MA Cross-Over Strategy for the Newbie

[TraderNumber7]

Are there any Newbies interested in learning how to trade? Of course, T2W is filled with clueless people who can't tie their own shoelaces - that's not who I am interested in. If you are a Newbie and can follow some pretty basic instructions/directions, then read-up on the first post and join in on the lead.

Class starts tomorrow. We'll see you then.

 

[TheBramble]

0007 – please don’t let lipflapper divert you from responding to my question directed to you. I am interested in why you find these data so useful if indeed you do so outside the context of each specific event to which they relate.

It would be a real paradox and a delight to be able to generate some sensible discussion from this thread.

TrudVector – please resist the urge to respond to this post. If you can’t help yourself, it’ll just confirm that you can't control yourself, are a total loser and shouldn't on any account be taken seriously.

 

[the hare]

Of course, it is important within the context of "the event" because the entire purpose of the event is to net a profit. And, if no net profit was realized, then by definition it was because the trader exited the position closer to the MAE than the MFE. In which case, not knowing where both extremes were, robs the trader of any useful post-trade analysis parameters (data) within which they can derive possible changes to the either the Limit or Stop level(s).

Which is precisely why when I teach my method that I dont initially applying arbitary constriants to MAE or MFE by using stops or targets.

I'm always interested in another perpsective, and hopefully things may become clearer with time (they usually do)

 

[TraderNumber7]

0007 – please don’t let lipflapper divert you from responding to my question directed to you. I am interested in why you find these data so useful if indeed you do so outside the context of each specific event to which they relate.

It would be a real paradox and a delight to be able to generate some sensible discussion from this thread.

TrudVector – please resist the urge to respond to this post. If you can’t help yourself, it’ll just confirm that you’re a total loser.

Ramble,

How many times do you have to be asked to leave? You don't contribute to anything on this forum that I can tell, other than hogwash and negative energy. If you had something to actually say about the subject matter here, then that would be different, but you don't, you never do and you never will. All you do on this forum is start ****. So, why don't you take your personal **** outside of this thread, where it belongs.

 

[TheBramble]

"TrudVector – please resist the urge to respond to this post. If you can’t help yourself, it’ll just confirm that you can't control yourself, are a total loser and shouldn't on any account be taken seriously."

QED

 

[0007]

Erm..knowing how far your trade went against you and how much potential profit you gave back before exiting are only useful within the context of each event. Determination of 'why' they went where they went before ending up where they ended up is an extremely useful exercise, but those data in isolation are meaningless.

True if you only have a limited number of trades to assess. But once you achieve a consistency (determined from long-term Excel stats) you can set stops with confidence and for any given risk allocate appropriate stake. You also know the probability that the trade has run out of steam. The stats also indicate how good you/your system are. I agree that determination of the "why" is very important - but that's an entirely different matter and MAE/MFE may not help.

Perhaps importantly, I don't trade fx which with its short term fluctuations (and possibly not cyclic) these metrics might be better suited to stocks.

 

[TraderNumber7]

Which is precisely why when I teach my method that I dont initially applying arbitary constriants to MAE or MFE by using stops or targets.

I'm always interested in another perpsective, and hopefully things may become clearer with time (they usually do)

\


You don't seem to understand what's being said, here. This is not your method, one. Two, you keep misspelling the word "arbitrary," and that makes me wonder about whether or not you really understand what's going on here. Three, you continually misspell the word "constraints," and that causes me even more concern that this thread might not be for you.

What's arbitrary to you is perfectly fine and essential for me and my purposes. Outside of that, since you do not know what's going on here, I would suggest that you and your hairy friends, exist stage left.

Just be gone. We won't miss you, I promise.

 

[TraderNumber7]

"TrudVector – please resist the urge to respond to this post. If you can’t help yourself, it’ll just confirm that you can't control yourself, are a total loser and shouldn't on any account be taken seriously."

QED

Ramble,

Go home. You are in the thread of another, telling the OP not to respond to his own thread. That's idiotic at best - foolish at a minimum and it demonstrates extremely low IQ. Now, once again, remove yourself from this thread and go start your thread on how it is impossible to successfully trade an MA Cross.

 

[the hare]

You also know the probability that the trade has run out of steam.

And it also gives a reasonable idea of where to add to winners if thats what you want to do.

 

[the hare]

I would suggest that you and your hairy friends, exist stage left.

I assume you mean EXIT :smart:

Having watched you from way back in the old moneytec days, I think I understand perfectly well the purpose of the thread. Its always entertaining to watch you work.

 

[TheBramble]

True if you only have a limited number of trades to assess. But once you achieve a consistency (determined from long-term Excel stats) you can set stops with confidence and for any given risk allocate appropriate stake. You also know the probability that the trade has run out of steam. The stats also indicate how good you/your system are. I agree that determination of the "why" is very important - but that's an entirely different matter and MAE/MFE may not help.

Perhaps importantly, I don't trade fx which with its short term fluctuations (and possibly not cyclic) these metrics might be better suited to stocks.

I can understand why from a historical perspective seeing a steady reduction in both data means you’re improving your timing and execution.

What I was saying was that without the review of each specific trade at the time to establish why it had X drawdown and why it left Y pips/points/cents on the table, those data aren’t going to change too much.

I was emphasising the importance of analysing the behaviour of each trade in relation to these data at the time of the trade (news, S&Rs, PPs, Sig. MAs, momentum - whatever) as a means to better timing entry and exit rather than the data in and of themselves from a historical perspective.

 

[kimo'sabby]

At least a slapper's gusset works....

These types of thread start off stupid, a few members try to reign in the stupidity, but in the end the power of stupidity just supernovas the whole thread. A very reliable pattern on T2W.

I think this thread has become unstable, i'm gonna get at a safe distance.

 

[TheBramble]

But wait...don't you want to catch my TheBramble MA-X method? Coming soon....

 

[kimo'sabby]

But wait...don't you want to catch my TheBramble MA-X method? Coming soon....

"Runs back into unstable reactor thread, grabs Toni Bramble, come on mate, there's nothing you can do for it....it's gonna blow!!!!"

You owe me one mate, i put my life on the line 4 ya.

 

[the hare]

What I was saying was that without the review of each specific trade at the time to establish why it had X drawdown and why it left Y pips/points/cents on the table, those data aren’t going to change too much.

Well, not if they are normalised by volatility....

This review malarly is a bit of a catch 22 situation, because you can always find a technical reason as to why price did something. If price isnt bouncing off a 61.8% retracement on a 4 hour chart then its bouncing off a 30 period bollinger band on the 1 minute chart, or a 34 period EMA on the 15 minute chart, or a pivot point, or there's oscilator divergence on the 30 minute etc etc etc.

You can always find a technical reason to support a move retrospectively. Mr Socco talks about being trapped in a hall of mirrors, ( and Talab talks about being fooled by randomness) but its this kind of trying to rationalise a problem using a limited toolset with incomplete understanding that causes these problems.

A pragmatist would say I have 1000 winning trades and the winners didnt exceed an MAE of X. The technical analyst might say, I have 1000 winning trades, 90% didnt exceed an MAE of X ATR. You can add in as many layers of complexity as you like over and above that with the danger of curve fitting.

The idea is to make some money, and you do that by having a knowledge of the game that you are playing. These simple metrics just provide some useful boundaries, and after that its nothing more than a case of recognising when price is moving appropriately for a given set up.

I'm not saying that you shouldnt review trades. I certainly do, and I wasted thousands of hours developing the technical capabilities to replay them on various timeframes etc, overlaying every technical study known to mankind, but if I had my time over again, I'm not sure I'd focus quite so much on that particular aspect.

 

[0007]

I can understand why from a historical perspective seeing a steady reduction in both data means you’re improving your timing and execution.

What I was saying was that without the review of each specific trade at the time to establish why it had X drawdown and why it left Y pips/points/cents on the table, those data aren’t going to change too much.

I was emphasising the importance of analysing the behaviour of each trade in relation to these data at the time of the trade (news, S&Rs, PPs, Sig. MAs, momentum - whatever) as a means to better timing entry and exit rather than the data in and of themselves from a historical perspective.

I see what you're saying and moons ago I tried to tackle the analysis of all (what I thought) were the relevant factors eg (news, S&Rs, PPs, Sig. MAs, momentum - whatever) as you suggest. The problem I had with this was that it raised the level of complexity to a state where I couldn't handle it.

I now ignore almost all non-TA stuff (eg fundamentals & news) - unless of Richter scale proportions, in which case I'm out of the market asap and concentrate entirely on things I can quantify. In some of my trades I don't even know what the company does unless it's obvious from the name or it's in the headline news.

Long term analysis leads to probabilties which, if you've got a half decent system/strategy will be postive & keep you in profit. Then, reasons why a trade failed or succeeded become less important though obviously if you can ascertain the "why" then it's a bonus. I've found that the probabilties and stats route suits me because it removes some of the "judgement factor" - which as a human will be influenced by all sorts of factors, some of which may be psychological and you aren't even aware of.

 

[counter_violent]

so try to visualize that concept before casting dispersions about something being misleading

The word you are looking for is "aspersions"

Only posting this to keep some balance.
Quite enjoying the thread, do carry on.

 

[TheBramble]

I'm not saying that you shouldnt review trades. I certainly do, and I wasted thousands of hours developing the technical capabilities to replay them on various timeframes etc, overlaying every technical study known to mankind, but if I had my time over again, I'm not sure I'd focus quite so much on that particular aspect.

Before this angle takes on significance it doesn’t have in relation to everything else we do when we trade, perhaps I could give an example?

If for instance you find your trades are fairly consistently taking less than half your risk, then you’re putting your initial stop twice as far out as you need to and reducing by half the size you could be trading. Doesn’t relate directly to these two data being discussed, but is of the nature of the trade review I’m suggesting.

As for the data in question, they are almost always entirely related to issues of timing. Getting in too soon and/or getting out too late and they will typically be of a similar magnitude over most of your trades. It makes sense to review what possibilities one has to reduce the size of these data whether it be by reviewing lower TFs and/or sharper setting on inds if you use inds, or by honing your skills in watching pure price action.

 

[TheBramble]

Behead CV.

 

[TheBramble]

Quite enjoying the thread, do carry on.

Well, as long as that sneaky little foo fighter doesn't go off and X-post his OP on another thread, right CV?