioned about people risking few pips for many pip return and hitting their sls several times before they finally aboard a trade of thier choice. Theoretically, if this practice is consistently applied should produce results equal to what a tectic of setting TP and SL at equal distance from entry produces. However, difficult to apply. It requires a lot of screen time and seamless execution. Equal risk/reward menthod saves this time, effort and stress.

3. Money management is essential part of trading. Only a fool is expected to disagree with this statement but when it comes to practice, I too sometimes get carried away but not too far.

4. There are so many systems that provide more than 50% winning chance but like you said it is Money Management that is less stressed upon.
The Thief of Wall Street
  • #467
  • Dec 22, 2011 11:20pm Dec 22, 2011 11:20pm
Quoting Chicky
Thanks for your contribution Red.

You discussed several interesting points, all of them very valid and pertinent. I would just like to add that:

1. Many do not relate thier risk per trade with their method's win/loss ratio of trades, a basic Money Management mistake. With 60:40 win ratio of my system, I take not more than 1% risk per trade knowing that there can be 40 consecutive losses. Like you mentioned there is a limit to how much one can afford to lose (Finite Number of Tries). That puts my trades within the definition of calculated...
makes sense, to correlate % risk to performance record, that would give a better picture of your overall VAR, according to average draw down.
AVT INVENIAM VIAM AVT FACIAM
  • #468
  • Dec 22, 2011 11:24pm Dec 22, 2011 11:24pm
thanks for this discussion Chicky

you gave me an idea

so then VAR+Monthly ATR, you can find a way to calculate realistic ROI target
which in turn you can derive ideal account size taking this values into account in order for you to trade for a living within reasonable risk parameters
AVT INVENIAM VIAM AVT FACIAM
  • #469
  • Dec 23, 2011 12:23am Dec 23, 2011 12:23am
Quoting the redlion
thanks for this discussion Chicky

you gave me an idea

so then VAR+Monthly ATR, you can find a way to calculate realistic ROI target
which in turn you can derive ideal account size taking this values into account in order for you to trade for a living within reasonable risk parameters
Definitely. If one strictly follows the trading method and Money Management rules. ROI should be based on realistic risk/reward target per trade PLUS achievable number of trades per year.
The Thief of Wall Street
  • #470
  • Dec 23, 2011 12:36am Dec 23, 2011 12:36am
Quoting Chicky
Definitely. If one strictly follows the trading method and Money Management rules. ROI should be based on realistic risk/reward target per trade PLUS achievable number of trades per year.
chicky in your opinion, the use of TP is it just to rough out the human intentiosn of wanting more and fearing of losing profit into an already planned ROI plan aka a set Level = TP order.

is that why you use TP? to stay as precise to ur plan?
Have I got something on my face, SOLDIER?
  • #471
  • Dec 23, 2011 12:58am Dec 23, 2011 12:58am
Quoting bumapatria
chicky in your opinion, the use of TP is it just to rough out the human intentiosn of wanting more and fearing of losing profit into an already planned ROI plan aka a set Level = TP order.

is that why you use TP? to stay as precise to ur plan?
There may be many differing opinions on this. However, I am not concerned with others. I use definite TPs and SLs in most of my trades for few basic reasons.

1. Currencies tend to keep price balance. If I don't take profit, it may come back to my entry or close to it, washing away all my profit or atleast significant part of it.

2. Many of my trades are based on bounce expectations and estimate of their sizes. Therefore my profit is mostly because of temporary price fluctuations at high interest points for both bulls and bears. I have no choice but to take profit before pa resumes trend or embarks upon a new trend.

3. I many times try to judge where price would hang around before breaking a support/resistance. Once it gets there, I am out. For example, if Euro/USD hangs around at this level, it would hang around between 1.3000 and 1.3250. Once it crosses 1.3200, I would take profit and will take chance of a bounce from 1.3250.

4. My method is based on many small moves and not one big move. I have to collect many petty profits and pay small losses to the market in order to implement this system.
The Thief of Wall Street
  • #472
  • Dec 23, 2011 1:04am Dec 23, 2011 1:04am
Quoting Chicky
There may be many differing opinions on this. However, I am not concerned with others. I use definite TPs and SLs in most of my trades for few basic reasons.

1. Currencies tend to keep price balance. If I don't take profit, it may come back to my entry or close to it, washing away all my profit or atleast significant part of it.

2. Many of my trades are based on bounce expectations and estimate of their sizes. Therefore my profit is mostly because of temporary price fluctuations at high interest points for both bulls and bears. I have no choice...
you have several good points there... thank you for the clarification.
all the success to your upcoming trades!
Have I got something on my face, SOLDIER?
  • #473
  • Dec 23, 2011 1:17am Dec 23, 2011 1:17am
Quoting the redlion
makes sense, to correlate % risk to performance record, that would give a better picture of your overall VAR, according to average draw down.
Which part of Vietnam?

Been to Hanoi and Quang Tri. ............... That train ride and puppet show are great. Miss coffees by Hanoi lakes.
The Thief of Wall Street
  • #474
  • Dec 23, 2011 1:40am Dec 23, 2011 1:40am
not sure i understand what you mean chicky

vietnam?

never been there.

by the quote you mean VAR Value At Risk?

or my signature?

AVT INVENIAM VIAM AVT FACIAM
either i will find a way or make one----Hannibal when told there was no way he could cross the alps with his massive army and elephants

i was born well after the Vietnam war,
AVT INVENIAM VIAM AVT FACIAM
  • #475
  • Dec 23, 2011 1:51am Dec 23, 2011 1:51am
Quoting the redlion
not sure i understand what you mean chicky

vietnam?

never been there.

by the quote you mean VAR Value At Risk?

or my signature?

AVT INVENIAM VIAM AVT FACIAM
either i will find a way or make one----Hannibal when told there was no way he could cross the alps with his massive army and elephants

i was born well after the Vietnam war,
LOL. I read it as Vietnam.

One more LOL. Not everyone goes there or anywhere else to wage a war. I went there for some other reason........decades after the war.

OK. now I noticed some familiar characters in your avatar line. What about Greece? Athens? I miss those Omonia-Acropolis walk and all those Brizolas and Ouzo 12 (Duo Deca)
The Thief of Wall Street
  • #476
  • Dec 23, 2011 1:58am Dec 23, 2011 1:58am
i was wondering if it was a chciky joke but inevere quite got it
Have I got something on my face, SOLDIER?
  • #477
  • Dec 23, 2011 1:59am Dec 23, 2011 1:59am
Quoting Chicky
LOL. I read it as Vietnam.

One more LOL. Not everyone goes there or anywhere else to wage a war. I went there for some other reason........decades after the war.
hahahahaha

nowadays with our country people should be wary of seeing an American in any country............either we are trying to find a reason, we are coming up with a plan or we are there to bomb

all this rhetoric now, building up the war propaganda to bomb Iran.

AVT INVENIAM VIAM AVT FACIAM
  • #478
  • Dec 23, 2011 2:01am Dec 23, 2011 2:01am
Quoting Chicky
LOL. I read it as Vietnam.

One more LOL. Not everyone goes there or anywhere else to wage a war. I went there for some other reason........decades after the war.

OK. now I noticed some familiar characters in your avatar line. What about Greece? Athens? I miss those Omonia-Acropolis walk and all those Brizolas and Ouzo 12 (Duo Deca)
oh yes..........beautiful Greece

it's classical Greek
an Archimedes quote
" give me a place to stand, and i shall move the world"
AVT INVENIAM VIAM AVT FACIAM
  • #479
  • Dec 23, 2011 2:10am Dec 23, 2011 2:10am
Quoting the redlion
oh yes..........beautiful Greece

it's classical Greek
an Archimedes quote
" give me a place to stand, and i shall move the world"
Tried after more than 30 years. It reads something like "Zos Moi Pou Sto.........." but not sure ........ Signo Me Para Kalo.
The Thief of Wall Street
  • #480
  • Dec 23, 2011 2:12am Dec 23, 2011 2:12am
Off to bed. Broke my back in the gym today. Cannot sit anymore.
The Thief of Wall Street
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