Firewalker's Journey: A path of discovery in search for enlightenment

This is a discussion on Firewalker's Journey: A path of discovery in search for enlightenment within the Trading Journals forums, part of the Reception category; Originally Posted by dbphoenix You're breezing by all the prerequisites as if they are givens and wading back into the ...

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Old Aug 16, 2006, 4:18pm   #161
 
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Quote:
Originally Posted by dbphoenix
You're breezing by all the prerequisites as if they are givens and wading back into the theoretical. What evidence do you have that "defining" your stoploss based on anything you've posted has any value?
Db
I have no evidence whatsoever, I was merely hypothesizing about what perhaps could be a way to do it. I'm listening to any suggestions or examples that have a proven track record. If you have any evidence that anything I've posted has no value at all, then don't hesitate to tell me if I'm wasting my time.

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Originally Posted by dbphoenix
How would you set your target? What evidence would you have that you had set it properly? What's the probability of your setup? What, as far as that goes, is your setup?
In any even, shouldn't all of this be in First Steps or in your journal?
A while ago you said you didn't find any ways to calculate a target. My point of view was I used ATR. As for the journal part, I was only replying to the questions you stated, no problem if you'd rather see them elsewhere.

About all the maths, you asked why? Well, to gain confidence, to have something to rely on. To see what the longest losing streak could be so that when I take to step to realtime trading, the light goes on when I would detect something statistically signifcant.
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Old Aug 16, 2006, 4:27pm   #162
 
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Yes, you are hypothesizing. And if you remain rooted there, then, yes, you are wasting your time unless and until you go beyond that to finding a setup, testing it, and so on. You aren't going to gain confidence by fiddling with formulas. You're going to do it by finding, defining, testing, and trading a setup.

Db
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Old Aug 16, 2006, 11:25pm   #163
 
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Originally Posted by dbphoenix
Yes, you are hypothesizing. And if you remain rooted there, then, yes, you are wasting your time unless and until you go beyond that to finding a setup, testing it, and so on. You aren't going to gain confidence by fiddling with formulas. You're going to do it by finding, defining, testing, and trading a setup.

Db
If I recall correctly, hypothesizing, testing and experimenting are some of the first stages in finding a setup following the "scientific method". This is exactly what I'm doing, not? I fail to see how I can answer your questions while I'm still searching for answers empirically. So let me ask you then what possible pathways are they I could walk or investigate finding a resolution to the following problems:

- How would you set your target? You yourself said you had not found any conclusive evidence of this or that strategy.

- What evidence would you have that you had set it properly? Only the results of the testing that would show a certain probability...?

- Would you have no contingency stops? What exactly do you mean by this, can you give an example?

- Would you make no changes to how you scale in or out? Have you found it useful to change or use scaling entries/exits depending on what happened in the past to your trades? I would say yes, if there's a possibility to enhance or refine your signal, but no if those changes were merely based on the result to your account size.
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Old Aug 17, 2006, 1:06am   #164
 
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Originally Posted by firewalker99
If I recall correctly, hypothesizing, testing and experimenting are some of the first stages in finding a setup following the "scientific method". This is exactly what I'm doing, not? I fail to see how I can answer your questions while I'm still searching for answers empirically. So let me ask you then what possible pathways are they I could walk or investigate finding a resolution to the following problems:.
Yes, hypothesizing, testing, and experimenting are some of the first stages in finding a setup. But you aren't doing any of that. What you're doing is regurgitating what you've read about expectancy. Chatting on message boards about expectancy formulas has nothing to do with the task of detecting patterns.

Quote:
- How would you set your target? You yourself said you had not found any conclusive evidence of this or that strategy.
It doesn't matter what I or anyone else does. All that matters is what you've found to contribute to a consistently profitable strategy through your own testing and your own trading.

Quote:
- What evidence would you have that you had set it properly? Only the results of the testing that would show a certain probability...?.
The evidence would be a consistently profitable strategy, which you would create through testing and trading.

Quote:
- Would you have no contingency stops? What exactly do you mean by this, can you give an example?.
It doesn't matter what I or anyone else does. All that matters is what you've found to contribute to a consistently profitable strategy through your own testing and your own trading.

Quote:
- Would you make no changes to how you scale in or out? Have you found it useful to change or use scaling entries/exits depending on what happened in the past to your trades? I would say yes, if there's a possibility to enhance or refine your signal, but no if those changes were merely based on the result to your account size.
It doesn't matter what I or anyone else does. All that matters is what you've found to contribute to a consistently profitable strategy through your own testing and your own trading.

You're not going to get anywhere until you stop waiting around for somebody to tell you what to do and start the work. If you have absolutely no idea how to locate a pattern, try the First Steps forum. Or hire a mentor. But all of these "what would you do" questions are pointless.
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Old Aug 17, 2006, 2:26am   #165
 
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Originally Posted by dbphoenix
. Being satisfied with a win rate of 50% or less is usually a beginner's rationalization for being too lazy to find something better (experienced traders know what risk:reward really means*).

Db

*.

DB ,,

Firewalker is talking a lot of sence. Listen to what he says because his views are foundation of many many program trade's that I know of and not only is not a biggerner's rationalisation , it is a pro approach to trading ..

Firewalker May i invite you to our technical Trader Forum ( Home page/control panel ) as we have very high calibre traders there. I trade the market myself daily and post all MY P/L daily on that site directly from Broker's screen .

Just one point regarding expectancy ... you said ... apart from psychological side of trading there is no difference what so ever between 40-60 and 60-40 system .. You are spot on how ever the psychological side of trading nearly always kicks in when the trader's loss rate increases and traders cut their winning trades unless their strategy is 100 % coded. Even if the strategy was driven by 100 % piece of software a 40-60 system could result in massive drawdawns that the winning trade has to run for a LONGGGGGGGGGGGGG time to compensate the losses which would make the trade subject to more adverse NEWS( upgrade/down grade/geo political issues/macro economic projections ) ..Saying that , I KNOW mathematically you are correct. I myself developed few trading algorithms based on mathematics you refered to ..

IT IS HUMAN NATURE TO WANT TO WIN MORE TIMES THAN LOSE .. EVEN IF THE TOTAL WIN IS SMALLER COMPARE TO ONE TIME BIG WIN .. We are all human ....

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Old Aug 17, 2006, 2:42am   #166
 
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Quote:
Originally Posted by dbphoenix

As for a setup that occurs once a week and has an 80% expectancy with a reward of "only" five points, how is that inferior to the beginner who overtrades every day and watches his equity dribble away? Those five points, if played with size, will look pretty good.

Db

The above text should read " 80% win probability " and not "80 % expectancy "

Also , the rest of the above quotation supports what FIRE has been saying which negates all of your own argument.. Please correct me .. Or did ya mean some thing else

thanks

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Old Aug 17, 2006, 3:15am   #167
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the average trader cannot emotionally survive a low win rate system.....if i believe that 1/2 of my entries will be losers are u kidding me? if more than 80% win then guess how much stress is in the right now moment of mashing the mouse button...not as much.....i prefer over 90 for comfort .......and profit.....emini daytrading......if 50 % is okay then use the coin flip method.....just as good as 50 percent loser or winner.....6 trades per day and 1/2 will lose.......that is a grade of 50 means u r a failure or an expert trader with nerves of steel.....and those are few and far between, if that many.
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Old Aug 17, 2006, 4:40am   #168
 
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Quote:
Originally Posted by Grey1
DB ,,

Firewalker is talking a lot of sence. Listen to what he says because his views are foundation of many many program trade's that I know of and not only is not a biggerner's rationalisation , it is a pro approach to trading ..
Grey, if you believe all of this, then I encourage you to take FW by the hand and teach him how to trade. You are very likely just what he needs.

Db
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