my journal 2

This is a discussion on my journal 2 within the Trading Journals forums, part of the Reception category; Here's what I am going to do: force myself to only make 1 trade per stock, so that will be ...

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Old Jan 27, 2010, 5:55pm   #92
 
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re: my journal 2

travis started this thread Here's what I am going to do: force myself to only make 1 trade per stock, so that will be a way to reboot my mind and to force myself to miss some opportunities and to not get into a trading frenzy.

So the new method will be (similar to an earlier one):

1) on the weekly chart of "chart game", one trade per stock on 5 stocks for a total of 5 trades (only LONG trades allowed)
2) if unprofitable after two weeks close trade
3) if profitable after two weeks, close after 6 weeks

Also, similar to an earlier method, I will force myself to post every single 5-trade series I played, whether good or bad, so this will somewhat force me to get serious about every single game.
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Old Jan 27, 2010, 6:48pm   #93
 
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Way to go!

travis started this thread Not only did I not exceed one trade per stock. I even waited so long as to skip a few stocks that didn't look good. Result: 3 good trades out of 5, with a huge profit, since on one of the losses, I lost nothing, and on the other 3 wins I made more than on the only one real loss.

Very satisfied and very tired. If this is what it takes to be profitable, it worth it though. However it would be very very hard to do this in real time, since real money is at stake, and a week does not go by with one click. However, if I have found a way to be profitable here, with all these rules and filters, this deserves more attention, in order to see what I do (in picking bottoms) and systemise it.

Right now I can say that i look for these things:
1) extremely oversold conditions
2) one candle of confirmation or at least uncertainty with regards to the previous downtrend (i never enter on a red candle, but also the confirmation doesn't allow a candle to be so big and green that the market becomes overbought)
3) All this happens on a previous level of support (which often was previous resistance)

snap2.jpg

It will take me hours before I can reboot my mind and do this again. Maybe even tomorrow. But I absolutely want to do it and want to get good and profitable at least at one type of discretionary trading.

In terms of risk/reward and probability of wins, I've done more or less what all my systems do, and I even do with discretionary trading (when I only trade once a day): a slight majority of wins, and a bigger average win.
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Old Jan 27, 2010, 7:37pm   #94
 
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the market is moved by a consenus of edges

travis started this thread Hey, kind of interesting what I did with the system above.

I summed up 4 different types of edges or more:
1) RSI ("extremely oversold")
2) Support/resistance
3) Moving averages ("some kind of confirmation or uncertainty with regards to previous trend")
4) "LONG only trades": knowledge that stocks go more up than down (that's why people say "Buy and hold" but not "sell and hold")
5) Stoploss and takeprofit: a specific approach to trading, which is not a given

The sum of these different "edges" seems to be profitable.

As I approached the markets in the past, I went through moving averages, pivots... all these things, and always said "hey, this thing doesn't work" or "this thing is unprofitable", and then I quit using them. I now realize how much the market is moved by a bunch of people like me, unprofitable and each trying to make money with their single edge: fibonacci, elliot, news, cycles, "my neighbour told me...", you name it. When all these people come together, or rather, when enough of these theories and trading methods, that alone might not be profitable, come together and agree, the market turns. I suppose one could build a system that weighs each edge with a value attributed to the edge which is simply a function of how many people use it, or rather how much that edge moves the market.

I often said "forget the news", "the news is useless"... wrong, of course. The news moves a lot of people. But probably the news alone will not make you profitable. The point is to be able to incorporate in your trading as many edges as you can compute mentally (in a correct way), because all these edges move people. A very elaborate automated system could definitely do this, but I am not capable of building it, so I am going to stick for now to my discretionary/automated systems based on just 3 or 4 edges, or better said, "ingredients".

Another way to achieve it and use all these edges together would be to gather 10 people using ten different edges (even better if 20), regardless of whether they're profitable or not, and ask them how they would trade and why. When there's a majority in favor, you can make the trade. Of course they could each be given different weight and so on, but you get my point. All edges are good, as long as you can weigh them correctly. And of course you can't say: I'll only make the trade if all edges agree, because then you might trade once a year or never.

I guess one simple way to do this is to spot, even on different forums, ten different users employing ten different edges, prolific users, who write posts all the time about their views on the market and their trades. Then you put all their links to their latest posts on one web page, and check it out as you're about to make a trade. These are the kind of users I would try to spot:
1) newbie trading just on news (doesn't matter if profitable or not) and mentioning them all the time (today this and that...)
2) elliot wave guy
3) support/resistance guy
4) pivot guy
5) fundamental analysis guy (long term fundamental trend) who comments about the economy
6) top and bottom picking guy (like me), who's always trying to pick a bottom and is always unprofitable
7) others I am forgetting...
8) and so on...

Actually this is exactly what I will do next, looking mainly on the trading journals across a variety of trading forums, such as elitetrader, this one and some others.

Last edited by travis; Jan 27, 2010 at 8:02pm.
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Old Jan 27, 2010, 9:58pm   #95
 
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re: my journal 2

travis started this thread Here's where I'll look for people who express frequent opinions on the markets according to different trading methods:
http://nuclearphynance.com/
http://www.fxstreet.com/forum/
http://www.elitetrader.com/vb/
http://www.trade2win.com/boards/
http://traders-talk.com/




I might have to focus on one specific market in order not to disperse my energies.
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Old Jan 27, 2010, 10:39pm   #96
 
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re: my journal 2

travis started this thread I have scanned all the forums, and I think the best predictions, opinions, and similar might be here:
http://www.elitetrader.com/vb/forumd...?s=&forumid=29

here in general, but harder to find:
http://www.elitetrader.com/

A lot of posts, and many posts are exactly on what I want.

Last edited by travis; Jan 27, 2010 at 10:45pm.
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Old Jan 27, 2010, 10:56pm   #97
 
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re: my journal 2

travis started this thread Interesting ones from here:
CL Redux
ES Journal
NoDoji's Day Trading Log

There's going to be others on elitetrader.com, and I'll check them all out in the next few days.
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Old Jan 27, 2010, 11:11pm   #98
 
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re: my journal 2

travis started this thread Not too good, but I am automating more and more my method, with more and more univocal requirements, and therefore less and less stressed attached to each trade. Every trade is a sum of edges, that's how I see it now. It's not gut instinct, subconscious requirements... it's clearly defined edges, as ingredients of a recipe: highly ovesold, important support level, confirmation/gap/uncertainty in previous trend.

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