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 DrSafari . . . Second trade (Kon) was nothing wrong with but just went south as soon ...

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Old Nov 10, 2015, 11:14am   #46
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Originally Posted by DrSafari View Post
. . . Second trade (Kon) was nothing wrong with but just went south as soon as I took a long position. I'll write that one off as an inevitable loser.

. . . Chart is a 30 min chart. Green is Open. Red is close. Orange line is stop loss.
Attachment 205386
Hi DrSafari,
If you've tested your entries and your records indicate the trade has a positive expectancy - then that's all that matters. However, looking at your chart, your entry is pretty unconventional (which may well be a good thing rather than a bad thing of course) . . .

1. Your entry is noticeably above your MA line which many traders would interpret as being an indication of poor value and, if anything, look for an opportunity to short rather than to buy. Or at least to wait for price to pull back to a more advantageous level.
2. Your entry is right into an area of resistance where many traders would look for an opportunity to short rather than to buy.

Had you bought when price was at or below the MA and below the upcoming resistance area, you'd have given yourself a little more room for manoeuvre to see if it burst through resistance or bounced off of it. If the latter, (as turned out to be the case), then you'd have an opportunity to close out for a smaller loss or, even, near break even.

All of the above is easy to say with the benefit of hindsight. As I say, if you were aware of these things at the time and it's part of a deliberate strategy to think differently to other traders - and your testing backs up your theories - then completely ignore these comments!
Tim.
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Old Nov 10, 2015, 12:11pm   #47
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Hi DrSafari,
If you've tested your entries and your records indicate the trade has a positive expectancy - then that's all that matters. However, looking at your chart, your entry is pretty unconventional (which may well be a good thing rather than a bad thing of course) . . .

1. Your entry is noticeably above your MA line which many traders would interpret as being an indication of poor value and, if anything, look for an opportunity to short rather than to buy. Or at least to wait for price to pull back to a more advantageous level.
2. Your entry is right into an area of resistance where many traders would look for an opportunity to short rather than to buy.

Had you bought when price was at or below the MA and below the upcoming resistance area, you'd have given yourself a little more room for manoeuvre to see if it burst through resistance or bounced off of it. If the latter, (as turned out to be the case), then you'd have an opportunity to close out for a smaller loss or, even, near break even.

All of the above is easy to say with the benefit of hindsight. As I say, if you were aware of these things at the time and it's part of a deliberate strategy to think differently to other traders - and your testing backs up your theories - then completely ignore these comments!
Tim.
I see what you mean. I think I'm going to wait for a better level in the future indeed. I think the reason I am neglecting this is because that's exactly what I've been doing in my demo account (choosing good entry points that is) and it's not working out so well atm. Of course this probably has other reasons and it's more of a subconscious decision so it makes no sense to think this way. But that's why I have this journal so I can detect these things and correct accordingly. After I finish this post I am immediately going to write down step by step my system (not in my journal though) including choosing good entry points. It's in my head and not that complicated but I think it will help me to have it written out because I keep adding more and more things.

I will soon post the other trade where I chose an even worse entry point
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Old Nov 10, 2015, 12:49pm   #48
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. . . but I think it will help me to have it written out because I keep adding more and more things. . . .
Hi DrSafari,
Having it written out is really useful - essential some would say - as you've then got a checklist to tick off each required condition prior to your entry. By the same token, when conducting a trade post mortem, you can look to see how well (or not) each entry conformed to your checklist.

Regarding adding more things, I'd advise against this. The more complex you make it, the harder it will be to execute. The likelihood is that you'll either overlook one of your conditions or say "to hell with it, I've got 80% of 'em - that's good enough". The problem with the latter is that over a large sample of trades, most of the conditions will both be present and absent, so you won't know which ones are 'working' and which ones are 'failing'.
Tim.
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Old Nov 10, 2015, 2:09pm   #49
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Regarding adding more things, I'd advise against this. The more complex you make it, the harder it will be to execute. The likelihood is that you'll either overlook one of your conditions or say "to hell with it, I've got 80% of 'em - that's good enough". The problem with the latter is that over a large sample of trades, most of the conditions will both be present and absent, so you won't know which ones are 'working' and which ones are 'failing'.
Tim.
I've read this before but how can one learn if you cannot integrate the things you learn? I get that you shouldn't add a ton of indicators or shouldn't think that some new indicator will finally 180 degrees flip your results. It's not that I have THAT many things added on, and most of them are pretty basic for traders. I'll explain a bit my evolution to make it more clear.

At first (Februari this year) I just analysed the European Economic Sentiment indicators (EESI) and the stocks that came out of that I usually picked to take positions in. I didn't really care too much about the chart although I looked at it I never had any rules as when I could take a position or not, I'd just decide it on a whim. I put stop losses but I never heard of proper risk management and the likes.

Then I started looking at the charts more closely and only chose those with a trend that agreed with the EESI. Still no sign of proper risk management though.

Then I learned that a good risk/reward ratio was 1:3 and that you should let winning trades run but cut off losing trades so I started taking that into account.

Then I learned to adapt my position size according to the amount of money that is at risk (stop loss) and to maximum only risk 2% of my equity per trade (stuff I learned on this forum)

And finally the thing I want to add now is look for a better entry point. It's not that I'm trying to look at 20 different indicators to align in order to execute a trade. Just trying to optimize the current system and so far I have seen a positive evolution of the system by doing that.

Do you still advise against this? I'm a bit confused about all of the information I am getting.
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Old Nov 10, 2015, 3:34pm   #50
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. . . Do you still advise against this? I'm a bit confused about all of the information I am getting.
Hi DrSafari,
For sure, this can be a very confusing business. One way to make it less so is to compartmentalize all the various elements. In your post above, you've either alluded to - or made direct reference to - pretty well the whole trading process . . .

1. Filtering suitable stocks.
2. Defining a setup.
3. Entry and exit criteria.
4. Risk and money management.

My comments in the previous two posts relate specifically to #3 - your entry (and exit) criteria - nothing else. For the reasons already stated, I suggest you keep this as simple as possible, but also because you'll have to test each individual component to satisfy yourself that, more often than not, each one delivers the desired result. Each component being a price pattern, indicator or a reaction to a trend line or support / resistance etc.

I hope that adds a little clarity! I don't mean to confuse and, if this is the end result, please ignore my comments. Most importantly, don't assume because I've been at this a tad longer than you that I'm better at it than you. It doesn't work that way. Follow your own nose and don't be distracted by posts from the likes of me - unless you want to be that is.


Tim.
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Old Nov 12, 2015, 8:03am   #51
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Originally Posted by timsk View Post
Hi DrSafari,
For sure, this can be a very confusing business. One way to make it less so is to compartmentalize all the various elements. In your post above, you've either alluded to - or made direct reference to - pretty well the whole trading process . . .

1. Filtering suitable stocks.
2. Defining a setup.
3. Entry and exit criteria.
4. Risk and money management.

...
Okay I got it, I will keep it simple. But right now I didn't really take the entry point into account too much (apart from massive peaks and the likes). I have noticed in the past my timing on my entries could be better so I think it would be useful to take this more into account.

Thanks for the help!
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Old Nov 12, 2015, 9:20am   #52
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DrSafari started this thread Real account
As promised here is the second trade. I know it's a bad one. If I keep making these mistakes there's no way I can become consistent. But that's why I'm still using "small" money and practising. It's just a super bad entry point, nothing more to add to that. But to keep this journal honest I must also post these embarrasing mistakes.

Long Ca
100 Shares
Reason of closure: stop loss reached
Opening rate: 34.69
Opening time:11/9/2015 11:46:39 AM

Amount risked: around € 91

Close rate: 33.72
Close time:11/9/2015 4:22:33 PM
Net P/L: € -97.00

Chart is a 30 min chart. Green is entry, Red is exit, orange is stop loss.
ca_long.jpg

Current equity: € 4,481.94
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Old Nov 13, 2015, 3:41pm   #53
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DrSafari started this thread Real account

Short Tes
1000 Shares
Reason of closure: Safeguarding profits/not wanting to hold over weekend
Opening rate: 172.38
Opening time: 11/12/2015 2:52:03 PM

Close rate: 168.12
Close time: 11/13/2015 4:22:28 PM

Amount risked: around € 90

Net P/L: € 60.30

Will re-enter the position on monday if trend seems to continue. By re-entering instead of holding the position I will lose around €5 because of spread but that's worth not having the risk for me.

Current equity: € 4,542.48


Demo account
Another loser and currently there are 6 orders open. If I have the time I will post the technicals.
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Old Nov 25, 2015, 3:43pm   #54
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DrSafari started this thread It's been a while since I updated. I haven't been sitting still though. Not much action on my real account. Only one trade which I closed with minimal loss. I closed it before my stop loss because I saw it was going south. It went down further so maybe good that I did.

Long Kon
100 Shares
Reason of closure: saw it going south and didn't want to await my stop loss
Opening rate: 25.97
Opening time:11/20/2015 1:28:14 PM

Close rate: 25.86
Close time: 11/24/2015 1:09:13 PM

Amount risked: around € 45
Net P/L: €-13.96

Current equity: €4,528.52

Oh yeah, forgot to mention. Everything is done for my account with a new broker and I deposited €100 just to try it out. I'm also looking for a good demo account to test Mr. Charts rising/fallings candles day trading method. Can't do it with plus500 due to the spread. And on the other broker there is no demo option and transaction costs are too big to be trading with only €100. Need something with a direct market access demo. I found one but it seems really slow and seems like I can only place limit orders instead of market orders which is annoying.


Demo Account
Two losing trades with the new method. Currently holding 5 positions of which 4 are making profits. This altered version seems to be doing better than the previous one.. but that's no surprise really. Could become a valid strategy. Only need to get a good feel for when to exit these trades and of course keep testing if it will be consistent. Keeping records for this on a separate sheet. I'm looking for a way to keep some basic records. I will probably just post the profit and losses and some comments with them for the demo account.

Last edited by DrSafari; Nov 25, 2015 at 3:59pm.
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Old Dec 16, 2015, 10:46am   #55
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DrSafari started this thread Real Account
I have 23 stocks on my watchlist for December. Only one suitable trade came out with my system so far.

Short TD
500 Shares
Reason of closure: reeling in profits, major economic events about to happen so don't want to take that risk
Opening rate: 33.55
Opening time:12/9/2015 9:54:55 AM

Close rate: 32.32
Close time: 12/16/2015 9:58:27 AM

Amount risked: around € 58.97
Net P/L: €83.98

Chart
Green line is where I opened the position. Red line is where my adjusted stop loss was and purple line (at the bottom) was position at time of closure at the end of the chart. Right after I closed it went up by a lot, excellent timing
td_short_16_12_15.jpg

Current equity: €4,612.50
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Old Dec 30, 2015, 8:24am   #56
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DrSafari started this thread Real Account
Another trade around 10 days ago. It was a small loss.

Long Conw
200 Shares
Reason of closure: adjusted stop loss got hit. I raised the stop loss because it was making some profit at some time
Opening rate: 13.71
Opening time:12/18/2015 10:11:42 AM


Close rate: 13.55
Close time: 12/21/2015 5:00:01 PM
Amount risked: initially €46 at 13.48
Net P/L: €-34.34
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Old Dec 30, 2015, 8:37am   #57
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DrSafari started this thread Real Account
Another trade I opened two days ago. I hit my profit marge I aimed at which is pretty good obviously.

Long Eli
200 Shares
Reason of closure: I had set a target and it suddenly gapped up which made me sell it. Didn't reallly mean for that to happen but can't complain either. After that it went down again but it probably will go up a bit over the course of the next few days but we'll see.
Opening rate: 34.61
Opening time:12/28/2015 12:37:13 PM


Close rate: 35.34
Close time: 12/30/2015 9:07:46 AM
Amount risked: I seem to recall it was €66
Net P/L: €142.05

Charts
Opened where the screenshot starts and closed at the end of the screenshot
eli_long_opentoclose.jpg

This is the longer term hourly chart. Open position at the green line. Closed at the end of the chart.
eli_hourly_chart.jpg



Current equity: €4,720.21
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Old Jan 15, 2016, 3:28pm   #58
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DrSafari started this thread Real Account
Took a while to get started again cause I have a new job and I didnt have a personal workstation yet etc etc. Anyway I did my ESI analysis and around 26 stocks came out if it that I will monitor. Two charts passed my technical parameters and I placed orders for them yesterday. They got filled today. One is around break even, the other one I already sold with profit, details below.

Short Rex
250 Shares
Reason of closure: Made a nice profit and didnt want to hold over the weekend. Opening rate: 10,46
Opening time:1/15/2016 9:21:45 AM

Close rate: 10,16
Close time: 1/15/2016 4:07:12 PM
Amount risked: € 95
Net P/L: €75


Demo Account
Consistently losing there so I am going to abort this system and look for something new. Time to take my trading to the next level but because of trading taxes in belgium I have to use CFD's. On the other hand I want to move away from plus500 if I want to go day trading american stocks. Perhaps I will use my current sytem (;ostly the technical side then) on american stocks too... I will have to brainstorm about this. That's on my TODO list.
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Old Jan 19, 2016, 1:33pm   #59
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DrSafari started this thread Real Account
Did another trade parrallel with the first one. Did hold it over the weekend because it was losing a bit. Seems a bad call. Stop loss seemed a little too tight cause afterwards it went down again but that is the name of the game, will post charts when I have time.

Short PP
20 Shares
Reason of closure: Stop loss reached
Opening rate: 139.85
Opening time:1/15/2016 11:42:30 AM

Close rate: 143.07
Close time:1/18/2016 9:05:20 AM
Amount risked: ~€ 64
Net P/L: €64.40


Current equity: €4.731,65

Last edited by DrSafari; Jan 19, 2016 at 3:32pm.
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Old Jan 21, 2016, 2:43pm   #60
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DrSafari started this thread Demo account
Using the technical side of my current real money system on US stocks as of today 21st of January, this just as a reference. Will now also post the results of my demo account here.
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