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  • #6,161
  • Mar 13, 2014 10:22am Mar 13, 2014 10:22am
and.... not soo rosy picture on UJ for me

Probably same for 60minuteman on his EA trade.
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Staying in my lane...
  • #6,162
  • Mar 13, 2014 10:28am Mar 13, 2014 10:28am
Quoting VEEFX
and.... not soo rosy picture on UJ for me Probably same for 60minuteman on his EA trade. {image}
lost one soldier and a few from friendly fire, sniper left but it ain't looking good..
tradewith60
  • #6,163
  • Mar 13, 2014 10:33am Mar 13, 2014 10:33am
Quoting Calculus
{quote} I did, the thread suggest traders try to find low risk entry ideas/patterns. What I posted was one of those, regardless of whether it's a 3:1 or 33:1 outcome
indeed sir.... it is a strategy that could be used.Talking of perversity, I still think the best entry thread on this site was also the biggest joke thread. Merlins strategy was by far the best way to build positions, but everyone laughed at it... funny
tradewith60
  • #6,164
  • Mar 13, 2014 10:38am Mar 13, 2014 10:38am
Quoting 60minuteman
{quote} lost one soldier and a few from friendly fire, sniper left but it ain't looking good..
coming back.... again... you gotta be a bottom's and top's picker

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tradewith60
  • #6,165
  • Edited 11:16am Mar 13, 2014 11:05am | Edited 11:16am
Quoting 60minuteman
{quote} coming back.... again... you gotta be a bottom's and top's picker {image}
speaking of tops and bottoms, i have been waiting patiently for a correction in the stock markets this year. Same is the case for NZD pairs reaching all time high. A dozen low risk probes at such levels would be worth the effort. I have already lost quite a few at BE on these long term setups. With yesterday's rate hike, it's a game changer for NZD to continue it's higher trajectory. Regarding R:R, it really doesn't have to be 1:100+. Just 1:10 is fine for me... especially when trading on M1/M5 with under 10 pips of risk. It's all relative. I must say this for sure... my stats reveal that I should lose interest in moving SL to BE. There is a far better approach with scaling in and out of risk and reward and creative position sizing
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Staying in my lane...
  • #6,166
  • Mar 13, 2014 11:16am Mar 13, 2014 11:16am
Quoting VEEFX
{quote} speaking of tops and bottoms, i have been waiting patiently for a correction in the stock markets this year. Same is the case for NZD pairs reaching all time high. A dozen low risk probes at such levels would be worth the effort. I have already lost quite a few at BE on these long term setups. With yesterday's rate hike, it's a game changer for NZD to continue it's higher trajectory. Regarding R:R, it really doesn't have to be 1:100+. Just 1:10 is fine for me... especially when trading on M1/M5 with under 10 pips of risk. It's all relative....
yes i would love to get into a stockmarket correction, but in general when my strategy says the trend is short then I will short.

yes, yes... moving stops to break even is stupid unless the money you are saving is more than the money you miss out on if it goes and goes.... I built everything around getting locations where you are likely to survive so I would be daft to move that point just because I had 100 pips in the bag, or any other reason...

I'm in the 20-30% WR, 20R ballpark, I like it there because its so bloody contrarian. Whenever I was doing the same as everyone else there was no profit in it, lot's of winners for sure, but no home run's.
tradewith60
  • #6,167
  • Mar 13, 2014 11:28am Mar 13, 2014 11:28am
I got that 3:1 in USD-JPY, short at 102.60 covered at 00. Stop was at 102.80.

60m man will of course be holding out for more

Lots of perversity in that trade, market doing it's usual thing, ie trying to fuck the many BEFORE the real move. Concentrate folks, these trades are everywhere (but only if you use said concentration).

Of course, I could show you 101 that setup just like my example that lose money so don't think for one moment that these trades are banker bets. But this is purely a numbers game, sometimes they work, others they don't and you'll NEVER know beforehand what the outcome on any INDIVIDUAL trade will be, so you must try to take them all.

As ever, easy to say, harder to do....

PS. The fact that trading is purely a numbers game is actually hard for many to properly grasp, but keep working on the belief, it will really help. Even I haven't yet been able to 100% grasp the fact and literally take it to heart, even though I fully understant it. That might take another few years because I think it's the hardest concept in all of trading.
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Road To Wisdom? To err and err and err again, but less and less and less...
  • #6,168
  • Mar 13, 2014 1:33pm Mar 13, 2014 1:33pm
Quoting Calculus
I got that 3:1 in USD-JPY, short at 102.60 covered at 00. Stop was at 102.80. 60m man will of course be holding out for more Lots of perversity in that trade, market doing it's usual thing, ie trying to fuck the many BEFORE the real move. Concentrate folks, these trades are everywhere (but only if you use said concentration). Of course, I could show you 101 that setup just like my example that lose money so don't think for one moment that these trades are banker bets. But this is purely a numbers game, sometimes they work, others they don't and...
nice trade mate.... sure you didnt want to hold it longer?

You're right it is a numbers game, no certainty in any approach, even the holy grail supply and demand... We should also mention feelings, everything is tied in with feeling - the best traders feel their trades but make their decisions intuitively and not impulsively.

The idea of controlling our emotions is rubbish, understanding them is what is required, if you feel fear, there's a reason and we should use that information to aid us when we trade.
tradewith60
  • #6,169
  • Mar 13, 2014 2:21pm Mar 13, 2014 2:21pm
last gold entry survived so far... gold loves to give 1000 pip weeks but you must resist the full close!

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tradewith60
  • #6,170
  • Edited 3:45pm Mar 13, 2014 3:29pm | Edited 3:45pm
It was getting to the end of the day and I was happy with 3:1 even though looking at the chart there was little support until price moved below 101.60 where we are right now.

Perversity dogs me like any trader.

  1. Many times I've covered these sorts of trades at 3:1 and with hindsight was the right thing as price went a touch further before moving sharply higher
  2. Many times I've covered these sorts of traders at 3:1 and with hindsight was the wrong thing (like today) as price went a lot further offering up a potnetial 5:1 or even 7:1 trade

The right answer?

It's a numbers game, sometimes you do the right thing other times it's the wrong thing on any individual trade but over time there will be a difference depending on which route you generally take. The difference will be both monetary and psychological. More or less money and more or less psychological impact.

Personally if I can keep my average ratio at 3:1 minimum with a reasonable win % I'm more than happy because although an average of 3:1 looks obtainable it's not easy to do it in the highly competitive markets.

And why is it not easy?

Because perversity dogs all traders most of the time...

PS. But if perversity dogs all traders most of the time, why not build strategies (not systems) that try to capitalise on the perversity that dogs our competitors...

Road To Wisdom? To err and err and err again, but less and less and less...
  • #6,171
  • Edited 4:25pm Mar 13, 2014 4:11pm | Edited 4:25pm
Quoting Calculus
It was getting to the end of the day and I was happy with 3:1 even though looking at the chart there was little support until price moved below 101.60 where we are right now. Perversity dogs me like any trader. Many times I've covered these sorts of trades at 3:1 and with hindsight was the right thing as price went a touch further before moving sharply higher Many times I've covered these sorts of traders at 3:1 and with hindsight was the wrong thing (like today) as price went a lot further offering up a potnetial 5:1 or even 7:1 trade The right...
Hey Calculus,

I recall a while back you had posted a spreadsheet with stats here http://www.forexfactory.com/showthre...61#post6865561.

Curious to see how your 1:7 RR is going. I looked at the xls a while ago and wanted to ask you why you choose 1:7 RR with 0.2% risk (20 basis points). Why not 10 or 4 or 6 or whatever? With M1/M5 entries, I am assuming you do only one trade and one pair at a time. is that right?

Not a Math Geek myself but looking into my own stats to see if I can mathematically derive my own Reward based on my average win/loss $/pip/% metric. I have not seen this type of analysis anywhere being done so curious if I am chasing the wrong thing here. I feel my position sizing is still not 'optimized' which, in my opinion, is quite crucial for a balanced Risk:Reward:Time:Effort. My approach to TP is not based on a fixed reward but based on a stall. If my entries are stuck in a range for few candles then the time/effort/concentration/monitoring factor increases therefore resulting in minimizing my intangible reward for that particular trade. If more such trades accumulate then it really reduces the value of trading as a profession/income as it then just becomes a 9-5 job. If my entry take a quick realization of 100 pips with under 10 mins of effort, I consider such trades to be 1:1000 risk/reward as I have spend less time and stress.
Staying in my lane...
  • #6,172
  • Mar 14, 2014 2:40am Mar 14, 2014 2:40am
Vee

I was looking for those 7:1 trades, why 7, I just like the number! But the more profit potential you go for the more losses/break evens you're going to get. Plus, I was using tight stops and came to realise that for me using bigger stops offers better trades even though the profit potential is smaller.

When I was going for 7:1 trades I used to get many consecutive losses and that didn't do my brain much good.
Road To Wisdom? To err and err and err again, but less and less and less...
  • #6,173
  • Mar 14, 2014 4:24am Mar 14, 2014 4:24am
A very good trader said to me recently that he likes to trade with 'the most insurance he can afford'. What he meant was that a larger stop is normally always better than a smaller one although the smaller one if it works (stop not activated) offers the far larger profit potential. 10 tick stop and 70 ticks profit is of course 7:1, a 20 tick stop and 70 tick profit is 3.5:1.

When I quized him, he said he's was stopped out too many times with tighter stops and as the markets can be so skitty the safer, less profitable option is normally the best. As ever though he said 'but you may think otherwise, and that's fine, we must do what we think is right for us'.

What happens with trading in general is very much ying and yang. Whatever positive you receive comes with an assicated negative. Bigger stops = less risk = less profit potential etc. Or say you're into system development, if you add in some filter that you believe will help, it will come with some sort of negative attached.
Road To Wisdom? To err and err and err again, but less and less and less...
  • #6,174
  • Mar 14, 2014 5:23am Mar 14, 2014 5:23am
Quoting Calculus
A very good trader said to me recently that he likes to trade with 'the most insurance he can afford'. What he meant was that a larger stop is normally always better than a smaller one although the smaller one if it works (stop not activated) offers the far larger profit potential. 10 tick stop and 70 ticks profit is of course 7:1, a 20 tick stop and 70 tick profit is 3.5:1. When I quized him, he said he's was stopped out too many times with tighter stops and as the markets can be so skitty the safer, less profitable option is normally the best....
Do you seriously prefer win rate to profit? I thought we were all here for profit.

A larger stop is almost always worse than a smaller one if we're talking about insurance.
tradewith60
  • #6,175
  • Mar 14, 2014 5:38am Mar 14, 2014 5:38am
Compare the affect on win rate and profit of increasing stops (reducing RR)

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tradewith60
  • #6,176
  • Mar 14, 2014 5:41am Mar 14, 2014 5:41am
Yes I do prefer win % over profits because a higher win rate means less mental and psychological impact. But there has to be a balance.

This game might be all about profits at the end of the day but what happens during the day is as important, ie can you execute your plan during the day/week/month to generate those profits at the end of the day/week/month. Low win rate and high profit in my opinion is hard, the easier to obtain is higher win rate and lower profits.

Also, on the smaller timeframes, 5m and 20m, the markets are so skitty that it really does pay not to hold out for the bigger profits (unless the chart indicted they're available and even then your analysis might be wrong). Big bull moves today can completely reverse tomorrow and vice-versa.

How does one feel when they had a 4:1 trade which then reverses to stop out at unchanged or loss versus how does one feel to take that 4:1 profit for the market to go better and offer an 8:1 if you'd held on? For me the better feeling is taking ther 4:1 profit regardless of how high the market goes. By taking that profit I've got money in the bank and the winning trade keeps me motivated which has a good chance of leading to more good trades and less missed oportunity. One could therefore make the argument that taking smaller profits more of the time is more profitable over the longer run than taking bigger profits less of the time even though on paper it says that taking the bigger profits less of the time will make you more.

For those that seek maximum profit potential my advice is simple, use Optimal f because if profit is all you're after that will (with a winning strategy) give you more profit than you thought was ever possible...
Road To Wisdom? To err and err and err again, but less and less and less...
  • #6,177
  • Mar 14, 2014 5:45am Mar 14, 2014 5:45am
Quoting 60minuteman
{quote}A larger stop is almost always worse than a smaller one if we're talking about insurance.
I would disagree because the flip side is the smaller stop has more of a chance of stopping you out and therefore more of a hidden psychological impact which can also be measured in money.

Whatever the case there are many ways to skin a cat in this business. Some go for option A and are happy others option B. There is no right answer for everyone, only the right answer for you.
Road To Wisdom? To err and err and err again, but less and less and less...
  • #6,178
  • Mar 14, 2014 5:58am Mar 14, 2014 5:58am
Quoting Calculus
{quote} I would disagree because the flip side is the smaller stop has more of a chance of stopping you out and therefore more of a hidden psychological impact which can also be measured in money. Whatever the case there are many ways to skin a cat in this business. Some go for option A and are happy others option B. There is no right answer for everyone, only the right answer for you.
It's not an opinion Calc, it's math' it's fact. Numbers will always say that higher risk to reward will generate more profit.

I don't agree with maxing out risk with optimal either, you know yourself the market is random, if you max risk based on past events then the market is gonna come back and bite your ass!

If a trader has problems with emotions then that is a different subject in my opinion. You're only looking at the short term psychological issues, both approaches have feelings the trader must confront, losses in the short term against very little reward despite your high win rate in the long term.

Seems we disagree on some main money management issues, I THINK your approach is the road most traders choose and I THINK it's wrong, but obviously there's no reason it can't work... I just personally think in the long term it will pose more issues for the trader.. (I have learned that any approach can work and I like discussing the pro's and con's, so don't think i'm knocking your thing mate!)

peace mate
tradewith60
  • #6,179
  • Mar 14, 2014 6:01am Mar 14, 2014 6:01am
60m

The table makes perfect sense, I understand that. But many things make perfect sense and even more so from a mathmatical angle in this game but CAN ONE TRADE THEM? That really is the key question.

Optimal f, using say half f makes perfect sense (assume a winning strategy) but who can trade that in real-time. Not many I wouldn't think. OK, this is an extreme example but nevertheless the human element of this game, just like sports, is absolutely critical.
Road To Wisdom? To err and err and err again, but less and less and less...
  • #6,180
  • Mar 14, 2014 6:06am Mar 14, 2014 6:06am
60m

I don't have a high win % and I don't take small profits either.

3:1 can never be considered small in this game, ever. It might not be huge on any one trade, but it can be huge overtime...
Road To Wisdom? To err and err and err again, but less and less and less...
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