Ive been doing mostly other things for a while. Ive been placing some trades though every now and then. And i had the idea that i would post about what ive been up to. I think its fair to say that what im about to tell is nothing for beginners. By that i mean you really need a lot of screen time if you are going to trade, any which way you decide to trade. Also to be fair i need to say that the trades im placing here is backed by my old statistics and a sort of higher TF trading. From factual statistics i now know that at reasonable risk, i can generate about 0.5% profit a day on average, in any given bank day in England. If i go at it a bit more aggressive and if im attentive i get maybe 1% and if i fail maybe i go - 0.5%. The worst case scenario is to loose 100%, but the probability of that happening once before 2013 is around .2 to .5. The exact time of doubling the money is not that important, but it takes around 140 bank days of trading before x becomes 2x.
For this kind of trading it takes 10 hours of work every bank day and at least 100.000 dollars to generate a decent income while also adding to the account (100.000 x0.05=500). 500 bucks a day and then you need a place to stay and maybe some brushes for painting and you need to fix your car and you need a bit of doe for new carpets in the kitchen and whatnot. So you need a couple of hundred bucks a day, but if you withdraw that money you wont double the account in about 140 days. So preferably you have the 100.000 dollars AND what ever you need to live for at least a year.
To me a beginner would never want to place a trade with a stoploss of 700 pip, and take a profit at 2. I guess thats one of the reasons why a beginner wont make profits at all. If i see that i have to take 2 pips of profit, rather then maybe get a loss on that position, i close that down. Ive tried doing it differently over and over again, and it just doesnt work. Well anyway the stoploss i use for these trades are 700, but thats only something i would use as a last resort, its never happend that i get a loss like that. Also stoploss is a function of what kind of thinking was in the trade. A decent profit is about 5 pips, a good profit is above 10. Sometimes i leave positions for a longer time at maybe TP of 50 or so, but mostly i dont want to do that.
I need to say something about systems also. What im talking about here is not mechanical, its mostly just experience and analysis.
When it comes to closing a position experience is maybe the most important thing, experience of a general kind. Its not sufficient to be good at support and resistance estimations, its not sufficient to be good at statistics, its not sufficient to be good at knowing how the banks operate.
Often when i trade i trade both ways, both on trend and countertrend. I often hedge my positions to take a low TF profit for one way while still holding unto the opposite positions for higher TF. This sort of behaviour generates something like 50-100 closed positions a day.
I use H4 with the given template to analyze, and i have the tough, big S/R in there to show whats going on and i can see whats happend in a couple of days. The keltnerchannel on H4 show conditions for "sort of sold a lot" and "sort of bought a lot".
My good old fashioned M1 template is pretty much the same ive been using for a long time now. Ive got my envelopes that has pretty much the same function as the keltnerchannel on H4, and then i have my old friend the EMA 21. For this edition i also use EMA 89.
I analyze the situation on H4 with regards to S/R ad the channel. Then if its seems like a good idea at the time when price gets back to EMA 21 in a protrend opurtunity, or at the envelopes in a contertrend opurtunity, i go in. It may seem simple, but ive never done anything as hard as trading. Im not going to write a book about this, but i could, so this little posts pretty much dont explain much at all, but maybe someone will get some sort of idea that can move them along the way to take some of the banks money.
Well anyway i finally want to say this: To me this is the best way of trading. Other things ive read is mostly bullshit. A few people, and i really mean A FEW people ive met or at least communicated actually knows a thing or two about trading. It takes a lot of hard work and its not simple at all. Most people dont have the tenacity to get good enough, they just want to get rich fast.
Now for the pictures with explanations.
For this kind of trading it takes 10 hours of work every bank day and at least 100.000 dollars to generate a decent income while also adding to the account (100.000 x0.05=500). 500 bucks a day and then you need a place to stay and maybe some brushes for painting and you need to fix your car and you need a bit of doe for new carpets in the kitchen and whatnot. So you need a couple of hundred bucks a day, but if you withdraw that money you wont double the account in about 140 days. So preferably you have the 100.000 dollars AND what ever you need to live for at least a year.
To me a beginner would never want to place a trade with a stoploss of 700 pip, and take a profit at 2. I guess thats one of the reasons why a beginner wont make profits at all. If i see that i have to take 2 pips of profit, rather then maybe get a loss on that position, i close that down. Ive tried doing it differently over and over again, and it just doesnt work. Well anyway the stoploss i use for these trades are 700, but thats only something i would use as a last resort, its never happend that i get a loss like that. Also stoploss is a function of what kind of thinking was in the trade. A decent profit is about 5 pips, a good profit is above 10. Sometimes i leave positions for a longer time at maybe TP of 50 or so, but mostly i dont want to do that.
I need to say something about systems also. What im talking about here is not mechanical, its mostly just experience and analysis.
When it comes to closing a position experience is maybe the most important thing, experience of a general kind. Its not sufficient to be good at support and resistance estimations, its not sufficient to be good at statistics, its not sufficient to be good at knowing how the banks operate.
Often when i trade i trade both ways, both on trend and countertrend. I often hedge my positions to take a low TF profit for one way while still holding unto the opposite positions for higher TF. This sort of behaviour generates something like 50-100 closed positions a day.
I use H4 with the given template to analyze, and i have the tough, big S/R in there to show whats going on and i can see whats happend in a couple of days. The keltnerchannel on H4 show conditions for "sort of sold a lot" and "sort of bought a lot".
My good old fashioned M1 template is pretty much the same ive been using for a long time now. Ive got my envelopes that has pretty much the same function as the keltnerchannel on H4, and then i have my old friend the EMA 21. For this edition i also use EMA 89.
I analyze the situation on H4 with regards to S/R ad the channel. Then if its seems like a good idea at the time when price gets back to EMA 21 in a protrend opurtunity, or at the envelopes in a contertrend opurtunity, i go in. It may seem simple, but ive never done anything as hard as trading. Im not going to write a book about this, but i could, so this little posts pretty much dont explain much at all, but maybe someone will get some sort of idea that can move them along the way to take some of the banks money.
Well anyway i finally want to say this: To me this is the best way of trading. Other things ive read is mostly bullshit. A few people, and i really mean A FEW people ive met or at least communicated actually knows a thing or two about trading. It takes a lot of hard work and its not simple at all. Most people dont have the tenacity to get good enough, they just want to get rich fast.
Now for the pictures with explanations.
My signature is: "Classified".
