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How difficult is it to find an effective daytrading method?

  • #81
  • May 13, 2013 6:56pm May 13, 2013 6:56pm
Thanks for your sharing. Agree with your about the specific nature of day trading.
- the huge effect of spread cost
- the huge possible profitability
etc.

Quoting M.A.C.Doug
Day trading is the most difficult way to achieve profitability because of the spread. I lost 20k in the my first 12 months of trading 7 years ago. Talk about pain and suffering - I was broke, a single parent living in a bed sit when I borrowed the money to start trading. There was no summer holiday for my kids that year or the year after. But I did 80K worth of trades with that 20k. I was trading many different instruments including stock and indicie cfd's, fx and gold. It turned out that, as a complete noob, I had actually broken even on those...
  • #82
  • May 13, 2013 6:59pm May 13, 2013 6:59pm
Quoting hollyk
{quote} Manage the risk, and soon you'll find that there are not too many entry systems where you cannot make a killing as a daytrader.
Thanks for your response. May I ask you?
If you have been successful, how long did it take for you?
  • #83
  • May 13, 2013 7:07pm May 13, 2013 7:07pm
I started trading about 3 years ago, and am still learning to manage my risks. There are good days, and there are bad days... but as I've gotten more practise, I've noticed less bad days, and more consistent good days =)
  • #84
  • May 13, 2013 7:21pm May 13, 2013 7:21pm
Quoting hollyk
I started trading about 3 years ago, and am still learning to manage my risks. There are good days, and there are bad days... but as I've gotten more practise, I've noticed less bad days, and more consistent good days =)
Ok. Good luck with your practising.
  • #85
  • May 14, 2013 12:22am May 14, 2013 12:22am
Quoting M.A.C.Doug
Day trading is the most difficult way to achieve profitability because of the spread. I lost 20k in the my first 12 months of trading 7 years ago. Talk about pain and suffering - I was broke, a single parent living in a bed sit when I borrowed the money to start trading. There was no summer holiday for my kids that year or the year after. But I did 80K worth of trades with that 20k. I was trading many different instruments including stock and indicie cfd's, fx and gold. It turned out that, as a complete noob, I had actually broken even on those...
incredible story .....i saw your trade explorer where it seems you have a T.P of 1 pip! is this a new strategy?
I think there is a difference between short term trading and intraday which one aims for 50-100 pips reducing effect of the spread.
wo-yoy! wo-yoy! wo-yoy! wo-yoi! wo-yoy-yoy-yoy!
  • #86
  • May 14, 2013 1:03am May 14, 2013 1:03am
Quoting Xhale
I'll quote a trading buddy of mine. This applies to lots of traders here on FF. "Most trading students spend almost all of their time in the phase of gathering information. This is encouraged by the believe that the more information they put in their heads, the more enlightened they will be. So they jump around from thing to another reading dozens of books, forums and threads on different trading styles and subjects. This can be likened to the 'trading buffet line'. Now there is nothing wrong with learning information. Indeed, if gives people the...

very true...

The problem is the information overload. Just here on FF, a lot of threads.

my process to find a profitable method is this:


1. Filter the threads
So the first quest: Which threads are worth reading?

So i did, and filtered about 20 threads (james16, DIBS, Price is everything, Trading with deadly accuracy...)

2. Read the information
So now the toughest part. Read through all the monsterthreads, filled with BS and spamming and try to filter the information. Write down what make sense to you and is mentioned in multiple threads (i.e. importance of S/R, importance of trend in higher TF...etc.)

3. Build the system/method
Mix the gathered information with your own thoughts and build a system/method.

4. Test/Evaluate the system
Test the system and see what actualy works and what not. Ideally with a tool like Forextester to shorten the learning curve.
There should be a working system now

5. Learn to trade your system
similar step 4 demo/small account/simulator

6. Apply your system in real trading


So this is the plan, and it make sense to me, but i am still at step 2, as it is very time consuming. These threads are filled with self-exposing people, offtopic-spam, noobs always asking the same questions, and so on.
  • #87
  • May 14, 2013 2:16am May 14, 2013 2:16am
[quote=h96;6678142]{quote} very true... The problem is the information overload. Just here on FF, a lot of threads. my process to find a profitable method is this: 1. Filter the threads So the first quest: Which threads are worth reading?
- all of them
2. Read the information So now the toughest part. Read through all the monsterthreads, filled with BS and spamming and try to filter the information.
-all the main ideas a thread has to offer is in the first charts of 20 pages max. if that works go on to the next pages.
2.a you have to immediately test the ideas that you are presented with
3. Build the system/method Mix the gathered information with your own thoughts and build a system/method.
-first you evaluate the idea "as is". if it works you just found 1 in 1000 that actually does. only after you find it doesn't work you ask yourself the question. can i change something about this that could make it work from what i know? what if i mix this in? what if i do the opposite?
4. Test/Evaluate the system Test the system and see what actualy works and what not.
testing will never stop.
5. always visual backtest and after you think you're on to something use a simulator. i personally use an expert that does not do anything and select open prices only so that when i hit f12 a new bar apears. you can purchase forextester2 for placing actual trades.

this was my line of thought.
  • #88
  • May 14, 2013 3:03am May 14, 2013 3:03am
@deltatrade

thanks for feedback.

Not every thread is worth reading. this is wrong there are thousands of threads and time is limited, so you couldnt read all/doenst make sense. So you have to filter.

Sure the things will repeat after 20 threads, but still the systems methods evolve and there is still valuable wisdom in the following pages.
  • #89
  • May 14, 2013 6:04am May 14, 2013 6:04am
@h96

That is correct. It is meaningless to read most thread. Just pick one whose style is suitable to you.
In my personal expirences I like SonicR
It is pretty good especially on gold and silver trading.
Money never sleeps
  • #90
  • May 14, 2013 6:08am May 14, 2013 6:08am
So this is the plan, and it make sense to me, but i am still at step 2, as it is very time consuming. These threads are filled with self-exposing people, offtopic-spam, noobs always asking the same questions, and so on.

@h96

Even if you read all, you will get confused and will not be able to digest all and understand all.
One way to speed up the process is if you find someone valuable, go to all of his postings by his name and read those first. Will shorten the learning process.

If you find something, copy and paste to a doc or file and go thru. again later. Can give you the lightening moment again when going thru. your harddrive.

Once you understand FOREX correctly in your way, if is correct way, you will recognize BS and No BS to you.

Best Pip Wishes!
  • #91
  • May 14, 2013 6:35am May 14, 2013 6:35am
Quoting h96
my process to find a profitable method is this: .......
Perfect process ... especially the point of writing down all what makes sense to you in order to structure your own method of trading.

MT4/MT5 EAs/Indicators/Alerts coder
  • #92
  • May 14, 2013 8:49am May 14, 2013 8:49am
Guys, please be careful to claim yourself as a profitable trader if your profit period only run for the past 1-3 years. I code EA a lot and in back test some of those EAs make profit for 1-3 concecutives years before all of those profits finally gone.
  • #93
  • May 14, 2013 8:58am May 14, 2013 8:58am
Quoting Special One
Guys, please be careful to claim yourself as a profitable trader if your profit period only run for the past 1-3 years. I code EA a lot and in back test some of those EAs make profit for 1-3 concecutives years before all of those profits finally gone.
This is usually due to the EA entering a market environment that is unlike that seen during the period of the backtest. Can you say that the more simplistic systems with fewer filters retain their consistency, and the more complicated ones tend to break down over time?
  • #94
  • May 14, 2013 8:59am May 14, 2013 8:59am
Quoting Special One
Guys, please be careful to claim yourself as a profitable trader if your profit period only run for the past 1-3 years. I code EA a lot and in back test some of those EAs make profit for 1-3 concecutives years before all of those profits finally gone.
nobody is claiming to be the special one here... oh, yes they are

What makes you think your EA's are anything like anybody else's trading?

Way too many presumptions for this statement to mean anything at all... akin to saying most lose so you will lose
tradewith60
  • #95
  • May 14, 2013 9:18am May 14, 2013 9:18am
Quoting Special One
Guys, please be careful to claim yourself as a profitable trader if your profit period only run for the past 1-3 years. I code EA a lot and in back test some of those EAs make profit for 1-3 concecutives years before all of those profits finally gone.
even though I am not supposed to be answering posts like this I cannot help myself..
the above statement is ridiculous, in 3 years you can make then get out.
if you are seeking information blindly you will probably fail but if you have the right head you can succeed and I do not mean you have to be a Harvard graduate
SEE LINE,TRADE LINE..PRICE HAS TO GO SOMEWHERE,,, PRICE WILL GO SOMEWHERE.
  • #96
  • May 14, 2013 9:31am May 14, 2013 9:31am
Quoting Special One
Guys, please be careful to claim yourself as a profitable trader if your profit period only run for the past 1-3 years. I code EA a lot and in back test some of those EAs make profit for 1-3 concecutives years before all of those profits finally gone.
this guy is telling the truth .....systems trading is looking for a free lunch...unless you keep finding newer methods to keep ahead of the curve.
wo-yoy! wo-yoy! wo-yoy! wo-yoi! wo-yoy-yoy-yoy!
  • #97
  • May 14, 2013 10:02am May 14, 2013 10:02am
Quoting pemully
{quote} systems trading is looking for a free lunch...unless you keep finding newer methods to keep ahead of the curve.
100%. There are two types of mechanical systems that work. The first are static systems, very simple ones with very few parameters/filters. These tend to be mediocre performers, nothing remarkable. The problem is that most mechanical systems developers then try to overcomplicate things by adding this filter or that filter, all in an attempt to 1) reduce the max drawdown seen during the test period (this is usually the case), and/or 2) boost return. So they end up creating an "optimized" mechanical system curve-fitted to their back-test period. Sure, like an airbrushed photograph of Elizabeth Hurley, the equity curve looks gorgeous. But once the system encounters a market environment that is unlike what was seen during the back-test period, the system breaks down. Either the mechanical system developer is naiive or he is trying to pull the wool over the eyes of his clients, e.g. all those $97 systems.

The second type of mechanical system that works is a dynamic one that continuously adapts to market behavior. But this involves designing extremely complex systems and hiring many programmers who can constantly test to see which factors are influencing prices. This is the approach of Renaissance's Jim Simons. And he has possibly produced the greatest returns of any hedge fund ever.

The moral of this story is that, unless you are Jim Simons, the discretionary trader should be able to produce better returns with less drawdown than a mechanical trader. The poster above who spoke of many systems falling apart in 1-3 years is speaking of static, mechanical systems optimized over a backtested period. Not discretionary strategies based on market truisms that can be calibrated and adjusted in real-time by a real live trader.
  • #98
  • May 14, 2013 10:19am May 14, 2013 10:19am
Quoting California
{quote} 100%. There are two types of mechanical systems that work. The first are static systems, very simple ones with very few parameters/filters. These tend to be mediocre performers, nothing remarkable. The problem is that most mechanical systems developers then try to overcomplicate things by adding this filter or that filter, all in an attempt to 1) reduce the max drawdown seen during the test period (this is usually the case), and/or 2) boost return. So they end up creating an "optimized" mechanical system curve-fitted to their back-test...
wow! couldn't have said better.
wo-yoy! wo-yoy! wo-yoy! wo-yoi! wo-yoy-yoy-yoy!
  • #99
  • May 15, 2013 12:53pm May 15, 2013 12:53pm
Quoting pemully
{quote} incredible story .....i saw your trade explorer where it seems you have a T.P of 1 pip! is this a new strategy?
no its just an enhanced version of all the high risk bs strategies that tanked my account in the past. I still test for the holy grail every now and then. Just a bit of fun with my micro account
BTC Return This Year: na
  • #100
  • May 15, 2013 5:16pm May 15, 2013 5:16pm
Quoting California
{quote} 100%. There are two types of mechanical systems that work. The first are static systems, very simple ones with very few parameters/filters. These tend to be mediocre performers, nothing remarkable. The problem is that most mechanical systems developers then try to overcomplicate things by adding this filter or that filter, all in an attempt to 1) reduce the max drawdown seen during the test period (this is usually the case), and/or 2) boost return. So they end up creating an "optimized" mechanical system curve-fitted to their back-test...
Totally Agree............Take 3 simple indicators, trending , momentum and a oscillator and discretionary trade is the only way to do it..................
In Time you will learn the markets moves, and most important is when to stay out of a non moving market....................IMO
The More You Learn, The More You Earn.....
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