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LFX Trading Proverbs

  • #201
  • Oct 4, 2015 7:46am Oct 4, 2015 7:46am
Why forex?
Most people choose forex due to deep seated masochistic tendencies with an unconscious drive to financial suicide rendering the individual in a constant state of unhappiness and despair.
  • #202
  • Oct 4, 2015 9:11am Oct 4, 2015 9:11am
Quoting Mingary
Why forex? Most people choose forex due to deep seated masochistic tendencies with an unconscious drive to financial suicide rendering the individual in a constant state of unhappiness and despair.
That made me laugh .have any brokers ever aproached you about possible jobs to run there marketing .

  • #203
  • Oct 4, 2015 4:39pm Oct 4, 2015 4:39pm
Quoting Atokys
{quote} I feel that since money is at stake, nobody should consider trading at full size until they feel they are at Stage 4. I also feel that upon reaching Stage 3, many will truly understand the game of trading and leave.
Yeah, anyone with a brain should demo, or paper trade, until they get efficient. Once they start trading live, they should use the smallest size available until they see how they handle the emotional effects. You also need to create a business plan, which should eliminate a lot of wannabes. Just like you budget your day, or your bank account, you need to break your business into components with goals, milestones, and continuous improvement processes. It is probably similar to whatever your job is now, or was, if you are unemployed. There was likely some form of training and advances in skill as tasks were learned, applied, evaluated, and approved. Real trading is not different. You need a mathematical model, a background for fundamentals, a calm soul, a delivery method, and a scalability plan. You also need support, such as a brokerage, a bank, an accountant, employees/partners, family/friends who allow you to sleep when you need to sleep, etc. You also need equipment, such as computers, Internet, electricity, and trading software. You can only control certain aspects of your business, so you must protect your money when it leaves your control the best that you can. You might think listing equipment is funny, or strange, but I have lost Internet and electricity before. I have blown up 4 computers so far. I have had MT4 crash on me before. Keep your broker's number in your phone because you never know when you might need to make a manual trading decision through them.

Stage 3 is where you have to decide if you are going to be an investor or trader. It is where you realize you need to dedicate your time and energy if you want to be successful. If you cannot commit, then you should seek other alternatives, like managed accounts or position trading.

It is not an insult nor should there be any embarrassment if you quit. Many people are invested in markets, but that does not make them traders. It is really no different than becoming a surgeon. Do you kick yourself everyday for being not being able to operate on people? Or did you pursue a different career/talent and excel at that? So, you do not need to kick yourself everyday because you are not good at trading. It is an extremely difficult craft to learn, and Forex is the top of the food chain. It is truly like being a brain surgeon. It takes years of study and practice. The extremely high loss rate is due to the complexity of this profession. The worst part though is that unlike becoming a surgeon, there is no formal education process you can take. There is more to trading than what is found in a book. It requires a deep connection with your soul. No one can teach that.

I sit on a double edged sword. On one hand, I issue a warning. On the other hand, I need you to disregard me or I cannot make any profit. I suspect very few will ever see my post, and even fewer will take it serious. Fewer still will ever apply my technique and become profitable. It really comes down to education, and commitment to yourself, but since we live in an entitlement society, many will recognize it as too much work and look for shortcuts. C'est la vie
You cannot be extraordinary by being normal
  • #204
  • Oct 4, 2015 5:20pm Oct 4, 2015 5:20pm
Quoting Mingary
Why forex? Most people choose forex due to deep seated masochistic tendencies with an unconscious drive to financial suicide rendering the individual in a constant state of unhappiness and despair.
My thread is about trading and making money. If that topic is not of interest to you, please troll the forum for a more appropriate thread. There are many negative threads available for people who prefer to lose money. This isn't one of them. Find one that suits you better. Thank you.
You cannot be extraordinary by being normal
  • #205
  • Oct 4, 2015 5:59pm Oct 4, 2015 5:59pm
Quoting dkrock
{quote} My thread is about trading and making money. If that topic is not of interest to you, please troll the forum for a more appropriate thread. There are many negative threads available for people who prefer to lose money. This isn't one of them. Find one that suits you better. Thank you.
All about trading and making money ?
There is a bit more going on in trading than just trying to make money ...
Cynicism aside, my statement is much closer to what is really going on in most trader's mind than just "trading and making money"
  • #206
  • Edited 6:49pm Oct 4, 2015 6:35pm | Edited 6:49pm
Quoting Mingary
{quote} All about trading and making money ? There is a bit more going on in trading than just trying to make money ... Cynicism aside, my statement is much closer to what is really going on in most trader's mind than just "trading and making money"
You have a long history of disturbing posts. I venture it is more about what is going on in "your" specific head, and not "most" traders. You are assuming most people are traders, but they are not. They are in various stages of development. Once someone is an authentic trader, the premise of financial sabotage is ridiculous.
You cannot be extraordinary by being normal
  • #207
  • Edited 11:00am Oct 5, 2015 8:39am | Edited 11:00am
Quoting dkrock
{quote} You have a long history of disturbing posts. I venture it is more about what is going on in "your" specific head, and not "most" traders. You are assuming most people are traders, but they are not. They are in various stages of development. Once someone is an authentic trader, the premise of financial sabotage is ridiculous.

A long history of disturbing posts ?
It is said that in ancient Rome some cities condoned and supported the local drunks so the youth would be made aware of the dangers and misery of excessive drinking.

Anyhow, I am puzzled as to how you would consider someone to be "an authentic trader"?
  • #208
  • Oct 5, 2015 8:43am Oct 5, 2015 8:43am
Quoting dkrock
{quote} Yeah, anyone with a brain should demo, or paper trade, until they get efficient. Once they start trading live, they should use the smallest size available until they see how they handle the emotional effects.
Thats pretty commonsensical though what im alluding to is actually understanding the nature of the game.

If people truly came to terms with and appreciate the uncertainty that accompanies trading there would be a lot less traders.
Quote
If you cannot commit, then you should seek other alternatives, like managed accounts or position trading. It is not an insult nor should there be any embarrassment if you quit.
Deciding not to be a trader can be the best decision many people would ever make. Many are called but few are chosen.
  • #209
  • Oct 6, 2015 3:15pm Oct 6, 2015 3:15pm
1. How can I apply to be on your team.
2. Can you talk about signs of head fake? Like last vertical line here.
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  • #210
  • Oct 6, 2015 4:49pm Oct 6, 2015 4:49pm
How do you finding an entry into position? How to join to trend?
  • #211
  • Oct 7, 2015 5:33am Oct 7, 2015 5:33am
What is a trend? Start there. A trend to you may not be a trend to me. For entry Dkrock explained that very well a page or two back.
  • #212
  • Oct 7, 2015 6:48am Oct 7, 2015 6:48am
Quoting Jhlewis10
1. How can I apply to be on your team. 2. Can you talk about signs of head fake? Like last vertical line here.
Hello again Jhlewis. I have to finish some personal goals and then I will look at expanding my team. It will be several months before I make any changes.

As far as your screenshot, I know you are not using my method in the same fashion as me so don't take any offense in my signals being different. I recognize the top indicator, but not the other two. I do not see a head fake at your vertical lines on my chart.

It is important for you to realize that I have modified my technique since I started this thread. Initially it was tighter to market movement and I worked it on 1M charts. I wanted to make it easier to use, less intense, and so I altered it and moved to 5M charts. It does not signal the same way. Before I used a fractional value of the market equilibrium to dissect trades and target only vertical movement. Now, I use the whole market equilibrium value. It allows me to diversify across the market since it signals less frequently. I needed to trade with more peace and less stress So I came to terms with winning more trades (giving me more peace) and making less daily profits (giving me less stress). I switched my business plan from intense "get all the pips", to lazy "diversify and compound".

Now, I usually trade through weak dips and consolidation areas, so head fakes are not very common. They still occur, mostly at London Open, but I am pretty sure that is by design because of all the "London Open" trading methods. They head fake the open, then force stop losses. However, it does not happen everyday, so I have to just trade through it and realize it is just part of the game. They might happen after several hours in one direction too, as some traders are either taking profit or thinking it is time to reverse and being wrong.

All that said, both of your vertical lines point to an area far outside the equilibrium, but not at my apex, so there would be no reason to pay attention to them. My sell signal occurs at 0030. The entry signal was 1700.

You know I cannot show you a real screenshot because this is my business and so my exact technique is proprietary, but, I will back up my statement, so here is a screenshot of the area you posted. The outside lines are my trade. The two inside lines are your vertical lines where you thought there was a head fake. There was an obvious reversal, so you could call it a head fake, but I ignored it. The area that my posted indicator shows a reversal trade was not validated by my primary indicator, so again ignored.

Hope this helps. Hopefully in a few months currencies still exist.
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You cannot be extraordinary by being normal
  • #213
  • Edited 7:47am Oct 7, 2015 7:08am | Edited 7:47am
Quoting Mariodrugs
How do you finding an entry into position? How to join to trend?
I use math to determine the probability of success. Then I enter/exit according to its signals. I never know I am in a trend until I am in it. To me, a trend is a trade that last awhile
You cannot be extraordinary by being normal
  • #214
  • Oct 7, 2015 12:11pm Oct 7, 2015 12:11pm
No offense taken, I am a student.

Sounds like you are finding a good balance in your personal and professional life, good job!

The first dip into red with your indicator, why is that not a valid sell? Is the angle of the entry too shallow? Or are you using other indicators to
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  • #215
  • Edited 7:46pm Oct 7, 2015 7:35pm | Edited 7:46pm
Quoting Jhlewis10
Or are you using other indicators
Yes. I said this is not my primary indicator. This is like my chop indicator. It alerts to general conditions and then I compare the alert to the primary indicator. If you wanted to take that signal, you could, but you see it was a break-even. A less risky trader could exit, and then reenter. But, I know what normally happens on those dips, so I just ride it out. Saves me from needing to be fast for the break-even, and some pips to pay for spread.

The trade previous, for example, was a break-even trade occurring in conjunction with the NY Open, so I would have taken it. The trade after was also a break-even trade, but occurring outside my normal trading hours during the lull, so I would not have taken it. I concentrate on Frankfurt Open to NY Lunch.
You cannot be extraordinary by being normal
  • #216
  • Oct 8, 2015 11:17pm Oct 8, 2015 11:17pm
dkrock,
A belated thank you for replying to my previous post, I needed some time to digest your reply and gather my thoughts (while free time constraints were also an issue )
I would like to share some of the thoughts I had with you. With different time frames having different sample sizes between the highs and lows (different means between buying and selling) would it not be prudent to have entries on a lower time frame, say 5 minute, that go in line with a higher time frame, say 30 minute? Meaning possibly less trades, but also a higher range to cover the spread. I ask this because I seem to get whipsawed or faked out quite often before a true direction for the session/day is chosen. I frequently get a few small losses and lose confidence for the next, usually profitable trade. So are you always looking to trade in the overall direction of the larger sample size or is looking at things at a more micro level a less time-consuming and equally profitable venture?

I read a post or two where you mentioned the importance of finding an indicator to help determine fake-outs. In my search, I keep coming back to the statement that "virtually all indicators are measured against some kind of moving average." Thus I'm wondering if there is a specific indicator I should be looking for that measures this better than others or if it's simple about measuring the average movement direction on a large sample size and determining when/if there are unnatural moves against this direction.

I'm a bit unclear on finding momentum from the bollinger bands in the indicator window, was hoping you could make it a little clearer. Do you see momentum increasing/decreasing by the opening or closing of the bollingers or when the indicator goes outside of the bands? Is there any trick to seeing this better? I have been studying them for quite some time now and the answer is still not apparent to me.

I didn't previously realize you had two different blog pages outside of FF. I had only read your most recent blog and since gone through the one from 2012. I have been trying to fine tune my system according to the logic therein. Do you still monitor your most recent blog?
I liked the read on the 5 steps to becoming a successful forex trader. I think getting past stage 3 is very difficult, as from my understanding involves knowing, having and believing in your trading edge. Until then step 4 will continue to be evasive for me and I'm sure many others.
Thanks for continuing to support fellow FF traders here on your blog and in enabling them to develop their own trading edge through your insights.
  • #217
  • Edited 8:41am Oct 10, 2015 8:21am | Edited 8:41am
nalovelady,

Bollinger bands are tools. You will see them expand in a break-out. They will show collapsing at the end of a break-out. They will be angled up/down in a trend. They will go parallel in a flat consolidation. I do not use them for signals. I use them for viewing market momentum and behavior. They are just visual references.

Just keep looking at the big picture and ways to define it. I can feel you getting close to your solution. Very close The test of success is trading without candles. Anytime you think you have it figured out, remove the candles and test it Anytime you are not sure what to do, remove the candles and figure out what you still need Crazy, but effective!
You cannot be extraordinary by being normal
  • #218
  • Oct 13, 2015 8:52am Oct 13, 2015 8:52am
Quoting dkrock
nalovelady, Bollinger bands are tools. You will see them expand in a break-out. They will show collapsing at the end of a break-out. They will be angled up/down in a trend. They will go parallel in a flat consolidation. I do not use them for signals. I use them for viewing market momentum and behavior. They are just visual references. Just keep looking at the big picture and ways to define it. I can feel you getting close to your solution. Very close The test of success is trading without candles. Anytime you think you have it figured out, remove...

Hi dkrock,

i've been following your posts since you joined ff, i've been using your 12sma scaled to a 5min and 1 min chart 72sma and 360 sma respectively.

very useful, i have used this on my bollinger settings, quite impressive but still doesn't work out always, any guidance please??
  • #219
  • Oct 27, 2015 4:18am Oct 27, 2015 4:18am
Quoting mahk90
{quote} Hi dkrock, i've been following your posts since you joined ff, i've been using your 12sma scaled to a 5min and 1 min chart 72sma and 360 sma respectively. very useful, i have used this on my bollinger settings, quite impressive but still doesn't work out always, any guidance please??
Try going up a time frame instead of down.
You cannot be extraordinary by being normal
  • #220
  • Nov 3, 2015 6:42pm Nov 3, 2015 6:42pm
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