My journey to long term consistency

This is a discussion on My journey to long term consistency within the Trading Journals forums, part of the Reception category; Originally Posted by options-george Thanks for sharing your trades here DrSafari. Is there a specific reason why you are risking ...

Reply
 
LinkBack Thread Tools Search this Thread
Old Sep 16, 2015, 9:26am   #16
Joined Aug 2015
DrSafari started this thread
Quote:
Originally Posted by options-george View Post
Thanks for sharing your trades here DrSafari.

Is there a specific reason why you are risking different amounts of money on the trades?
Yes there is actually. With the second trade which I called "WA" here I shorted the absolute minimum I could short. But that was still 1.7% of my equity. Which is on the rather high side when you are still testing and learning. The first trade the minimum was about half of that which is a better amount for learning. It's difficult to keep the amount risked the same with my current broker and equity.
DrSafari is offline   Reply With Quote
Thanks! The following members like this post: options-george
Old Sep 16, 2015, 1:09pm   #17
Joined Aug 2015
DrSafari started this thread Both the G and WA positions are already closed:

G simply went up at the point I bought it and hit my stop loss

G
Type: short
Amount: 50 shares

Opening rate: 33.44
Stop loss: 34.16
Opening time: 9:57:30 am 9/15/2015

Amount risked: 36 €

Close rate: 34.17
Net P/L: € -36.33
Closing time: 9:14:06 AM 9/16/2015

g_short_close.jpg

---------------------------

WA suddenly dropped a lot so I moved my stop loss slightly above the break even point. Sadly then it rose again and went through it. I'm looking for a good entry point to reopen this one if an uptrend doesn't establish itself.

WA
Type: short
Amount: 50 shares

Opening rate: 74.68
Stop loss: 76.26
Opening time: 10:00:41 am 9/15/2015

Amount risked: 79 €

Close rate: 74.66
Net P/L: € +1.37
Closing time: 12:58:08 PM 9/16/2015

wa_short_close.jpg

Next time I will try to use the same timeframe as the first charts for my opening position are hourly and the ones for my closing position 15min interval.
DrSafari is offline   Reply With Quote
Old Sep 18, 2015, 10:19am   #18
Joined Aug 2015
DrSafari started this thread I took on another short position at WA at 74.17 and currently it's down to 72.17 being in the +100€ profit zone. I moved my stop loss to +40€. I don't remember precisely but my original stop loss was risking around 60€. This trade is going good. Should have journaled it immediately but didn't have the time. When the position is closed I'll add a chart with my entry and closing point.
DrSafari is offline   Reply With Quote
Thanks! The following members like this post: options-george
Old Sep 18, 2015, 10:49am   #19
Joined Jan 2006
Your initial stops and adjusted stops are based on technical price levels, not on monetary amounts, right?
__________________
Check out my FX trading blog - updated 5-8 times a month - entertaining and educational!

And for a honest look into trading, check out my T2W member profile (published Dec2015)
options-george is offline   Reply With Quote
Old Sep 18, 2015, 11:53am   #20
Joined Aug 2015
DrSafari started this thread
Quote:
Originally Posted by options-george View Post
Your initial stops and adjusted stops are based on technical price levels, not on monetary amounts, right?
Yes, my original stop loss is based on technical price levels. But my adjusted one isn't. Isn't it so that you should take into account your risk management rules for that so if you base your adjusted one on monetary amounts (relative to your original monetary amount) it would be correct as well? Provided that your original one is based on technical price levels?

If not, how else should I do it?

Last edited by DrSafari; Sep 18, 2015 at 2:21pm.
DrSafari is offline   Reply With Quote
Old Sep 18, 2015, 3:31pm   #21
Joined Aug 2015
DrSafari started this thread Closed my short WA position at € 121.74 profit. Around my soft target. Funny thing is, I was just thinking I shouldn't hold my position over the weekend, that would be stupid cause I would probably lose a lot of my profit due to slippage. So I had to close it soon because market would close in an hour. Right at that time it started going up. Why? My guess is other guys were thinking exactly the same and started closing their short positions as well. Either what I'm saying now is bat**** crazy or I'm starting to understand the market better.

I will update with a chart with opening and closing prices. See you guys on monday

Current equity: € 4,622.15
DrSafari is offline   Reply With Quote
Old Sep 18, 2015, 5:32pm   #22
The Staff are paid members that perform various roles such as editorial, advertising, support or technical work.
 
timsk's Avatar
Joined Mar 2002
Hi DrSafari,
Well done on your WA trade. The really impressive thing you did was to re-enter after you were stopped out the first time. That's an area a lot of traders struggle with psychologically, as they're still suffering from a loss first time around or annoyed with themselves for giving back a profit to the market.
Quote:
Originally Posted by DrSafari View Post
. . . Isn't it so that you should take into account your risk management rules for that so if you base your adjusted one on monetary amounts (relative to your original monetary amount) it would be correct as well?

If not, how else should I do it?
First off, there are no 'shoulds' or 'shouldn'ts' in trading. Well, precious few anyway. Those that there are tend to be universally accepted truths such as these: Mark Douglas on Emotionless Trading.

With the above in mind, regarding your question, my view is that it sounds as if you're trying to impose your money management rules on the market. It couldn't care less! There are no rights or wrongs, but I suggest you adjust stops to sensible technical levels rather than saying 'I've risked X, therefore I want my profit to be 2X, 3X' - or whatever. The problem with fixed ratios based on amounts risked is that one ends up putting stop loss and take profit orders in technically poor positions. That said, there are traders who do exactly this and swear by it. Do what you're comfortable with and works for you.

Quote:
Originally Posted by DrSafari View Post
. . .So I had to close it soon because market would close in an hour. Right at that time it started going up. Why? My guess is other guys were thinking exactly the same and started closing their short positions as well. Either what I'm saying now is bat**** crazy or I'm starting to understand the market better. . .
No, you're not crazy. Often in the last twenty minutes or so of the U.S. session there is a reversal as traders flatten their positions, taking profits or simply bailing because they don't want the overnight risk. Similarly, the opening half hour can be a bit haywire as market open orders are triggered. Then the day settles down and takes its course.
Tim.
__________________
I'm New To T2W - Where Do I Start? - a must read for anyone new to T2W
I'm New To TRADING – Where Do I Start? - a must read for anyone new to TRADING
The Trading Plan Template - a must read for anyone without a proper TRADING PLAN
Please note: I am part of T2W Admin' Staff - I am NOT a Moderator!
timsk is offline   Reply With Quote
Thanks! The following members like this post: options-george
Old Sep 19, 2015, 2:53pm   #23
Joined Aug 2015
DrSafari started this thread
Quote:
Originally Posted by timsk View Post
Hi DrSafari,
Well done on your WA trade. The really impressive thing you did was to re-enter after you were stopped out the first time. That's an area a lot of traders struggle with psychologically, as they're still suffering from a loss first time around or annoyed with themselves for giving back a profit to the market.
Thanks! And yes indeed I have struggeled with this in the past. The thing that helped now was that I determinded up front that if an uptrend wouldn't establish I would take a short position again, and so I did.

Quote:
With the above in mind, regarding your question, my view is that it sounds as if you're trying to impose your money management rules on the market. It couldn't care less! There are no rights or wrongs, but I suggest you adjust stops to sensible technical levels rather than saying 'I've risked X, therefore I want my profit to be 2X, 3X' - or whatever. The problem with fixed ratios based on amounts risked is that one ends up putting stop loss and take profit orders in technically poor positions. That said, there are traders who do exactly this and swear by it. Do what you're comfortable with and works for you.
How I do it is that I try to abide by my fixed ratio's if possible. Of course I also look at the technicals, if I get stopped out by the slightest noise I would put it higher of course. But that is already taken into account by my first stop loss and the adjusted ones are relative to that one so unless the volatility of the stock changes it should be sensible in my eyes. As for profit levels, I try to picks stocks that realistically can make 2X profit if I've risked X, but in reality i always let my winning stocks run and continue to adjust my stop loss, kind of like a trailing stop loss. With this trade I happened to close it manually because market would close soon and wouldn't want to hold the position over the weekend and the profit taken happened to be my soft target which I obviously was happy about but it could just as well have been more or less. It's not that I absolutely stick to my ratio's at all costs.

The one thing I'm still not too sure about is to when to move my stop loss when I'm in the profit zone. So far I kind of use a trailing one so that the distance between the actual price and the stop loss is always the same (except when i've reached my target that's when I move it closer to actual price) but I'm not sure if that's the best way to do it.


Quote:
No, you're not crazy. Often in the last twenty minutes or so of the U.S. session there is a reversal as traders flatten their positions, taking profits or simply bailing because they don't want the overnight risk. Similarly, the opening half hour can be a bit haywire as market open orders are triggered. Then the day settles down and takes its course.
Ok! Thanks for the clarification.
DrSafari is offline   Reply With Quote
Old Sep 19, 2015, 3:03pm   #24
Joined Aug 2015
DrSafari started this thread Here are the technicals of that trade

WA
Type: short
Amount: 50 shares

Opening rate: 74.17
Opening time: 2:22:43 PM 9/16/2015

Stop loss: (information not available anymore, that's why I should have logged it sooner)
Amount risked: around 60€

Close rate: 71.75
Closing time: 4:25:20 PM 9/18/2015
Net P/L: € +121.74

Chart is a 15 min chart. Green arrow is open, red one is close

wa_short_open_close_16_09_15.jpg
DrSafari is offline   Reply With Quote
Old Sep 22, 2015, 12:48pm   #25
Joined Aug 2015
DrSafari started this thread Yesterday I entered another trade, it already got stopped out.

Long TE
Amount: 50 shares

Opening rate: 53.56
Opening time: 2:33:50 PM 9/21/2015

Stop loss: 52.38
Amount risked: 59€

Close rate: 52.38
Closing time: 9:56:36 AM 9/22/2015
Net P/L: € -59.00

Chart is a 15 min chart. Green arrow is open, red one is close, red horizontal is about where my stop loss was. General trend of the chart was up, although it's not obvious on this part of the chart.

te_long.jpg

Not every trade that goes wrong is a bad trade but this one is in my opinion. The chart didn't look perfect but because there were not many candidates this month (only 2 instead of the average 4-5) I decided to take it anyway. Mistake #1.

Mistake #2: I shouldn't have gone long in the current market. Since the China thing on August 24th the market felt bearish ever since. The Fed decision didn't help. Writing this down I feel so stupid to have done that trade. I'm sure I could have found a stock to go short on that had an equally good chart (or even a better one) than this did.

Things to improve: My entry point. If I had chosen my entry point more carefully I wouldn't have been stopped out yet. At least this time I didn't blindly enter the position but I tried to choose a better entry point. I have difficulties with this because whenever I see it going down (when I want to go long) or going up (when I want to go short) I'm afraid that the trend will actually reverse. This is a psychological thing because as long as the downwards or upwards fluctuations are within the expected parameters of the volatility of the stock I have no reason to believe that the trend will reverse. Because of this my entry points are often on a top (or near the top) when I'm long and in the pit or near the pit when I'm short.

Also, once I see a good chart that's approved by my trading system I am impatient and want to enter a position ASAP, another psychological issue

Now that I'm aware of these things I can work on them. I lost a small amount of equity but these lessons were worth it imo.

So next time I wil focus on choosing a good entry point so my brain will learn that the trend won't necessarily reverse.
DrSafari is offline   Reply With Quote
Old Sep 24, 2015, 2:44pm   #26
Joined Aug 2015
DrSafari started this thread I'm trying out the Triple screen trading system explained in "The new trading for a living" in my demo account. So far not much trying has been going on because it's REALLY difficult to find a stock that matches the criteria. This makes me think I'm doing something wrong but I've been reading that part in the book over and over again and seems I'm doing everything right. Could also be that the current market doesn't produce many opportunities according to that system or you just have to go through a ton of stocks before an opportunity arises. Time will tell I guess, I will have to have discipline to monitor everyday and be patient. If I can't even do that I don't deserve to be able to trade for a living in the future.

On one hand it's good because it will discard many bad potential trades, on the other hand it's annoying, especially when testing and you don't know what to expect. I guess I'll just have to monitor a ****load of stocks. Another good thing is that it's purely technical and I don't have to "wait" for any economical indicators. I can do this everyday on every stock. If I keep a list of 100 stocks and keep monitoring them every day something must meet the criteria sooner or later. So far I'm only monitoring 14 for 3 days so that's not saying much I suppose.

Meanwhile I'll still continue to trade with my old system for real money. So far I seem to be making more money with it than losing (albeit not that much) but I can't conclude anything yet.
DrSafari is offline   Reply With Quote
Old Sep 24, 2015, 3:13pm   #27
Joined Aug 2015
DrSafari started this thread Ok, looking back in history I see there are opportunities so it's just a matter of time and/or monitoring enough stocks. Just writing this down to remind myself.
DrSafari is offline   Reply With Quote
Old Sep 30, 2015, 8:17am   #28
Joined Aug 2015
DrSafari started this thread Demo account
So I've been monitoring 15 stocks with my new to be tested trading system. Yesterday 2 came out as potential trades. Part of the system is to track the daily stochastic and if there's an uptrend you should place a buy order when stochastic lines drop below there bottom reference line thus indicating being oversold and vice versa. I'm testing on USA stocks and am doing this before market opens.

With both potential trades the stochastic lines didn't go perfectly over the reference line, only near it (one upper and one bottom reference line for long and short positions) but because I was excited about opportunities and thought it couldn't get any better I placed some orders already. But now I see yesterday's stochastic values are even better, so it pays to wait.

Yesterday the buy order for the long position (Activision) got already triggered, but because I entered too soon it kept dropping and almost triggered my stop loss. At the time I thought the system wasn't as good as I thought it would be, but now I know I should have waited for better stochastic values, because for both potential trades the values got a lot better. This won't always be the case of course, but that's the whole idea of the system.... filtering out bad trades.

Demo account equity ~12000€

So this is my open long position:

Long Activision
Amount: 250 shares

Opening rate: 31.00
Opening time: 9/29/2015 4:00:06 PM

Stop loss: 30.18
Amount risked: €182.79

Current rate: 30.64
Current Virtual Net P/L: € -82.22

This is the chart, it's a daily chart so I entered somewhere near the top of the last bar. On the daily chart, stop loss line is very close to current sell rate :

activision_long.jpg
DrSafari is offline   Reply With Quote
Old Oct 1, 2015, 9:46am   #29
Joined Aug 2015
DrSafari started this thread Start of a new month so I should analyse the European Economic Sentiment Indicators again and look for some new stocks with my real account. I still think this system is profitable in the long run with the knowledge I gained meanwhile. I've only been applying it properly since July (and even then) so it's too soon to tell. Lost some money due to the china thing mistake there was to let all my trades reach stop loss instead of cutting them sooner. And it were 6 of them, all long unfortunately. Ouch. Should have diversified. Bottom line, can't draw any conclusions yet but since I still see potential in it, I will continue with small amounts of real money. It's also important to trade with real money cause psychologically it's different... although lately I don't seem to make much of a difference between my demo account and real account. If I see potential trades on either of them I seem to be equally excited, I don't seem to make a mental distinction between the two anymore and I'm treating them with the same discipline. I say "seem" because maybe my brain is fooling me.

That being said. Some interesting things have come up while monitoring my 15 stocks on my demo account. This is how I monitor my stocks in a text file:

Code:
Activision
		1st screen Impulse system =		long
		2nd screen Stochastic = 		85,89 / 76,86 / 23,61 / 16,38 / 25,22
		
		--> action = order was placed on 23,61 but should have been placed on 25,22
I determine the general trend by a weekly screen. In this case it's an uptrend hence long. Then I wait for a good time to place an order on the 2nd daily screen and I monitor the Stochastic values daily. I wrongly placed the order at 23,61 which caused me to enter the trade too soon. I should have placed it at 25,22. No real harm is done because my stop loss wasn't reached but potential profit margin is now less of course.


Code:
	Agco
		1st screen Impulse system =		short	
		2nd screen Stochastic = 		59,31 / 77,48 / 69,69 / 91,79 / 86, 82
		
		--> action = placed order at 69,69 but should have placed it at 91,79 or 86,82
Here the order didn't get hit yetso I can adapt my order now since 86,82 are good values. Looking at the evolution of the stochastic I would say it's the perfect moment now.


Code:
	Allison Transmission
		1st screen Impulse sysem =		short	
		2nd screen Stochastic = 		12,9 / 12,10 / 16,14 / 33,20 / 95,48

		--> action = wait
This one starts to look interesting. Can't enter yet because stochastics aren't above or near 80 yet. Seeing how they evolve they probably will be tomorrow.


Code:
	********** Financial 
		1st screen Impulse sysem =		short	
		2nd screen Stochastic = 		35,26 / 62,38 / 7,35 / 59,43 / 97,54

		--> action = wait
Same as above, starts to look interesting but can't place an order just yet. Tomorrow looks promising.
DrSafari is offline   Reply With Quote
Old Oct 2, 2015, 3:14pm   #30
Joined Aug 2015
DrSafari started this thread Demo account testing trading system

I'm still long in my Activision trade. Price has almost reached my stop loss because of the bad Nonfarm Payrolls results yesterday which suprisingly didn't have much impact right away but only now seems to have an impact on stocks globally.

Code:
	Agco
		1st screen Impulse system =		short	
		2nd screen Stochastic = 		77,48 / 69,69 / 91,79 / 86, 82 / 18,65
		
		--> action = 	adapted order to 45.95 price on 86,82 stochastic
I said I put my order wrongly on the Agco stock and I did but of course it didn't get hit yet so I adapted at the time the stochastic values read 86,82 and it got hit. Started making profits right away but instead of following the money management rules of the system I kind of followed the rules of my system I use with real money, meaning I left too little margin for my trailing stop loss and taking a small ~80€ profit.

Realising this I re-entered short position and it's making profit again. I will post details and charts when I have the time.
DrSafari is offline   Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Similar Threads
Thread Thread Starter Forum Replies Last Post
Should I trade long term or short term in the forex market? tradewithferl Forex 34 Aug 2, 2017 5:54am
My journey towards consistency gftrader32 Trading Journals 818 Aug 4, 2015 8:57pm
Advice needed Shorting UK Long Guilt for Long Term! steve10000 Commodities & Money Markets 0 Dec 30, 2011 6:03am
How to use Gann Calculator for Short term and Long term trading? TradeLearner First Steps 0 Jul 23, 2010 6:39am
CME Crude Oil Long term long position bluejean Commodities & Money Markets 10 Dec 13, 2009 6:54pm

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)