Non-Predictive Trading

I've always been around. Just stopped posting ever since was invited to start a fund. Our biggest recent success was a Brexit straddle. Not quite as massive as Soros breaking BoE, but still substantial and my investors are very pleased with me.

Not much has changed, and I still stand by virtually everything I've said in the past.

The point is that nobody is ever going to tell you or anybody how to do 'it' exactly, and i believe many would agree that in 'the real world of business' it is exactly the same.

I own multiple 'retail' businesses and let me tell you nobody that is in direct competition will spell out to you how/where/why/when they buy their stock. For price is the competition. Price and Location. Yes they may share pointers but that is about it. Go ask McDonalds if they will share their 'proprietary processes and formulas' with you. Or better still, go ask a hedge fund where they enter/exit etc.

Ive said this before - I dont trade a currency cross as a single entity, but as a fraction of a whole.
Depending on the circumstances i may be all in/out or i may campaign around a core position and this comes down to my risk/trade/price structure process.

Last but not least, i never said there was 'a goldmine somewhere' but that price can be interpreted in parts just like each piece of a puzzle FORMS the puzzle.

There's some users on here saying my thread is in contradiction in terms of prediction ill explain what i meant:

My idea of non-predictive trading or you may call it scalping..

Scalp pips a few times a day until you're satisfied and be done for the day.

Close as soon as your "signal" changes due to price movement.

Follow price using a Moving average or something similar and get out when the price goes the opposite way, then look for another signal again, rinse and repeat.

no technical analysis at all.

The problem is that only a few people will share their method.
I need a method.

Trying tick charts now..could be the answer.

Ok can you please show us on a chart ?

Best regards

Its impossible to show it on a still chart..simply because price behaves how it wants live and not how you see it on past history...thats a mistake 90% traders make..backtesting is pointless..you cant predict. Also indicators are drawn perfectly on historic data...but its the absolute opposite when live trading.

all the backtests you see in images or on your platform is a scam.

The only way to tell someone is either. Buy above "..", sell below "..". Get out when it touches ".." etc.

OK and you must have days when price cross the line many times going sideways ?

Best regards

I think, moving average or something similar itself is part of technical analysis. if you said no technical analysis at all then do not look at chart totally. watch closely on price(number) movement. watch totally on that, watch how the price change, the velocity of the move, watch how the spread(bid-ask) move, its different kind the spread move which the bid move fast versus the ask move fast. that is some of my method and experience if trading totally without chart and only numbers. and yes this kind of method will be called by lot of people is BLIND, and lot of people will say its GAMBLE. but if we can rigidity discipline on"trading hours" and accept how much pips we get on that trading time no matter what, on long period the account balance will rise .

how long have you been losing money trading like that ?

Hi guys , i actually have a robot that do not use any predict logic or uses any indicator. Screenshot shows my 3months result

Can you share the EA with us?

Sure i can share . But i have some terms and condition that needs to be adhere to. Send me PM

'Trend Following' as a trading methodology will be one of the most difficult strategies mentally speaking, that you will probably ever encounter as a trader.
However, I personally believe the time and effort to structure such a method is well worth it. The major problem with this method from a trader's mental standpoint, is that we're all programmed to look for things such as support and resistance, fibs, patterns, etc. The truth is that all of these 'tools' are no better than a 50/50 probability - for as many price movements will go through that resistance line as bounce off of it. As I've said many times, there are just too many 'variables' included in a moving price for any of these things to be of any great significance.

In my opinion, there are only two methods to trade to increase your probability and both of these are in direct contradiction to each other. One is to devise a method of trading 'reversals' - yes, tops and bottoms if you will. I realize this is frowned upon in the trading world but this allows you not only to buy at good prices but also provides a cushion for pullbacks and fundamental events during the price movement. Otherwise, all you're doing is 'trading in the middle of the money' and you end up feeding the financial institutions.

The number 2 method is the point of our discussion - which is 'mechanical' or as it's often referred to as Trend Following. Simply put, in this method you structure a method for entries (a trigger) which allows you to take advantage of the longer movements the market at times presents you with. Again, the mental challenge here is to be disciplined enough to follow your prescribed method and not be influenced by other markers you see in the charts. I will tell you upfront that your accuracy percentage will probably be less than 50%. History shows us that the most renown traders in the world were only right 30 to 40% of the time. However, they made more money on the 3 or 4 out of ten they won, than the amount lost in the remaining 6 or 7. But as has been said, there are no predictions or pre-determinations as to where the price is going - you took care of all of that when you devised your mechanical method for trading.

I suggest you choose one method and become proficient at it.

There is in fact a third method - trading baskets (a form of arbitrage). But we'll save this discussion for another time.

Well, of course - there is a well-known strategy for making trades without being concerned about analysis. It is called 'Martingale'. Simply stated, you double the amount of a trade after each loss. Mathematically, it is impossible to lose with this strategy because each time you lose, by doubling the amount of the previous trade, you will regain the loss plus the profit of the new trade.

You would need to add some money management to your process, i.e. making a decision on HOW MUCH you will allow a trade to lose and HOW MUCH to let a trade continue when you are winning. Those who trade with 'binary' forex brokers are fond of this strategy because the decision about HOW MUCH (to lose or to win) is predetermined at the time the trade is initiated. At the end of a predetermined time, that you select, there is either a win or a loss of a finite amount that the broker dictates before the trade is initiated.

Now the BAD news :-(

Notice that I said that it is "mathematically" impossible to lose. In the real world, there is a small problem with the math. If you double the amount of the previous loss and you have a string of losses, the amount of each consecutive trade can become quite large very quickly - like astronomically large!

So, some think that by starting with a very small trade, in comparison with the total amount of available investment capital, one should be able to cover enough losses in a row to overcome any likely number of string of losses - WRONG. Even starting with a small trade of just $100 would exceed an initial investment capital of $5,000 after losing (and doubling the amount of the trade) 6 times in a row. If you think that you could bring $10,000 to the game and be able to last through a string of twice as many losses, sorry you would exceed $10,000 after only 7 losses in a row. Do the math.

But, here is a simple strategy that can be used with no indicators. It is difficult to trade it with more than a 50% win ratio and it takes good money management to maintain a profit: Place a pending buy order above the current price and a pending sell order below the current price at the same time.

In a choppy market, this will whipsaw so much that you will lose on almost every trade as the price moves just enough to fill your trade and then bounces back to put you in a loss. The price must move further than the amount of the spread plus the commission in order to hit a profit.

Money management is critical - losses must be controlled and kept to a small amount (probably 1% of your capital). Trailing stops are the best way to preserve profits in a running profitable trade, unless you can continually watch the market and have the discipline get out of a trade when pullbacks occur and before the trade looses most of its gain.

If you "paper trade" this strategy for a number of weeks, you'll learn a lot about how a currency pair performs in different markets - even at different times of the day if you're inclined to day trade. You'll also begin to see how just one or two basic indicators assist you in understanding whether or not there is a good chance for a significant move in price.

Using nothing more than a moving average and (maybe) a basic indicator such as RSI, MACD, or Stochastics, you'll eventually gain the skills to pretty accurately know the direction of the market. Also, observe the volume in relation to the trend.

But, again, money management will make the difference between losing or breaking even and having bigger wins than losses.

Hi there,

So I have basically uncovered a lot of "truths" about forex these last couple of months that really opened my eyes. The thing is, I've learned to disregard the use of indicators and whatnot but the only variable that truly makes sense to me is the use of support and resistance. Think of it this way, when you draw confluence lines on your chart (it must be accurate or it won't be effective!), price ALWAYS has to touch a certain point before it can move another direction... So you guys mentioned to pay no attention to the past data, which I agree because we will never know which way the market will go but won't using support and resistance create some advantage or "edge"?

Regards.