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Someone talk to me about trading

  • #21
  • Aug 26, 2015 8:03pm Aug 26, 2015 8:03pm
Quoting Atokys
{quote} Are you sure? A risk management plan involves: - Limiting your market risk exposure to a tolerable level - Using a position size that reduces risk of ruin - Selecting which markets to play to provide diversification benefits but avoid over-trading
YEP SURE!! Check out the threads. MUST go to bed.
  • #22
  • Aug 26, 2015 9:26pm Aug 26, 2015 9:26pm
ive come to realize trading isnt about the sytem u use. more its about money management and risk/reward.

damien
  • #23
  • Aug 26, 2015 9:50pm Aug 26, 2015 9:50pm
Hey man,

For me I only started becoming profitable when I started trading on higher time frames. I only trade the 4H charts now and f*ck me it's changed my life lol.
I use to trade the 1 minute and 5 minute charts. What a disaster haha.

Is there any particular strategy you're using bro? Have you started trading live yet?
  • #24
  • Aug 26, 2015 10:03pm Aug 26, 2015 10:03pm
Quoting TheGreatMilenko
I know I've come across as a bit of a twat to some people over the years, but I can assure you I wish no one any harm. A couple of people have even subscribed to me!! Please don't do that as I'm not there yet. Some people have pm'd me saying they agree with what I've said!! I 'm not a guru. More of a dick at the mo. Anyway, how does someone trade to make money? I have my ideas, like to hear other people's. Seriously. The principles involved. Not the same old poop we've heard all before, ( some of it might be right) something fresh anyone? Oh yeah,...
Well, I would look at Aliens stuff, that's pretty good. Lately because of volatility I have gone back to good old ACD. Sadly I have to report that there is very little under the sun that's new. What's new is the generation, not the information. I am not good at laying out systems per se, I am much better at just answering questions.
If you are good at something, never do it for free--Joker
  • #25
  • Aug 26, 2015 10:58pm Aug 26, 2015 10:58pm
Reading through the posts to this thread, one thing stands out - no-one considers analysing the best times to trade. You need to develop a defensive attitude towards conserving your capital so that you can concentrate on making money rather than not losing money.
I am not about to give you the answers but try this on to see how it fits.
Keep good records of all the trades you took and those you saw but did not take.
Analyse the best and worst MONTHS to trade - avoid trading the worst months (ie., August)
Analyse the best weeks within the month to trade (ie., avoid trading the last week in the month)
Analyse the best days in the week to trade (ie., Mondays are patchy, Fridays trade differently to the rest of the week)
Analyse the best hours within the day to trade.
There are reasons behind all of these statements but I will leave you to research that.

Trade with a minimum reward to risk ratio of 4:1. This allows you to be "right" 1 in 5 times and you are breaking even. Of course you are not in this business to break even but this is part of the defensive mind set you need.

Consider how the big traders trade. Do you think they take risks with millions of dollars at stake. Start to think like them and try to follow their lead.

Someone posted a response that it is not about your trading system but about your strategy (or similar words). This is correct. Brokers provide plenty of indicators so that you start to believe that they must be the most important thing. That plays right into the brokers hands. Look beyond that and start asking yourself WHY that last big move happened. Until you start to get a feel for this, you are simply lighting matches in the dark - getting a short term look at the market but missing the big picture.
Price does not respond to indicators, or does it respond to S/R lines or news announcements. Price responds ONLY to the actions of traders entering or leaving the market. Follow that activity.

By my reckoning, there are about 90-120 good trading days in the year. If you are trading outside this, your results are purely luck.

Consider this - traders respond to EVENTS. There are vertical events (financial announcements and changes to economic conditions) and there are horizontal events (support/resistance lines, demand/supply zones). Price feeds off these events. When there are no events, price will float around like a small boat adrift on the open sea.

Before anyone asks me how I trade, let me say that the most important aspect of my trading is in the above post. The rest - I do not use any standard indicators. I have developed my own. If price makes a u-turn I generally have a line of some sort there to warn me.
I have fast moving indicators placed on long term charts and slow moving indicators placed on short term charts to filter out the noise and small movements. My trades are generally targeted at 40-50 pips.
I limit my trading to the above times and if I miss a good entry, I simply wait for the next one. If I take a profitable trade at the start of the trading session, I will risk part of this on a later trade. If my first trade is a loss, I will generally stand aside for the rest of that session unless I feel that I was simply unlucky with the initial entry.

Until you are consistently profitable, trade very small lots. You are trading to learn to trade, not for profit.
Once you are consistently profitable, you need to use a compounding technique to start making money. That is a whole new conversation. I use something like a reverse martingale technique. ie., I increase my lot size when I am trading profitably and I hold it or reduce it if I am in a loss period. I have no difficulty walking away from the market if a losing streak continues for some time. That is generally a sign that the market lacks conviction. ie., traders do not know what to do but they trade anyway.

I hope this helps someone.
Cheers, H
  • #26
  • Aug 27, 2015 12:15am Aug 27, 2015 12:15am
Quoting Aich
Reading through the posts to this thread, one thing stands out - no-one considers analysing the best times to trade. You need to develop a defensive attitude towards conserving your capital so that you can concentrate on making money rather than not losing money. I am not about to give you the answers but try this on to see how it fits. Keep good records of all the trades you took and those you saw but did not take. Analyse the best and worst MONTHS to trade - avoid trading the worst months (ie., August) Analyse the best weeks within the month to...
Paying attention to the time of day is valid if you trade intraday, but the idea regarding profitable months or specific dates is simply curve-fitting.
  • #27
  • Aug 27, 2015 3:08am Aug 27, 2015 3:08am
Quoting Atokys
{quote} Paying attention to the time of day is valid if you trade intraday, but the idea regarding profitable months or specific dates is simply curve-fitting.
Apart from this week, when market moves appear to be fueled by traders rushing to buy USD in line with China's apparent meltdown, put up your hands anyone who has made money in August.
Anyone??
I thought so.
August is the slowest month of the trading year - not just forex but all types of trading. All of the big money is on holiday in the south-of-france or spain.
Take notice of trading cycles and work out what causes them and you will be able to make a value judgement of the best times to trade with good risk/reward ratio.
Start to think beyond indicators and you may make some money. They are called indicators rather than "exacts" for a pretty good reason.
Cheers, H
  • #28
  • Aug 27, 2015 3:37am Aug 27, 2015 3:37am
Quoting Aich
Apart from this week, when market moves appear to be fueled by traders rushing to buy USD in line with China's apparent meltdown, put up your hands anyone who has made money in August. Anyone?? I thought so. August is the slowest month of the trading year - not just forex but all types of trading. All of the big money is on holiday in the south-of-france or spain. Take notice of trading cycles and work out what causes them and you will be able to make a value judgement of the best times to trade with good risk/reward ratio. Start to think beyond...
If you believe in seasonal trading cycles, and it helps you trade well, I guess I shall not judge. Just to let you know, when developing trading systems, its very common to find particular months of a year to be very profitable or otherwise. This tends to be due to coincidence and usually have no predictive value.
  • #29
  • Edited 4:19am Aug 27, 2015 3:46am | Edited 4:19am
with that kind of experience i am pretty sure you already know the answer to your questions, i'm also convinced that if you take the time and really dig into it you will come up with a solid trading plan in a day all by yourself. you know your strength and weaknesses, likes and dislikes, you can have all kinds of issues in different areas of trading, which only you can solve, what aspect of trading you should improve etc. there are a lot of ways to make money and what works for one type of person doesn't for the other.

off the top of my head here are some general guidelines

psychology:

make uncertainty your friend, the more you are trying to get rid of uncertainty and lean towards confirmation, the more you increase your risk and at the same time cut into your profits (kill your RRR), this goes for entry and exit of a trade. if you need confirmation your risk is too high and you will need an insanely high W/L ratio.

you have to take action despite of uncertainty and then judge your "being right" by following the market response.

entry/exit:

as said before, buy low, sell high, buy wholesale, sell retail, buy the down-, sell the uptick, this doesn't mean at all to try to catch the top/bottom it means don't chase price, don't be a sucker. in a trend buy the dips, sell the rallies, in range buy support, sell resistance. Sam Seiden is also a good read as well.

range:

what is a range: price bounces back and forth, making no advances, good range: large swings, bad range: small swings

never trade from the inside to the outside of a range (try to catch a trend early), fade fake breakouts, trade only away from the range when price already broke away substantially and tests from the outside. with experience you can see when price will break through, that means, stay in if you already are from the other boundary, don't enter during the breakout.

trend:

what is a trend: price goes up, stays up and goes further up, strong trend: weak retraces, weak trend: strong retraces (slanted range)

trade weak trends like a range, exit fully on the boundaries, but only enter in trend direction

in strong trends partially exit on strong moves in your direction, add more on retraces.

examples for entries (could be exits as well):

- a strong move goes into a tight range, a test of the countertrend-boundary of that range
- a tight range breaks building another tight range on top of it, test of the lower boundary of that range

example for exits (could be entries as well):

- unusual strong move, large candle, large profit, immediate counter-move
- dying out of the move, lame advances

apply that knowledge to two different timeframes and stack it on top of each other and with experience you can come up with your own favorite types of setups.

just my 2 silver eagles
Invincibility lies in the defence, the possibility of victory in the attack
  • #30
  • Aug 27, 2015 3:53am Aug 27, 2015 3:53am
The Work Required
Forex trading, simply put, is betting that one specific currency will appreciate or depreciate versus a second specific currency. It stands to reason that understanding what makes currencies appreciate or depreciate is an important first step in Forex trading.
Oddly enough, only a small fraction of retail Forex traders consider what makes currencies appreciate or depreciate in their Forex trade entry and exit decisions. Their focus is almost exclusively on currency pair exchange rate chart analysis (technical). There vague awareness of fundamental factors causing currency appreciation or depreciation, such as economic news, is tactically sidestepped and strategically ignored.
I am of the opinion that when a trader enhances his chart analysis (technical) by considering the fundamental factors that are likely causing the chart to look the way it does; the resulting trade entry and exit decisions will be significantly better than chart analysis alone.
Factors That Cause Currency Appreciation or Depreciation
There is no exact formula for determining why a currency appreciates or depreciates. There are many intertwining factors involved and the relative importance of any one factor can increase or decrease as economic conditions change and trader sentiment shifts.
Factors that consistently play a significant fundamental role in all currencies are:
· Market perception of the current and future state of a country’s overall economy
· The ongoing periodic releases of a country’s key economic indicators
· Central bank’s assessment of a country’s current and future economic prospects
· Central bank’s guidance on a country’s current and future level of interest rates
· Traders and investors sentiment and corresponding open positions
Factors that consistently play a significant role in specific currencies are:
· Significantly increasing or decreasing commodity prices
· Volatile increases and decreases in stock indices
Your chances of winning at Forex trading will increase if you take the time and do the work required to understand what causes currencies to appreciate or depreciate and use this information alongside your chart analysis.

Get the Necessary Experience
If you’re doing the work required and staying on top of your fundamentals, you are in a tenable position with a credible opinion of what should happen (which currencies are likely to appreciate or depreciate). What comes next is critical.
If your trade idea is the same as you read all over the internet, you are probably too early or too late. Success will come when you can identify unique opportunities; not the obvious ones that everyone is talking about. Original ideas will come with experience, provided you are consciously and actively on the lookout for them.

Be Patient
If you’ve done everything I suggested so far, it might possibly be time to write a simple trading plan (your trading strategy and risk management) and get started trading with real money. I suggest starting off with very conservative goals. Achieving them will build your confidence and give you a creditable basis for setting your goals a level higher.

Be Flexible
From the moment you put on a trade things start changing – the price (charts and technical), the economic news (fundamentals), the sentiment (traders’ opinions) and other relevant factors. It’s important to be aware, flexible and adaptive as needed.
  • #31
  • Aug 27, 2015 3:57am Aug 27, 2015 3:57am
With respect, Atokys, the thread starter has asked for some advice with fresh ideas. Thus far, your total contribution seems to be to buy low and sell high!
Silverheat has something to offer that you could benefit from.
Come back to me when you have got over the view that you are right and that makes everyone else wrong.
Read the first paragraph of silverheat's post a few times and you may learn something new.
Good trading to all.
  • #32
  • Aug 27, 2015 4:13am Aug 27, 2015 4:13am
Quoting Aich
With respect, Atokys, the thread starter has asked for some advice with fresh ideas. Thus far, your total contribution seems to be to buy low and sell high!
In all honesty, what I said was literally the opposite. Its buy high and sell low.
Quote
Silverheat has something to offer that you could benefit from. Come back to me when you have got over the view that you are right and that makes everyone else wrong. Read the first paragraph of silverheat's post a few times and you may learn something new. Good trading to all.
If you say so. A successful trader is one who looks within. Perhaps you should examine your own beliefs and why you became defensive when I challenged them.
  • #33
  • Aug 27, 2015 4:24am Aug 27, 2015 4:24am
Quoting TheGreatMilenko
I know I've come across as a bit of a twat to some people over the years, but I can assure you I wish no one any harm. A couple of people have even subscribed to me!! Please don't do that as I'm not there yet. Some people have pm'd me saying they agree with what I've said!! I 'm not a guru. More of a dick at the mo. Anyway, how does someone trade to make money? I have my ideas, like to hear other people's. Seriously. The principles involved. Not the same old poop we've heard all before, ( some of it might be right) something fresh anyone? Oh yeah,...
One can always learn from others.
The road to pipland is arduous and fraught with challenge.
  • #34
  • Aug 27, 2015 4:46am Aug 27, 2015 4:46am
Quoting Aich
{quote} Apart from this week, when market moves appear to be fueled by traders rushing to buy USD in line with China's apparent meltdown, put up your hands anyone who has made money in August. Anyone?? I thought so.
Putting my hand up! 14% and 1,940 pips at time of this post, obviously I've a couple of days left to lose it!

My trading is based on market sentiment, pure randomness and checking myself everytime I start thinking in theories. Just have to go with the flow and never believe you are right.

Anything that might endure you to stubornly stick to a position against what the market is doing, e.g. wave theory, indicators, fundemental analysis etc is going to cost you money.

Longer time frames have helped, bigger stop losses (50 pip+) and smaller trade sizes.
If a man knows not what harbor he seeks, any wind is the right wind.
  • #35
  • Aug 27, 2015 4:50am Aug 27, 2015 4:50am
Quoting Atokys
A successful trader is one who looks within.
What an absolute load of drivel! What second hand out-of-date paperback did you read this in?
Rather than being defensive, I am defending my assertions thus far. They are based on many hours of analysis, trading, head scratching and looking at my results over some years.
Now I challenge you to contribute something of value.
Something along the lines of Jimmy Young would be good.

BTW Well done ant358.
  • #36
  • Aug 27, 2015 5:48am Aug 27, 2015 5:48am
Quoting Jimmy Young
. What comes next is critical. If your trade idea is the same as you read all over the internet, you are probably too early or too late. Success will come when you can identify unique opportunities; not the obvious ones that everyone is talking about. Original ideas will come with experience, provided you are consciously and actively on the lookout for them.
I agree, wise words.

Jimmy do you know anyone who got to this point, without spending years (loosing money) trying to trade all the different published systems?
Can we learn from others or do we have to experience it for ourselves?
If a man knows not what harbor he seeks, any wind is the right wind.
  • #37
  • Aug 27, 2015 6:48am Aug 27, 2015 6:48am
Quoting Aich
What an absolute load of drivel! What second hand out-of-date paperback did you read this in? Rather than being defensive, I am defending my assertions thus far. They are based on many hours of analysis, trading, head scratching and looking at my results over some years. Now I challenge you to contribute something of value. Something along the lines of Jimmy Young would be good. BTW Well done ant358.
The problem with this is that 'value' is subjective and specific rules / mantras will only ever be of value if they fit a trader's personal beliefs about the markets. I prefer to give general opinions because my specific trading style matches my own beliefs. We do not trade markets, we trade our beliefs about markets.
  • #38
  • Aug 27, 2015 7:39am Aug 27, 2015 7:39am
Quoting Atokys
{quote} The problem with this is that 'value' is subjective and specific rules / mantras will only ever be of value if they fit a trader's personal beliefs about the markets. I prefer to give general opinions because my specific trading style matches my own beliefs. We do not trade markets, we trade our beliefs about markets.
There (in my opinion) you've hit the nail on the head, accidentally!

The problem is you have a belief. People will suffer immeasurably for their beliefs just look at religion.
Once you form a belief your in trouble and will hold a position against the market.

Have no belief, only objectivity!
If a man knows not what harbor he seeks, any wind is the right wind.
  • #39
  • Aug 27, 2015 7:48am Aug 27, 2015 7:48am
Quoting ant358
There (in my opinion) you've hit the nail on the head, accidentally! The problem is you have a belief. People will suffer immeasurably for their beliefs just look at religion. Once you form a belief your in trouble and will hold a position against the market. Have no belief, only objectivity!
The mental process of assessing objectivity is also shaped by beliefs about the market. Beliefs are neither good nor bad. However, some beliefs are more useful when it comes to trading. I can listen to an Elliot Wave theorist explain with intricate detail his methodology for objectively determining wave structure. I think its bogus, but if it helps him pull the trigger and cut losses it is an effective belief for him.
  • #40
  • Aug 27, 2015 9:38am Aug 27, 2015 9:38am
Have a look at this picture. It is taken from one of the best texts that I have read on trading that isn't about trading. "Improving Intelligence Analysis with ACH.pdf"

It's freely available on the web so I assume that I can quote it's explanation directly:

The drawing provides the reader an opportunity to test for him or
herself the persistence of established images. What do you see an
old woman or a young woman? Now look again to see if you can visually and mentally
reorganize the data to form a different image that of a young woman if your original
perception was of an old woman, or of the old woman if you first perceived the young
one. If necessary, look at the footnote for clues to help you identify the other image.
Again, this illustrates the principle that mindsets are quick to form but resistant to change.

When you have seen the figure from both perspectives, try shifting back and forth
from one perspective to the other. Do you notice some initial difficulty in making this
switch? One of the more difficult mental feats is to take a familiar body of data and
reorganize it visually or mentally to perceive it from a different perspective.

[The old woman' nose, mouth, and eye are, respectively, the young woman' chin, necklace, and ear.
The old woman is seen in profile looking left. The young woman is also looking left, but we see her
mainly from behind so most facial features are not visible. Her eyelash, nose and the curve of her cheek
may be seen just above the old woman' nose.]

So if your looking for something like Elliott Waves you then become blind what else is happening.
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If a man knows not what harbor he seeks, any wind is the right wind.
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