The Subprime to the ridiculous.

Here is another go at journalizing the insanity.....(insolvency).

Last time I thought I'd post some trades, but then I realized I didn't know how to. Trade that is, not post on the forum.

So this thread will contain the bemused ramblings, of yet another fearless Grail searcher, and like the brave Sir Robin I may be liable to piss my pants and run away. Without further notice.

So Without further ado.........

Question:

What kind of person would do this?

1. Look at a price chart (euro) and open a short position.
Looks ok, after all we're below 4700, he thinks.

2. Proceed to add to the position when it moves 10 pips against him.
Calm down, the first one was only half a position. Phewww.

3. Well, It moves against him some more.
Well a partial hedge back to 700, now theres an idea.But wait that was not part of the plan.

4. Aussie news out in a bit, golds ridin' high, lets take a look sports fans.
So long the Aussie, lookin for a break to the upside. Now were really deep in the joojoo, chasin' the train.

5. Hold on..................net position; short EUR/AUD.

6. Oh bugger I don't do EUR/AUD what a mess!

Answer..... ME.

Good job EUR/AUD looks weak, support is looming though, a nice break to the downside and we're in the money.

Don't worry its only pocket change, but at this rate it always will be.


More from our intrepid adventurer soon......

I was up 75 pips from 2 trades by monday night. Gave back 59 trying to play the Yen range, chasing a bounce which had already happened. Got back 11 on the spike above the range.

So I'm 29 pips up for the week on balance (including +ve swap).

So why go and piss about? As we speak the floating loss is 66 pips. For no good reason whatsoever.

How to maintain consistency from now on?
Some rules methinks.............................

1. Although I never over-expose myself (well not (often) in public) my trades all carry slightly different risk. Henceforth all entries will be normalized using diligent position sizing, relating to the required stop size for each trade. If the stop exceeds parameters, the trade will not be executed!

2. My market analysis is based on candlestick analysis. Therefore all
trades will be executed at the close of a candle and not before!

3. The time frames I will use are D1, H4 and H1. other time frames will not be consulted!

4.For each positive month I will add £250 to my account, as long as all the above rules are adhered to.

5.Further rules may be added at any juncture. However the above rules may not be omitted.

Starting Balance: $962.92. (alas it was once $1000).

Oh and heres my chart setup;

If anyone happens to catch me playing with any other squiggly lines then please tell me off. I know they're useless, but they do look pretty.

As we know one mans range is another mans trend is another mans range... However if we can define a clearly visible range then surely the value of 00 and 50 numbers, to a lesser extent, is increased.

I would assume that in ranging market trend traders are out of the picture therefore those setting specific targets for their trades would hold sway.

Marks and Spencer.
Results

to May '05 to May '06 to May '07 As reported earnings £0m £0m £0m Dividend 11.7p 12.3p 15.5p Earnings Per Share 17.4p 31p 38.5p Pre Tax Profit £505.1m £745.7m £936.7m Turnover £7490.5m £7797.7m £8588.1m

Increasing dividend, almost double profits on increased turnover. Yet the shares drop 20%, as the directors are buying.
Is this value? I would think so.

So we reached the end of the month lets see what divine favours the trading Gods have bestowed.

This would have been a positive month if had had managed to keep from being trigger happy on the Euro.

Lets take a look at the equity curve;

As we can see this little cock up looks delightful, somewhat like the north face of the Eiger, in equity form.

Thankfully though after some much needed conservative trading some of the damage has been restored, with + 78 pis collected this week.

Lets see if the trigger finger can keep from itching for the month ahead.

Bon Voyage to all.

I have decided to revive this journal. In the past few months I have not really been paying attention to the markets.

I hadn't made any losses or gains but was disillusioned by the lack of progress I saw in my trading method. I will use the next few posts to review what I "know" about trading and how it should inform my methodology.

R:R

As we all know, profit and loss is dictated by the simple relationship;

(% profitable trades x R:R) - spread.

Therefore if the markets exhibited entirely random bhaviour we would experience a profit rate of 50% when targeting a 1:1 risk to reward ratio. In this case we would eventually be wiped out by trading costs.
This observation shows that we place ourselves at an advantage when trading markets with the lowest spread : range ratio. As well as finding the cheapest broker!

Timeframes

To make trading profit we must then assume that pricing is not entirely random and that price fluctuation can be quantified and then systematically exploited.
It follows logically that a technical system based on chart patterns, indicators, statistical observations etc should be scalable to any time frame. However at small resolutions the spread constitutes a prohibitive proportion of potential profits . (Now thats alliteration folks.)

For example a 1000 period ATR for EUR/USD is 16 pips on the 15 minute charts. Thus a spread of 2 pips represents 12.5% of the ATR. The ATR1000 rises to 54 pips on the 4hr charts. In this case a 2 pip spread only constitutes 3.7% of the ATR.
This simpe observation shows how punitive trading costs become for short term and scalping systems.

In light of the above we wish to create a method which trades 4hr or greater time frames. Also if we can achieve a R:R greater than 1 we afford ourselves the ability to profit less than 50% of the time and still be succesful in the longterm.

http://bloom.bg/yGhru1#ooid=x2eGxpMz...IyqSBTWatg9bhe