james16 Chart Thread
Hey Forex Factory, This is my first post ever, I'm excited to join everyone here!! So I wanted to post a trade I just took to get some critique and also as a way to present a new idea. First off, was this a good trade in your guys' eyes? I saw pin bar formation, not a lot of traffic around the trade (potential for larger movement), as well as divergence (signified by the green lines on my chart). Also where would you have put the stop loss? I tried to place it at the next support and resistance lines. Now on to presenting a new idea. The green lines...
{quote} That isnt really how probability works. I cant remember exactly, but I think it was Elder pushing this line (maybe Van Tharp though - my brain is jumping around today like Tom Cruise on a couch), and it's erroneous at best. Basically, assuming you have an 'edge' (ie, a positive expectancy), then in the long term your results will approach that value. The usual examples are flipping a coin or rolling a die - for every roll, we have a 1/6 chance of rolling a 6, about 16.7%. Roll it a million times and you will end up pretty close to this....
{quote} We have a winner!!!! For me I know if I change it up if it is good or not in a few weeks because I have a few 100 trades, the 4hr / daily guys may get a nice 6 month run then 2 years of crap before they even know if they can trade or not
{quote} {quote} Hey Mike, Was just going through some old posts since someone mentioned Ryanmcd. Just wondering what your opinion/view is on the above ? Take care Dan
poss thats pull back , {quote} {image}
{quote} That isnt really how probability works. I cant remember exactly, but I think it was Elder pushing this line (maybe Van Tharp though - my brain is jumping around today like Tom Cruise on a couch), and it's erroneous at best. Basically, assuming you have an 'edge' (ie, a positive expectancy), then in the long term your results will approach that value. The usual examples are flipping a coin or rolling a die - for every roll, we have a 1/6 chance of rolling a 6, about 16.7%. Roll it a million times and you will end up pretty close to this. The issue is variance. Over the short term, our results can vary considerably from what they 'should' be. Roll it ten times and you might no sixes. Do it a hundred times, you will get closer. A million? Even better. It's all about volume. Doesnt matter if we roll the dice ten times, then go hit on the hot girl at the coffee shop, buy a bagel and then come back to roll it another 90 - the only thing that matters is the number of trials. (At this point, you can google 'central limit theorem' if you like, but the results will bore you to tears) To wrap up this dicey (see what I did there?!) analogy, the issue isnt with 'taking every trade'. It is with taking enough trades so that the variance is minimised and you approach your expected value. So, someone like Ryan who trades the 5m charts doesnt have a disadvantage because he 'misses' trades, he actually has a huge advantage over people on daily bars* because he can take so many more trades, which means his results are going to be much closer to their true underlying value than someone trading daily bars. Assuming that the two trades have the same EV and SD, someone on the dailies is going to take alot fewer trades and their results can vary much more widely before they start getting close to their 'true' return. Also, all this dice talk makes me wish I knew how to play craps* this isnt to say that it is 'better' to trade the 5m chart. at all.
{quote} {quote} Hey Mike, Was just going through some old posts since someone mentioned Ryanmcd. Just wondering what your opinion/view is on the above ? Take care Dan
