Get rich! It's a sure thing, guv........

Over the years I've always been amazed by how people are prepared to part with their hard earned cash to buy systems of the "Make a million pounds in five minutes" type.

To anyone who is tempted I would suggest you ask yourself this question:

If you had a sure-fire system would you be more likely to:

a) Guard the secret with your life and go about trading it quietly until you had made a fortune beyond your wildest dreams, or

b) Sell it to others in the full knowledge that the more people used it the more it would be adversely affected by slippage (all your customers trying to enter/exit at the same price) and manipulation (others taking advantage of knowing where there is a ready supply of buyers/sellers).

It's a no-brainer isn't it?

jon

Yet there are plenty of examples here on this site where one could 'get rich' using a similar style or even the same but no one sees it... Countless posters with glaring examples yet unless its spoon fed, they don't realise... and besides, only the few and correctly wired to trade consistently to any plan regardless. Its funny seeing them buy these systems then to screw them up too.... Markets need the cannon fodder!

wasp said:

Yet there are plenty of examples here on this site where one could 'get rich' using a similar style or even the same but no one sees it... Countless posters with glaring examples yet unless its spoon fed, they don't realise... and besides, only the few and correctly wired to trade consistently to any plan regardless. Its funny seeing them buy these systems then to screw them up too.... Markets need the cannon fodder!

Click to expand...

Here's one of the finest examples.

It's true, this system never loses because it has no stops!

[ youtube=http://youtube.com/watch?v=QonHdUzkkjA ]

barjon said:

Over the years I've always been amazed by how people are prepared to part with their hard earned cash to buy systems of the "Make a million pounds in five minutes" type.

To anyone who is tempted I would suggest you ask yourself this question:

If you had a sure-fire system would you be more likely to:

a) Guard the secret with your life and go about trading it quietly until you had made a fortune beyond your wildest dreams, or

b) Sell it to others in the full knowledge that the more people used it the more it would be adversely affected by slippage (all your customers trying to enter/exit at the same price) and manipulation (others taking advantage of knowing where there is a ready supply of buyers/sellers).

It's a no-brainer isn't it?

jon

Click to expand...

there is no question about guarding that secret but. although i can't speak for everyone i sure dont look at using trading systems as a way to look for buyers or sellers.. its in interesting concept but with so much crap out there being sold i doubt anyone does it.

I understand the arguments made by barjon in the first post that knicked off this thread, and there is no doubt some truth in them.

On a humanitarian level, I think there is also truth in the maxim that you get richer by giving, but on a more mercantile level, in zero sum equations like trading this argument probably doesn't hold up.

That said as Wasp intimated in his post above, you could post the 'perfect' trading system and only those that can see it and then put the effort in to learn it/trade it will profit.

wasp said:

Yet there are plenty of examples here on this site where one could 'get rich' using a similar style or even the same but no one sees it... Countless posters with glaring examples yet unless its spoon fed, they don't realise... and besides, only the few and correctly wired to trade consistently to any plan regardless. Its funny seeing them buy these systems then to screw them up too.... Markets need the cannon fodder!

Click to expand...

oofff!! Harsh words but true, sadly.

barjon said:

b) Sell it to others in the full knowledge that the more people used it the more it would be adversely affected by slippage (all your customers trying to enter/exit at the same price) and manipulation (others taking advantage of knowing where there is a ready supply of buyers/sellers).

Click to expand...

Why not give it away then?

shadowninja said:

Why not give it away then?

Click to expand...

same result, shadow.

the more it gets known and the more traders who use it the less effective it becomes.

good trading

jon

Yeah but.........

Take 'pinbars'... they became popular but they don't 'stop working' as they are just a visual representation of weakness....

How many people look at S/R or supply and demand and use the same levels but they still count as justified analysis as its just representation.

There is no holy grail that works consistently due to an anomaly that, if more were to do the same things, would stop it working. There is no group of people making things happen at certain levels to take advantage of and consequently make them change their behaviour. Only maybe in real small stocks. Otherwise there are just too many parties doing different things anyhow.

There is no holy grail because we are dealing in probabilities not absolutes.

Back to the OP, yes, I am constantly amazed by these "fail safe" systems which are sold to the gullable.

Don't these people realise that they don't learn a thing by relying on someone's elses black box, even if there is merit in the system.

It's an oft-repeated argument that a system will fail the more people that use it. I can't see this at all because if everyone is buying, the price goes up and vice-versa - that's what moves the markets. As for slippage, there are hundreds of brokers and you'd need astronomical numbers of people buying at exactly the same time to have an effect. It's unlikely that followers of the same system would trade at precisely the same time, anyway.

If you have something successful, it's human nature to want to share it and if you can make some money by doing so, why not? In reality, even a good system will not produce money for most people because of the psychology of trading. The relatively small numbers involved, compared to the market as whole will make no difference to the results of the person who sells the system, other than maybe improving the moves as suggested above.

As for jealously guarding a successful system, very few such systems can be translated into a fixed set of rules (which is why EAs don't work) because the market is variable and methods need adjustment all the time.

The bottom line is that most systems don’t really work in the first place but there are some that can provide an edge. It is sometimes the case that the creator knows the system can work but his own shortcomings as a trader means he screws it up often. There are certainly a few systems on the market that can show a profit but certainly no holy grail that guarantees a profit.

From a TA perspective, all of this is perfectly simple.

If we divide whole market price activity into time frames...and we know different groups of participants trade different time frames and the price in relation to these different time frames...then the picture becomes very clear. This activity at certain key prices affects the supply demand balance.....and one side will win the argument. This is why when taken to absolute extremes and we involve lets say 5 groups of time frame players, it results in the biggest price moves.

Rols example is actually a good one....provided you know and understand what information its showing....suffice to say its all about time frames and how these time frames line up ...and when they do line up in a certain sequence....the probability of failure of a trading opportunity become very small indeed.

There are sufficient ops intraday that line up to keep everyone amused and ticking along...but go up the time frames, and these ops become less and less....people are just too impatient to see this and wait for the right ops...but when the right ops present...they should be good and ready to take action...and most are not...they don't see the best ops for what they are...to them its just another intraday op, when in fact it is the mother of all trading ops.

Some people get it...some don't....good I say...we have a market !

That's perfectly simple?

£10kLoser said:

That's perfectly simple?

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Yes...and your answer demonstrates that you do not understand what it is that you need to understand.

This is not a criticism at all...I appreciate that different participants are at different stages/ levels on their trading journey.

Where is the loser? Make sure it's the other guys!

counter_violent said:

From a TA perspective, all of this is perfectly simple.

If we divide whole market price activity into time frames...and we know different groups of participants trade different time frames and the price in relation to these different time frames...then the picture becomes very clear. This activity at certain key prices affects the supply demand balance.....and one side will win the argument. This is why when taken to absolute extremes and we involve lets say 5 groups of time frame players, it results in the biggest price moves.

Rols example is actually a good one....provided you know and understand what information its showing....suffice to say its all about time frames and how these time frames line up ...and when they do line up in a certain sequence....the probability of failure of a trading opportunity become very small indeed.

There are sufficient ops intraday that line up to keep everyone amused and ticking along...but go up the time frames, and these ops become less and less....people are just too impatient to see this and wait for the right ops...but when the right ops present...they should be good and ready to take action...and most are not...they don't see the best ops for what they are...to them its just another intraday op, when in fact it is the mother of all trading ops.

Some people get it...some don't....good I say...we have a market !

Click to expand...

Yes this is familiar ground but I think it's worth repeating for those for whom the penny is still suspended.

To add another familiar point known to 'those that get it', is that the majority of price action is actually due to traders exiting positions. For those who lose consistently I suggest they read this again in bigger and bolder type.

The majority of price action is actually due to traders exiting positions.

Here is a post from some time ago which expands this further...

rols said:

It's all about NET ORDER FLOW on multiple TFs

Well open up a window with M5 M15 M30 H1 H4 and D1 bar charts

There are two types of info

Actual completed closes and real time dynamic closes.

Trends are defined by consecutive HH or LL on whichever TF the trader is trading from.

Put very simply (in reality it's a bit more complex!)

For example the D1 trader must wait for the H4 or lower TFs to close lower than previous closes to enter the market LONG. (He needs sellers to buy from and must wait for the price on lower TFs to fall)


Jankovsky on NET ORDER FLOW on multiple TFs

Your best trades occur when you have correctly positioned yourself on the net order flow as traders in each successively higher TF choose to execute. For example if you are looking for a buy point, you would like to see the M5 M10 M15 price charts produce similar clues all around the same price area. At the exact same time the M30 and H1 price charts are likely neutral or slightly bearish after a move to the downside has already happened. The D1 and W1 charts may show a down day or weekly low within a broader weekly or monthly established range....As time goes on the market will continue to advance even though the the short-term TFs produce sell signals because the larger TFs are still attracting order flow from the buy side.

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AND to add

Jankovsky further explains;

To avoid being one of the 90% traders who close their accounts at a net loss you must accept and trade from the point of view, "where is the net order flow?" and you must have a method of getting out of the way when you are not on the right side of the order flow.
One assumption you can make is that most traders do not know the game they are playing. About 80 to 90% of price action is simply the losers liquidating their losing trades. When you begin each day, before placing a trade, ask yourself this question: "Where is the loser?"

I agree very much with rols and cv. However, I also think there is a lot of advantage taken from known (likely) bunched orders to set balls rolling, particularly in relation to well-known patterns. An upthrust out of congestion as a prelude to a sharp fall is but one example.

good trading

jon

barjon said:

I agree very much with rols and cv. However, I also think there is a lot of advantage taken from known (likely) bunched orders to set balls rolling, particularly in relation to well-known patterns. An upthrust out of congestion as a prelude to a sharp fall is but one example.

good trading

jon

Click to expand...

Exactly Precisely.

How many times do we see in forex where the asian range breakout proper is preceded by an opposing false breakout...it happens every day for sure on some instruments and when there is also correlation ..it happens across the majority of instruments.....and every time around these fairly narrow ranges traders are caused pain.....so before the main move starts....the traders who have had the pain are already pips down and have lost heart before they even start....they then try to claw back the earlier losses and some go deeper in the mire and some will get back to break even by lunchtime .....completely worn out and exhausted by their experience and none of them has made any money for their labours.

Its a rite ol game innit guv.

For anyone new to this site please do not be put off by the threads title. The final chunks in the jigsaw are contained within.

barjon said:

Over the years I've always been amazed by how people are prepared to part with their hard earned cash to buy systems of the "Make a million pounds in five minutes" type.

To anyone who is tempted I would suggest you ask yourself this question:

If you had a sure-fire system would you be more likely to:

a) Guard the secret with your life and go about trading it quietly until you had made a fortune beyond your wildest dreams, or

b) Sell it to others in the full knowledge that the more people used it the more it would be adversely affected by slippage (all your customers trying to enter/exit at the same price) and manipulation (others taking advantage of knowing where there is a ready supply of buyers/sellers).

It's a no-brainer isn't it?

jon

Click to expand...

I would sell it right away!

good stuff this!