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Amazing Black Magic Trading Method

  • #221
  • Jul 30, 2012 1:26pm Jul 30, 2012 1:26pm
Quoting almo
I have to disagree Chicky.

MM is what saves your ass when your wrong.

Trend Direction is what puts you on the right foot to begin with, assuming you did your homework.


As a better trader than I once said

"When you know what the trend is, it doesn't matter where you get in "
I agree. Let me repeat what I said earlier:

What I really learned from the experience is that being right or wrong on trend direction does not matter as much as money management does.

Never said direction doesn't matter.

The Thief of Wall Street
  • #222
  • Jul 31, 2012 10:35pm Jul 31, 2012 10:35pm
Added 1/2 more lot to longs. Now operating at full capacity (3.15 lots).

I think it is now staying above 1.2250. Let's see if it does. If it goes under, will close major part of this long position.
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The Thief of Wall Street
  • #223
  • Aug 2, 2012 4:38pm Aug 2, 2012 4:38pm
Quoting Chicky
Added 1/2 more lot to longs. Now operating at full capacity (3.15 lots).

I think it is now staying above 1.2250. Let's see if it does. If it goes under, will close major part of this long position.
I can speak only one word "SHIT"
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The Thief of Wall Street
  • #224
  • Aug 2, 2012 9:44pm Aug 2, 2012 9:44pm
Quoting Chicky
I can speak only one word "SHIT"
Im a science student, but my business teach told me that a lot of trader lost money on the past few months. We can all guess that these trader are longterm trader. its very difficult for a longterm trader to make any profit since something new , AND BIG, happens every weeks. Even stock trader struggle. I personnaly think that people should not go longterm, things are moving and changing too fast. Medium term trade might give you better results.
Alternatives are more important than the plan itself
  • #225
  • Aug 2, 2012 11:33pm Aug 2, 2012 11:33pm
Either your going to need to revisit how your scaling in or your going to need to use SL's as they were originally intended - moved to BE once your ready to add a new position. Possibly both.


While the 2nd 1/2 lot purchase was certainly wide enough apart from your initial purchase to keep your average price closer to the original entry...maybe having a SL at BE on your average price would also be a good idea going forward.
  • #226
  • Aug 3, 2012 4:58am Aug 3, 2012 4:58am
Quoting Chicky
I can speak only one word "SHIT"
After such bearish outside candle. You are not seeing the sign of "trend-reversal" like Jesse would do?
  • #227
  • Aug 3, 2012 8:09am Aug 3, 2012 8:09am
Quoting duyk20
After such bearish outside candle. You are not seeing the sign of "trend-reversal" like Jesse would do?
Seems to me, he was right to be long , just early.
  • #228
  • Aug 3, 2012 9:16am Aug 3, 2012 9:16am
Quoting almo
Seems to me, he was right to be long , just early.
overleveraged......................... got stopped out almost at the same level as earlier.
The Thief of Wall Street
  • #229
  • Aug 3, 2012 10:50am Aug 3, 2012 10:50am
Quoting Chicky
overleveraged......................... got stopped out almost at the same level as earlier.
What is your current leverage?


Sounds like this might be the final piece....


** Edit - Nevermind. Must be 50: 1 as its Oanda ***
  • #230
  • Aug 3, 2012 7:39pm Aug 3, 2012 7:39pm
Quoting almo
What is your current leverage?


Sounds like this might be the final piece....


** Edit - Nevermind. Must be 50: 1 as its Oanda ***
50:1
If I trade with low leverage, cannot multiply my account like Jesse did.
The other option is to set tighter stop losses. But this market is so volatile that I get enough margin calls even with over a 100 pip stop loss.
I can think of three solutions:
1. Lower the profit expectation and play safe using 20:1 leverage instead of 50:1.
2. Keep the leverage at 50:1 but use tighter stop losses.
3. Keep the leverage at 50:1 but increase the trade size in number of pips. This will be somewhat like #1 above.
What I am doing in fact is, trying to apply Jesse Livermore’s method in currency trading knowing that his method works better in stocks and commodities. But if I have to use his method in currency trading, have to lower my profit expectations because currencies are not as trendy as stocks and commodities.
So let’s accept the facts and go from here……………………………….. Thinking of a method that takes into account what we have learnt so far from this little experiment.
The Thief of Wall Street
  • #231
  • Aug 3, 2012 7:52pm Aug 3, 2012 7:52pm
Quoting -Melo-
whether or not I'm wrong, I used this chart to make my decision on the Eur/Usd. Its a monthly chart. Maybe it will fit better with your strategies since you are a longterm trader
Melo, I trade on daily chart, but had a look at this one.

Wallah, its too big for me. But let me check it once again.
The Thief of Wall Street
  • #232
  • Aug 3, 2012 7:59pm Aug 3, 2012 7:59pm
Quoting Chicky
50:1
If I trade with low leverage, cannot multiply my account like Jesse did.
The other option is to set tighter stop losses. But this market is so volatile that I get enough margin calls even with over a 100 pip stop loss.
I can think of three solutions:
1. [size=3][font=Calibri]Lower the profit expectation and play safe using 20:1 leverage instead...
I think Turtles used something that can help, i.e. setting sl at 2 x daily atr.................. or something like that.
The Thief of Wall Street
  • #233
  • Aug 3, 2012 9:05pm Aug 3, 2012 9:05pm
Quoting Chicky
50:1
If I trade with low leverage, cannot multiply my account like Jesse did.
The other option is to set tighter stop losses. But this market is so volatile that I get enough margin calls even with over a 100 pip stop loss.
I can think of three solutions:
1. [size=3][font=Calibri]Lower the profit expectation and play safe using 20:1 leverage...

I think the Jury is out on which is trendier.....there' s a good arguement that we may have finally reached a significant bottom for the EURUSD, which may skew how we think down the road about which is trendier

I'm thinking that the right balance is #1 - Leverage at 20:1 , with lowered profit expectations.

Did Livermore's book ever mention what kind of leverage he was using?
  • #234
  • Aug 3, 2012 10:35pm Aug 3, 2012 10:35pm
Quoting almo
I think the Jury is out on which is trendier.....there' s a good arguement that we may have finally reached a significant bottom for the EURUSD, which may skew how we think down the road about which is trendier

I'm thinking that the right balance is #1 - Leverage at 20:1 , with lowered profit expectations.

Did Livermore's book ever mention what kind of leverage he was using?
Let's try 20:1

No. He did not mention the leverage, but I think he used something like 1,000:1 the way he has portrayed his profits.................. "doubled my money in a jiffy", "Shoe string margin", "averaged 100% a week", etc.
But I think it was during his scalping days, later, he had to move to longer term trading where he made money not based on leverage, but because he was right 9 out of 10 times. This is exactly what I will try to do with 20:1 leverage.
The Thief of Wall Street
  • #235
  • Aug 6, 2012 10:44am Aug 6, 2012 10:44am
Quoting Chicky
Let's try 20:1

No. He did not mention the leverage, but I think he used something like 1,000:1 the way he has portrayed his profits.................. "doubled my money in a jiffy", "Shoe string margin", "averaged 100% a week", etc.
But I think it was during his scalping days, later, he had to move to longer term trading where he made money not based on leverage, but because he was right 9 out of 10 times. This is exactly what I will try to do with 20:1 leverage.
Tried several times, but cannot change the leverage. Maybe I need to close few trades before changing the leverage. ..............Not going to do that because of the 8.3% US Unemployment.

Equation: Pofit/loss per trade x number of trades = Net Gain / Loss

Longer term application: 80% profit/loss per trade x 1 Trade = 80% Gain or 80% loss

Shorter term application: 20% profit/loss per trade x 4 trades = 80% profit, or 40% profit, or BE, or 40% loss, or 80% loss.
The Thief of Wall Street
  • #236
  • Aug 6, 2012 11:38am Aug 6, 2012 11:38am
Quoting Chicky
Tried several times, but cannot change the leverage. Maybe I need to close few trades before changing the leverage. ..............Not going to do that because of the 8.3% US Unemployment.

Equation: Pofit/loss per trade x number of trades = Net Gain / Loss

Longer term application: 80% profit/loss per trade x 1 Trade = 80% Gain or 80% loss

Shorter term application: 20% profit/loss per trade x 4 trades = 80% profit, or 40% profit, or BE, or 40% loss, or 80% loss.
It is much easier to trade longer term because overwhelming underlying fundamentals provide direction that is mostly correct.

All one needs is to trade in the right direction with some risk and good reward.

There is no right or wrong number of pips trade. It all depends on the pair. I think a 1000 pip trade on Eur/USD is moderate and one gets a couple of opportunities a year to make good % playing those moves with some decent risk and good reward. All one needs is a lot of patience and knowing what's happening on economic front.
The Thief of Wall Street
  • #237
  • Aug 6, 2012 1:12pm Aug 6, 2012 1:12pm
Note:

This thread is an experiment on a demo account that has seen several margin calls. Please don't follow the trades, but try to get the concept until we refine this method.
The Thief of Wall Street
  • #238
  • Aug 9, 2012 8:54pm Aug 9, 2012 8:54pm
Looks like Im not the only one who hasent been active for the past days. But I can see you have few position who are still open. I only see uncertainty and noise, do you have a plan or you just forgot to close those position ???
Alternatives are more important than the plan itself
  • #239
  • Aug 9, 2012 9:10pm Aug 9, 2012 9:10pm
Quoting -Melo-
Looks like Im not the only one who hasent been active for the past days. But I can see you have few position who are still open. I only see uncertainty and noise, do you have a plan or you just forgot to close those position ???
LOL. This thread becomes active when all figures are in green and goes back to dead when figures change color to red.

It is still above 1.2250 my baseline for long. I am long until 1.2250 gives way. The only issue is the leverage. I am highly leveraged with 2.5 lots. But can take one more margin call and therefore haven't closed any positions to bring it to 20:1. Not opening any new position until the current position show enough profit that it becomes 20:1.
The Thief of Wall Street
  • #240
  • Aug 9, 2012 9:46pm Aug 9, 2012 9:46pm
Quoting Chicky
LOL. This thread becomes active when all figures are in green and goes back to dead when figures change color to red.

It is still above 1.2250 my baseline for long. I am long until 1.2250 gives way. The only issue is the leverage. I am highly leveraged with 2.5 lots. But can take one more margin call and therefore haven't closed any positions to bring it to 20:1. Not opening any new position until the current position show enough profit that it becomes 20:1.
lol. I hope you will have more green next week then. If we study the EUro chart a little bit, we can see that the optimism from last week is fading. But trading that could lead to huge losses. At any moment, Germany could come and say something.

Few months ago, I started looking for alternative so that in these kind of day, I can find opportunity to trade. Gold, silver and Oil can be alternative because they follow the same fundamental as the Euro. Have you ever found alternative from currency or stocks ??
Alternatives are more important than the plan itself
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