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Which Trading System Or Strategy Is The Most Profitable?

  • #21
  • Sep 20, 2013 3:08am Sep 20, 2013 3:08am
Quoting Jhig
What Angry said. If you truely want to make it in the markets, you'll need to learn more about "Order Flow" trading (as it's called) and Global Macro. Basically, it all comes down to knowing "what moves the markets" and taking advantage of this information. Unfortunatley, technicals nor fundaments move the markets which is why tech/fundie traders are always late to game. Those of us who understand the market and who understand what moves the markets are always a step ahead of the heard. Global markets (i.e. currencies) are truely a "thinking...
Jhig,

I apologise if you perceive this post as annoying, but would you mind sharing some of your knowledge with a struggling trader such as myself?

If you can find the time to send me a simple message, I would appreciate it.

Thanks.
  • #22
  • Sep 20, 2013 4:05am Sep 20, 2013 4:05am
Quoting Jhig
What Angry said. If you truely want to make it in the markets, you'll need to learn more about "Order Flow" trading (as it's called) and Global Macro. Basically, it all comes down to knowing "what moves the markets" and taking advantage of this information. Unfortunatley, technicals nor fundaments move the markets which is why tech/fundie traders are always late to game. Those of us who understand the market and who understand what moves the markets are always a step ahead of the heard. Global markets (i.e. currencies) are truely a "thinking...
Hi Jhig,
If we want to understand more on these moves, where shall we start from?
I am in dark!
  • #23
  • Sep 21, 2013 11:18am Sep 21, 2013 11:18am
Quoting nsn14
{quote} Hi Ttop, Your comment above set to open eye for me!! Guide me to see the real reasons why most traders failed! As a newbie, I search indicator and system around and download many indicators for my mt4 chart. I try each indicator and sometime make me confuse which one to follow?! Can you further explain your points below? Please correct my understanding if I m wrong. 1. In your opinion, intraday trading is dangerous. 2. Can you explain this statement further? "Such systems neglect to consider what the major players are doing and their trades...
1. Yes I have found day trading to be dangerous. Too many news announcements, amongst other things.

2. Price patterns are subjective because we can each see different things on charts. Who is right? Anyone or nobody? Was a move that appears on a chart a significant move (i.e. were the big boys involved?) or was it just minor fluctuations on small volumes - unfortunately the chart doesn't tell us. No chart tells us what the intention of the big players is. Are you being suckered into a trade? The price can't tell us.

3. I do not trade once in a month. I can hold positions for several months and Sometimes I hold positions in different instruments. For example I have held a GBP position for a few weeks already and entered a AUD position last week. I check my charts once a week to ensure I am trading with the big boys and not against them. I do not claim that my method is perfect but it is far more profitable than what 95% of traders experience.

4. If you want to trade long-term charts you need large stop losses or risk being closed out.

5. Yes you went to right place. But also explore on internet as other people provide COT charts with price charts which makes things easy to follow.

6. I shall post a chart later

7. I leave others to answer this question
  • #24
  • Sep 21, 2013 12:09pm Sep 21, 2013 12:09pm
Here is the AUDUSD COT chart as it was last week

The blue line is the weekly trend line - I try to make it as steep as possible. Exit when a weekly candle closes below the trend line in an uptrend or above the weekly candle in a downtrend. Enter long when the CoT is rising and so is the weekly trend line or enter short when the weekly trend is down and so is the CoT. In this way one is aligning one's trades with the big boys. If the CoT and the weekly trend start to diverge then hold the weekly trend until the price closes across the trend line

CoT (large speculators) and trend going in same direction is the ideal.

Attached Image (click to enlarge)
Click to Enlarge Name: Weekly AUDUSD 210913.png Size: 54 KB
  • #25
  • Sep 22, 2013 6:22am Sep 22, 2013 6:22am
Quoting Ttop
Here is the AUDUSD COT chart as it was last week The blue line is the weekly trend line - I try to make it as steep as possible. Exit when a weekly candle closes below the trend line in an uptrend or above the weekly candle in a downtrend. Enter long when the CoT is rising and so is the weekly trend line or enter short when the weekly trend is down and so is the CoT. In this way one is aligning one's trades with the big boys. If the CoT and the weekly trend start to diverge then hold the weekly trend until the price closes across the trend line...
Hey Ttop, just been reading your posts, quite refreshing Ty. Do you really have 20 years trading expertise?
Time hides Nothing
  • #26
  • Sep 22, 2013 7:01am Sep 22, 2013 7:01am
Quoting CindyXXXX
{quote} Hey Ttop, just been reading your posts, quite refreshing Ty. Do you really have 20 years trading expertise?

Yes I am a battle-scarred veteran of the trading trenches. Started in 1990 by learning TA. Suckered in by the appearance of how simple it would be with just a moving average. Became an obsession. Been searching for an answer as to how to trade ever since. Been down the road of searching for the Holy Grail, trying to optimise indicators, thinking there was something wrong with me etc . It has taken many years to realise that both TA and FA are just plain crap and so is psychology (if this book/course doesn't improve your results then you must have psychological problems! My ass!). What a cop out, blame the student if your method doesn't work! 10 000hours to become successful? - more like 30 000 in my case to devise my own trading/investing methods.

If the common methods worked then how come "professional" fund managers fail to beat broad-based market indices? What do their methods offer that they perform so poorly? Why do 95% of forex traders fail, surely one would expect about 50% to be successful? I am tired of the BS. I believe that the answer to being successful is to understand that there has to be a "cause and effect relationship" i.e. prices change for a reason. In the forex markets I believe that the driving force is the big boys manipulating the market to set up and then cash in on their futures and options positions. I have found nothing else that correlates so well to forex price movements.

All imo, of course
  • #27
  • Sep 22, 2013 7:51am Sep 22, 2013 7:51am
Quoting Ttop
{quote} Yes I am a battle-scarred veteran of the trading trenches. Started in 1990 by learning TA. Suckered in by the appearance of how simple it would be with just a moving average. Became an obsession. Been searching for an answer as to how to trade ever since. Been down the road of searching for the Holy Grail, trying to optimise indicators, thinking there was something wrong with me etc . It has taken many years to realise that both TA and FA are just plain crap and so is psychology (if this book/course doesn't improve your results then you...
Right, Im of the belief that 95% if not more fail in the long run because of the rigid nature of strategies/ edges. I think that "edges" are spawned from repetitive patterns price behavior and coupled with the belief that they will repeat. If this repetition becomes a reoccurring "inefficiency" then this market "gap" becomes a target which overtime gets smaller and smaller until it is cancelled out completely and in the process a new gap opens up at the opposite end of the spectrum.

Much like a gold mine which becomes known, then mined, then depleted. The long run and short run perfect competition economic curves come to mind. So unless a short term trader can adjust to the shifts fast enough (very difficult) then profits made become profits foregone. Targets once hit become stop outs. Its just a constant cycle that weeds out the old inefficiencies and in the process creates new ones.

Intraday trading is so attractive to anyone because of the potential speed in which profits could seemingly be made but like you say, that's what "everyone" does and so for that reason becomes the reason it's so hard to win long term. The FOREX market makes this short term trading dream a possibility with the leverage it offers. Anyway Im sure there are probably some successful intraday traders. I doubt they are rubbing two sticks together to make fire though.
Time hides Nothing
  • #28
  • Sep 22, 2013 10:57am Sep 22, 2013 10:57am
"Which Trading System Or Strategy Is The Most Profitable?"

For the vast majority, closing their account.
Okay, not what is wanted. But it's true.
I have no clue what I'm talking about.
  • #29
  • Sep 22, 2013 10:59am Sep 22, 2013 10:59am
Quoting Ttop
{quote} Yes I am a battle-scarred veteran of the trading trenches. Started in 1990 by learning TA. Suckered in by the appearance of how simple it would be with just a moving average. Became an obsession. Been searching for an answer as to how to trade ever since. Been down the road of searching for the Holy Grail, trying to optimise indicators, thinking there was something wrong with me etc . It has taken many years to realise that both TA and FA are just plain crap and so is psychology (if this book/course doesn't improve your results then you...
I agree with everything you say, except that fundamentals do win out in the end and *some* technicals *can* give vital clues but you've got to be able to sort the wheat from the chaff. Like they say, if you have to look for it, it ain't there.
I have no clue what I'm talking about.
  • #30
  • Sep 23, 2013 8:10pm Sep 23, 2013 8:10pm
Quoting Ttop
Here is the AUDUSD COT chart as it was last week The blue line is the weekly trend line - I try to make it as steep as possible. Exit when a weekly candle closes below the trend line in an uptrend or above the weekly candle in a downtrend. Enter long when the CoT is rising and so is the weekly trend line or enter short when the weekly trend is down and so is the CoT. In this way one is aligning one's trades with the big boys. If the CoT and the weekly trend start to diverge then hold the weekly trend until the price closes across the trend line...
Hi Ttop,
Appreaciate your reply!

However how do I get the CoT chart or the blue trendline??
Your chart is look different from mine at MT4?

PS: What is CoT stand for? Is it a line /indicator??
  • #31
  • Sep 23, 2013 9:02pm Sep 23, 2013 9:02pm
Quoting nsn14
{quote} Hi Ttop, Appreaciate your reply! However how do I get the CoT chart or the blue trendline?? Your chart is look different from mine at MT4? PS: What is CoT stand for? Is it a line /indicator??
CoT = commitments of traders ( http://www.babypips.com/school/under...ket-sentiment/ )

Updated weekly at http://cftc.gov/MarketReports/Commit...ders/index.htm under current legacy reports, futures only, chicago mercantile exchange, short format.

CoT charts: http://www.timingcharts.com/
"To hold, you must first open your hand. Let go." - Lao Tzu
  • #32
  • Sep 23, 2013 9:21pm Sep 23, 2013 9:21pm
Quoting vox dei
{quote} CoT = commitments of traders ( http://www.babypips.com/school/under...ket-sentiment/ ) Updated weekly at http://cftc.gov/MarketReports/Commit...ders/index.htm under current legacy reports, futures only, chicago mercantile exchange, short format. CoT charts: http://www.timingcharts.com/
Thank you vox dei!

I open timingcharts.com and attached image on EU (current)

What are the information can we gather from the chart?

What does the comm, large, specs stand for? Do them carry specific market information?

This is the Daily chart (attached image), do we need to access weekly, monthly as well?

THANKS FOR HELP!!!
Attached Image (click to enlarge)
Click to Enlarge Name: EU20130923.PNG Size: 78 KB
  • #33
  • Edited 10:37pm Sep 23, 2013 10:02pm | Edited 10:37pm
Quoting nsn14
{quote} Thank you vox dei! I open timingcharts.com and attached image on EU (current) What are the information can we gather from the chart? What does the comm, large, specs stand for? Do them carry specific market information? This is the Daily chart (attached image), do we need to access weekly, monthly as well? THANKS FOR HELP!!! {image}
You are welcome.

Make sure you read all the info from the first link provided. In there you'll find detailed instructions on how to interpret/use CoT report.

Comm = comercials, Large= large speculators, Specs = small speculators (us included).

This info is released weekly, so I believe the weekly chart should be used. Please note that my opinion is worth what it's worth, as I don't really use this type of analysis in my trading anymore.

I was merely pointing you in the right direction to learn about CoT report. I'm sure there are plenty people here who can offer better guidance.

Edit:
See this thread for instance: http://www.forexfactory.com/showthread.php?t=376395
"To hold, you must first open your hand. Let go." - Lao Tzu
  • #34
  • Sep 23, 2013 11:26pm Sep 23, 2013 11:26pm
Quoting nsn14
{quote} Hi Ttop, Appreaciate your reply! However how do I get the CoT chart or the blue trendline?? Your chart is look different from mine at MT4? PS: What is CoT stand for? Is it a line /indicator??
nsn14

vox dei has answered you questions very competently except for your query about the blue trend line I showed in my chart. I drew in that trend line and will extend it each week on my weekly chart. When the weekly price closes below that trend line that is my exit signal. Please note that this is MY way of trading this method, feel free to develop your own way or to ignore it all together.

I would just like to make one more comment - I can see that you did not spent time searching the internet if you don't even know what a CoT chart tells us (prior to vox dei replying to you) despite it being mentioned in previous posts. That is being lazy. Do your own research first (yes it takes time, why do you think it takes years to become a competent trader?), stop expecting to be spoon fed everything, and then if you have difficulties or require clarity you are most welcome to ask questions.
  • #35
  • Sep 24, 2013 3:42am Sep 24, 2013 3:42am
Quoting Ttop
{quote} nsn14 vox dei has answered you questions very competently except for your query about the blue trend line I showed in my chart. I drew in that trend line and will extend it each week on my weekly chart. When the weekly price closes below that trend line that is my exit signal. Please note that this is MY way of trading this method, feel free to develop your own way or to ignore it all together. I would just like to make one more comment - I can see that you did not spent time searching the internet if you don't even know what a CoT chart...
My apology for make you feeling that I am lazy but in fact I did seach for COT but google guide me to CTO EA (now I know they are totally different things)... that was why I post question directly to know what actually CoT stand for.

Truly thankful to all of you here, at least I know what I don't know! In earlier time I thought I know forex/trading if I understand about fundamental, TA, MM, trading pysco..
But you and others tell me different things...

Phiaw... I am still fresh fresh fresh newbie!!!! Got to work harder!!!!
  • #36
  • Sep 24, 2013 3:43am Sep 24, 2013 3:43am
Quoting vox dei
{quote} You are welcome. Make sure you read all the info from the first link provided. In there you'll find detailed instructions on how to interpret/use CoT report. Comm = comercials, Large= large speculators, Specs = small speculators (us included). This info is released weekly, so I believe the weekly chart should be used. Please note that my opinion is worth what it's worth, as I don't really use this type of analysis in my trading anymore. I was merely pointing you in the right direction to learn about CoT report. I'm sure there are plenty...
Thank you vox dei, again!!!
  • #37
  • Sep 24, 2013 5:47am Sep 24, 2013 5:47am
Quoting nsn14
{quote} My apology for make you feeling that I am lazy but in fact I did seach for COT but google guide me to CTO EA (now I know they are totally different things)... that was why I post question directly to know what actually CoT stand for. Truly thankful to all of you here, at least I know what I don't know! In earlier time I thought I know forex/trading if I understand about fundamental, TA, MM, trading pysco.. But you and others tell me different things... Phiaw... I am still fresh fresh fresh newbie!!!! Got to work harder!!!!
All OK nsn14.

The challenge, and what takes time, is to try this and try that and back test and live test (with real money) and read and carry on and repeat until you either find something that suits you or you lose and give up. Forex trading is hard and so is any futures market. Equities are easier to profit from because you cannot be forced to sell your position (you can still lose money though). Anyone can work hard but if it is the wrong direction then it is just a waste of time. I think you have had good guiding advice from contributors on this thread to help you on your way which should save you a lot of time. Good luck
  • #38
  • Sep 24, 2013 9:44am Sep 24, 2013 9:44am
hello, i am a beginner trader and i was fall last week and this makes me feel bad and i don't know what should i do no!!!!!!!!!!!!
  • #39
  • Sep 24, 2013 4:08pm Sep 24, 2013 4:08pm
Hi,

Go to the following thread
http://www.forexfactory.com/showthread.php?t=403563

this will help you

Kind regards
Kashif
  • #40
  • Sep 24, 2013 4:18pm Sep 24, 2013 4:18pm
Most profitable is hard to determine, and there are various factors to consider, for example, a system may make excellent returns but expose you to a really big draw down one day ... so it was very profitable, until the music stopped and you are then dropping 50% or something.

Something to note though, is practically every tested and established strategy is profitable - but people still lose using these systems since they fail to follow it properly.

I think psychology is the real telling factor in trading.
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