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Trading Without a StopLoss

  • #1,721
  • Mar 17, 2014 4:25am Mar 17, 2014 4:25am
Quoting Rap Skallion
{quote} "except to move it in the direction of a trade that is going in my favour." That is an excellent use of a stop loss: It allows you to let the thing run and walk away knowing there is no more risk on that trade. A true competitor with close, consider, re-enter. That idea is common practice among traders, and a good alternative to the method mentioned in the last sentence. If conditions are optimum (indicators in your favour, moving averages all moving in your direction and spreading apart form one another, etc), This strategy is probably...
FX is a ranging market Rap. You are just fine. Your only real concern is negative swap if you have to hold for a long time. Even then, that will negate itself with profits won between your holdings.
If you are good at something, never do it for free--Joker
  • #1,722
  • Mar 17, 2014 4:59am Mar 17, 2014 4:59am
Quoting jmn5611
{quote} FX is a ranging market Rap. You are just fine. Your only real concern is negative swap if you have to hold for a long time. Even then, that will negate itself with profits won between your holdings.
I find that I am unable to put a stop loss on a trade in profit and walk away. My greed and excitement keep me at the screen until the screaming stops, and I close.
Usually (if the MAs are not against , or no pushes are going the wrong way) I get back in , or with a pender about 5 pips away .

I did manage to try a stop loss in profit once, did not like the results. For me, that is not my style.
for my argument against stoploss see post number 1,715. Transitioning from Demo to real coming up later today.
  • #1,723
  • Mar 17, 2014 5:06am Mar 17, 2014 5:06am
Quoting Rap Skallion
{quote} I find that I am unable to put a stop loss on a trade in profit and walk away. My greed and excitement keep me at the screen until the screaming stops, and I close. Usually (if the MAs are not against , or no pushes are going the wrong way) I get back in , or with a pender about 5 pips away . I did manage to try a stop loss in profit once, did not like the results. For me, that is not my style. for my argument against stoploss see post number 1,715. Transitioning from Demo to real coming up later today.
Considering your situation in the temporal world, I would say go for it!
If you are good at something, never do it for free--Joker
  • #1,724
  • Edited 11:00am Mar 17, 2014 5:20am | Edited 11:00am
Quoting jmn5611
{quote} Considering your situation in the temporal world, I would say go for it!
Also there is no sliding take profit with that method. Less money opportunity with it. so far this morning 90 pips (nothing last night, and monday is usually a quiet day).

Temporal situation? I have pretty much passed the baton to those who would take it, and still get to run with it. For me, it is the best of times, citizen!
  • #1,725
  • Mar 17, 2014 6:04pm Mar 17, 2014 6:04pm
Changing from a demo to real cash:
This is entirely up to you, but there will become a time when
playing with a demo will become boring to you. You would like
to become rich!
I.
If you have the real cash you can just switch right over, but
follow this simple rule:
Trade only the three windows with the best moving average setups
at the time:
Now do not say"Rap, won't it be boring just to trade same three
windows all the time", because that is not what I said.

Sooner or later every window will have its turn to be one of the three
best. At that time you will trade that window and the two other
best.
Pending trades will be removed from a window that is no longer
one of the three best. Chances are the prospects of trades in
that window are no longer what they once were.
Pending and active trades will be installed in the windows that
are best.
Let the trades in the other windows run: close them in profit if
you will. Once they are closed they would need multiple pushes
for you to even consider re-opening them, for they are not in
the three best windows of the time.
This is not hard and fast. If you have four really fantastic
windows, then trade four.
If you get in margin trouble, go close-a-trade-in-loss shopping
in the windows that are not the three best.
In the three best windows, you can use screamer scalping and
sliding take profit techniques to Increase the income from
those, overlapping pending trades. the lot.
When a window falls out of favor, move the take profits of
trades that are open so they do not overlap. Close windows
in profit, as they come into profit, and keep the cash
II.
All of this holds true in spades if you have an account less
than 1000. You may have to concentrate on only the single best
window in the garden at the time. You may have to limit the
number of total trades to keep margin safe. If margin gets to be
1/3 of balance, no new pending trades. You can put one on only
if another trade closes.
Become very unhappy and frustrated at the opportunities that are
passing you by and let that motivate you to find ways to
increase the money in the account from your own funds.
III.
Now if you feel secure, you can play "what if" games:
you look at a window and say what if this window were one of the
three best? Where would the price be in order for this to
happen?" put your pending trade there, but don't let it
activate unless the window actually becomes one of the three
best. (four best? six best? They will never ever all be
optimum).
As your account grows, you can expand out from there.
I believe that other systems, say, Ichi moku, or Gann Fan, are
actually pretty roughly this system in a different guise. You
will recognize Gann butterflys, Bearish and bullish triangles,
flags etc. in the system and that you are already set up to meet
them.
(the 45 degree angle of the "screamer"? W.D. Gann thought of it
first. I thought I had something new there, until I came across
it in his writings).
If anyone ever says to you "tell me who ever traded sucessfully
in the forex". Cite him W.D.Gann. Half a billion dollars in
trading gains, some of it in the currency exchanges of his day.
He was always succesful at trading anything he go into.

I would characterize my system as reactive rather than
predictive. It gets in early enough on a move to make money off
of it, rather than predicting which pair goes where next.
That to me sounds too much like work!
  • #1,726
  • Mar 18, 2014 1:52am Mar 18, 2014 1:52am
Quoting Rap Skallion
Changing from a demo to real cash: This is entirely up to you, but there will become a time when playing with a demo will become boring to you. You would like to become rich! I. If you have the real cash you can just switch right over, but follow this simple rule: Trade only the three windows with the best moving average setups at the time: Now do not say"Rap, won't it be boring just to trade same three windows all the time", because that is not what I said. Sooner or later every window will have its turn to be one of the three best. At that time...
If you have the disposable cash to study in depth Gann, Baumring, and Wyckoff, I promise you will chortle at all the "new" discoveries being made.
If you are good at something, never do it for free--Joker
  • #1,727
  • Mar 18, 2014 7:22am Mar 18, 2014 7:22am
Quoting jmn5611
{quote} If you have the disposable cash to study in depth Gann, Baumring, and Wyckoff, I promise you will chortle at all the "new" discoveries being made.
I may have picked up stuff form Gann and Wyckoff. Baumring , hmm.
will look him up.

Local libraries don't have these guys: you pretty much have to go to Amazon, etc.

Thanks for the tip. As far as I know, none of them actually say "parent and child pairs" or compare trading with preparing a garden bed. As far as I know.

I would like to read stuff you wrote, sir... I am subscribed to you.
  • #1,728
  • Mar 18, 2014 7:25am Mar 18, 2014 7:25am
Quoting jmn5611
{quote} If you have the disposable cash to study in depth Gann, Baumring, and Wyckoff, I promise you will chortle at all the "new" discoveries being made.
I may have picked up stuff form Gann and Wyckoff. Baumring , hmm.
will look him up.

Local libraries don't have these guys: you pretty much have to go to Amazon, etc.

Thanks for the tip. As far as I know, none of them actually say "parent and child pairs" or compare trading with preparing a garden bed. As far as I know.

I would like to read stuff you wrote, sir...

(Don't you just love those pictures with stiff necked people in celluloid collars? Aren't you glad you don't have to do that any more?)
  • #1,729
  • Mar 18, 2014 6:24pm Mar 18, 2014 6:24pm
I'm putting this out there for your examination: I've noticed how frequently in order to cross an S/R line the moving averages I use change states:

I've also told how I look upon moving averages as smoothed histories of pushes, either from parents or from News, and how parent pushes and news pushes tend to work together on the child pair (Even though news pushes propagate differently.

Let us tie together the use of S/R lines into this by saying the only "true" S/R lines are crossed only when the moving averages change state.

This is easily done by using price hesitations and turnarounds ( the hand- shaped patterns) to draw a prospective line. If price can reach this without causing a moving average pattern change ( 4 states Optimum four, weaving for, weaving against, optimum against) move to the next possible location until this does happen. The moving averages must at least be on the verge of changing states for it to be a TRUE S/R line;

At optimum the price is above the outmost moving average ( the 8 bar one) and merits great aggression if in your favor.


Now consider this: If the child is in optimum mode (but not being pushed) there is likely to a pair (or more) of parents also in optimum mode. And both Parent pushes and news event pushes propagate along the lines of currency pairs, just in different ways.

Can anyone out there see what I am driving at?
  • #1,730
  • Mar 18, 2014 9:59pm Mar 18, 2014 9:59pm
Quoting Rap Skallion
{quote} I may have picked up stuff form Gann and Wyckoff. Baumring , hmm. will look him up. Local libraries don't have these guys: you pretty much have to go to Amazon, etc. Thanks for the tip. As far as I know, none of them actually say "parent and child pairs" or compare trading with preparing a garden bed. As far as I know. I would like to read stuff you wrote, sir... I am subscribed to you.
No they didn't, the parent/child analogy is a rather ingenious way of getting people to understand correlation. If you are watching your pairs, they tend to push in groups. CAD pairs pushed together last night, for example. Good trades if you could stay awake for them.

A lot of folks like to focus on the astro parts of the three that I mentioned, but Gann especially was a good technician as well.
If you are good at something, never do it for free--Joker
  • #1,731
  • Mar 19, 2014 12:42am Mar 19, 2014 12:42am
Quoting jmn5611
{quote} No they didn't, the parent/child analogy is a rather ingenious way of getting people to understand correlation. If you are watching your pairs, they tend to push in groups. CAD pairs pushed together last night, for example. Good trades if you could stay awake for them. A lot of folks like to focus on the astro parts of the three that I mentioned, but Gann especially was a good technician as well.
Attached Image (click to enlarge)
Click to Enlarge Name: News_event_groups.jpg Size: 35 KB


I made this chart of news event propogation: it is specific to the bias I have on each pair : YOu have to pencil in usdcad in the "CAD UP" frame. I forgot to put it in. (Where else would you watch the CAD from)?
closed 7 trades in Euro cad yesterday, one trade in gbpcad, so yes, this feature that you mentioned has been good to me.

It also came in handy during the speech Art Carney gave in the after noon. Made over 245 pips.

People criticize the technical traders, saying that the past is not the future, but consider this: You are a baseball manager: Bottom of the ninth, two out, bases loaded, three runs down, last chance to win the pennant; you have a slugger, one who contends for the lead in home runs,or you could put in your prize shortstop, who does not really have any power; Which one would you have go up to the plate:

I was thrilled when, in 1948, I listened in on the radio, coming home from the beach, as Gene Hermanski, down to his last strike, hit one out of the park for the Dodgers and won the pennant.

The market is like baseball. It happened before somewhere, and it will happen again.
  • #1,732
  • Mar 19, 2014 1:38am Mar 19, 2014 1:38am
Cycles occur all over nature, Daily, weekly , monthly cycles have been studied for thousands of years. The ice ages are a recurring cycle, which we have perhaps been postponing with our fossil fuel emissions, The tides come in regular, predictable cycles. Sunspots occur in cycles. Toss a pebble into a calm pond and you will generate a predictable cycle of ripples, going out in circles from where the pebble hit the water. The rain falling on the same pond makes thousands of little ripples all intersecting. The yearly seasons form a cycle that effects our lives in drastic ways (unless you live in Buenos Aires where the temperature seems to be 72 degrees year round). Every 40 years or so a different group of people seem to inhabit the earth.

It was from charts that Kepler deduced the planets orbit the sun not in circles but ellipses, and from this did Newton deduce the Law of gravity and Newtonian physics. (The accuracy of his calculations obscure the fact that no one has ever adequately described what a "force acting at a distance" is).

It only stands to reason that, since the market exists as an artifact of people living in reality, that it has cycles.

Odd that Newton spent the vast majority of his time trying to turn lead into gold, the invention of calculus, his whole work in the Principia, were only side lights to where his real interests lay. Yet no one today is really involved in alchemy.
J.P Morgan invited his friend, Henry Ford to join a highly secret group studying Egyptology and its relationships to modern life, including the market.
Does this club exist today? One has one's suspicions
Does the market move in predictable cycles?
You betchum!

Just don't look to me to calculate and predict them (yet).

Other than the area under a cyclical curve involves a number Pythagoras conceived of that no one has calculated perfectly yet and no one ever will.

It strikes me as ludicrous that people use fixed stop loss. It's like trying to navigate the ocean in a boat made of skins and bone.
(Oh wait: the Inuit did just that, didn't they?)

Time is running out for me to attempt such a task, sir. How about you?
  • #1,733
  • Mar 19, 2014 2:06am Mar 19, 2014 2:06am
Quoting Rap Skallion
Cycles occur all over nature, Daily, weekly , monthly cycles have been studied for thousands of years. The ice ages are a recurring cycle, which we have perhaps been postponing with our fossil fuel emissions, The tides come in regular, predictable cycles. Sunspots occur in cycles. Toss a pebble into a calm pond and you will generate a predictable cycle of ripples, going out in circles from where the pebble hit the water. The rain falling on the same pond makes thousands of little ripples all intersecting. The yearly seasons form a cycle that effects...
I see you are voracious reader, up to the power curve right away. If you are old enuf to remember the Brooklyn Dodgers, then you should know that I am a young pup in comparison. My first childhood baseball team was the Big Red Machine. And you are right, baseball and trading go hand in hand. Never did understand comparing it to poker.

I do try to try away from bottom of the 9th, bases full, count full. In trading it is usually my luck to pop it up. If it was only one out, I would surely hit into the 4-3-2 double play. I try to stay away from that.

What people miss about Gann is that he did not predict when he was right. He predicted the points where he knew he would be wrong. That is something that took me years to figure out. I still use that nugget today. As far as the CAD I watch all the crosses of all the majors. It is fun to see them popping like popcorn. Yesterday the E/C went off first I think, then the rest followed.
If you are good at something, never do it for free--Joker
  • #1,734
  • Mar 19, 2014 3:00am Mar 19, 2014 3:00am
Quoting jmn5611
{quote} I see you are voracious reader, up to the power curve right away. If you are old enuf to remember the Brooklyn Dodgers, then you should know that I am a young pup in comparison. My first childhood baseball team was the Big Red Machine. And you are right, baseball and trading go hand in hand. Never did understand comparing it to poker. I do try to try away from bottom of the 9th, bases full, count full. In trading it is usually my luck to pop it up. If it was only one out, I would surely hit into the 4-3-2 double play. I try to stay away...

A method of telling when your other method would be wrong! .... hmm.

Most games are won by the unexciting work the teams do in the first innings, of course, That just sets up the exciting climaxes.

looking for some action around 5:30am est. from the Gbp. Back to bed. I'm not an insomniac. no, really!
  • #1,735
  • Mar 19, 2014 4:07pm Mar 19, 2014 4:07pm
got some action from the fomc statement: 250 p today most from news pushes. they also seem to have a habit of pushing the M.A.s around. The news pushes chart has paid off for me so far. the gbp pushed only once today, thought there was another news event with red FF signal later in the morning. One push per currency per day?

I have never played the FOMC report before because there doesn't seem to be a headline release. So I just put pending trades in with lines of S/R between current market price some time before the event on the windows indicated by my chart, and played the market itself. If you remove the pending trades that did not take a half hour or so after the event you prevent them from sneaking into your entry column, raising the number of trades, and hence, margin. NOthing of note for tnight.
  • #1,736
  • Edited 11:58pm Mar 20, 2014 6:41pm | Edited 11:58pm
Attached Image (click to enlarge)
Click to Enlarge Name: Money flows.jpg Size: 131 KB


This pretty well demonstrates that pushes caused by the news and pushes caused by parent-child relationships are independent.

That does not mean they cannot coincide, adding or subtracting from each other. The person selling into a buying spree here is fortunate, for he is getting a bargain for his money. The person buying into a panic, likewise. There are winners, for different reasons on both sides of this kind of transaction. The other way 'round, both parties lose.

The frame in the upper right hand corner exhibits the 16 kinds of money flows, between currencies. All money flows between currencies can resolves themselves into groups of flows between threes.

Translating these flows into rising and falling currency pairs: that can be confusing...
  • #1,737
  • Mar 21, 2014 12:01am Mar 21, 2014 12:01am
Quoting Rap Skallion
{image} This pretty well demonstrates that pushes caused by the news and pushes caused by parent-child relationships are independent. That does not mean they cannot coincide, adding or subtracting from each other. The person selling into a buying spree here is fortunate, for he is getting a bargain for his money. The person buying into a panic, likewise. There are winners, for different reasons on both sides of this kind of transaction. The other way 'round, both parties lose. The frame in the upper right hand corner exhibits the 16 kinds of money...
Not quite sure what to make of that Rap.
If you are good at something, never do it for free--Joker
  • #1,738
  • Mar 21, 2014 12:03am Mar 21, 2014 12:03am
E/A A/U and A/C all had moves at about 9pm EST last night. Just quick little pops. But the child pair E/U and E/C did not make a move. What happens when parents push but the child stays?
If you are good at something, never do it for free--Joker
  • #1,739
  • Mar 21, 2014 4:01am Mar 21, 2014 4:01am
Quoting jmn5611
E/A A/U and A/C all had moves at about 9pm EST last night. Just quick little pops. But the child pair E/U and E/C did not make a move. What happens when parents push but the child stays?

Note that the correlations are not 100% My guess is that the Aussie had a surge(noted) and the Euro did well as well, blunting the push.

when a single currency moves in news push, the children are independent. (via my last post).

At this time gbpaud is still going down into profit.

Child pushes should be for verification on a move, only. (See why?)

Or, it could be something else

Informative post you have made.
  • #1,740
  • Mar 21, 2014 4:37am Mar 21, 2014 4:37am
I am new to trading, still only using demo accounts.

My opinions on the original question about trading without a stop loss are:

1. You are never trading without a stoploss as your account is a giant stop loss.

2. Of course it is ok to trade in this way as long as you are happy to eventually lose your account balance and have a money management plan that can cope with that. (i.e. not all of your money in that one trading account!)

When I have found a system (or a few) that work and have been thoroughly tested, I plan on having multiple accounts with relatively small amounts of money in them. I also plan on withdrawing money regularly (maybe half of profits when there are profits). Once the money is withdrawn it is safe.

I am currently testing one expert advisor that doesn't use stop losses. It seems like you might need too large an account balance for it to work for me though as it uses martingale strategy.
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