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Technical Analysis Fallacy

  • #34,601
  • Jul 2, 2012 1:30pm Jul 2, 2012 1:30pm
Quoting eblip
everything has now changed for me in forex.

3 days ago a good trader to me was someone who could pick the good trades.

now a good trader is someone who can manage the bad trades.

regards.
Hey Eblip,

As you can see from your trade the "tools" of attack and rescue allow you to "manoeuvre" through the market managing risk in attempt to follow the "flow" of the market.

Even though your trade was against the direction and got into trouble you were able to exit with a small profit and not take any loss. I think this is the important thing, now you have another attempt with your army intact.

This is why timing is so important especially with rescues.

If you can escape the bad trades with break even or small profit and attack on the successful trades then you will be very successful, is how i see it.

And with time and practice the better you get at following flow and direction the less bad trades you will have
  • #34,602
  • Jul 2, 2012 2:09pm Jul 2, 2012 2:09pm
Quoting CindyXXXX
um... question... why is rescuing a trade so important?... Take a small loss and move on/?

Or sit at the computer for 18 hours to save .5%?

Make 10 times as much next time... ? No?

It was a question... Not a preaching...

Sounds like some ego BS to me...

Provocatively instigating provocation
Same thoughts for me. I just take the loss and move on. However I see a lot of people doing rescure and actually averaging down their position, for those novice traders, It could take them a bad trade to blown an account.

It's the whole Operation Method that's proven by people here but for novice traders, they would rarely kill their scouts because they always thought that price are seeking for the sitting ducks. Then they start to average down

Not bashing or anything because it's a proven method. I'm just saying for the newer trader applying the method of rescuing.
  • #34,603
  • Jul 2, 2012 2:16pm Jul 2, 2012 2:16pm
Quoting CindyXXXX
um... question... why is rescuing a trade so important?... Take a small loss and move on/?

Or sit at the computer for 18 hours to save .5%?

Make 10 times as much next time... ? No?

It was a question... Not a preaching...

Sounds like some ego BS to me...

Provocatively instigating provocation
Hey Cindy

it all depends on the situation and your appetite for "battle".

But at the start of this thread Fti posted this table here. http://www.forexfactory.com/showthre...=57639&page=26

"The % gain required to to come back to balance (break even) will increase gemetrically with your losses."

You often see him talk about "death by 1000 arrows" If you keep taking small losses it eventually builds up and this is not our objective if we are to make money.

It should be the mindset to avoid losses at every cost. Never should we take a loss on the account, I dont know about you but i dont want my balance to ever go down, only ever up.

There of course may be times where you have to bite the bullet and take a loss, "only a fool fights a battle he can not win". But it should be on very very rare occasions and avoided at all costs.

This is just how i see it others may see differently.

I find that if you easily prepared take a loss that it could often have been avoided in many cases if you were not so willing to lose money..

You will be surprised at how quickly your balance increases if you never let it go down

The other thing with this is that you must be very very well capitalized, keep your scout small in relation to your balance this gives you much more scope to avoid loses.
  • #34,604
  • Edited 2:52pm Jul 2, 2012 2:30pm | Edited 2:52pm
hi acs and cindy.
yes i dont ever want a loss..
plus even more beneficial is the skill in trading that comes from the battle...
that is what i want more than anything...to be an expert skillful trader.

if you just take the loss and walk away.
it reflects that maybe you have quitter mentality. or maybe dont like to get too involved.
for me ..i need to taste blood....either my own blood or the markets..before i throw in the towel.

who would you rather entrust your money to cindy ..someone who never or hardly ever has a loss and fights tooth and nail to come out on top.

or someone who maybe comes out on top maybe not...if not then better luck next time, and doesnt get their hands dirty.

but more than that fti says somewhere in the thread something along the lines of ...some traders actually make bigger wins from their rescued trades than they do from a standard winning trade....because the battle brings out adrenaline and sharpens the trader ...something like that ...those were not fti exact words..

i just remember that i could relate to it.

if you never battle...then you will only know how to pick a good trade...an average trade or a bad trade.

through battling you will forge yourself to pick better trades as it wasnt just a loss...it was a fully involved thing...you had to make sure you rescued at the correct time..you had to focus and pay serious attention....otherwise your loss could have turned catastrophic...conflict is essential to learn and grow.
do you think usaine bolt would be the fastest man on the planet if he didnt race...he competed..and the competitive spirit brought out what was necessary...possibly brought out levels that he never knew he had .

who is the better climber...the guy who climbs the sports wall in a sports centre...or the guy who climbs the rock face.

it shows you have an appetite for risk...calculated risk.
if you have no appetite for calculated risk..then maybe you will not be very successful in the end.

plus if you battle and lose...your initial starting position had better not be too big for your account otherwise you will soon be dead in the water.
it makes you conscious of money management..if you have the mindset to battle...then before every trade you must make sure you can weather several battles if necessary.

any way thats how i see it.
  • #34,605
  • Jul 2, 2012 3:54pm Jul 2, 2012 3:54pm
Quoting CindyXXXX
Suck a cock
What the hell!

I'm going to assume that the big grinning smiley indicates this in a joking manner.
  • #34,606
  • Edited 8:43pm Jul 2, 2012 7:19pm | Edited 8:43pm
Quoting eblip
thank you fti..
the markets are teaching me.

right i did my first dance a usd cad short

ready to do battle..comentary

theory is i should be able to make this trade eventually profitable no matter what happens in the near future...as long as i manage the trade properly ...i should come out pips in at the end of the day...
i may have to send in some rescue troops (orders at some stage) but by time i close this trade...should be profitable..
hopefully highly profitable..but market conditions not too hot today for big profits quickly.

entry...
finally seems there's someone learning without all the smart baggage to overcome.
There is lots more to it.
so read slowly.
think about what you read, and watch it happen as markets teach you.
there's many lessons.
Then as you learn more from markets and your experience grows, watch what you add to your education.
If what you add affects your profitability then you need drop it quickly. Revert to basics.
.
It is of paramount importance that you grow, but slowly,
as you gain experience , it all comes to you in a rush.
learn to move forward at your own pace.

was a good 1st attempt.
remember this well, the day you think you smarter than the market, your fall begins.
Trust no one, not even me.
only yourself and God.
The system is out there destroy anything that its designed to destroy.
If you fall into its sights, it will net you.
The market structure is there to defend itself, not you.

Friends you have when you squared.
In the markets , there no friend nor foes.
All pips serving only.
everyone wants the pips. everyone, no exceptions.

As you move ahead, learn deal with yourself, your scorpions.
be 1 in mind and energies. There's enemies everywhere.
but none can hurt your book but from within.

When trading, singleness in purpose.
be kind and generous, to self and the markets.

regards

Inserted Video
  • #34,607
  • Jul 2, 2012 8:41pm Jul 2, 2012 8:41pm
Quoting fti
finally seems there's someone learning without all the smart baggage to overcome.
There is lots more to it.
so read slowly.
think about what you read, and watch it happen as markets teach you.
there's many lessons.
Then as you learn more from markets and your experience grows, watch what you add to your education.
If what you add affects your profitability then you need drop it quickly. Revert to basics.
.
It is of paramount importance that you grow, but slowly,
as you gain experience , it all comes to you in a rush.
learn to move forward at your...
Then as you learn more from markets and your experience grows, watch what you add to your education.
If what you add affects your profitability then you need drop it quickly. Revert to basics.
.
remember this well, the day you think you smarter than the market, your fall begins.
Trust no one, not even me.
only yourself and God.

Friends you have when you squared.
In the markets , there no friend nor foes.
All pips serving only.
everyone wants the pips. everyone, no exceptions.

As you move ahead, learn deal with yourself, your scorpions.
be 1 in mind and spirit. There's enemies everywhere.
but none can hurt your book like yourself.
--------------------------------------------------------------------------------------------------------------------------------------------------------------------------

ya ya ya,,,
these word is very fit to me

it's all I have experienced in forex trading and in real life

thank you my friend
regards

ps; ;;;;;;;;; you not just good in trading but good in wisdom of life ;;;;;;;;;;;;
  • #34,608
  • Edited 9:04pm Jul 2, 2012 8:47pm | Edited 9:04pm
Quoting sumakianlee
.

ya ya ya,,,
these word is very fit to me

it's all I have experienced in forex trading and in real life

thank you my friend
regards
thank you , bro. you're too kind.
sold any of your china goods yet?
everyone's made some $$ already from manufacturing to shipping to.......taxed.
make sure you get yours . lion's share?


regards
  • #34,609
  • Jul 2, 2012 9:14pm Jul 2, 2012 9:14pm
Quoting fti
finally seems there's someone learning without all the smart baggage to overcome.
There is lots more to it.
so read slowly.
think about what you read, and watch it happen as markets teach you.
there's many lessons.
Then as you learn more from markets and your experience grows, watch what you add to your education.
If what you add affects your profitability then you need drop it quickly. Revert to basics.
.
It is of paramount importance that you grow, but slowly,
as you gain experience , it all comes to you in a rush.
learn to move forward at your...
Awsome! Great job eblip!

I don't know how long you have been reading the thread, but if you can get Fti's attention in 16 post's...You're kickin ass in my book.

Keep on keepin on!!!!!!!!
  • #34,610
  • Edited 10:08pm Jul 2, 2012 9:53pm | Edited 10:08pm
Quoting eblip
thank you fti..
the markets are teaching me.

right i did my first dance a usd cad short

ready to do battle..comentary

theory is i should be able to make this trade eventually profitable no matter what happens in the near future...as long as i manage the trade properly ...i should come out pips in at the end of the day...
i may have to send in some rescue troops (orders at some stage) but by time i close this trade...should be profitable..
hopefully highly profitable..but market conditions not too hot today for big profits.

entry...
now that i have some strength , i like make some commentary about the trade you made.

1. you traded aginst the trend.
is very evident you trading against a triple bottom.
at every turn you can see that triple bottom coming into form.

is very dangerouse trade against trend, however you mm survived you this time.
But be wary to tempt fate.

2. the meat will be in building the scout trendwards, after you had managed to salvage the rescue.
But is your 1st attempt to dance, so i shall not say too much about that.

but remember not chase a shooting rocket or catch a falling knife next time.
the up move will not be in 1 wave so you have plenty opportunities ambush a kill.

Mostly is better be a little late than too early in the runs.then you avoid the your pain threshold being screwed to tight.
only be aggressive when on wind in a run.
Be wary 70% of the time the run will not materialise or it may be too fast, to well position your cost.

regards
Attached Image
  • #34,611
  • Jul 2, 2012 10:06pm Jul 2, 2012 10:06pm
Quoting eblip
a good trader is someone who can manage the bad trades.
Ok. You send in a rescue x5 at an obvious resistance, but the price doesn't retrace. Bugger! 50 pips later, you send in a rescue x20 and it still doesn't retrace! F@#K! F@#K! F@#K! Your account is 25% underwater! A giant octopus is grabbing your leg. What will you do?

This is how I see it. If I can average 0.1% every day, that's 28% pa, a stunning return, better than Mr Buffett himself. But most days I make more than 0.1%, easily, with very little apparent risk. The difference between my 0.1% compounding target and my accumulated profit is the amount I'm prepared to lose.

After one month, if I need $100 profit to be on target and have made $300 from my stellar trading, I'm prepared to lose $200. After 2 months and $700 profit, I now have a $500 buffer. ie. The better I trade, the bigger the buffer, and the harder it will be to ever lose (unless, of course, I listen to ego, get greedy and increase my % target.)

Speaking of risk, I'm increasingly aware of the chance of black swan events. No matter how good you are, if you trade big aiming for a few percent every day, you will be torpedoed sooner or later when the market misbehaves. San Francisco or Tokyo earthquake. Another Twin Towers. President assassinated. Nuclear meltdown. Tsunami. Enron. The grim list is long...
  • #34,612
  • Edited 10:31pm Jul 2, 2012 10:11pm | Edited 10:31pm
Quoting AllanS
Ok. You send in a rescue x5 at an obvious resistance, but the price doesn't retrace. Bugger! 50 pips later, you send in a rescue x20 and it still doesn't retrace! F@#K! F@#K! F@#K! Your account is 25% underwater! A giant octopus is grabbing your leg. What will you do?

This is how I see it. If I can average 0.1% every day, that's 28% pa, a stunning return, better than Mr Buffett himself. But most days I make more than 0.1%, easily, with very little apparent risk. The difference between my 0.1% compounding target and my accumulated profit...
sure my friend.
feeling like ejecting from a good airplane. But yours is already on fire.

but your 1st mistake is overtrading if yout drawdown can eat you 25% in 1 drinkhole.
re strategise your MM. get the scout right.

and please no tell me about your undercapitalisation, thank you.
You can't make a phone call with 9 cents.
In treasury terms is know as foreign cap risk.
In BIG BOYs terms, country's foreign reserves.
But is not for countries who are in foreign debt.

Black swan days, tsunamis? i just love those days.
When i babysitting, i have capacity turn on wind in the blink of an eye.
Worst case i scalp the ranges to their demise.


regards
  • #34,613
  • Jul 2, 2012 10:14pm Jul 2, 2012 10:14pm
Quoting AllanS
Ok. You send in a rescue x5 at an obvious resistance, but the price doesn't retrace. Bugger! 50 pips later, you send in a rescue x20 and it still doesn't retrace! F@#K! F@#K! F@#K! Your account is 25% underwater! A giant octopus is grabbing your leg. What will you do?

This is how I see it. If I can average 0.1% every day, that's 28% pa, a stunning return, better than Mr Buffett himself. But most days I make more than 0.1%, easily, with very little apparent risk. The difference between my 0.1% compounding target and my accumulated profit...
yes alans...i understand your concern..

but price HAS TO retrace at some point...even if just a little.
if you show me a chart where price never retraces...i will change my view..
but i have never seen that yet.

even if i was wrong with trend..which in this case i was..
on the next retrace i would have put in 10 units just to get maybe 3 pips each and i would still be within my limits of what i am prepared to lose...then i may cut my losses as it would be clear i was going against the wind...and look for next trade.

but i see your point of view and it is valid...and no doubt sounds like its working for you..
but that is not my personality...i have to be true to myself...
i make my bed...and am prepared to lie on it.

thanks for your advice though...i always listen to anyone who can teach...and take what i need.
  • #34,614
  • Jul 2, 2012 10:20pm Jul 2, 2012 10:20pm
Quoting fti
now that i have some strength , i like make some commentary about the trade you made.

1. you traded aginst the trend.
is very evident you trading against a triple bottom.
at every turn you can see that triple bottom coming into form.

is very dangerouse trade against trend, however you mm survived you this time.
But be wary to tempt fate.
yes i did trade against trend..at the time i thought i was trading with the trend...because hourly chart looked like it was heading downwards..

now when i look at hourly chart it looks like higher highs...and lower lows...so i need to focus on reading trend correctly.

reason i did it was because before i entered the trade it was double bottom, and it looked like price attempting tripple bottom with conviction..i thought bottom will not hold for third time...and put scout in to get strong position on breakthrough at the third attempt at the bottom.

but this never happend....and i got out luckily.

i am learning about candle formations as we speak ..so hopefully this will help...then onto basic waves...to help also

thank you for your advice fti ...i take it extremely seriously.
as i am deadly serious about this business...i am not messing about here.
i am lucky to have found this thread.

and i am honoured to follow your guidance.
  • #34,615
  • Jul 2, 2012 10:21pm Jul 2, 2012 10:21pm
Hi fti,

Referring to the "time window" in the chart above. Is that just a turn of phrase meaning "look carefully here". The price could sit for hours on support, bounce right off, fall right through, or dither about. Each would tell me something.
  • #34,616
  • Jul 2, 2012 10:26pm Jul 2, 2012 10:26pm
Quoting AllanS
Hi fti,

Referring to the "time window" in the chart above. Is that just a turn of phrase meaning "look carefully here". The price could sit for hours on support, bounce right off, fall right through, or dither about. Each would tell me something.
ok look carefully there, if it suits.
so they rub your balls with time.
and drawing more and more of my army mobilise,
whats the big deal, i got balls of steel.

Look carefully, time window has a safety valve, the gap vacuum.
If one cannot take risk with such a safety , then one cannot take risk trading at all.
Sure sometime it fails.but ok take the 3 to 5% of my foreign cap , no big deal.


regards
  • #34,617
  • Jul 2, 2012 10:28pm Jul 2, 2012 10:28pm
Quoting fti
and please no tell me about your undercapitalisation, thank you.
Hey! Here's your chance to invest some of your hard-earned into my new company: AllanS HyperTrading PtyLtd. Satisfaction guaranteed. Plus a set of steak knives.

Inserted Video
  • #34,618
  • Jul 2, 2012 10:34pm Jul 2, 2012 10:34pm
Quoting eblip
yes i did trade against trend..at the time i thought i was trading with the trend...because hourly chart looked like it was heading downwards..
???
after seeing markets gap away in vacuum?

respect the market, they not stupid yu know.
They already scrambled like seen a ghost and gapped away.


regards
  • #34,619
  • Edited 10:57pm Jul 2, 2012 10:37pm | Edited 10:57pm
Quoting AllanS
Hey! Here's your chance to invest some of your hard-earned into my new company: AllanS HyperTrading PtyLtd. Satisfaction guaranteed. Plus a set of steak knives.

http://www.youtube.com/watch?v=npjOSLCR2hE
no IPO?

steak knifes.
to do what, perform seppuku?

regards

stiff parrots?
oh bly me
carryon old chappy.

Inserted Video
  • #34,620
  • Jul 2, 2012 10:55pm Jul 2, 2012 10:55pm
It's not dead. Just resting.
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